Some interesting statistics were discussed in the latest edition of MHD Supply Chain Solutions.

Before the pandemic hit Australians spent approximately $63 billion on domestic and international travel.

With domestic travel largely restricted and most international flights grounded for the foreseeable future, what are people doing with this spare cash?  Statistics show that a large portion of it is being spent online.

Christmas peak activity

What does this mean for this year’s peak shopping period? More people shop online now than ever before.

Australian households will be spending big this Christmas, according to recent trends in consumer behaviour.

Efficient, reliable and swift delivery are fundamental factors of any online shopping experience and this industry is innovating and investing at record pace to meet the increase in volume and demands.  Australia Post has been operating seven days a week since the corona virus hit. Staff are hired and trained continuously to cope with the demand.  3PL warehouses have experienced the same kind of spike in demand, naturally flowing into the freight forwarding and courier industries.

Dramatic increase in order volume

Volumes are likely to reach record levels this year.  Consumers are now very comfortable shopping from their lounge-room. A bumper Christmas is on the way, as surveys show that 34 per cent of consumers are planning to increase their online spending this year.  Retailers and logistics providers are about to be faced with volumes they have never had to deal with before.

Now, more than ever, we need the systems and processes in place to meet the increasing demands of our consumers.

Supply chain solutions

Sophisticated solutions in the supply chain are helping retailers, grocers and supply chain providers meet this demand.  You will start well behind the pack if you choose a 3PL partner that does not have a robust warehouse management system.

Consumer purchasing will drive the Australian economic recovery.   Supply chain and logistics plays an increasingly important and critical role in the nation’s future growth.  The activity in Promtel’s 3PL operation makes it hard to fathom the conflicting news stories recently as to whether we are in a recession.

Marketing wasted if logistics poorly executed

It might seem wise to spend a lot of resources on marketing; to have a beautiful website and a punchy message to your customers and potential customers.  However, if you cannot trust your supply chain and cannot guarantee that your customer’s order will arrive in full and on time, then your marketing is largely wasted effort.

If you have a product that you are selling online the best advice you could have is to partner with an excellent third-party logistics provider.  A 3PL can add so much value to your operation and help ensure your customer’s experience is pleasant, easy and efficient.

Bad news travels fast – a happy customer is potential advocate for your business

‘Our experience ensures your experience is a good one’.  That is Promtel’s mantra. In today’s digital environment no-one wants a disappointed customer .  Bad news spreads so fast.  Give yourself a chance to ensure your story is good news and your business has a happy customer.

This week at Promtel we unloaded an incoming container. It was a delivery of products for e-Commerce sales to consumers. What’s news about this? It is what we do for a living. What’s news is how it arrived at our warehouse.
The way the pallets were wrapped was so deliciously fabulous that I stood around marveling about it with my staff members. We were so mightily impressed! There were so many things to love.

The cartons on the pallets were all the same size

‘Not so earth-shattering’ I am sure you are thinking but hear me out.

The cartons fitted exactly onto the base of the pallet in neat configuration, 8 cartons per layer, right to the outer edges but not overhanging by one millimetre.  Where Australian Standard pallets are used this means we can easily load them onto our standard Australian racking.  This was true for every single pallet.

The cartons were layered alternatively to make a ‘brick wall’ effect, creating strength and stability.

Each carton had an easy-to-read label on the outside

The label displayed a colour image of what was inside and included a barcode and a stock code (more on this later) .**

The pallets were extremely well protected against damage in transit

The pallets were plastic-wrapped (not so good for the environment) but they used very little plastic (they are soon to switch to a bio-degradable alternative) because the packers had used recycled cardboard to enclose the cartons after they stacked them & before the plastic wrap.

This meant not as much plastic used (good).

When we cut the plastic off the pallet we were in no danger of damaging the cartons underneath (great – they were protected by the recycled cardboard).

All that equals – quicker (saving money for our client in receiving time).

The non-damage to the customer’s shipping cartons means that we will be able to re-use them to ship out orders – (also saving money for our client in packaging costs).

The pallets had even weight distribution

This was due to the pallets having consistent carton sizes.

This means a quicker, safer de-stuff (yes, that’s a word in 3PL land) from the container.

It means a quicker check against paperwork (or electronic advice) of how many cartons we should receive.  Even though technology drives most 3PL transactions, it is still necessary for a person to count the cartons.  Easy to do if they are uniform.  Not easy to do if cartons are all different sizes and packed in a non-uniform way onto pallets that are wrapped, making them difficult to see.

The stock inside the cartons was designed to fit perfectly inside each carton

What that meant for us is that we knew exactly how much space each product sku (Stock Keeping Unit) would take up on our picking shelves.

This is key to calculating what you will be paying for your pick-face space.

If you’re not shipping air you are saving money – a full carton is much more efficient to send than a partly empty one.

So much care and design had gone into each product code to make the use of space that it almost made me weep.

** Remember those beautiful, informative labels I mentioned?  Well, there was just one tiny little problem – there was only one of them per shipper carton.

Scanning guns can easily and efficiently scan barcodes.  They need a direct line of sight to the label.  Text adds another layer of ‘check-ability’.  If a human being can read text and obtain information, it can mean the difference between a job going right and a job going wrong.

With only one label per carton, it meant that we could not always see the label, nor could we easily scan it.  Two labels (one on each side of the carton) would have meant easy visibility no matter how the carton needed to be stacked.

These things may seem irrelevant or at best overkill, but they save so much time and as we all know, time is money.

The humble pallet

In Promtel’s warehouse it is king.  When storing goods at height in a warehouse, a good sturdy pallet is vital.

Some people regard the pallet as the single most important piece of hardware in the supply chain.  Almost every object in the world requiring transport will, at some time or another, be moved on a pallet.  Be it the strong sturdy hardwood variety of rented CHEPs and LOSCAMs, the plastic pallets often used for international shipping (no need for fumigation of timber on arrival) or the flimsy, single-use only-for-one-way variety, for movement of items around the world, pallets are a fundamental component.

Where did pallets originate?

The invention of the gas-powered forklift in 1937 strongly influenced the dominance of the ‘standard’ pallet, though standard is quite a loose term here.  Standardisation is discouragingly lacking when it comes to pallets. This is surprising given the abundance of global shipping,   There are no less than six different standards recognised by the International Organisation for Standardisation (ISO).  There are also the inches -v- millimetres contradictions in sizing and suitability.

Shipping containers are built to a US customary standard, 20 feet and 40 feet, but European pallets measure 1000mm x 1200mm.  Japan, on the other hand, has a standard 1100mm x 1100mm and then there is the Australian CHEP pallet, which is standard at 1200mm x 1200mm.  Throw in the smaller skids and various made-to-fit-the-product single use (or one-way) pallets, and you have a potential problem when attempting to maximise the quantity of products that can be loaded into a container for global shipping.

The influence of World War II

A major factor in the rise of the pallet when shipping goods was World War II.  For any military campaign to be successful, logistics cannot be overlooked.  Historians have long agreed that logistics was in fact the untold story behind most successful military campaigns.  The sturdy pallet played an enormous part in the world’s first truly global war, WWII.  Rick Le Blanc in Pallet Enterprise notes ‘the use of the forklift trucks and pallets was the most significant and revolutionary storage development of the war’.  Many millions of pallets were used, especially in the Pacific.  Goods were shipped almost exclusively in bulk, due to the long supply chain.

Norman Cahners, a sailor with the American Navy during WWII, invented the four-way pallet.  He was looking at ways to improve turnaround times for materials handling. Cahners’ design helped to revolutionize the shipping of supplies during WWII.  The new design, which was a relatively small departure from the original, doubled material-handling output by allowing forklifts to pick up pallets from any side.

During WWII many hundreds of thousands of US soldiers were deployed in Australia.  Another time I might talk about how that was for those soldiers, here to fight and die for us.  At that time our White Australia Policy was in place.  We were happy to have these brave men here.  However, our Government asked politely if they could please make sure that the black soldiers did not frequent the inner-city areas of our major capitals.  It might upset the (largely white city population of) locals.  Their commander, General Douglas MacArthur eventually came to Australia and took our Prime Minister to task about our dreadfully racist attitude. But I digress.  Pallets!

After the War in the Pacific was over the US Military left behind much of the equipment it had been using in Australia.  There were many forklifts, cranes and over 60,000 pallets.  The Australian government created the Commonwealth Handling Equipment Pool – CHEP to manage these resources.  Users rented the pallets and CHEP took care of maintaining, delivering and retrieving them.  This system is still in use today.

Maxing the Cube

Goods are shipped around the world in enormous numbers.  Changes in population growth and the rise of the global economy are largely responsible for the shift in the way humans expect to obtain goods. eCommerce is the new normal. This constant movement of items around the planet has led to the need to ‘max the cube’, or ‘make sure every square metre of space is filled’.  Thinner pallets now come into their own, but of course any pallet design change means changes down the supply chain line.  How can companies with thousands of standard racks, built for existing pallets, re-invent the way they store incoming products?  Retrofitting would be hideously expensive.  These are challenges that many companies now face.

Ikea

Two such companies are Costco and Ikea.  Both of these enterprises adjusted.  Ikea abandoned wooden pallets in favour of a low-profile system called ‘Optiledge’.  It is a system of cartons stacked onto little ledges with feet and held together with a giant band around the whole lot.  One of the many benefits of this system is that the little ledges fit to the edge of the carton being shipped, whatever size the carton happens to be.  No more requirement to make the shipping carton fit the size of the pallet.  The ledges themselves are for one-way shipping and are completely recyclable at the end of their journey.

A truckload of Optiledges replaces 23 truckloads of pallets.  That’s the great news.  The not-so-great news was that once the flat-packed items were delivered to the store they needed to be put onto metal shelving.  They could not be immediately lifted onto existing racking with a forklift.  Ikea stores were re-fitted with additional shelving at great cost to the company.  In Europe alone more than 500,000 new metal shelves were installed. The ongoing savings are significant and have justified the pain of change.

Costco

Costco has shifted to using ‘block pallets’.  These pallets are essentially an improvement on the ‘four-way’ pallets invented during WWII.  The pallet decking boards rest on sturdy blocks rather than long cross boards (these are known as ‘stringers’).  This makes the pallets even easier for forklifts.  They are also much easier for a person using a pallet jack, as there is no impediment (the stringers) to moving the pallet jack under the pallet at an angle.

Costco warehouse workers could not fit the long pallet jack forks into pallets if they were facing the wrong side.  They would have to twirl the pallet around (think of that scene in the Austin Powers movie with the golf cart trying to turn around in the tunnel).  When you consider that Costco staff members unload over a million trucks a year, you can see that small things can lead to enormous changes in efficiency.

Cost Effective Decisions – What price?

That, again, is the good news.  The bad news is that block pallets cost more to produce than the existing stringer pallets.  I have noticed that an inferior, one-way style of block-skid has begun to appear.  These skids allow for good approachability by pallet jacks and forklifts, but the ‘sturdy blocks’ underpinning the decking surface are anything but sturdy.  They are held together with staples, are made of some kind of spongy material and rarely survive beyond their journey in the container.  The outcome is that many businesses, including my own, are saddled with finding useful ways to recycle these now useless items.

Pallet redundancy?

The pallet may slowly lose its place as the necessary giant of logistics supply chains.  Changes are sweeping the world regarding how we shop.  We now order units into our homes in small numbers.  Bricks and mortar stores are on the decline and may no longer require pallet deliveries. This is sometimes known as ‘The Amazon Effect’.  The Internet shopping standard impacts supply chains in a big way.

So far, however, there is no evidence that global pallet usage is demonstrably on the decline.  I recommend reading Charles Fishman’s ‘The Walmart Effect’ to see what is happening in the USA with regard to bulk display and purchasing.  Let’s wait to see what happens as Internet shopping becomes more mainstream globally.  I believe we have even more interesting times ahead.

Website to warehouse is a new innovation now available with Promtel Pty Ltd.  Our team can get your eCommerce orders from your site to our warehouse management system, pick, pack and send your orders, then push the tracking information back to your site.

eCommerce – how it can work to your advantage

COVID19 has taught us all that we really can do things differently.

Many of our clients are rethinking their distribution channels and concentrating on an eCommerce mindset, rather than direct to store (DTS) as many stores no longer operate as they once did.  With the rapid turnaround required, the shift has been truly challenging.

Businesses previously sending pallets of stock around the country to stores are now selling direct to the public or providing drop-shipping type services for their retailers.  Sales are usually via an eCommerce website, but the challenge lies in accommodating and implementing the logistics after the sale.  Many business owners do not want to be spending time working on this part of their enterprise because it takes them away from what they do best.  Why not engage an experienced professional team to take care of it?

A 3PL solution makes good sense

This is where a third-party logistics (3PL) operator becomes a crucial and integral partner.  Promtel has the technology to allow you to plug your eCommerce site into the vast functionality of its Warehouse Management System (WMS).  The WMS manages your inventory, stock replenishments, expiry dates, batch codes, order picking, packing and shipping.

Your trusted 3PL can pick, pack and send your orders according to your specifications.  The 3PL has established relationships with various carriers.  They offer you their experience when choosing the best way to get your goods to your customers.

Mind the gap 

Promtel began work with IT professionals to solve the integration of website-to-warehouse black hole well before COVID19 suddenly changed everything.  We wanted to provide a professional WMS service that worked hand in hand with a top end retail eCommerce solution.  We identified the gap in the logistics and IT cycle and have worked hard to close it.

Identifying the danger zone

The process of turning a website order into a fully picked, packed, ready-to-ship parcel using the most cost-effective process has been the logistics and IT danger zone for many businesses.

Promtel’s IT partners have developed API integration with eCommerce platforms (Shopify, Magento and BigCommerce) including initial set up and testing, live freight rates (Shopify only) and integrated tracking information.  You have peace of mind and you don’t have to worry about skills shortages, training and redundancy.

How does it work?

In simple terms this is how it works:

1. Your stock is housed in Promtel’s warehouse
2. Each stock keeping unit (SKU) or product has a location, ready for picking. You can view your inventory online and download reports in real time
3. You have an eCommerce website, eg Shopify
4. Your customer orders and pays for it using your web-based online store
5. Our integrated software captures the order details in the back end of your website
6. Secure integrated software pushes the order details to the WMS
7. Our staff, using RF scanning, pick, pack and ship your order
8. Our WMS pushes the completed consignment information securely back to your website
9. Your branded communication from your website with shipping, consignment number and tracking details is sent to your customer

Adapting to the changes

Changes are happening quickly and universally.  Outsourcing this aspect of your supply chain is not only a good idea, but, according to KPMG, enterprises’ operations strategy is increasingly at odds with reality – particularly balancing cost savings and strategic investment priorities.  In plain English – it is not always cheaper or better to do things in-house, especially when it involves people being taken away from their core tasks to do jobs that they didn’t sign up for.  Also, the high cost of gaining and maintaining your own space and infrastructure to store your stock and process your orders can be out of reach financially.

This week one of our staff members had an unplanned day off.

A couple more were already away sick with the lurgy.  It meant that I was called on to work in an area that I don’t usually work in.  I was covering for one of our warehouse workers, including operating a forklift.

It is relatively easy to overlook the challenges that others face in their day to day jobs, as we become caught up in our own.

When we are asked to step in for someone else suddenly we are forced to see their tasks from their point of view.  The demanding question ‘But why can’t you just do this?’ (the thing that I want) becomes ‘Oh, I see that you’ve got this issue and that is why you can’t easily do what I have asked of you’.

Eyes are now open.  Empathy ensues.  Understanding dawns. Ideas formulate and are discussed.  Change is made.

HOW OBVIOUS IS IT?

It is easy to wonder why someone would do things a certain way, when it is clear to you that a different way is better/faster/cheaper/easier.  This ‘obvious’ change may actually not be as obvious as you consider it to be.  Perhaps the staff member in question does not have the same way of thinking that you do, or does not have access to the information you have, alternatively perhaps they simply do not feel that they have permission to speak up about a problem.  They may be just getting through each day and are not committed to the success of the company in the way that you are.

WALT DISNEY’S TEAMWORK

Walt Disney often attributed his success to the many talented individuals on his team:

“The whole thing here is the organisation. Whatever we accomplish belongs to our entire group, a tribute to our combined effort.”

Walt Disney

He was also onto a good thing when he made sure that his managers spent time selling Micky Mouse ears on the ground inside his Disneyland theme parks.  There’s a lot to be said for this approach.  If the managers are sitting at desks miles from the action, how can they possibly understand the challenges facing the sales staff who walk around the theme park and deal with Disney’s customers daily?

Walt Disney also had an exciting way of communicating his many ideas.  His enthusiastic explanations of his next new idea meant that he brought people along with him who were equally as keen.  Walt was known for helping to upskill his employees.  He often paid for further training and went to great lengths to nurture friendly relationships with his team.  In return, his staff members often worked long hours for no pay.  They believed in what they were doing and they loved Walt.  I hasten to add, I am not advocating this as a sound business practice, I am simply reporting what happened.

Walt loved innovation.  He produced Steamboat Willie, the first animation to have a synchronised soundtrack.  Another first was when he released ‘Snow White and the Seven Dwarfs’ in 1937 it was not only Hollywood’s first-ever full length animated film, he also pioneered movie merchandise.  For the release of this first animated feature, he had merchandise all ready for sale to coincide with the film’s premiere.

HOW DID WALT STAND OUT AS A LEADER?

Walt stood out as a leader in four distinct ways:

1. Innovation
   1. We keep moving forward, opening new doors, and doing new things, because we’re curious and curiosity keeps leading us down new paths.
2. Perseverance
   1. Disneyland will never be completed. It will continue to grow as long as there is imagination left in the world.
3. Risk-Taking
   1. All our dreams can come true, if we have the courage to pursue them.
4. 1. Implementation – The way to get started is to quit talking and begin doing.

 ‘You can design and create, and build the most wonderful place in the world. But it takes people to make the dream a reality.’

Walt Disney

A WORD OF WARNING

Too much of a good thing can sometimes be a bad thing.  By that I mean that being empathetic and listening to the way people see things is very different to adopting an ‘I always know best’ attitude.  Walt Disney, clearly one of the good guys, appeared to eventually get this part wrong.  He ended up as a sort of ‘know it all, seen it all’ kind of boss.

His leadership style changed and became autocratic.  This approach saw many people simply fired who disagreed with him.  He had a firm vision for his future and did not tolerate opposition.  His own unquestionable belief meant that he insisted all those around him supported him absolutely.

This of course meant that he started to miss out on the fabulous innovation from his people that had previously been enjoyed by his company.

 ‘When you believe in a thing, believe in it all the way, implicitly and unquestionable.’

Walt Disney

CHALLENGE YOUR BIAS

Back to the unplanned day off.  It may be a good business strategy to plan some ‘swap jobs’ days within your business.  Having to walk a mile in someone else’s shoes is a great way to shake your misconceptions around and keep you thinking.

We are willing, as a society, to regularly adopt new, time-saving technology and devices.  We put them everywhere; in the home, in the supermarket, in the workplace.  We love them.  What we don’t seem to appreciate or want to pay for is human work.

George Calombaris underpaid his restaurant staff for the physical work they performed, others have been accused of the same. Nannies in private homes are often woefully underpaid, even though they do what some might consider the most important work of all.  It is a similar story for carers of the aged.

What happened to a fair day’s pay for a fair day’s work?  Why don’t we want to pay for human labour anymore?

Human exertion must have an accepted monetary value and be paid for when it is done on our behalf.

It is not only business owners, it is consumers who overlook the value of physical work done by humans.  As we incorporate more and more technology into our lives I believe we are under-valuing the human physical exertion portion of our own personal supply chains.

Our shopping is done online.  Warehouses are full of machines and robots that select our goods and drones are delivering them to us.  Our business leaders are moving manufacturing/customer service to off-shore locations because labour costs are so much lower.  Labour costs are the number one ‘threat’ in predicting profitability for any business.

Business departments, employees and customers are continually demanding better and more integrated services in today’s tech-driven world. However, IT departments are facing the need to deliver more with less, and are struggling with legacy software that doesn’t easily allow for integration.  That kind of problem requires thinking, planning and innovation – in other words, time spent by a human.

Thinking about a human life-cycle.  Generally speaking it involves air, water, food, love, work, procreation and death.  At our basic level, humans don’t really ‘need’ technology.  We do, however, need to be physically active to maintain our health, get satisfaction from our work, derive pleasure from our interactions with others, and achieve emotional stability through our relationships.  Isolation is not a great thing if you are a human.  It has been used repeatedly throughout history as a form of punishment.

A good example of collaborative endeavour combined with physical labour is an Amish barn raising.  A barn raising is an Amish work event that combines socializing with a practical goal.  The barn raising fulfils a practical need and also serves to tie the Amish community together, reinforcing Amish society through a very visible expression of the principle of mutual aid.

A barn raising is a showcase of Amish planning, organization, and manual labour.  Amish tap into the social capital and goodwill in the community, mobilize labour and come together to erect a building which serves as a practical linchpin of their agriculturally-rooted communities.

The big take-away from the exercise is that only one family immediately benefits from the completed barn.  The work is done with genuine selflessness, with the small thought that in the future the participant may need to raise their own barn and may need help to do so.

I wonder if we have swung the technology pendulum so far that we would struggle in today’s technological world to ‘raise the barn’ as a team.

After all, our manual labour is worth so much.

Barcoding; save time and money for your business

How much do you know about barcodes from the perspective of a 3PL business, that is, using RF (Radio Frequency) scanning to receive stock as it arrives at the warehouse?

In this day and age, we are all very familiar with seeing barcodes on items.  I want to talk about their use and why they are so important.

We had a client once who sent us tiny plastic tubs of product paste which they sold in single units and also in a pack of six.  Each little tub had its own barcode printed onto the side.  Six of them were shrink-wrapped together, often with all their barcodes.  Two of the packs of six  were put inside a non-barcoded shipper carton.  It was uncanny just how often the barcode was not showing through the shrink-wrap when it came time to scan a six-pack for an order.  We had to destroy the shrink-wrapping to get at the tub to turn it around so we could get a line of sight to the barcode and then enter the quantity of 6 for the order.  Slowed us down so much!

Usually, the product or its retail packaging has the barcode printed onto it.  Putting your products inside a sealed shipper box when shipping your products to your 3PL partner,  can mean that scan-receiving is quite slow.  The 3PL staff members need to open the shipper boxes to retrieve your barcoded products to scan-receive them, taking precious time.  RF scanning requires a clear ‘line of sight’ between the scanner and the product (as opposed to RFID scanning, but more on that later).

Let’s assume that your shipper carton holds twelve of your barcoded products. The solution to the slow scenario above is to create an additional barcode that represents twelve of your stock items.   Printing this additional barcode onto the outside of your shipper carton means that when the shipper cartons arrive at the warehouse, the RF scanner shows a quantity of twelve every time the shipper carton’s barcode is scanned.

Even if you use unbranded, unprinted shipper cartons, if you liaise with your 3PL partner you can still save yourself a lot of time and money.  They can print the quantity barcodes.  When the cartons arrive they affix them.  This saves the need to open the shipper cartons.  It means an incoming pallet can go straight up onto the racks, and above all, it saves time.

So how do you get started in saving time? Glad you asked the question. Here’s a brief overview of how the system works.

The GS1 system

The GS1 system is a set of standards for the unique identification of all trade items, services, logistic units, consignments, assets, documents, relationships, parties and locations at every point in the supply chain.

It is very simple in theory and practice.

Depending on your annual turnover, you can get one barcode number or thousands.  You pay a yearly licence fee for your barcode numbers at the start of July each year. The fee depends on your turnover and the number of barcodes you’ve licenced.

There’s much more to the GS1 system than just barcodes. At its heart is an interlinked system of rock-solid standards to help you streamline your supply chain. These standards enable you to improve your business processes internally, through greater accuracy, cost efficiencies and readiness to market.

Did you know?

The beep of the GS1 barcode is heard over 6 billion times a day around the world.

Here is a link to GS1’s website explainer – I have also included some valuable information from GS1’s website.

There are many different GS1 ID keys.

There are different GS1 ID Keys to suit different uses. You can use GS1 ID Keys to identify anything from a product or place to a consignment note, pallet or crate.

Barcode Technology

Most businesses are familiar with the barcode inventory system as a means of managing and tracking stock inventory. In retail sales, the use of barcode also allows for swift checkout.  The bottom line is that these days, major retailers won’t accept your products if they are not barcoded.

Barcodes require the use of an optical barcode reader or scanner. The scanner decodes the barcode’s black bars, which generally represent a series of numbers. The decoded information is sent to a computer, which interprets the numbers. This information typically contains data regarding the manufacturer, the product, and, when applicable, the price.

To scan a barcode, it must be oriented properly and the scanner must have an unobstructed view of it. This is referred to as the line of sight. Without a clear line of sight, the scanner may be unable to read the barcode. This is one of the primary differences between a barcode inventory system and RFID, as the latter does not require a line of sight.

RFID Technology

Radio frequency identification or RFID technology reads information by using radio frequencies as opposed to an optical laser. RFID inventory management systems require tags and an RFID reader.

Each RFID tag contains a microchip that holds information about the item to which it is associated. The most widely used and inexpensive tags, passive ultra-high frequency (UHF) tags, typically will only contain a basic identification number; other RFID tags are capable of holding up to 8 KB of data, anything from price to colour, manufacturing date, shipping date, expiration date, maintenance history, and more. Each tag includes a radio antenna that allows it to receive signals from a reader.

In a passive RFID system, the reader, which also has its own antenna, sends out radio signals that activate tags that come within range. Readers receive the signals that are bounced back from the tag and are able to capture the unique identification information about the item or asset. In some cases, the reader is also able to write or encode information directly onto the tags. Software on the reader is then able to pass information about the item information to an organization’s back-end systems.

Lastly some information on the meanings of common terms:

• GS1 – this is the name of the not for profit organisation that develops and maintains global standards for business communication.
• GTIN – Global Trade Item Number. This can refer to the EAN, UPC or other standard codes.
• EAN – European Article Number (a barcode standard, 12 or 13 digit product identification code). This is the usual standard barcode used in Australia and the rest of the world, except for USA and Canada.
• UPC – UPC barcodes are 12 digit barcodes and are used exclusively in the United States and Canada. You can convert from UPC to EAN, but not the other way around.

Statistics can be a little tedious, but sometimes they tell an amazing story.  For example, Americans spend more than $30 billion a year on dietary supplements — vitamins, minerals and herbal products, among others — many of which are unnecessary or of doubtful benefit to those taking them.  There is little or no documented evidence that they have any positive impact on health.

Statistics also tell us what the main killer of people is worldwide.  It is ischaemic heart disease.

And then there’s that cute little quokka.  Did you know that the statistics tell us that the females only stay pregnant for one month? They can have babies twice a year!

But I digress.  Statistics also tell us that over 85% of Fortune 500 companies utilise 3PLs, and the industry is still predicted to grow by at least 5.2%.  If they think it’s a good idea, maybe you should too.

Here are my seven tips.  Consider them if you are thinking about your supply chain.  If you’ve got a product and your customers are ordering it, you may want a few insider insights into why a 3PL partner can be a really good idea.

1. It saves you time. – What a great thing this is. You’ve probably all thought of a dozen things you could do with more time already.  You could concentrate on your business and increase your input into its core competencies.
   1. You can eliminate the need to invest time and money in warehousing bricks and mortar, transportation, and the staff required to execute the logistics.
   2. You can also leave the logistics paperwork, billing, stock-takes, stock management, training and HR management as this is the area of expertise for 3PLs.
2. It offers scalability and flexibility – Businesses become more flexible due to a 3PL partner’s ability to scale space, staff, and transportation according to inventory needs.
   1. There is no need to stress about high and low seasons, whether you have a loading dock or can unload a container, as transitions can be handled smoothly.
   2. If a business needs more space, a 3PL provider is just one phone call away.
3. It makes valuable expertise accessible – 3PLs are knowledgeable about the best practices in the industry, and all that knowledge and experience is available to you.
   1. To gain an edge in a competitive market, 3PL providers stay up to date with the latest developments in technology. The software that good 3PLs use is capable of advanced reporting, inventory management and provides visibility to enable you to monitor the entire logistics process.
   2. By outsourcing your logistics requirements to a 3PL, your management team can focus more on its core competencies while your logistics needs are being handled by industry professionals.
   3. The 3PL team is accountable and becomes a partner supplier with risk in the transaction. If your 3PL partner lets you or the customer down it risks losing your business.  This is a compelling argument for excellence.
4. It encourages continuous optimisation –3PL providers are masters at coping with change.
   1. These organisations can adjust quickly in various circumstances.
   2. 3PLs can also improve most links in your supply chain.
   3. They ensure that your needs and those of your customers are met in the fastest, most efficient and cost-effective way.
   4. 3PLs can help maximise profits, reduce wait times, and improve customer satisfaction.
5. It maximises your growth rate- By utilising a 3PL provider, you can save time and money.
   1. This directly affects the growth of your company.
   2. 3PL providers have warehouses in strategic locations.
   3. With this benefit, businesses can expand their market with minimal change to transport and delivery costs.
6. It improves quality – Outsourcing to a 3PL provider ensures that you have more capital.
   1. The advanced technology and expertise that comes with 3PL providers also guarantees that your logistics needs will be satisfied.
   2. Since 3PLs thrive on efficiency, you can expect numerous aspects of your supply chain to improve as well. Volume discounts, flexible staffing, flexible space – all part of the job for 3PLs.
7. It improves customer service – With the cost of acquiring new warehouses and new technology eliminated, your business can now focus more on customer service and innovation.
   1. You can be sure that your customers will be happy with the improved quality and depth of your operation.