Just-in-time solutions support production operations to remain more efficient, cost effective and customer responsive. Look at some of the key developments in this service which are becoming crucial to a wide range of industries. Namrata More...
Logistics companies are coming up with customised solutions that allow manufacturers to synchronise with suppliers in support of production line demand. “We see growing demand for 3PLs to provide just-in-time (JIT) solutions in Asia as land costs increase and retail outlet rental costs continue to rise in major cities across Asia,” said Amit Dhingra, director operations at Menlo Logistics. Menlo provides a range of JIT solutions across multiple industries. “In India we have a strong presence in the automotive industry providing time-critical components to assembly lines and spare parts to distributors.” Menlo Logistics expanded its automotive logistics operations in India, moving to a new after-sales spare parts facility in Dharuhera, near New Delhi in Haryana state. The 3,846-square-meter facility is managed on behalf of a global brand-named client and is situated in an original equipment manufacturers (OEM) cluster including Manesar, Neemrana, Bhiwadi, Bawal and Dharuhera. The facility is well connected to the highway network and has easy access to Delhi International Airport which is 66 kilometres away. In India, Menlo also has a presence in the medical equipment sector providing hospitals and medical centres with a broad range of equipment essential to the care, treatment and well being of patients. The food and beverage sector is also one of the various verticals where Menlo provides its JIT expertise. In Thailand Menlo provides daily replenishment of a range of fresh produce, as well as chilled and frozen products, delivering to over 100 stores across Bangkok as a major global brand. “Pressure is building to reduce inventory levels particularly in the luxury brands and F&B sectors, this will provide greater opportunities for 3PLs like Menlo to expand its business,” added Dhingra. With a growing demand from customers to reduce their own inventory levels and maximise production or retail space, Menlo has developed a highly effective system called Lean, to deliver a range of time critical solutions across the supply chain. Lean is a process that produces material savings that flow directly to their bottom lines. By understanding customers’ changing requirements, Lean develops innovative strategies for shortening lead times and reducing costs. Menlo’s Lean process starts with Value Stream Mapping (VSM), a tool used to establish customer’s goals. Then, Lean as a process can help optimise the supply chain by reducing inventory. A global engine manufacturer needed a Lean-focused 3PL that could seamlessly warehouse and ship its complex, SKU-intensive inventory of products and parts. The chosen supply chain provider had to demonstrate ingenuity and an unwavering commitment to continuous improvement. Applying a two-way exchange of Lean concepts, Menlo has generated a multitude of kaizens (the practice of continuous improvement) for the customer — many of which were innovations developed by line employees. Earlier this year, UTi Worldwide and Changjiu Logistics, an independent automotive logistics company in China, came together in a strategic partnership. The partnership between UTi and Changjiu Logistics will serve the logistics requirements of global automotive OEMs and suppliers in the booming automotive market in China. "We are very excited about this partnership," said Ed Feitzinger, UTi CEO. "Our clients are very interested in what UTi and Changjiu Logistics can do together and we are committed to make this a successful partnership." He also noted that UTi and Changjiu Logistics possess complementary strengths and many cultural similarities, especially a focus on client service, which will enable their joint success. Bo Shijiu, board chairman, Changjiu Logistics, said, "The partnership with UTi will give Changjiu the strength to develop international business with multiple-modal transport service as well as to enrich client bases and company comprehensive capability." Ditlev Blicher, UTi president, freight forwarding, said, "Our strategy is to develop an inland transportation system for both component milk-run and finished-goods deliveries utilizing UTi's solutions and best practices and Changjiu Logistics' strong trucking and warehousing capability in key automotive manufacturing and industrial centres in China. These areas offer a critical mass of Auto clients for OEM/Tier 1 and Tier 2 and are key clusters for UTi and Changjiu Logistics to focus on together." Blicher added that three areas of joint development are planned: railway solutions between Europe and China, VMI/production logistics for automotive OEMs and Tier 1s, and aftermarket parts and accessories distribution. CEVA Logistics announced the launch of TireCity in Italy. The hub, which covers an area of 50,000 sq m. is strategically located in Somaglia, in the province of Lodi, and is fully dedicated to the warehousing, handling and cross docking of products in the tire sector. TireCity, is the fourth sector-specific hub to open in Italy. CEVA believes that the future of supply chains in Italy is focused on a collaborative approach: sharing infrastructures, networks, people and processes through sector-focused multi user hubs, enabling customers to face market fluctuations, benefit from savings and receive high service levels. "We have decided to create a new sector-focused multi-user hub dedicated to the tire sector, to continue to drive additional value for leading companies in this market, both existing and future customers,” said Giuseppe Chiellino, CEVA’s managing director, Italy. “This hub is also the beginning of a strategic course of growth in the automotive sector in Italy that starts from tires as a key and vital element for vehicles such as cars, motorcycles and industrial and agricultural vehicles," Chiellino stated. "In the current economic climate, CEVA’s collaborative approach can be an opportunity for innovative processes, improving supply chain responsiveness to meet user demand and reducing costs." He added. "The launch of TireCity reinforces CEVA's leading presence in the Italian logistics market and accelerates our growth in the tire and automotive sector, by offering distinctive and unique logistics solutions, customized for single category of products," said Alberto Scagnetti, Vice President, Contract Logistics General Manager for CEVA in Italy. "Thanks to our operations excellence approach and relentless focus on impeccable standards, CEVA will be able to further invest in technology, competence and people, in order to meet the increasingly sophisticated needs of our tire customers and ensure efficiency and speed throughout the entire supply chain," he added.
Increasingly, logistics companies are coming up with customised solutions that allow manufacturers to synchronise with suppliers in support of production line demand. These solutions, now being backed by strong IT systems, are useful for retailers, restaurants, and convenience stores, ensuring fast-moving items are replenished as required.Take the case of Accenture, which has successfully completed a large-scale supply chain and inventory management transformation project for the Russian operations of Leroy Merlin, the leading do-it-yourself (DIY) retailer in Europe.Accenture designed a solution that aims to improve the efficiency of Leroy Merlin’s Russian enterprise logistics system by creating greater transparency of supplies and more accurate and reliable calculation of inventory costs based on management accounting and International Financial Reporting Standards (IFRS). The solution will help Leroy Merlin eliminate discrepancies in inventory valuation and automate a variety of manual processes used to manage its supply chain operations across three of its distribution centres, serving 28 stores in 16 Russian cities and offering a combined product catalogue in excess of 35,000 items. “Our primary challenge involved connecting the components of our demand and supply planning and fulfillment operations to gain a clearer view of product availability and to develop a more reliable, time-to-shelf system that is speedy and cost effective, improving customer service,” said Bernard Barfety, operations and IT director at Leroy Merlin Russia. “To achieve our objectives, we needed a solution that would enable us to capture and analyse dynamic demand signals across multiple channels, supply networks and fulfillment locations, and Accenture, drawing on its extensive experience, has helped us navigate complex IT, business processes and supply chain transformation considerations to develop our new system.” ASAP Systems, popular for online inventory management and asset tracking market, recently introduced its new stock inventory feature that includes an alert functionality for when inventory levels are too low, too high, or out. Now users have a powerful communication tool at their disposal to track the rise and fall of stock levels from anywhere, at any time. With the new feature, users have the ability to set minimum and maximum inventory quantity levels. Once inventory levels reach either of the set quantities, the system sends out an alert via SMS text and/or email. Those alerts are configured by the users and can be sent to selected personnel. This information helps BarCloud customers avoid inventory shortages or overflows, both of which hurt sales and their bottom line. Previously, BarCloud users could only set up alerts to track asset activities. Now users can set up both stock inventory and asset alerts so that users have more complete systematic control. The end goal of the new feature is to give managers the visibility needed to make important decisions regarding the status of their inventory and assets when they are in or out of the office.“By allowing our BarCloud customers to create their own alerts, our users have the ability to send their decision-makers critical information in real-time by leveraging their smart devices,” says Elie Touma, CEO of ASAP Systems.Ultimately, ASAP Systems has made the process of maintaining cost-effective stock inventory levels easier for its customers. All types of warehouses and storage infrastructures can utilize the module to build a more complete inventory management and asset tracking system. New expansions have been taking place. Yusen Logistics, a global third-party logistics provider, announced the expansion of its operations in Russia, with the opening of an office at Togliatti. Home to one of the world’s biggest automotive plant – the Renault Nissan AVTOVAZ assembly plant – with more than 86 miles of production lines and the capacity to produce over a million cars per annum, Togliatti is at the very heart of the Russian car industry.The surrounding area is also of vital importance, with more than 800 first and second tier suppliers located within a 124-mile radius, including Ulyanovsk and Dimitrovgrad.“We are seeing major increases in demand for high quality supply chain solutions for the automotive industry and this new office at Togliatti represents the next step in our development to serve this key sector,” says Dennis Pastukhov, commercial director, Yusen Logistics Russia. Yusen Logistics is offering the following logistics services to the domestic automotive market in Russia:Road freight to and from Togliatti;Air freight services, including final mile solutions; Inland port bonded and non-bonded transit operations; and Cross docking and distribution services. Yusen Logistics is also offering international line haul solutions including:Ocean freight forwarding via Novorossiysk, St. Petersburg, Nakhodka and the Baltic states including Finland;Air freight solutions via Moscow and the Samara region, centered on Kurumoch airport, 37 miles from Togliatti; and road freight services via Moscow and Smolensk.Main gateways to serve Togliatti are Moscow for internal flows and Novorossiysk, the Baltics and Finland for import traffic.The new operation builds on Yusen Logistics’ current infrastructure in Russia, where the company operates 11 sites, including 322,917 square feet of warehousing, container sites and a fleet of trucks and container chassis. Some time back, CEVA Logistics, one of the world’s leading supply chain companies, announced the renewal of its contract with MANN+HUMMEL to 2017, one of the world’s leading experts for filtration solutions for the automotive and mechanical engineering industry. Since 2002, CEVA has exclusively operated the central warehouse for MANN+HUMMEL’s automotive aftermarket parts in Niederaichbach, which is located close to their production site in Marklkofen. The continuous growth of MANN+HUMMEL made an extension of capacities necessary and the new building with 17,000 sq m of space directly borders the central warehouse and is linked by a passageway. With the groundbreaking ceremony in August 2013 and the expected completion of the new site in 2014, the warehousing space will double to 34,000 sq m and will enable gains in efficiency by providing more room in the current storage area as well as capacity for future growth. Thomas Mangold, director logistics automotive aftermarket and manager of the central warehouse in Niederaichbach for MANN+HUMMEL, said: “By outsourcing the warehouse management to CEVA, we have significantly gained visibility and flexibility in our supply chain. Companies dependent on Just-in-Time solutions have to react quickly and agilely to short term changes, which is dependent on new solutions. Despite the downturn, the automotive and aftermarket sector will continue to innovate to achieve optimized inventory levels, taking growth rates and seasonal fluctuations in account, allowing them to offer a supply service of the highest level to the end customers.