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Asia: Logistics and manufacturing can benefit from each other
Posted by admin in CHAKKR News
SINGAPORE: Manufacturing companies in Southeast Asia can benefit from the seamless flow of their goods and services across the region when the logistics industry becomes fully integrated, experts said.
Logistics connectivity within the Association of Southeast Asian Nations (ASEAN) will help spur the manufacturing industry in the region and make ASEAN a very competitive region.
According to a study done by APEC Policy Support Unit, a one per cent increase in logistics performance and competitiveness could lead to an immediate three per cent improvement in exports.
Dave Tan, Executive Director, Regional Office, Conference of Asia Pacific Express Carriers, said: “When it comes to competing with your neighbouring countries, you need the speed and reliability so that you have more time to focus on your core business of improving your designs and other aspects of the manufacturing process.”
Experts said each member country of ASEAN could be good at doing different things such as providing skilled labour or strong infrastructure.
As such, economies of scale can be achieved by having different countries participate in different parts of the value chain.
Dr Robert Yap, Chairman, ASEAN-Business Advisory Council Singapore, said: “If you have a connected supply chain landscape, then countries can specialise in what they are doing best. And through the connectivity program, this will allow ASEAN to be a very competitive region, and as a region to move forward.”
Experts said that after China, ASEAN looks like a strong next source of manufacturing competitiveness, with Vietnam and Indonesia as strong contenders.
The ASEAN Economic Community or AEC Blueprint was signed in November 2007 to transform ASEAN into a single market and production base by 2015.
The aim is to achieve free movement of goods, services, investment, skilled labour and freer flow of capital within ASEAN.
Source: channelnewsasia
Representative association for express freight and the courier industry the South African Express Parcel Association (Saepa) executive director Garry Marshall believes that, across the different segments of transportation, express freight remains the strongest growth point for the industry.
“With the global tendency towards pulling goods through the supply chain based on consumer demand (rather than the old push methodology of pushing products into the consumer’s hands), there is a need to keep high-value goods off warehouse shelves and move them into the consumer’s hands as they are needed, and I believe our industry is perfectly poised to do that,” he adds.
In developed countries, the freight and courier industry percentage growth is three times that of the gross domestic product (GDP) percentage growth and in developing countries the industry percentage growth is about five to seven times faster than the GDP percentage growth of individual countries.
Although trends over the past two years have found that a lot of low-end airfreight has moved to road, Marshall believes that airfreight is still a fast-growing component of transportation. “I suspect that, over time, the use of road to transport goods will be affected as the tolling system is implemented on South Africa’s roads and more road freight is moved to rail,” he says.
Meanwhile, Marshall says that companies in the express industry are still trying to recover from the recession, but there has been a positive impact on companies that have redesigned supply chains to have the low-value goods moving slower and the high-value goods moving faster. “The industry has become a key component of the supply chain, whereas three to four years ago, it was not as popular,” he adds.
“I do not believe that the industry’s growth rate will slow down, as courier and freight services have become a part of everything, from the delivery of cosmetics and clothing to safety boots and car parts,” explains Marshall.
“Companies continue to refine their processes and lower costs. The industry is moving in a new direction, which also includes technological developments,” concludes Marshall.
Source: Engineering News
Over the last few weeks, first FedEx and then UPS in near tandem announced a series of published rate hikes for 2011. The headline news was that the average increase at FedEx will be 3.9% and for UPS 4.9%, in both cases net rate changes based on a combination of even high rate hikes combined with a reduction in fuel surcharges. But many shippers can actually expect to see their costs rise even more than those numbers.
UPS announced late last week that its 4.9% net hike would come through a combination of a 5.9% jump in rates and a 1% reduction in the UPS Ground services fuel surcharge, while UPS Air and International services rates will also rise a net 4.9% through a combination of a 6.9% increase in rates and a 2% decline in the UPS Air and International services fuel surcharge.
FedEx had earlier announced similar rate hikes through a combination of base rate increases and fuel surcharge decreases, though the Memphis-based carrier’s Express rates will increase a percentage point less than its Atlanta-based rival, coming in at a net 3.9% rise (5.9% base rate increase less 2% reduction in fuel surcharge).
The level of year-over-year increases are high in historical terms and vis-a-vis still relatively soft demand in most markets and services (Asia to US being an exception). But shippers need to be aware of several ways their parcel shipping costs could take a big jump in 2011.
For example, FedEx and UPS accessorial charges are set to increase even more substantially than the general rates. Some of the planned increases in accessorial charges by FedEx for 2011 – the largest in its history – are listed below.
* FDX Express Delivery Area Surcharge up 8.9% ($1.85 vs. $1.70)
* FDX Express Residential Area Surcharges up 10.0% ($2.75 vs. $2.50)
* FDX Express Extended Area Surcharge up 9.1% ($3.00 vs. $2.75)
* FDX Express Indirect Signature Required up 14.3% ($2.00 vs. $1.75)
There was similar news out of UPS, with the Residential Surcharge Ground up 11.36%, the Residential Surcharge Air up 10%, and the Extended Delivery Area Surcharge up 9.09% for residential deliveries and 8.82% for commercial deliveries in some zip codes, among other accessorial charge increases.
Changing DIM Factors Could Pack a Real Cost Wallop
Perhaps having the biggest impact on many shippers, however, are the planned changes by both carriers in the dimensional weight (DIM) factor – a mechanism created a few years ago to enable the carriers to charge more for large but relatively lighter weight parcel shipments (dropping the previous “oversized” fixed surcharge).
Both FedEx and UPS are changing for 2011 the divisor on air and ground domestic shipments from 194 to 166, a factor used to determine whether a package is subject to higher DIM rates (almost, literally, similar conceptually to the IRS’ Alternative Minimum Tax or ATM).
“Most shippers again will fail to appreciate how big an impact this change can have,” says Jerry Hempstead, a long-time parcel industry executive and now president of Hempstead Consulting.
He notes, for example, that this change will likely mean many shippers that have not been subject to the DIM weighting or only marginally so in the past could now see a higher percentage of their parcel shipments are now impacted.
Hempstead says when the DIM concept was first introduced, many shippers at the time did not fully appreciate the impact it would have on shipping costs, and that all parcel shippers should understand how this latest change will potentially impact their spend.
“A shipper that may have had few packages DIM under the 194 rule may wake up in January to find all their packages dim,” Hempstead says.
Source: Supply Chain Digest
St. Onge Co.’s
Tom Bonkenburg will present a discussion on ways the robotics industry can impact the world of logistics, distribution and material handling. His presentation, “New Opportunities for Automation in Warehousing & Logistics,” will address how robotics can play a valuable role in warehousing and distribution. “My presentation is a primer to get the robotics industry ready to wade further into the world of logistics and material handling,” says Bonkenburg. “The focus is to spur the industry into thinking about how they could make money by investing in research to develop profitable and efficient solutions for the warehouse.”
Bonkenburg will share:
* Real-world examples of new technology in robotic warehousing automation in the United States, Europe and Japan.
* The competitive edge — How a perception exists that the United States lags behind Europe in distribution automation.
* The challenge of using robots in the warehouse environment.
* How to get a distribution center manager to understand why the most complicated piece of warehouse equipment should not just be a forklift.
Bonkenburg, a principal at St. Onge and director of its European operations, is affectionately known throughout the company as the ‘robot guy’ because of his passion and knowledge of robotics research and automation.
The 18th Annual Robotics Industry Forum brings together top executives from robotics manufacturers, system integrators, component suppliers, end users, research groups, universities and consulting firms.
For the second consecutive year, the forum will be co-located with the AIA Business Conference and the MCA Business Conference. Combined, these events will attract some 250 industry leaders from the robotics, machine vision and motion control industries.
St. Onge Co. is a world-recognized supply chain strategy and logistics-consulting firm. Its discovery-driven approach brings together the elements of supply chain logistics, engineering, operations and new technology to ensure that a client’s supply chain challenges receive customized answers.
The presentation will be at the 18th Annual Robotics Industry Forum, Jan. 19 – 21, 2011, at the Disney’s Boardwalk Resort in Orlando, Fla.
For more information about the Robotics Industry Forum, visit
http://www.robotics.org/events/event.cfm?id=80.
Source: PRWeb
It’s time again for the results of the yearly 3PL awards of Inbound Logistics. From year to year the readers of Inbound Logistics vote for their favorite 3PL company, Inbound Logistics compiles the results and the best 3PL providers come out on top.
And here are the Top 10 3PL companies of the year 2010:
1: Ryder
2: C.H. Robinson
3: Menlo Worldwide
4: Transplace
5: UPS Supply Chain Solutions
6: Exel
7 (TIE): BNSF Logistics & J.B. Hunt
8: Landstar
9: Penske Logistics
10 (TIE): TLC & Unyson
Backlogs in postal deliveries continue on Tuesday as members of the Finnish Postal and Logistics Union (PAU) continue a series of spot strikes. National conciliator Esa Lonka is meeting with employers and postal workers on Tuesday to resolve the dispute over contracts.
The job action is targeting the Turku mail distribution hub on Tuesday. Workers are meanwhile scheduled to walk out of post offices in Turku, Raisio and Kaarina on Wednesday.
Further strikes have been planned around Finland, including a 24-hour strike on all mail delivery, if no new contract is reached.
The sticking points in talks concern night shifts, outsourcing and the use of temporary and part-time workers.
About half of the post that passed through the Pasila mail distribution hub in Helsinki late last week is still unprocessed.
Last week, postal workers staged walkouts that caused delays in deliveries. Also, a self-imposed ban on overtime work that came into effect on October 20 has slowed delivery services.
Source: YLE
Choosing a courier out of the high number of offers is always a difficult task. We’ve got five tips for you that might help.
1) Don’t just rely on the biggest name you come across. We’ve all heard of a DHL and FedEx. But this doesn’t mean they are necessarily the best choice for you. Check out alternate offers, too, not just from the “biggies”. Smaller companies don’t have to be bad. Perhaps they are just new in business.
2) Check out the feedbacks of the courier. Are there positive ones? If yes it’s a good hint that you are talking to someone trustful.
3) Is the International Courier service the actual service of the courier company you are enquiring with, or is it being outsourced? Some smaller couriers just don’t have the capacity to take on larger jobs but will happily make a small profit by passing the job onto someone else. It’s ok, but you should be informed about that.
4) How long have they been in service? If they have been around for a while they are probably a safe bet. But it’s no shame to try out newbies. Probably they are trying to bring a good service to win customers and might be cheaper than bigger courier companies. Just check out and make your choice.
5) Does the courier offer any insurance or perhaps an online tracking of your package? With this offers you are always safe.
No matter what courier you are going to choose. Just remember: bigger companies can offer you safety and experience. Smaller ones can probably be cheaper and more personal. It’s your choice.
Caterpillar Inc. (CAT – Analyst Report) announced that its wholly-owned subsidiary, Caterpillar Logistics Services Inc. is opening a new 9,000 square-meter Logistics Center in Suzhou, China. The initiative is aimed at strengthening Caterpillar’s growing manufacturing presence in China and enhancing supply chain and operational efficiency in its manufacturing operations in that country and the Asia-Pacific region.
The Logistics Center will provide inbound logistics support to Caterpillar’s manufacturing operations in China and in the Asia-Pacific region. The logistics center will also help in the movement of goods in and out of China, supporting the company’s global production as well.
The new facility will employ approximately 50 full-time employees. The center will apply the company’s Caterpillar Production System (CPS) to drive efficiencies throughout the new facility. By utilizing the CPS Guiding Principles, the company plans to ensure high speed delivery, increase inventory turns and make material available to its manufacturing facilities in Asia.
This is another development in a series of investments carried out by Caterpillar in line with its long-term strategies to tap the growing Chinese market. In the second quarter, Caterpillar had announced its intention to expand its excavator facility in Xuzhou, China.
This will almost quadruple its excavator capacity once the expansion plans are completed in 2014. In late September, Caterpillar announced another expansion plan of a new facility in Wujiang, China, to produce mini-hydraulic excavator models in the under 8-ton range.
In 2008, China had announced a RMB4 trillion ($586 billion) economic stimulus package to prevent the global financial crisis from ravaging its economy. Under the package, the lion’s share of RMB1.5 trillion was earmarked for public infrastructure development. Projects that were lined up included railway, road, irrigation and airport construction.
The second largest allocation of RMB1 trillion was for reconstruction in the earthquake hit regions of Sichuan. This has spurred construction in China, triggering demand for construction equipment, which bodes well for companies like Caterpillar.
Further, China has passed Japan in the second quarter to become the world’s second-largest economy behind the United States. This year, even though growth has begun to moderate slightly, China’s economy is projected to expand by about 10%, continuing a remarkable three-decade streak of double-digit growth.
China is thus a viable option for expansion, and we appreciate Caterpillar’s focus on expanding its presence in that country as well as in the Asia-Pacific region and Latin America. Further, Caterpillar is well positioned to expand margins through its CAT Production System initiatives, market leadership and ultimate pricing power.
We believe once President Obama’s $50 billion plan to rebuild the U.S infrastructure is approved, Caterpillar will benefit immensely. Consequently, we have recently upgraded our rating from Neutral to Outperform. We have a Zacks #1 Rank (short-term Strong Buy recommendation) on the stock.
Peoria, Illinois-based Caterpillar Inc. is the manufacturer of construction and mining equipment, diesel and natural gas engines, and industrial gas turbines. Caterpillar is one of the few leading U.S. companies in an industry that competes globally from a principally domestic manufacturing base. The company operates three divisions –– Machines, Engines and Financial Products.
Source: Zacks Research
More than 190 leading logistics providers worldwide confirmed to exhibit in 418 exhibition booths, covering every angle of the logistics industry, including logistics products, machinery, equipment, logistics services, software and information technology, education institutes and Government State Enterprises, at the 7th International Logistics Fair 2010 (TILOG 2010), to be held on October 7-11, 2010 at Hall 101-102, BITEC Bangna, Bangkok.
Mrs. Nuntawan Sakuntanaga, Director-General of the Department of Export Promotion (DEP) Thailand, revealed that visiting TILOG 2010 will undoubtedly provide a beneficial opportunity for the entrepreneurs who want to save their logistics cost and time can seek for suitable services from professional service providers at this event, while exporters and manufacturers in logistics industry to see the innovative logistics management and technology exhibited at the show, establish trade ties and expand business cooperation.
Moreover, DEP has also invited members of the International Federation of Freight Forwarders Association (FIATA), who attend the FIATA World Congress in Bangkok, to visit and join the Business Matching activities in TILOG 2010. Currently, FIATA has more than 40,000 members of leading freight forwarding companies in 150 countries worldwide.
Mr. Suwit Ratanachinda, President of Thai International Freight Forwarders Association (TIFFA), said that TILOG 2010 is expected to be an important arena for networking among logistics service provider and users across the Southeast Asia region and beyond and business matching between Thai and International entrepreneurs.
As the host of FIATA World Congress in Bangkok this year, DEP and TIFFA have prepared the memorable event for the members of FIATA during staying in Bangkok, including: the Speech by Mr. Alongkorn Ponlaboot, Deputy Minister of Commerce together with the Top Officers from the Government Sectors; the Lecture about the export management and challenge of logistics business in Thailand by top executive of DHL; and FIATA Gala Dinner with around 500-700 attendants.
Assoc. Prof. Phietoon Trivijitkasem (Ph.D.), Vice President, Thai National Shippers’ Council (TNSC), talked about the highlight of TILOG 2010 that this trade event will showcase not only state-of-the-art technology in transportation and logistics, but also the Green innovation for logistics, i.e., Green Logistics, Green Packaging, and energy-saving technology.
Source: PR Newswire
The ELSC awards were given out during the Express, Logistics and Supply Chain Conclave held in Mumbai.
Drive India Enterprise Solutions Ltd, (DIESL), logistics arm of the TATA group, has won the award for the “Best 3rd Party Logistics (3PL) Company of the Year” at the 4th Express, Logistics and Supply Chain Awards held in Mumbai on 30th September 2010. The award was received by Ajay Chopra, CEO, DIESL.
The ELSC Awards were given out during the Express, Logistics and Supply Chain Conclave held in Mumbai at Taj Lands End on the 30th of September ’10. The ELSC conclave, now in its 4th year, recognizes and showcases logistic companies and supply chain led businesses that have set new benchmarks in the delivery of logistics solutions.
The winners of the awards are selected by a panel of industry leaders and the eminent members of the advisory council of ELSC. These Awards were decided on the basis of a research conducted by A.C. Nielsen.
Speaking on the occasion, Ajay Chopra, CEO, DIESL said, “We are pleased to receive the award for the ‘Best 3PL Company of the Year’ in the country. The recognition underlines our capabilities to deliver the highest standards of service with a customer-focused approach, through our extensive network and deep penetration across the country powered by a huge investment in technology. This award is dedicated to all the 3500 plus DIESLites who have made DIESL what it is today.”
DIESL (Drive India Enterprise Solutions Ltd.), a Tata group company, jointly owned by Tata Industries and Tata International, is a leading provider of integrated logistics solutions, with over 176 warehouses connecting 4000 towns across India.
DIESL operates more than 4.4 million sq. ft. of warehouse area, covering around 90% of country’s districts and managing over 1.25 million transactions per month. Recently, DIESL roped in TCS for 100-crore technology upgrade. DIESL also recently launched nationwide road-safety training for truck drivers which will cover minimum of 10,000 truck drivers in 2 years.
This award was won amidst stiff competition from leading logistics companies in India like TCI Supply Chain Solutions, AFL Pvt. Ltd., Safexpress Pvt. Ltd., GATI Ltd., DHL Supply Chain, Schenker (I) Ltd. and Agility. This achievement is recognition of DIESL’s efforts towards seamless integrated logistics solutions.
Source: India Infoline