Having
worked in the returnable packaging industry for over 30 years , I have come across a number of challenges that face
the global supply chain across a number of industries. In recent years these
challenges have both increased and intensified.
Here are
10 key areas that I believe need to be addressed in order to ensure that a supply
chain is performing for your business.
Space
Utilisation - in
a global supply chain space = money. Making the best use of space in containers
is essential to increase value for money whilst reducing costs at the same
time. Packing as many units into a container increases value for money and
reduces the amount of containers required. Increased space utilisation has
always been an area that the supply chain has strived to improve, this has increased in
importance as supply chains are now on a global scale and more items are
required in more locations at a higher frequency than ever before.
Reducing
damages & higher quality standards - the need to reduce the cost of damages to
parts during transit in the automotive industry is paramount. The margin for
error is now virtually nil. Achieving this target is down to the quality of
your packaging. Expendable packaging is commonly used through the supply chain
which is not the sturdiest of materials especially when transporting heavy
parts in a Global Supply chain. This type of packaging is susceptible to
collapse when exposed to moisture. Container rain is a common issue with cardboard collapsing when being transported across a number of continents with
varying climates resulting in damaged goods. Damages are both a monetary and
time cost. Solid returnable packaging delivers on all of the quality
requirements, therefore helping to reduce costs.
Reducing operating costs -
as supply chains become ever more complex and increase in size, keeping a lid on
the costs of a global footprint is key. Increasing overall efficiency and
sustainability are top of agenda. Reducing the reliance on expendable packaging
can help to make a huge step towards reducing costs, expendable packaging has
been used for decades but now it is increasing becoming less viable. Looking
towards other alternatives is now a necessity - returnable packaging is a
cheaper more viable option that provides sustainability over a number years on
a global scale. Reducing the costs in a supply chain can have a direct effect
on your bottom line, so with returnables available on a Global “one trip”
rental basis, through poolers, then target costs can be met.
Safety standards -
health and safety is now a huge part of the working life and improving safety standards
in the supply chain is constant. Containers and packaging now play a role in
helping to improving health and safety. Earlier in this post I mentioned the
risks of using expendable packaging; if stacks are collapsing or weakening
during transit this presents a significant risk when they are being moved and
unloaded. Returnable containers are designed with interlocking feet and rounded
edges, ensuring they can be stacked safely when in use and reduce the risk of
catching on clothing or people.
Increasing awareness of pooling companies - investing time into looking at the benefits
of using a pooling company is something I would advise all businesses to do. I
have seen how partnering with a pooling company can help to reduce costs,
improve efficiency and transform the performance of a supply chain but I find
that a lot people in the industry have ignored poolers so far and simply don’t
realise how they can help you. With the pressures of a global supply chain,
renting containers from a pooling company and employing their services to
transport your goods across the world solves a lot of headaches especially when it comes to costs and
responsibilities.
Need
for standardisation -There is a huge need for standardisation in the global supply chain as I have mentioned several times already and I am
going to bring it up again. Moving to a global standard footprint especially in
the automotive supply chain would make everyone’s life more easier. Agreeing on
a global standard for returnable packaging will remove all of the problems that
OEM’s and tier suppliers currently face when moving components across several
continents and countries. One packing size and shape may be ideal for being
transported around Europe but may not be the most viable option once it reaches other
continents. If there is a standardisation, value for money increases, larger
quantities of goods can be transported quicker and it improves the overall
supply chain.
Space Utilisation (Storage) - As we see more parts/ components being required in multiple
locations at a higher frequency means that storage and space is now more
important than previous years. Tailoring your supply chain to improve
performance at every stage even includes warehouse storage - saving space means
saving money whilst at the same time improving safety. Using containers that
can be safely stacked at height can save a considerable amount of floor space,
allowing your to store more components at any one time. Also storage when not
in use is a consideration that needs to be factored in - solutions that nest
neatly and safely helps to reduce risks and costs again.
Reduce handling -
within the automotive industry reducing the amount of times that the people
come into contact with parts is an ever present target. This helps to again
reduce operating costs which have a direct impact on the bottom line, reduces the
risk of damages and makes the process a lot smoother. In an ideal world, OEM’s
would like a part to be placed into a container and not touched again until it
reaches the assembly line. In order to achieve this target, a standardised
container is essential due to the global footprint which complies with the
requirements in order to be allowed to go line side. Expendable materials
cannot do this; the attention then turns to plastic returnable packaging.
Part
protection - using fabric dunnage within your returnable packaging
solutions helps to maximise the pack out of the container, but more importantly
protect the contents. As I have mentioned above, parts and components are being
shipped in larger quantities across larger geographies therefore there is risk
of damage. Using fabric dunnage specifically made to order, ensures that the
contents of the returnable packaging solutions arrive at the line side in the
desired quality. This helps to reduce replacement costs and reduce hold up time
spent in the assembly process.
Keeping
up-to-date with returnable options - returnable packaging is an area which
is constantly changing with the rapid developments in design and manufacturing innovation.
In the automotive manufacturing and supply chain industry it is surprising the
amount of people are unaware of the different types of returnable packaging and
the benefits. Therefore, my final tip for people in the automotive industry is
to keep up-to-date with developments to the returnable packaging options on the
market as you may be missing a big opportunity to make savings to your bottom
line and drive up the performance of your global supply chain. It is important to seek the correct advice
from the right people and when consulting from a Packaging Supplier this can
be biased towards their products - ALWAYS
seek an independent consultant
