Loop : What about we get rid of packages?

E-commerce is one of the major business that have been developed over the years, in parallel with retail. Nowadays, we don’t care anymore about if we are going to miss any food, drink, shampoo or even toothpaste : we just need to order it or to go to our nearest shopping store.

We’ve learned that products are being shipped on pallets at Mercadona, and that for example milk is being sold in cartonboard bottles. Hence, when I go shopping for my milk, I don’t just buy milk : I buy a bottle + the milk inside. That’s right, when I leave Mercadona, I’m also the owner of a bottle of milk.

But if you like old American movies you remember the milk salesman, bringing the milk into glass bottles and then getting the old ones back. So what happened to our recycling mood ? Why did we change to this amount of packaging, that 1 out of 4 times finish in our oceans ?

Let’s get back 70 years ago, with the development of single use packaging. It won over reuse bottles and packages because it was more affordable and convenient for the customer. Product became cheaper, and it was easier to use. The consumer only saw the advantages of it, and without any knowledges, it’s completely understandable !

So, how can we compete with this convenience and this low price?

Tom Szaky presents the concept of Loop, that is going to start in Spring 2019 in France and USA

Here is the challenge tackled by Loop : a division of Terracycle, mainly owned by Terracycle but also other strategic partners such as P&G and Suez. Loop is a new project of e-commerce platform that will allow their customers to buy the products they usually get in a supermarket, in a zero-waste policy.

The customer order online their product, and they receive them into reusable (and not recyclable!!) packages, themselves contained into totes. Those totes are then used as a « reusable bin » : the consumer put the empty package in the tote. When it’s full, the consumer contacts Loop and the company comes directly to the consumer’s home, and collect the tote full of empty packages.

A client receiving his Loop totes, full of reusable products

What’s the interest for Food Retailers ?

First, this would drastically reduce the use of plastic packages ; the company would own the package, not the consumer. And this will allow them to produce long-term packaging, and minimize the price of it. They would be able to distribute their product in a more sustainable way, and be able to manage from the creation to the end-life their packages. Indeed, for the moment the consumer is responsible for the package, and a bad behavior would, at the end, have repercussion on the brand’s reputation.

Conclusion

The development of packaging was an evidence for the increasing of supermarkets and then, the e-commerce. However, the studies about our impact on oceans and the environnement is clear : we need to find alternatives to single-use packages, and make them reusable instead of recyclable. Another challenge for food retailer, but that definitely have an impact on our future world.

Disaster Management & Logistics

In this subject, we have talked a lot about how Supply & Logistics Management became a key component inside companies. With the development of communication, transportation systems, the demand is increasing and diversifying constantly. Highly developed logistics models have been developed, and now gigantic retailers like Amazon are able to fulfill a large part of the world on a wide range of objects.

However, we have mainly concentrated our thinking on goods and warehouses, but what about managing human lives? The number of disasters have been multiplied by 3 in the last 30 years (see graph n°1), but fortunately the number of death have decreased. This is all due to the development and installation of frameworks and actions in order to react in case of disaster : disaster management and logistics.

World Cup 2018 – Transport Planning Challenge & Strategy

As we are digging up into flow management during the Logistics class, I wondered myself about events that required a really complex organization and planning.

I’ve been to a lot of concerts, conferences, festivals… But nothing as big as the World Cup. And as it was a successful edition for the French Nation, I’ve decided to analyze the logistics that it needed.

All this article explanations are going to be based on this official document, presented by a Honorary Professor of the Federal Institute of Technology of Lausanne, Philippe H. Bovy, as part of a training seminar for the organization of the event.

FIFA 2018 World Cup transport planning challenges and strategy

National Event vs. City Event

The World Cup of Football, in term of visibility and attractibility, is comparable to the Olimpic Games. However, as there isn’t enough football stadiums in ONE city, it’s mandatory to host this event in different cities. In average, every World Cup is hosted in 10/12 cities, hence create issues about mass transportation and hosting. Fans from all around the world are going to follow their teams and therefore will need to move from one city to another. This involves in particular:

• Improvement of the Airport temporary capacity : high flow of arrivals at the same moment.
• Hosting capacity : Russia have built over 100 new hotels to host all the arrivals, in each cities.
• Increase security : with the increasing number of terrorist attacks mass events need to be highly protected (for example, in December 2017, the Harbour Master of the Large Port of St Petersburg informed the port operators that handling of all dangerous chemical, biological, toxic, radioactive and explosive substances will be suspended during the World Cup).

Hence, the World Cup Council decided to cut down into 4 levels of transportation :

This have to take into account that the visitors (the football fans) would travel next to the inhabitants of Russia : the solution was to distinguish them by giving them a Fan ID,  that would allow them to travel more easily around the country.

Host City Mobility Concept

As discussed before, this event gather a high number of people at a specific time; but this one is not predictable. In order to face those periods of large affluence, the committee developed the host city mobility plan.

Indeed, the “Fan Zone” (zone designed to host the fans and in particular display the games on large screens – which can lead to a large affluence), the city center and the stadium receive large human flows, and especially in the “stadium last km concept”.

Responsability Matrix

The Football World Cup is, due to its decentralized aspect, organized and managed by different entities :

• The FIFA (International Federation of Football)
• The Local Organising Committee (LOC) 2018 Russia – the organisation in charge of planning and staging the world cup in russia.
• The Russian Federal Government
• The Host Cities

Therefore, it is necessary to define which is going to be in charge of the different transportation phase and management, to ensure the good execution and transition of the fans through the event. Here was the matrix that have been designed :

We can clearly see that from the home country’s fan to the stadium, 3 different entities are in charge of the transportation logistics, even though those 3 entities are working all together every time.

Conclusion

The Russian World Cup have faced a lot of difficulties, especially by taking a lot of delay in the construction of stadiums. There are a lot of controversy in those events as they involve a high amount of work in extremely dangerous conditions, especially during the organisation of the 2014 World Cup in Brazil, where a lot of riots occurred. However, the international promotion that the event releases seems to take advantage on all the other aspects, and countries are putting a lot of effort (and money..) into the organization of this event, even if this not make sense (the next World Cup in 2022 will be hosted by Qatar, in highly air-conditioned stadiums, that are built only for the event…).

AI in Inventory Management

             “Managers tend to overcomplicate the process and the tools, but most of the time the real benefits lay on simplifying the process and getting accurate data about the stock.”

Following an interesting course about Inventory Management, we received this phrase in a conclusion e-mail, that made me think. Indeed, there is no real solution or framework to optimize perfectly your inventory, unless you know how to predict the future and therefore I would love to meet you.

However, my interest into Data Analytics and AI resurfaced, as it’s the type of problematic that this scientific field is trying to solve during the last 20 years. The fact that there is not an all-done solution for Inventory Management, is because information is always lacking. Therefore, how can we get this information? AI, indeed, can be a great help.

The most talkative example here (of course…) the giant of retail Amazon. They developed many tools that help them to manage better their inventory, hence having the possibility to make it grow.

Inside the Warehouses: Automating and Monitoring Inventories

When a company is in the field of retail, movements inside warehouses and number of goods are growing exponentially. It’s humanly impossible to make no mistake and follow perfectly everything: thus, Amazon developed Kiva (see picture below), a small automated robot that move pallets of goods inside the warehouse in an optimized way, reducing human needs & enable the tracking of movements.

Demand Forecasting for Inventory Management:

              Automating the movements inside your warehouse will give you more information about the present activity of your inventory; but the greatest challenge of this century is to be able to predict the future.

Let’s imagine that you are an important water bottle supplier, and that you faced stock shortage during a heatwave this summer. A way to prevent this kind of event is to try to analyse your sales throughout a determined time framework, taking also into account pertinent variables, such as the temperature. Therefore, you could develop an ordering policy depending on the weather forecast and optimize even more your stocks.

This AI field related to this type of problematics is Time Series Analysis, which is also extremely used in the stock market and high-frequency trading.

If you are interested to have more insights about Time Series Analysis, I advise you to take a look at this video, that will introduce to the theory of this concept.

              To conclude, we can clearly state that AI have been developed to solve knowledge management problems, that have been and will always be an issue. However, thanks to this technology decisions are taken with more insights, and show the power of the symbiosis between humans and machines.