Failures in inventory management

During the last last lesson of Logistics we were talking about the management of inventories and its different parameters. This is a difficult issue that appears in the management of every companies, independently of their size.

Here I wanted to comment some troubles that some big companies, like Best Buy, Walmart and Nike, have had with the management of their inventory, in order to observe the difficulty of it.

In December 2011, Best Buy communicated that owing to the hResultado de imagen de best buyigh increase of the demand in some products with deals, they had had problems to supply the 100% of orders of their customers. They apologised for the discomfort caused with the respective notification to the affected customers. The fact that Best Buy failed managing the inventory not only affected the sales, it also diminished their customers’ confidence.

Recently have appeared some problems in Walmart for lack of stock. Little by little, customers have stopped buying their products owing to bad service and to its, each time more common, empty shelves. Waltmart’s logistics is calculated with and amazing accuracy. However, some analysts have attributed the problems to a bad management in their inventory.Resultado de imagen de walmart

Retail sales is a very competitive sector, so a bad management in their inventory can destroy a company soon.

The last example I wanted to mention is Nike. In 2001 Nike failed implementing a software to manage the supply chain. They installed the system of demand’s management without testing it adequately. The result was an excess in stock of low circulation products and a deficit of very popular products like Air Jordan. This supposed the company a loss in sales of $100 millions dollars.Resultado de imagen de nike

As we have observed, a bad or wrong management in their systems of stock management can generate high amounts of loss in their sales, but also of customers, so the management of inventories remains a key piece for companies.

Source: https://cloudadmin.mx/blog/post/caso-de-estudio-walmart-bestbuy-nike 

UPALET BY ALPESA

In our last lesson of innovation management, we watched a short video about Upalet, the carton pallet, which is an innovation in the market of pallets. Despite it was in the class of innovation management, I also could appreciate​ a connection with logistics, so I decided to introduce you this new product as an alternative to the traditional pallets, and also its advantages described in its features.

Its main features are the following ones:

Light

Between 1kg to 8 kg compared to 32 kg that can weigh the current pallets

Ecological.

Developed with materials that are not harmful to the environment.Reduces CO2

Recyclable. Sustainable.

The carton pallet is 100% recyclable, even has a residual value that allows the owner to recover part of his investment.

Compact. Accessible.

Thanks to its interlocking stacked for can be stored in a much more compact way, reducing space and optimising transport and storage.

Safe.

Because of its weight and the useless of metal things is safer avoiding serious accidents. For example, when my father was working as a truck driver, once a pallet fell on his head and cause him a lot of pain. With Upalet, he would avoid suffering that much.

Resistant

Able to hold 4000Kg the maximum.

Economic

Competitive price in the market.

As we can see, the Upalet represents a trend-setting product, which is not only with better features than the current pallets but also is environmentally friendly and sustainable.

Have a look at this promotional video, where you can see in a more fun way the things I just have said. Hope you enjoy!

Source:

http://upalet.com/index.html

Quick Pallet Maker

qpm_icon_test_small

Quick Pallet Maker is pallet loading and package design software application that allows the user to calculate optimal secondary package dimensions and pallet arrangements, thus reducing shipping costs, it was developed by Koona, LLC a US-based Software Engineering company.

They are mainly focused on small and medium sized companies, particularly manunfacturers and packaging operators. But not leaving behind corporations.

The software is pretty user friendly and as said before it includes different key features that will allow the user to perfectly manage their packaging operations making it more efficient:

  • Calculation: Complex features for calculating the ideal dimension of each item so as to fit the latter’s capacity.
  • Container fill: Assists the user in organizing multiple-sized objects in a container. It takes into account the dimension of each box and suggests the way how they should be heap up so as the whole cargo gets in.
  • Optimizing costs: Indicates the user how large each pallet should be so as to get a maximum number loaded into a single cargo.

Quick Pallet Maker also has a YouTube channel for their customers to get free tutorials on how to apply the software features, for example, the presented video allows the customers to learn on how the “Filling Containers with Boxes” feature works, providing them to calculate and better fit their delivering order.

 

 

Reforestum

Reforestum is an App which led the customers to create a real forest from any electronic device.  The objective is to recover the lost forests of the planet and to help protect the existing ones creating environmental sensitivity.

What this App does is to measure the carbon footprint of your daily activities and  to compare it to the carbon you are capturing through the forests you have created through the platform.  Furthermore you can check the status of your forest at all times, with satellite images, notifications, and photographs.

In this way we can all get involved in caring for and improving the planet. It is the perfect tool to take direct, useful and collective action to solve the problems that our way of life is causing to the planet.

Source:

https://www.reforestum.com/es/

AquaReturn: A NEW METHOD FOR SAVING WATER

One of the world’s main concerns nowadays are the natural resources; they are becoming more and more scarce that is why people, mostly environmentalists are worried about our future and are looking for ways of prevention and savings. With this concerns, two spanish guys got to an amazing idea that is called AquaReturn; a device that recirculates the cold water first and then tempered until it reaches 35ºC, which allows to save energy. This device works when the user open the tap they do not have to wait until the water reaches the desired temperature, usually the user need to wait a couple of seconds until the water turns warm and those seconds are a waste that this device is avoiding.

imagen-sin-titulo

AquaReturn is a product design for home use and it works with a boiler, thermo or individual heater but it can also be use in companies or tourist establishment since the since the return system can help for instance hotels that have a high consumption of energy and this system will suit them very good, as well as for families.

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This device prevent the water from flowing out until it reaches its consumption temperature, generating significant savings in water, energy and CO2 emissions, resulting in huge economic savings.

In the following image will help you understand the functionality of the device:

imagen-sin-titulo-2

Sources:

http://www.elconfidencial.com/tecnologia/2013-10-23/un-revolucionario-artefacto-espanol-para-ahorrar-8-000-litros-de-agua-al-ano_44621/

http://www.abc.es/sociedad/20131107/abci-ahorro-agua-caliente-201311061844.html

 

 

 

HOW PACKAGING INFLUENCES OUR DECISIONS ?

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The other week during lesson we deal with the theme of packaging. I’ve always find this particular topic rather interesting because I’m also somebody whose guilty of having bought something just because I was attracted by the colors. Have you ever wondered that there is almost a science behind it?

Since the first moment we open our eyes in the morning till the time we go to bed in the evening we have many different needs. The basic ones are like eating, drinking and such. We can control our needs, thanks to our will, but most of the times we get influenced by the surrounding what we feel we need. Here is the key: what we feel we need but actually we don’t.

What trick all of us is the so-called smart packaging, which helps the targeted consumer feel an emotional attachment to a brand. Keep in mind that 1/3 of the consumer decision-making is based on the packaging. Impulse purchasing makes up almost 75% of the consumer spending, and if the package fails to project the right message then it might be left sitting alone on the shelf.

One crucial element is an icon: what the brand try to trigger every time is positive feelings, because marketing is based on emotions and the smart packaging ground his way of working on marketing which trigger our emotions. What all the companies try to do is to influence positive feelings toward the brand and the product. On the first step this lead to buying the product, then it may become loyal to it and in some cases also willing to pay more than its actual value.

 

Emotions are also connected to brand icons as memories and these feelings can create long-term relationship between the brand and the consumer. Nonetheless it influences purchasing decision. A right design can trigger a ripple effect: a friend take a photo of the packaging, he or she share it on Facebook, someone share it and by doing this there is the chance that other will see it and be interested in the product.

 

First impression matters also between the counter of the Supermarket. It takes only 7 seconds to make a judgement based on the first things we see on the package. The brand is represented by the packaging, and this promise to deliver also a quality experience. What are the elements that might catch the eye of the consumer?

  1. Color
  2. Images
  3. Typography
  4. Brand name influence
  5. Structural design
  6. Print finishes

 

Packaging has been proved as a crucial factor in decision-making, it is directly related to the perceived quality of the product and affect if the product is noticed on the shelf or not. It has been estimated that 60-70% of buying decisions are made in the store. The consumer, on average, leaves home to get back with a product serving a definite purpose but no strict decision has yet been made about the brand to go for. The final choice depends on a variety of factors. These on-sport decision making about choosing among alternatives is influenced by product perceptions, which is conceived by packaging design, knowledge about the brand, attitude towards brands and the consumer personality.

The more the brand costs the more the costumer wants to be involved and the less it costs the less he feels the need to a connection.

Did you ever think that also the color plays a role in this game?
Examples:

  • Red = makes the adrenaline increase and the heart beat faster. The color is used to grab shoppers’ attention.
  • Blue = with water and sky, it is a soothing color when in the pale hues, and somewhat mysterious, like the ocean

 

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Now, next time at the Supermarket, what will you do? 🙂

¿HOW DO THEY TRANSPORT A METRO?

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Medellin is the only Colombian city that has Metro, its construction took 12 years until in 1995 it was open.

The metro transports nearly 650.000 passengers every day and constitutes a core asset of the city, moving at a speed of 37 km/Hour it crosses the city in both north-south directions with its 10 lines and 76 stations spreading through west and east, among which we can count the Metro cable ones, but that will be an upcoming topic for a future post.

1 train unit composed by 3 carriages mobilizes 1.165 passengers, whom otherwise to be transported would need 942 vehicles, 18 public service buses and nearly 8 articulated buses.  And as the population of the city grew, the Metro had to keep up, so in 2015 the company purchased 20 trains, each one composed by 3 carriages, to the Spanish company Construcciones y Auxiliar de Ferrocarriles (CAF) through a contract that includes manufacture, supply, transport and kick off, for a total of 88’800.000 Euros, which are going to improve capacity in a 36% and shorten the time interval between trains from 3’40” to 3’15” in rush hours.

In order to complete this project, the trains had to be dispatched from Spain (Bilbao and Sgunto) to Colombia in ships and the tricky part was just to begin, because from the Cartagena port where the carriages arrive, to Medellin, they had to cross 640 km approximately through roads, which I have explained before, are all but adapted and convenient for this tasks, but they are all we got, so what they did was to stop traffic for intervals of 2 to 3 hours so that the trucking rigs could pass without any inconvenience. For the 12 trains received, the whole operation took 6 days and it is expected that by the end of this year all of the 20 will be in Medellin, ready to be put in service for 2018.

This is how it was done, first a video of how they embarked the trains which with the first minute is enough to see how it was done, and then a video of the trucking rigs transporting them through the middle of the country to Medellin.

 

Mr. Trash Wheel: New way to process trash in rivers

It is said that Oceans are the world’s dump. According to National Geographic, “there are 5.25 trillion pieces of plastic debris in the ocean. Of that mass, 269,000 tons float on the surface, while some four billion plastic microfibers per square kilometer litter the deep sea”.

Next infography shows top 10 items foun in our oceans caused by human being.

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The only way to solve completely this problem is by making people concern about the issue and creating a responsible feeling to them through education. This will take time and it coud be achieved in some generations, but for the moment some of the people already concerned is focusing on the trash process from a logistical point of view.

Since most of the trash comes from rivers, one of the solutions found by John Kellet, was focusing on processing the trash of the rivers before it achieves the ocean. I kindly introduce you to Mr. trash wheel, a sustainable solar and water-powered trash cleaner:

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It takes the trash from rivers, process it and then burns it to transform it in energy, providing energy for more than 6000 households in Meryland in 2016.

Next picture shows the impact in the Baltimore harbor:

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The photo on the left was taken on April 30, 2014, after a torrential downpour washed a harrowing amount of garbage into the harbor. Just over a year later, a similar storm earlier had almost no recognizable impact on the Harbor.

We must improve our habits in order to avoid this issue, but there are some advances made in order to diminish the impact of trash in the oceans. This is just an example made thanks to focusing from a logistics point of view in the process of trash contamination.

 

Logistics: Keypoint on population growth

I would like to introduce what most of you know but it worries me a bit: Population growth.

In the next figure, we will see population growth forecast until 2100. Since we are already 7 billion people, with limited resources and with a lot of demand, this means that we must make a lot of advances to reach a sustainable world.

Population growth.jpg

Having a quick overview on the figure, we can see that most of the growth is forcasted to be in undeveloped countries, provided with less infrastructure. Moreover, from a globalized perspective, we are on our way to a more connected world, with more specialized countries where all of us export and import products from everywhere. For example, in Spain we receive daily a huge variety of products from China, wood from Finland or Marble from Brazil, on the other hand  we send cars to Austria, furniture to France and vegetables to Germany. But what does this last assumption imply in a more connected world, with a growing population and therefore a growing demand?

Let’s remember what is logistic to understand clearly how important is becoming:

Logistics image

As we see in the picture, logistics it is not just about equipments, goods or material, but also time, energy and information. If it is difficult nowadays with the resources and technology we are provided with, How difficult can it become? Are we ready to face this situation? What do we need to advance in order to overcome it?

Logistics has always been a key point in human development, but we have never faced an exponential growth as this one, will we be capable to sustainably overcome this situation? We are facing a huge challenge that will determine the future of human being and logistics (and other aspects/disciplines too) will play a central role on it.

ABC Analysis and 80/20 Rule

The ABC analysis is a system for the inventory control that allows to classify any type of product, good or raw material in any of three different categories, each of which will be subject to a different management control. Thus:

A: critical importance.
B: medium importance.
C: less importance.

Once the products have been grouped together, each category will be managed differently, with more attention and resources being devoted to articles in category A, less those in group B, and even fewer in group C.

The called “80/20” rule, can be used in conjunction with the ABC analysis for inventory management. Under this rule, 80 percent of the value of the inventory is concentrated in approximately 20 percent of the products. Applying this principle: Group A would represent 80% of the value in 20% of the items and categories B and C would represent 20% of the value in 80% of the items.

Resultado de imagen de abc analysis

In my opinion and according to my experience, the ABC analysis helps to optimize the inventory:

-Reduce the necessary working capital.
-Improves the allocation of resources.
-Allows identify which items should be put in stock and when, so that the customers’ demands can be satisfied and maintain a healthy balance.
Resultado de imagen de abc analysis

Pokayoke and Supply Chain

Pokayoke is a simple technique that was developed from Toyota’s production system (Lean methodology) and usually consists in a simple and low-cost device that prevents errors from occurring or detects them, so that you do not go to the next operation. This way of working increases the effectiveness of control by overcoming the inefficiencies of inspection.

The supply chain benefits from pokayoke. Examples are the following situations:

Detection of human errors, alert for something inevitable in daily operations and giving the opportunity to step back and correct them on time.

Detection of simple errors, such as the existence of duplicates, in shipments or documentation:

Detection of mistakes that would otherwise have been unforeseen, spelling mistakes that affect the direction of a shipment, errors in punctuation marks that vary the amount of an invoice or any other similar type of failure that can negatively influence the reputation. , Customer confidence and its positioning in the market.

Example of Pokayoke:

https://www.youtube.com/watch?v=jPmQSzc_L9A

Differences between Logistic and Supply Chain

All we have learned that this subject is oriented mainly to logistic and supply chain but is important to know that there are not the same thing.

Supply Chain is an integrated method to manage all the distribution channels flow and information flow inside the organization or out of it, such as: supplier, manufacturer, distributor and final consumer.

Resultado de imagen de que es supply chain

Logistic is an operative function that includes all the processes and activities necessaries to manage the storage of raw materials and components, stock in process and final products to bring them in the right quantity, in the correct place and at the appropriate time. Also to order and purchase planning is a logistic task. Logistic is part of the Supply Chain.

Resultado de imagen de logistic

The main differences between them are:

  • Logistics seeks to offer the best service at the lowest cost, to deliver quality products to the customer. In the supply chain are already in charge of finding raw materials of quality at a good price, so that the costs are not high.
  • The logistics delivers the product on time; The supply chain seeks to improve those times and that of other activities.
  • Logistic is part of the supply chain, but supply chain is a much wide process.

Sources: https://www.youtube.com/watch?v=-7SfaBD1bVo.  https://youtu.be/K3YY8rHehNg. https://youtu.be/pvtw-EEc4VE.

 

Logistics Performance Index

 

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One of the most salient benchmarks in supply-chain management is the World Bank’s Logistics Performance Index (LPI), which has received wide acceptance and coverage. Its goal is to assess how countries rank in the managerial and physical effectiveness of their logistics.

The LPI is an interactive benchmarking tool created to help countries identify the challenges and opportunities they face in their performance on trade logistics and what they can do to improve their performance, its main objective since it was created in 2007. The LPI 2016 allows for comparisons across 160 countries.

The LPI is a composite index based on proxy measures for transport and information infrastructure, supply chain management (SCM), and trade facilitation capabilities, which are calculated based on a world survey of international freight forwarders and express carriers. Therefore, it consists therefore of both qualitative and quantitative measures and helps build profiles of logistics friendliness for these countries. It measures performance along the logistics supply chain within a country and offers two different perspectives: international and domestic.

International LPI:

Provides qualitative evaluations of a country in six areas by its trading partners—logistics professionals working outside the country.

Domestic LPI:

Provides both qualitative and quantitative assessments of a country by logistics professionals working inside it. It includes detailed information on the logistics environment, core logistics processes, institutions, and performance time and cost data.

In 2016, more than 7,000 country assessments were made by logistics professionals, in line with the past two years. Moreover, this year covers 160 countries in the international LPI, whereas the domestic LPI covers more than 125 countries.

LPI

The World Bank’s LPI analyzes countries in six components:

  • The efficiency of customs and border management clearance
  • The quality of trade and transport infrastructure
  • The ease of arranging competitively priced shipments
  • The competence and quality of logistics services
  • The ability to track and trace consignments
  • The frequency with which shipments reach consignees within scheduled or expected delivery times

The Top Ten 

LPI

Spain and DR are in the position 23 and 91, respectively. 

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The LPI Methodology

Because logistics has many dimensions, measuring and summarizing performance across countries are challenging. Examining the time and costs associated with logistics processes—port processing, customs clearance, transport, and the like—is a good start, and, in many cases, this information is readily available. But even if complete, this information cannot be easily aggregated into a single, consistent, cross country dataset because of structural differences in country supply chains. Even more important, many critical elements of good logistics such as process transparency and service quality, predictability, and reliability cannot be assessed using only time and cost information.

The following tables show how they group the countries and the results of 2016. 

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Sources:

 

CAUCEDO LOGISTICS CENTER First Logistics Center inside a port in the America Regions!!!

CLC

How does Dominican Republic offer a powerful combination of logistics services?

planeta_w1024_elipse-2As retailers and other logistics experts understand, global logistics planning is all about efficiency, and that’s what Caucedo offers. The Port of Caucedo is only one component of the Caucedo Logistics Center, where seaport, airport, and warehousing operations are combined in a single site. The entire zone was designed to serve near-sourcing and multi-destination shipments in a strategic Caribbean location that is 27 days, or more, closer to the final market than Asia.

So, What is Caucedo Logistics Center?

CLC is undoubtedly the best integrated logistics solution in the region, located at the midpoint of the Americas and center of the Caribbean, its strategic location provides the best platform for regional distribution and a perfect opportunity for companies to enhance the efficiency of its supply chain.

Providing up to 300,000m² of built-to-suit warehouses available for lease inside DP World Caucedo Port, allowing for unparalleled savings in transportation costs and offering efficient customs procedures.

Multimodal Connection

Right next to Las Americas International Airport, its position increases the flexibility for companies to quickly expedite their cargo either by air or sea.

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Competitive Advantage

Caucedo is already one of the major transshipment port of the region, serving as hub for 16 of the major shipping lines in the industry. Its location provides the least standard deviation for the main East-West and North-South shipping routes.

DR has a population of over 10.5M and is currently the #1 economy in the Caribbean and #1 recipient of FDI in Central America and the Caribbean.

Our robust Free Zone law offers unparalleled incentives allowing for more than 55 Free Zone parks and over 533 multinational companies to use the DR as their manufacturing and logistics hub.

With advanced road infrastructure and an availability of well-trained, multi-skilled and competitively priced labour force, the DR is the ideal location to develop your logistics infrastructure.

Adding to that, the location of the CLC makes it ideal for multimodal operations being located inside the port and roughly 5 minutes away from the Las Americas International Airport. In a second phase, the project will include an airport expressway running directly from the project to the cargo terminal of the airport.

Benefits of CLC

  • Significant reduction in supply chain costs
  • Improved product availability and visibility of inventory
  • Improved time-to-market of key product lines
  • Increased efficiencies “DC bypass” and cross-docking
  • Reduction in transportation costs
  • Reduced inventory across the supply chain
  • Reduced road congestion and environmental pollution

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Specifications

  • High quality class A warehouses
  • Modules available starting at 890m² (column free)
  • 10m clear height
  • Precast concrete beams structure – Less columns than average warehouse allowing more efficient use of space

Opportunities

  • Free zone benefits for users 
  • Multimodal connection 
  • Available for immediate construction
  • Excellent multi-modal national and international transport connections
  • Direct access to DP World Caucedo Port
  • Inside Primary Customs Area

The CLC will offer all services needed for companies to effectively run their operations:

  • 24/7 operations
  • Recruitment and selection of personnel
  • Waste/garbage disposal
  • Fiber optics connections
  • Electrical sub-station and backup generation
  • Technical vocational training centers
  • Banks, food service and shipping agencies
  • Security patrol 24/7 – Connected to Port’s CCTV monitoring system

IKEA

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On July 11th of 2016, IKEA and Caucedo Logistics Center (CLC) celebrated the start of construction of the new IKEA regional logistics operations building, strategically located in the facilities of Caucedo. This logistics center will be the main logistics redistribution platform of IKEA for the Caribbean and America, receiving goods from different geographical areas for consolidation and redistribution from DR.

 

References: 

DP WORLD CAUCEDO

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DP World Caucedo is a world-class marine terminal and free zone, located in Punta Caucedo, 25 km from the city of Santo Domingo which is the commercial and political capital of the Dominican Republic. 

The Caucedo´s Port main driver is in the combination of land, air and ocean transportation with the objective of projecting the DR as a strong competitor in international markets and to be an example of development on a national and regional level.

This port is part of the DP World portfolio of marine terminals. This company is a global leader in Operations, terminal development, logistics and other related services. With more than 65 terminals on 6 continents, including new development projects in India, Africa, Europe and Middle East.

Caucedo´s operations started in December 2003 and works under the highest standards with quality and operational efficiency, providing the cornerstones of its success and development.

Strategy

Its strategy is all about making the best use of the resources at their disposal in order to obtain a predetermined goal. It describes their plan to maximize value through leveraging their world-class infrastructure, to strengthen global supply chains and to generate sustainable economic growth.

Recently, they introduced the concept of the Balanced Scorecard Framework to communicate their strategy, with the aim of communicating a clear, consistent and shared vision of DP World Caucedo for a sustainable future. This Balanced Scorecard Framework defines strategic pillars to be implemented across the company and strategic priorities which are measured against KPIs.

Port Services

Their main activity is the loading and unloading of container ships visiting the port, as well as break-bulk cargo. This activity is carried out in an efficient, effective and continuous manner, during 24 hours a day, 365 days a year. DP World Caucedo offers a wide range of port services for importers and exporters in DR.

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Some of these services are:

  • Secure storage of loaded containers.
  • Assistance in customs/verification area, of personnel trained and/or forklift.
  • Re-stowage of containerized goods.
  • Electricity and monitoring services for refrigerated cargo.
  • Handling of oversized/out of gauge cargo.
  • Vehicle Discharge.
  • Storage of imported vehicles, monitored by a CCTV system.
  • The parking area is managed and controlled by ZFMC.

Caucedo Routes

  • To North America
    • MEDITERRANEAN SHIPPING COMPANY
    • HAPAG LLOYD
    • NIPPON YUSEN KAISHA
  • To Central America
    • HAMBURG SUD
    • HAPAG LLOYD
    • X-PRESS FEEDER
    • MEDITERRANEAN SHIPPING COMPANY
    • MAERSK LINE
  • To Caribbean Islands
    • TROPICAL
    • CFS
    • MEDITERRANEAN SHIPPING COMPANY
    • MAERSK LINE
    • HAPAG LLOYD
  • To South America
    • MEDITERRANEAN SHIPPING COMPANY
    • HAPAG LLOYD
    • NIPPON YUSEN KAISHA
    • CMA CGM
    • CHINA SHIPPING
  • To Europe
    • HAPAG LLOYD
    • HAMBURG SUD
    • CMA CGM
    • MAERSK LINE
    • MEDITERRANEAN SHIPPING COMPANY
  • To Asia
    • CMA CGM
    • HAPAG LLOYD
    • CHINA SHIPPING COMPANY
    • HAMBURG SUD
    • ZIM 

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Source: https://www.marinetraffic.com/es/ais/details/ports/1486

Infrastructure

Proyecto Dragado - Seccion Proyectos-min

  • 922 meters of berth
  • -13.5 meters of depth (-15 meters Q2 2015)
  • 50 hectares of container yard
  • 800 Reefer plugs
  • 5 Post-Panamax cranes
  • 1 Super Post-Panamax cranes
  • 23 Rubber tire gantries (RTG’s)
  • 2 mobile harbor cranes
  • 13 inbound yard lanes
  • 5 outbound yard lanes
  • 24/7 operations – 365 days
  • X-rays scanners at gates
  • Radioactive detection portals
  • CCTV surveillance system
  • Biometric access

Security Accreditations 

  • Caucedo was the first terminal in the DR to be ISPS certified.
  • Caucedo is a member of the US Customs-Trade Partnership Against Terrorism (C-TPAT), a voluntary program that aims to enhance the security and efficiency of global supply chain operations through active collaboration with US Customs and Border Protection (CBP), shipping lines and end-customers.
  • Caucedo participates in the Megaports and US Container Security Initiative (CSI), which deploys US Customs officials in the port.

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To continue: DP World is building a 40 acre free zone Logistics Centre next to the terminal. In the next blog, I will talk about this Caucedo Logistics Center, where seaport, airport, and warehousing operations are combined in a single site.  

References: 

The Hyperloop: the future of transportation

Historically, the progress in transportation has been hampered by the difficulties to manage friction and air resistance, having into account that both factors increase considerably with velocity.

These obstacles are defeated thanks to a new transportation prototype that is seeking to attain the incredible speed of 1200 km/h becoming the fastest mode of transport in the world. We are talking about the Hyperloop.

How the hyperloop works?

Basically, the concept created by Elon Musk consists on a vacuum tube with low pressure air where the capsules carrying passengers or freights would be pushed along by a series of electromagnets.

The next interesting video of only 2 minutes admirably explains how the hyperloop technology works.


Advantages of hyperloop for freight transport

  • Rapidity: the hyperloop can connect LA with San Francisco in just 30 minutes while the drive between these cities is six to eight hours.
  • Cheaper for the customer: this technology is a self-sufficient system reducing this way the costs and reducing at the same time the cost for the customer.
  • Arrival more frequently: Hyperloop pods are expected to arrive every 30 to 120 seconds.
  • Reduction of pollution: thanks to its powered with solar panels instead of fossil fuels.
  • Avoid the waiting cost for traffic jams.
  • Immune to weather (wind, ice fog, rain and so on)
  • Resistant to earthquakes
  • Safer

These advantages suppose great improvements for the logistics, like the possibility of sending pallets and containers on-demand, the getting of a better communication between the different actors of the supply chain and a sustainable supply chain.

In the video bellow, you can watch some of the advantages pointed.

Curiosity

Our colleagues from the Polytechnic University of Valencia won the last year the prestigious Hyperloop Pod competition sponsored by SpaceX, obtaining the Top Design Concept Award and Propulsion/Compression Subsystem Technical Excellence Award.

I suggest you that you watch this last video in order to know more about their beautiful history.

One reason to fail in any project

The reason is a lack of or wrong communication. (For those of you who want to safe time and not read all of it).

I’m writing about this topic because I experienced it in several ways at work, in private life and also in university.

In a project there are usually involved several people/departments/counterparts and there should be one project leader who is responsible for the handling.

In a successful project (regarding the process, not the outcome) everyone knows at anytime what to do and what their task is. On the other hand this means that in an unsuccessful project there is a sort of chaos caused by communicaton. Reasons for that can be:

  • missing information
  • unclear expressions
  • unstructured communication
  • word-to-mouth deviatons
  • misunderstandings
  • not asking if anything is unclear
  • etc

Of course communication is not the only reason why projects fail. But it’s indeed one of the biggest issues, regardless the industry.

One example herefor is something we all probably faced in our logistics course a few weeks ago. As you all know we receive emails after each class with a good summary of what we’ve learned and about what we have to prepare for the next class. One task was about the HOF3M project we are supposed to do. And for Mr Garcia the task of course is clear as he did it many times before, but for us students this task simply produced a lot of question marks in our heads when we read the mail. He tried to explain it but many of us were not able to follow the instructions immediately. We started to ask along in whatsapp what we are supposed to do and no one had a clue. Some simply started to do the homework how they thought it was meant and some didn’t do anything.

You can see that wrong or a lack of communication can have a quite immense impact on what you are doing and how you are doing it.

But the good thing is that we changed the situation and asked him to explain it again because we didn’t understand. And that’s where the good communication started. We asked for help and we received the missing information that we needed to fulfill our homework.

So, for the future some Tipps: don’t ever hesitate to ask if you don’t understand anything, try to express yourself as clear as possible and last but not least: it’s always better to explain something face to face as the probability of misunderstandings increases with written communication.

IMG_9377

LOGISTICAL CORRIDORS

bandera

To continue with my past post about navigability in Colombia’s most important river, i thought about addressing one important fact that the post says, it doesn’t matter if they improve the navigability of the river and build all the docks and the ports to load and unload the barges if there are no roads available to transport the merchandise from and to the ports.

My country’s topography is mainly mountains arround which they have built narrow two lane roads which do not comply with any standards of transportation and through which not only trucks but cars and buses drive, mostly facing clifs in one side and huge mountains in the other. This is the reason why the government has been workining on what is called 4th generation highways.

This road infraestructure project aims to build and license about 8.000 km of roads which include 1.370 km of double lanes and 159 tunnels. But in order to have logistical corridors they need, among others:

  • Strategically placed container yards
  • Scales installed in the corridor
  • Scheduling dispatches and deliveries with I.T systems and tracking technology
  • Procedures for entry and recovery of containers
  • Head offices for controlling loading and unloading turns
  • Aereal load centers
  • Transporter’s service center
  • Adaptations of urban paths
  • Reactivation of railroads

All the above is contained in the governments plan to develop not only the 4G highways but the logistical corridors in order to improve Colombia’s competitiveness, lower trasnsportations fees from the cities which are inside the country and from which the merchandise has to come out to the sea to be exported and vice versa.

 

150324-primerosegundaola

The slightly different delivery

Finding topics for the logistics blog starts for me with brainstorming about my own thoughts at first. What am I passionated about? Well, since I am able to read I love the marine sealife. There are many topics, especially because a huge amount of goods and raw materials is shipped over the oceans. But today I wanna write about my favorite animals: Sharks! I like them a lot, but I like them alive. But who is delivering living sharks? – A very big aquatic park does it for reasons like breeding.  Even while I am not a big fan of aquarium maintenance, it helps protecting sharks by changing the wrong public picture of this amazing animal.

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Transporting medium sized sharks (like the reef sharks above my head in the picture), in comparison to Whale sharks, is easy. The youtube video below shows these kind of medium-difficult transportation. (Only by additional curiosity, please prefer the points 1. to 7 for the logistics knowledge.)

But when it comes to the biggest fish in the world, (see the Whale Shark in the picture below) a super plan with logistics expertise is required.

Image result for huge whale shark and diver

In 2006 the Georgia Aquarium in Atlanta had a demand for female Whale Sharks which are located in Taiwan. For professional logistic knowledge they cooperated with an expert team from UPS, the have the required additional dedicated resources and special expertise.

The difference to goods is that the sharks have to arrive in a psychological calm and good condition, – living, breathing and not too stressed out. Diana Hatcher, spokesperson for UPS Supply Chain Solutions said: “We set protocol and standards for the way animals are transported. We have a team with a history and expertise in moving animals.”

The whole project had three primary objectives: logistics planning; configuring the containers and securing the aircraft needed to transport the whale sharks; and customs clearance. To keep this blog entry short as possible, I foccused on the main points of this transport success as follows:

  1. Design a strategy: Aquarium staff &  UPS’ logistics employees & loadmasters
  2. Reengineer one of UPS’ B-747 freighters so customized holding tanks could lock into the aircraft for proper balance (two tanks, each weighing 25 tons, including the water and the fish).
  3. UPS also took care of necessary customs clearance paperwork for the animals as well as the shipment handler’s documentation and experienced loeadmasters.
  4. Installing an Onboard-lab that enables aquarium veterinarians to proactively monitor the status of the whale sharks and check water vitals during transit.
  5. Getting whale sharks on the plane airlifted out of a sea pen 100 yards offshore on a Belfast turboprop fraighter
  6. Sharks were transloaded to specially designed trailers for a police escort to the aquarium.
  7. Schedule planning to make sure there wasn’t a conflicting baseball game or traffic issues to contend with while transporting the whale sharks to the aquarium.

I apologize for giving so much to read, but it was my personal issue to tell the whole story. I hope you are also excited by this slightly different logistics topic. Please keep in mind, that all sharks a very important for the worldwide eco system. I hope that successful aquariums are helping society to not forget this truth.

Source: http://www.inboundlogistics.com/cms/article/how-do-they-ship-that/

3D-Printed Shoes?

 

3D Printing technology has been with us for a while now, offering adaptation and customization in various areas, from construction to manufacturing and even gastronomy.

Quite recently, Adidas has announced the Futurecraft 4D – their most ambitious shoes yet, which makes use of the new advanced 3D Printing technology from the Silicon Valley company Carbon. The mid-sole of the shoe is created using the Continuous Liquid Interface Production process. Faster, more adaptable and offering better product quality than traditional additive printing, this technology enables mass production through 3D printing. With the time from designing to production much reduced, Adidas can quickly make batch of limited edition shoes or even soles that are designed to fit the weight and foot shape of a specific customer.

At the moment, Adidas and Carbon are trying to find a way to reduce the production cost to make their Futurecraft 4D more affordable. But even so, the price for this product will still lie within the premium range.

Source:

http://www.theverge.com/2017/4/7/15216724/adidas-3d-printed-sneaker-futurecraft

Alfilpack Valencian company and the use of paperboard pallets

During the last lesson in logistics, the teacher was explaining us about products and logistics. In it we were talking about the barcodes, product packaging and also about pallets. The last one issue was quite interesting for me as we continuously see pallets in transportation and everywhere, but you never realise about the importance that this product has in our life. This product makes the transport of every product easier and is used in every type of transport (plane, ship, truck, train…).

Therefore, I decided to search information about the materials of the pallets, and I came with a new that was talking about a resistant paperboard pallet implementation in Valencia.

Resultado de imagen de ALFILPACK palet de cartonIt was done by a Valencian company called Alfilpack, which is dedicated to the paperboard industry, as they realised that this can be as resistant as the wood manufactured ones and with some other advantages. They bought the patent to Lifdek, an American company that was who had invented this design.

They made different resistance tests and they obtained that this kind of pallet could support 4,000 kilograms of load in static. Moreover, this kind of pallet brings some important advantages. They are totally recyclable and its weight is lower than 4 kilograms, so it suppose a considerably energetic save in the transport and, also, a save in in the storage because it can be delivered both assembled or not as its assembly is very simple (it takes less than one minute). Owing to its resistance is mainly indicated for the distribution and export of toys, footwear or food, with the added advantage that it doesn’t need a phytosanitary treatment as the wood pallets.

So as you can see, not only the packaging are starting being environmentally friendly, but the pallets can follow the same way and with good properties and advantages than the old ones.

Source: http://valenciaextra.com/es/alfilpack-personalitza-el-palet-de-carto-per-a-transportar-el-teu-productes/

LLadró Packaging

As studying the lecture about product and logistics that was related to containers, pallets, boxes, Barcodes, RFID labels etc. I was thinking about a company whose packaging is completely involved with the product. This company is Lladró, which is a Spanish Brand dedicated since 1952 to the creation of art porcelain figurines at the brand’s only Factory in the world, in Valencia.

I have always had at home a lot of these porcelains because that was my dad’s souvenir from his trips to Spain. This means that part of his luggage were those delicate figurines and they get home intact and I wanted to know how that happens.

lladro mujer

While searching about the packaging of Lladró I figured out that the packaging was part of the process of the product because even though the customer was not traveling with them, they had to take them home in some way. So, the final step of the Lladró sculptors is the figurine packaging, which is made with a cardboard box, specially-designed for each piece of the porcelain whose main job is to ensure the figurines are suitable protected for the transport. As it is shown in the image below:

lladro-box-3

As you can see the porcelain comes in a box that is specifically created to fit in, because as it was my doubt Lladró have to ensure it arrives to the customer’s hume is perfect conditions. Customers should also know about it because the unpacking is not that easy, they have to be patient and not force the cardboard a lot so the figure is not damage.

lladro-box-4

In conclusion, depending on the product features companies need to take into account the way of packaging them either for delivering to the customer or to storage it without damaging it.

Sources:

https://lladroblog.com/lladro-figurines-packing-unpacking/

http://www.biggsltd.com/Lladro-Figurine-Packaging-C2207.aspx

http://www.lladro.com

Uber in supply chain: Uber Freight

Uber Freight is the name of Uber’s new project, the result of the purchase of a transport company and a freelance truck project that has already been tested for months.

Otto is the name of truck that will carry the goods we want without a driver present, as we can see in ot.to, a truck that already traveled more than 150km to carry beers inside the United States, without needing a driver constantly managing the address.

Resultado de imagen de uber freight

In my opinion this business model has different advantages, such as:

  • Uber is already known.
  • The technology tested in the transportation field for passenger can easily provide a more efficient truck coupling.
  • Since August Uber has been active in 66 countries and 515 cities.
  • Saves the driver’s cost and also the limitation on the number of hours driven per day.

https://freight.uber.com/

RFID technology in ZARA

After the last logistics lecture, the RFID technology came to my mind, though that is a good idea to get deeper in this topic in order to show how a big company like Zara uses this system.

Before starting to explain how Zara makes profit from this technology and the advantages that it provides, I recommend you to visit the post where our partners explained how the RFID exactly works  and an overview of the logistics of the Inditex group

Inditex started using this technology in Zara, getting the total implantation in 2016. They expect the incorporation of the RFID progressively to the rest of the brands of the group.

Inditex uses the RFID for the identification of each item of clothing through radio frequency, incorporating a chip inside the alarm at the logistic centres of Inditex. After that, the company is able to identify where is each item during all the stages of the supply chain.

alarma

I suggest you to watch the video below in order to understand how useful is this system in each stage of the supply chain.

 

Basically, the advantages that this technology provides are:

  • The location of each item in all the stages of the supply chain.
  • Every shop is able to have the precise information of the inventory that allows to replenish immediately the stock in the shelves or to ask for new inventory to the logistic centres.
  • The customers are able to know in which establishment is their desired item of clothing through the web page and the app.
  • RFID allows the store of more data than other identification systems.
  • The staff is able to do and easy inventory.
  • There is a reduction in the number of mistakes in the product data.

As a conclusion the technology RFID for Zara is synonym of agility, simplicity, information, confidence, precision and speed.

 

FACTORS TO CONSIDER IN THE PACKAGING OF MERCHANDISE IN NATIONAL AND INTERNATIONAL TRADE

The transport of the merchandise can be affected by a bad choice in the packaging of the product. As we have discussed in class, there are many factors to take into account, the most important are:

  • The stability of the load.
  • The amount of unit load to be carried.
  • The change in transport or in the vehicle.
  • The type of good of the commercial exchange.
  • The unitary load standards across the supply chain.
  • Resistance of packaging material to climatic changes.
  • The distance that will have to travel in the transport.
  • The intensity of the manipulation to which it will be subjected during the journey and until reaching its destination.

Based on these factors will have to determine the most suitable type of packaging, which will help to prevent the breakage of goods, their loss or deterioration.

Captura

From my point of view, choosing the packaging is an important decision. Consider commercial and marketing aspects, such as consumer tastes in the destination country or the trend in the local market; But also the practical part should be evaluated. Must be assessed:

  • The adequacy of the manipulation.
  • The need to contain, isolate or protect depends on the product.
  • The applicable regulations: which may require the packaging to include certain information or its translation into the local language.

Captura

However, in all the different packaging options, it is necessary to take into account the Price, Risk and Normative.

Traceability

 

In the last class of logistics we interact with different interesting topics one of them was about traceability, this topic is focused in the ability to verify origin, ubication and application of an object through an archived document and to discover the information about where and how a product was made or invented.

Another important point is the Traceability Requirement, which focuses on tracking all the cases with test and allows users to find the origin of each requirement and follow all the changes they made at the beginning of the requirement.

There are different areas in which you can apply traceability, some of them are:

Logistic: Refers to the capability for tracing goods along the distribution chain on a batch number or series number basis.

Materials: Refers to associate a finished part with results of a test performed on a sample.

Supply Chain: Illustrating the fact that the products they sell are manufactured in factories with safe working conditions .

Forest product: Improving effectiveness and efficiency and Increasing transparency.

Others.

Below we will see a video that shows how the traceability allows you to Track Lost & Serial numbers on demands.

 

 

Sources:
http://www.careerride.com/testing-requirement-traceability.aspx
https://en.wikipedia.org/wiki/Traceability
http://www.businessdictionary.com/definition/traceability.html

DFMA

DFMA, stands for Design For Manufacture and Assembly. It´s the combination of 2 methodologies: Design for Manufacture, which means the design for ease of manufacture of the parts that will form a product, and a design for assembly, which means the design of the product for ease of assembly.

Image result for dfma

It provides guidance to the design team in simplifying the product structure, to reduce manufacturing and assembly cost, and to quantify improvements. The practice of applying DFMA is to identify, quantify and eliminate waste or inefficiency in a product design. DFMA in therefore a component of Lean Manufacturing.

Image result for dfma

Also, DFMA is the name of the integrated set of software products from Boothroyd Dewhurst, Inc. that are used by companies to implement the DFMA methodology. DFMA is a registered trademark of Boothroyd Dewhurst, Inc.

 

Image result for dfma

 

 

 

4 influencing trends in the packaging industry

In the last lecture we talked deeply about the main characteristics in the packaging industry. Watching about some additional information I found an interesting text about the most influencing trends in this market. I think it’s worth writing about it because it summarizes the whole lecture.

  1. Sustainability:

During the lecture we had a short discussion about that subject. According to the text the generation of LOHAS (Lifestyle of Health and Sustainability) has a high demand on packages which are easy to recycle and are eco-friendly produced

  1. Active Packaging:

The goal is to create a packaging which extends the shelf-life of the product. Intelligent Indicators like             Time/Temperature or Number of Opening events should help to estimate the quality of the product

  1. Digital Printing:

This trend is a reaction on the challenging individualization and the market customization. Digital Printing will allow the industry to extend the speed to market and to fulfill the demand on mass-customization

  1. Mobil Revolution:

The connection between mobile devices and products will go in the next round. QR-Codes are too complicated to use and thus were not often used. Techniques like Near-Field-Communication (NFC) will make it easier and more efficient.

 

Source:

http://www.lead-innovation.com/blog/5-trends-in-der-verpackungsindustrie

Industry 4.0 at BMW: Driverless transport logistics

Industry 4.0 is the current trend of automation and data exchange in manufacturing technologies. It introduces what has been called the “smart factory,” in which cyber-physical systems monitor the physical processes of the factory and make decentralized decisions. The physical systems become Internet of Things, communicating and cooperating both with each other and with humans in real time via the wireless web.


Currently, BMW has developed an industry 4.0 system regarding driverless transport vehicles.

  • Intellignet reach trucks which are smart trucks that learn to orient and adapt themselves based on their environment. Communication with the vehicle is easily done using speech or gesture commands. If a warehouse worker were to issue a command such as “Store this pallet on shelf 3”, the vehicle interprets both the spoken word and any associated gesture. It can then identify the desired pallet and perform the requested storage, fetching or re-positioning task without the need of human intervention.
  • 3D Time of Flight camera technology in the reach trucks. This technology provides an effective way to capture 3D shape and volume measurements ideal for driverless-vehicles. Each ‘reach truck’ utilises three cameras. Each one takes a three dimensional note of its environment and spatial perception. Any changes in the warehouse are noticed, for example if there is a barrier in its path the reach truck (thanks to the camera system) would edge around the obstacle.
    • 2 of the 3 cameras gives the trucks the perception
    • The 3th camera gives the trucks the accuracy necessary to pick up the pallets

Advantages of the system:

  1. Reduced number of picking errors
  2. Increased working speed
  3. Increased productivity and profitability
  4. No labour cost

Soruces:

 

Futuristic Forklifters. Super nice. Super interesting.

So, recently my boyfriend started working at a forklifter company and he is completely in love with their new products now. As a consequence I get dozens of videos and pictures every day and I to be honest.. It is indeed really cool. So I wanted to show you what already happens in warehouses nowadays!!

The forklifters (I call all kind of logistic vehicles in a warehouse forklifter to keep it simple) are already 100% autonomous! For me that’s kind of insane. According to their current order, they follow you without any needed additional  action (like a dog), they pick up orders from shelfs or load and unload trucks. No lines on the floors – no remote control. MAGICAL!! The machines and the products communicate over a so called internet of things and know best what is going to happen. High tech sensors allow the forklifters to move free within the warehouse and to avoid accidents with plopping up obstacles like people.

The latest innovation of the company is called Cube XX which unites 6 functions in one device. Check out the video to see it!!

(I Chose the short version without sound, but you can also find a longer one with super annoying music if you prefer that one ;))

For me, it’s really impressive what technology is already able to do nowadays, but it also has some negative aspects. If the technology can do everything on its own human workforce will not be needed anymore. Many jobs will disappear which will lead to major problems. There must be soon an awakening to prevent this situation: the people must be higher qualified in order to be competitive and work together with the machines and not to be replaced by them.

Sources:

– my boyfriend.

http://www.digitalistmag.com/digital-supply-networks/2016/04/05/still-uses-innovative-cloud-platform-to-power-its-self-managing-cubexx-forklift-04119712

GS1 personal experience

Before having to work on this topic for Logistics class I knew about bar codes but when I started to read on this topic I started to understand how important for business world is GS1 and how they help each of us day by day.

GS1 is an international non profit organization that provides these supply chain standards for industry (Retailers, Health, transport, logistic, etc.). It serve to identify, capture and share information between different stakeholdersIn the next video you will see how GS1 has helped us during the years and the impact it has had on business.

One way to understand crearly how it works is by watching the next video, that shows with examples how it works.

Curiously this week, I have had my first professional experience with this topic. Usually we are used to see how the logistics of Amazon work to deliver products to customers fastly, but what are the options from different points of view?

From sellers perspective, you can do it by your own or contract the fullfilment by Amazon service. This is what is the fullfilment by Amazon.

To contract the fullfilment by Amazon service there is some requirements, how it works?

Among all the requeriments to use this service, one of the main is having an EAN code that gives the information about each product to be processed and shared with the Amazon logistics team to properly communicate with the final consumer.

EAN-13-Numeric-Sections.gif

The image above shows an EAN code needed to work with amazon and gives the information about the origin of the product, manufacturer information, product details and serial number.

As I said before, I was not aware about the importance of GS1 until these days, when I clairly saw the importance of this way to communicate with the different stakeholders by using standar forms that really help and ease the business trade.

Three marketing strategies that made companies lose millions of dollars.

3. Silo: electronic market.
They had the promotion “a stereo for 299 bananas”, because in this time (1986) dollars were also called bananas. They transmitted the offer around 21 cities. The problem was that cities such as Washington took it literal and bought 299 bananas for 35-50 dollars and brought them to the store. To hold goodwill they gave the stereo with bananas. At the final of this day 35 stereos were delivered and Silo lost 10,465 dollars. They retired the advertising of all places and donated all the bananas to the zoo where there just used 1000 in a week and donated the others to a food bank.

2. Pepsi
In 90’s Coca Cola was over Pepsi in Philippines and to get market Pepsi launched the promotion “number fever” It consisted that under the caps of it favorite beverage (Pepsi, 7up, mountain drew) there was 3 number digits and consumer could earn from 1000 to 1,000,000 Philippines pesos. The 1,000,000 was for the number that Pepsi announced when the campaign finished. The problem was that there were 800,000 caps with this number. Was impossible to pay to everybody and Philippines people made a disturbance where there were also dead people. Pepsi had to pay 10,000,000 dollars for legal taxes and restitution.

1. Hoover: household cleaning equipment.

Hoover was number one in cleaning market for many years, but then they had many stock because of the competence of new companies. In 1992 they created the promotion “buy over 100 pounds and get a free flight for two people” first was successful because flights were just in Europe but then they gave the same promotion but travelling to the US. The idea of Hoover was to attract 50,000 clients but finally they attracted 540,000, they didn’t have to pay all these flights. In 1998 they had to pay 50,000,000 pounds, but they didn’t have enough money,  so they had to pay all the flights.

Source: https://www.youtube.com/watch?v=dKZ6Tb7IAAo

4 things that make the Walmart supply chain successful.

Walmart is one of the most important retailer, mainly in US. Here we have 4 strategies that make it successful:Resultado de imagen de walmart logistics

1- Few intermediaries in their supply chain: Since 1980 Walmart began working directly with manufacturers to lower costs and better manage the supply chain. Manufacturers were responsible for managing their products in Walmart stores. As a result, Walmart was able to expect about 100% of the re-supply of all merchandise.

In 1989, Walmart was named the retailer of the decade, with an unparalleled distribution cost estimated at 1.7% of its cost of sale – far superior to its competitors like Sears (5%) and Kmart (3.5%). Since then, the company’s supply chain has done nothing more than improve.

2- A strategic and efficient partnership: Walmart establishes strategic alliances with most of its suppliers, offering them the possibility of large and long-term purchases in exchange for the lowest possible prices. In addition, Walmart improved its supply chain by building communication networks with its suppliers to improvise the flow of materials with low inventories.

All the intermediaries in the chain are connected through technological tools, which include a central database, point-of-sale systems at the store level and a network of satellites. In recent years, Walmart has used radio frequency identification (RFID) tags, numerical codes that are scanned from a distance to track the movement of goods along the supply chain.

3- Cross Docking as a method for inventory tracking: Cross-docking is a logistics practice that is a key part of Walmart’s strategy to replenish inventory efficiently. It refers to the direct transfer of products from one truck to another output, without using extra storage.

The suppliers deliver their products to Walmart distribution centers, where they are transferred to another truck, which will be responsible for delivering them to stores. Cross-docking maintains reduced inventory and transportation costs, reducing transit times and eliminating inefficiencies.

Using cross-docking allows you to avoid keeping your inventory stationary for long periods of time; since, the products are shipped by the suppliers to the Walmart stores, and then, automatically, they are re-shipped to the stores. This process is usually done in 24 hours or less.

4- Technology: Walmart has the longest technological infrastructure that any private company in the world. Its state-of-the-art technology and network design enable Walmart to accurately predict demand, control and predict inventory levels, create high-efficiency transportation routes, and manage logistics for customer relationship and service.

Source: https://cloudadmin.mx/blog/post/una-cadena-de-suministro-increiblemente-exitosa-Como-lo-hace-walmart

Precision Agriculture

Since everyone has to eat, no matter how advance our civilization is going to be, it might be prudent to check how our latest technology is able to support the agriculture industry. Therefore I present to you “Precision Agriculture”.

Precision agriculture is one of the modern farming practices that allows the farming to be much more efficient than before, putting the emphasis on working smarter, not harder.

Just imagine that you are a farmer owning tens of thousands acre of farming land with different crops and vegetables, each requires different amount of water, fertilizer, sun shine, chemicals etc. Having to take care of every single thing by yourself is bound to be a very challenging task, not to mention keeping track of the continually changing weather and its effects on the condition as well as moisture of the soil.

But fear not, for in the following video you will see how high-tech equipment can change the game:

Source: https://www.facebook.com/baresquare

Backhaul: taking advantage of returning vehicles

In many cases you have been seen, how a vehicle made a full delivery and went back to its point of return with empty hands. It is customary to think that this is what happens when making deals but, would be better to go to deliver a package and return to your starting point with another type of merchandise taking advantage of the trip. (This exists in the world of logistics and it´s called backhaul).

Often, backhaul is used in different types of companies, specially in centralized distribution companies such as beverages, household items and those who use some kind of waste to incorporate back into their process and obtain a benefit.

Examples :

willy

The idea is simple; Once the merchandise is delivered, on the way back the vehicle is stopping to those companies that have to return merchandise, products or packaging to the point of return. This type of reverse logistics that is characterized by the return of travels with useful merchandise, brings many benefits for companies that opt for it:

  • Increased workload.
  • Save time in deliveries.
  • Supply more customers.
  • Higher priority to customers.
  • It can be seen as a new way of business.
  • Cost optimization. Cost reduction in the company that supply the material and the company that collect the merchandise.

When the company do the normal route and the return, prevents that other suppliers have to go to the distribution company with the load. With this measure is less contaminated because less CO2 is emitted to the atmosphere by the reduction of trips of the trucks.

When designing a backhaul strategy you have to take into account mainly the planning of delivery routes and collection.

                                                                                                                                    Willy M. De Leon

RFID: Radio frequency identification.

As my topic in the assignment of Product and Unit Load was the RFID and I have always been a little confused with its function and difference with the bar code I wanted to search more about it. The RFID is considered a very valuable technology and business tool. Its main work is to track inventory within the supply chain in a more efficient way. This tool is trying to beat tools like bar coding which is not giving as much information as RFID can.

The RFID works with tiny tags embedded microchips containing data about an item and its location to transmit radio signals over a short distance to RFID readers. The RFID readers then pass the data over a network to a computer for processing. Unlike bar codes, RFID tags do not need line-of-sight contact to be read. The tags are electronically programmed with information that can uniquely identify an item plus other information about the item, such as its location, where and when it was made, or its status during production. Embedded in the tag is a microchip for storing the data. The rest of the tag is an antenna that transmits data to the reader.

 

Captura de pantalla 2017-04-03 a la(s) 3.17.34

 

There are two kinds of tags the active tags and the passive tags. The active tags are powered by an internal battery and enable data to be rewritten or modified and can transmit for hundred of feet buy are way more expensive while the passive tags don’t have their own source of energy, range only several feet and are smaller and cheaper.

RFID system can handle with inventory control and supply chain management much better than barcodes because it contains more detailed information about the goods in the warehouse and production units. If a company is shipping many articles, the RFIS systems track each pallet or item in the shipment; that’s why big companies such as Walmart are being benefit with this systems because they manage many different kind of products stored in different warehouses, so RFID tags give them the chance know more about the status of their products.

Other benefits the RFID system give to companies are: the serialized data which means that all items in the supply chain has a unique identifying number, it reduces the human intervention by the automatization of the system that also reduces the number of errors, real time information flow and the security of the items by tagging before being tracked in a facility.

A different way to buy: Glovo

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Despite that this idea came up to my mind during a lesson of Service and Sales, I wanted to share it with all my classmates to show how the delivery systems are constantly changing.

A few months ago, while I was in the bus on the way to my house, I saw a bycicle with a yellow bag in the back part with the name Glovo written in it. However, I didn’t realise, until one of my friends talked to me about a company called Glovo, that it was doing food deliveries at home, so immediately it came to my mind that day in the bus, so I decided to investigate about it.

This company called “Glovo” was previously working in Madrid and Barcelona, and through a smartphone App you can buy, receive or send any product of the same city and receive it in less than an hour.

They differentiate from other competitors offering the restaurants our own delivery service, where those restaurants just have to cook and prepare the order.

But, how do they do it? I think it is a very good idea, in a way that everybody can participate. What they do is get involved the customers and the “glovers” through the app. The “glovers” are independent couriers that accept and performance with total flexibility in a maximum guaranteed time of one hour. The requirement to be a “glover is being at least 18 years old, have an own vehicle, mainly a motorbike or bicycle, and a smartphone. Moreover, the shipping cost is 4.90 € and the “glover” earns a 70-80% of that amount.

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Once the delivery has been done, the user can pay through the app and assess the “glover”, so if any of you are interested in proving this app, the only thing you have to do is uploading it in your smartphones and buy what you are interested in.

Source: http://valenciaplaza.com/llega-a-valencia-glovo-mensajeria-expres-basada-en-economia-colaborativa

 

LEAN CULTURE 5’S

I was wondering why JP tells us every time when we work in groups to remove all the stuff from the table. I must confess that the first time he told us to change the layout of the class, although I thought that was a good idea, I also thought that was an unnecessary step. Moreover, I always thought that we don’t need to remove our stuff from the table in order to become more creative and effective or efficient. But now,  my point of view have changed since I have recently joined to a new workplace I realised how important is to have all my stuff organised in order to be more productive.

I would like to introduce the 5’s methodology, which I believe we all already know. 5’s methodoilogy is composed of 5 Japanese words: seiri, seiton, seiso, seiketsu, and shitsuke. Its word in English are: Sort, Set in order, Shine, Standardise and Sustain. It aims to create and maintain a clean, orderly pleasant work environment in order to facilitate the daily work which follows the productivity and the efficiency.

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The theory says that “Dirty, cluttered, or damaged surfaces attract the eye, which spends a fraction of a second trying to pull useful information from them every time we glance past. Old equipment hides the new equipment from the eye and forces people to ask which to use” (Ward, Allen (March 2014)).

In conclusion, it is obvious that we all apply automatically parts of this method in our daily life, but if we force a bit ourselves and applying all these steps we would become more useful in our companies and become more successful in our daily life. Sometimes the simple tips are the useful ones.

Ps: I leave you this short but interesting video explaining in a practic way step by step how to apply 5s methodology. Hope you enjoy!

HOW MUCH TIME OF AN AVERAGE LIFE IS SPENT WAITING?

Last time in class we discussed about queue. How to deal with it in a logistic way. This made me think about how long do we wait in our lives on average including pretty much anything.

Get ready for numbers then!
According to a Timex survey, Americans wait:

  • on average of 20 minutes a day for the bus or train
  • 32 minutes whenever they visit a doctor
  • 28 minutes in security lines whenever they travel
  • 21 minutes for a significant other to get ready to go out
  • 13 hours annually waiting on hold for a customer service
  • 38 hours each year waiting in traffic
  • those living in Big cities wait in traffic more than 50 hours annually

= about 37 billion hours each year waiting in line somewhere
Human beings spend approximately 6 months of their lives waiting in line for things, it means like 3 days a year of queueing up. The average person spends about 43 days on hold with automated customer service in one lifetime. Those who take the bus will wait about 27 days of their lives waiting around on the platform or at the bus stop.

And what about our Phones?

  • We spend 23 days a year on our phones
  • 90 minutes a day
  • 9 years of the average person’s life

 

The “Phone” means to call somebody but this is now the sixth most used feature. Before there are social media and gaming. Web browsing come top of the list with people spending 24% of their mobile browsing the web, closely followed by time spent on apps. 57% of the persons assert they don’t need any more an alarm clock and 50% of those who wear a watch use anyway the phone as first choice for knowing the time.

This lead me to the internationally famous queue for the launch of every iPhone, since 2007 they increased and expanded their features.

According to a source, intern at Bloomberg News, the first man in the queue have been waiting since August-25 – which means more than 10 days before the iPhone 7 was unveiled. In New York, strange things might happen: like a spot in sale for 300$ or other Apple fans who are paying other to queue for them. A “pro line-sitter” claim that he got paid 3.400$ per week just to wait there. Tents have been pitched on the pavement outside the shop and several people were sitting in foldable chairs.

In New Zealand, the queue was taken to another level: the first 100 customers got a robot to wait in line for them and this will allowed the customers to wait in line using FaceTime.

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Source:
http://www.mobilestatistics.com/mobile-news/23-days-a-year-spent-on-your-phone.aspx
https://www.reference.com

 

The surprising benefit of queues

The accepted wisdom is that long lines are bad for business. In fact, they can be very good for business, as long as they are not too long. Research shows that long lines help customers learn what’s worth waiting for, and help businesses attract uninformed customers.

Most consumers don’t realize, however, that they will sometimes seek out queues. The empty restaurant syndrome is one example. Perhaps you’ve looked through the glass window of a restaurant, seen mostly empty tables, and decided to move on to the next restaurant in your search for a meal. On the other hand, that restaurant over there with the people waiting seems popular. The underlying psychology of empty restaurant syndrome is simple: if so few people come to this restaurant, it must not be good. The dynamic is based on uninformed consumers (for example, you, first-time visitors to a city) taken their cues from informed consumers (the residents of the city who know which restaurants are good).

At the same time, there is no doubt that consumers also avoid long lines even in these situations: if there is a 45-minute wait for a table, diners may go elsewhere.

In short, waiting in a queue is a cost that is incurred by the consumer. However, because a queue also increases the perceived quality or value of a product, the value can be perceived as greater than the waiting cost (the quality of the restaurant is worth the wait). The result: a ‘herding effect’ where many consumers attract even more consumers.

Researchers Mirko Kremer and Laurens Debo investigated the impact of this herding effect through two controlled laboratory experiments. These experiments involving numerous rounds of simulated shopping expeditions in which the various factors , for instance, the value of the product, whether or not consumers were informed about price or value, the number of informed consumers, and the amount of wait times — where randomly manipulated. The experiments led to some interesting results:

  • The diagnostic value of a queue depends on the presence of informed consumers. In a tourist area, where the restaurants are patronized by tourists (in other words, uninformed consumers), the presence of a queue is not necessarily perceived as an indication of the quality of the restaurant.
  • A small number of informed consumers can have a great impact on uninformed consumers. One of the revelations of the experiments is that it does not always take large numbers of informed consumers to convince uninformed consumers of the value of the product.
  • Even high-quality products or services need a sufficient number of informed consumers. Not surprisingly, low-quality products or services do not benefit from more informed consumers. However, for the herding effect to take place, even high-quality products or services need a certain number of informed patrons or users to bring in uninformed consumers.

 

Source: https://www.ideasforleaders.com/ideas/the-surprising-benefit-of-long-queues-for-customers-and-business

The impact on queuing systems

The queuing theory is the study by formulas of waiting lines by which we analyze the different processes related as: The arrival in the queue, waiting time, among other variables. At present, this model is considered as a branch of operational research, as it dares to study an extensive diversity oriented in: business, commerce, industry, engineering, transportation and telecommunications.

 

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The objectives of queuing theory are:

  • Recognize the optimum capacity of the system to minimize cost.
  • Analyze the impact on process changes.
  • Maintain a balanced balance between quantitative cost and qualitative relations of services.
  • To be pending of the system.

One of the most important objectives is the impact of this study on the improvement or change of its process reflected in costs. A determining characteristic is the quality of the service that depends on subjective aspects such as: The ability to attend to the client, the hygiene, the presentation of the service, respect and kindness.

In most cases the psychological cost of waiting is longer than the time of service, the main reason is because customers do not take their time while they wait. Therefore businesses and services use various strategies to entertain customers by adding Tv presenting news, new products in the exits and mirrors to distract customers in the waiting areas.

 

Different queues at Primark and Zara

Nowadays, these are two of the most important stores for consumers. However, they are related to a very different type of client and regarding to their queues management also they are different.

Primark has in all his stores the same system:

  •  Unique queue controlled by an algorithm that shows the customer which is the cashier he has to go to.
    • This system is fair since every client is going to spend almost the same time in the queue (there are no wrong queues).
    • The time variations in the queue that may occur depend on the number of items purchased, the number of servers available (around 10) and the mistakes that may happend while paying.

The average time in the Primark queue are 12 minutes which is a big amount of time, but meanwhile customers have acces to a lots of products offered in the queue lay out which is disposed in a “s” form. The characteristics of such a time during the Primark queue are this:

  • Prices are very low, so the average number of items purchased by a client is really high (between 6 and 10).
  • The stores size is really large (10.000 m2). This leads to more people and longer queues.

Nevertheless, Zara has much better product quality than Primark so is realted to a different client that is willing to pay more money for better products.

  • The queues at Zara are smaller and shorter.
  • They have not an interactive algorithm as Primark, and depending on the store the queueing system is a unique queue or parallel queues, but the most used system is the unique queue.
  • Time variations in the queue are the same that at Primark.
  • During the queue few products are provided and usually they are not clothes, they may be sunglasses, jewellery, etc.
  • Normally Zara has only two cashiers available.
  • Prices are higher, so the average amount of items purchased are much lower than in Primark (from 1 to 3). This reduces the queue lenght.
  • The average size of the Zara’s stores is 1.200 m2, which makes queues much shorter due to the small space comparing to primark.

Pros and Cons of CROSS DOCKING

Cross dockingCross Docking is to transfer the goods and materials from an inbound carrier to an outbound carrier without storing it at a warehouse. ( Ray Kulwiec)

It can help the company lessen the need for materials storage, speed deliveries and generally improve your supply chain management. In summary, Cross Docking  helps improve the Inventory and Operation, to be more efficiency.

When a company implements a Cross Docking, the distribution operation would reduce normal processes to just:

  • Receiving
  • Staging
  • Shipping

 

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Advantages of Cross Docking including:

  • Reduce the inventory and safety stocks.
  • Reduce the cost of inventory on hand, as well as labor costs and the number of part damage
  • Reduce the number of touches applied to materials, reducing the cycle time.
  • Improve the flow of the material in the network
  • Expediting the customer order
  • Customer Satisfaction

Nonetheless, implementing Cross Docking is not easy, and needs a lot of consideration and preparation. It must be programmed and monitored carefully, and requires a good collaboration among all members of the chain.

The basic steps involved in implementation of Cross Docking are:

  • An awareness of the demand at customer level (point of sale)
  • Knowledge of the destination of incoming items even before their arrival at distribution centers, and
  • The same unit of measure from both inbound and outbound carriers.

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Be carefull, the Cross Docking should not be used to replace inventory. Late changes in customer order, disruption in production planning, and shipment disorder are all examples that make the inventory inevitable in supply chain network.  But if it implements correctly then it improves the flow of goods in the network and will reduce the holding inventory.

 

 

Reference:

Crossdocking as a supply chain strategy, Ray Kulwiec , target volume 20, Number 3.

http://searchsap.techtarget.com/answer/How-can-SAP-cross-docking-optimize-my-supply-chain

https://blog.kinaxis.com/2016/11/crossdocking-for-supply-chain-network-efficiency/

Walt Disney World now testing virtual queue system at water parks

The objective of a queuing system is to find out the optimum service rate and the number of servers, so that the average cost of being in queuing system and the cost of service are minimized.

By nature, the service companies most affected by queues and the waiting time of the customers, are those which offer services of entertainment and more if they are for the children´s market. This is the case of Walt Disney. 

“Virtual queue” is not literally a new concept for Walt Disney, in Universal Studios Tour in Hollywood they had used a FastPass,  boarding pass for the World Famous Studio Tour where guest would be given “return times” when entering the park to encourage guests to experience other shows and attractions in the park as opposed to waiting for hours in line.

Now as Universal Orlando sets to opening Volcano Bay Water Theme Park in late may they are introducing another concept “Virtual queue” hat has been floating around small parks for years but this will be the first large scale use in the United States, TapuTapu a wearable pager of sorts that will let guests know when it is time to head to which ever water slide with no wait.

A virtual queue allows guests to “save a spot” in the line for an attraction without physically standing there, so they can enjoy the wave pool or lazy river while waiting their turn on a wristband. Current virtual queue testing includes Downhill Double Dipper, Slush Gusher and Summit Plummet at Blizzard Beach, and the new Miss Adventure Falls at Typhoon Lagoon.

TapuTapu Wearable bands

The guests should visit a  distribution table as the walk up the mountain and are given a return time to Summit Plummet later in the day. They need to used a wristband, that is just a hard plastic card on a rubber band with the attraction name, return time window, and legal jargon on the back; that is, instead of a paper ticket, the time will be printed on a waterproof card attached to the wristband. When guests return during their appointed 15-minute window, they should experience a nominal wait before riding.

The current test of this virtual queue system is set to run through April 7th.

Reference:

http://attractionsmagazine.com/walt-disney-world-introduces-virtual-queue-water-parks/

http://www.laughingplace.com/w/articles/2017/03/29/walt-disney-world-water-parks-virtual-queue-testing/

3D printing in a delivery truck

The delivery truck stops in front of your house to deliver your ordered product, while in the load bed of the truck a 3D printer finalizes your product to completion. The idea to produce during a delivery is a method Amazon is about to receive a patent for.

With this method Amazon wants to achieve a much faster delivery process. In the best case, the customer would receive the ordered product after a short time after the ordering process. This will lead to higher customer satisfaction. On the other hand Amazon could save a lot of money by reducing warehouse capacity close to their customers because they don´t have to store the products due to the production during delivery.

In logistics it is an important a present discussion about when, where and how much of a type of a product should be produced to ensure permanent availability with a minimum of inventory.

Maybe this method would change this discussion totally.

But of course this procedure has its limits. Nowadays only a small amount of products can be produced with the 3D printing technology but maybe in the future this technology is matured enough to let the Amazons dream of driving manufacturing plants become true.

 

Source:

http://www.maclife.de/news/amazon-ware-wird-weg-zum-kunden-lieferwagen-produziert-schnellere-lieferung-10063050.html

One plane ticket for the dead uncle, please..

I know, this topic is very strange. But did you ever think about what happens if someone dies during the holidays?

In general, there are two common ways for human remains transport: car and plane. While the transfer is usually done by car for neighbor countries or short distances, long distances must be done by planes.

Did you know, that the probability is quite high that if you are on your plane to the holidays or back you travel together with a corpse?! Dead bodies are usually treated as delicate cargo -but still cargo- and are put in the freight room of the plane. To “keep the meat fresh” there are special requirements before a corpse can be shipped. Besides the certificate of death they need an own “corpse passport” and the transport must be accompanied by a funeral company. In some countries the wood must have a certain thickness or the corpse must be balsamed, but typically the only requirement is a sealed cinced coffin.

“Fun” facts:

costs: depending on country and insurance up to 6.500€

In order other passengers do not get afraid the coffins are put in a special box.

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if only human organs are transported, they are even in the cabin with you in the hand luggage storage

if someone dies during a flight, they sometimes put alcohol on his tray, sleeping mask on and pretend him to be sleeping.

Sorry for the disturbing post guys 😉

Source: http://diepresse.com/home/panorama/integration/624444/Ueberfuehrung-ins-Ausland_Mit-Verstorbenen-an-Bord

Queuing strategies to cut perceived wait times

The waiting line experience is a huge factor in determining  a business´s overall customer satisfaction rating.

The key is impacting the way customers feel about waiting in the line. How is it impacted? with distractions…

Below , we have three simple, yet powerful strategies to reduce the perceived wait time of customers in the queue.

Queuing Strategy #1: Provide estimated wait times

Known wait times feel shorter than unknown wait times. You are proactively managing their expectations by providing the customer with an estimated time of how long they will be waiting in line. For instance, theme parks have in line a sign of the time customers will need to wait from the point of the sign until they reach to the point of the ride.

Queuing Strategy #2: Arm your queue with merchandising

Distractions are key. When people´s mind are busy, they will not think that much about how long they will be waiting.

Adding an in-line merchandising system to your queue is perhaps the most effective way to keep waiting customers distracted.Merchandising in the queue is reported not only to reduce perceived wait times, but to increase sales, too.

Increase the usefulness of your in-line merchandising system with the likes of simple price tag signs, larger format signage, and video displays. The waiting line will become a place of information, education, and entertainment to your customers.

Queuing Strategy #3: Get your customers started

Once a transaction starts, the wait is over.

There are several ways to begin a transaction before the customer actually reaches the point of service.

For example, a service business can install an in-line table for people to begin any necessary paperwork before they reach the service agent. Not only will customers be distracted from the wait by their task at hand, but the waiting line itself will run more efficiently by eliminating long amounts of time spent at the service counters.

Conclusion

Queue managements is very, very important. Only small changes in the queue will start making huge difference regarding how customers feel about waiting in line. Again, key is distraction. If the mind is busy, time flies. It is as simple as that.

Source:

http://customerthink.com/top-queuing-strategies-to-cut-perceived-wait-times/