Logistics Manager Analysis; Adapting to a new age

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2020 saw an explosion in online orders as demand for e-commerce grew exponentially. With it, came a rise in packaging use for outgoing orders and also returns. The need for efficient and sustainable packaging has never been greater. So can retailers keep up with the demand, while streamlining their packaging use? Michelle Mooney investigates the latest packaging technology trends.

Thousands of online retailers have had to completely transform their operations since the huge demand in orders exploded. Transformations happened throughout the entire supply chain, including warehousing operations, logistics, and of course, packaging and packaging technology. David Ashwell, managing Director of AO Logistics agrees, and says that the demand has led to an array of transformations. He says: As well as growing our network to 24 depots across the country, we’ve increased our warehousing space to over 1.3 million sq ft. With so many customers turning to online to shop for their appliances during lockdown, we made swift decisions to invest in new infrastructure and technology while maintaining high service levels for customers.”

Do not overlook the importance of data

So how have retailers and packaging providers managed to keep up? The answer may lie within their data usage to utilise performance, agrees Craig Turner, Managing Director at Southgate Packaging. He explains that by utilising data, a company can gain valuable insight into a packaging operation, and therefore can enhance its performance. He says: “Sophisticated data analysis can provide gained insights and enhance performance. For many of Southgate’s customers, data is now increasingly becoming a key factor when making any packaging decision. Used strategically, it can completely transform performance and help businesses to stay successful and competitive.”

By utilising the data correctly, a retailer can significantly limit the amount of waste they produce, while also saving on costs.

Turner adds that Southgate Packaging reduced the costs one particular client had, by analysing the type of packaging they were using. He explains: “Last year we collated the data on usage for a furniture retailer, in metres of plastic tape and price per roll, adding in the time taken for a packing operator to seal the carton. We advised switching to water activated tape, which reduced the time per carton from 34 to 27 seconds and the average length of tape per carton from 5.1 to 1.5 metres, resulting in an annual saving of 17 per cent on packaging tape costs.” Clearly, taking advantage of the available data ac company has, they can upscale their operations, while limiting costs and packaging waste. And after the sudden surge in online orders throughout 2020, and no doubtable, 2021, data will be one of the key factors at the forefront when streamlining packaging use in the supply chain.

Elizabeth Sheaffer, Global Communications Director at beverage multi-packaging company Hi-Cone, adds that data can help to create a “circular economy” in the packaging world. She explains that in the linear economy model, “resources are drawn upon to create products which are used and then generate waste.” This creates a throwaway culture that invariably leads to more environmental damage. Sheaffer explains that by adopting a circular economy model, “reuse and recycling are at the heart of keeping products and materials in use.” To help arrive at this kind of model, manufacturers and their customers, says Sheaffer, “must use data to help them see the complete product life cycle.” This will mean taking into account carbon emissions throughout the supply chain, such as energy used, as well as “recyclability of the final product.”

Automate your way to greener efficiency

The next step to consider, is how automation can lead to efficiencies in packaging. Mark Patterson, Vice President of Global Packaging at DHL discusses the impact automation can have. The surge in e-commerce has of course led to a rise in the amount of packaging needed to fulfil orders, and automation might be a practical resolution for this, suggests Patterson. He explains: “Collaborative robots are currently being used in packaging operations, along with quick setup palletisers, box erectors, void reduction technologies and box on demand equipment. However, to maximise the benefits here it’s likely that more innovation will be required to ensure packaging designs themselves are optimised to be handled by automation.” Alan Potts, Head of Innovation and Design, DS Smith explains that with automation, comes challenges, however, the reward for using an innovative automation process is great. “Automation can play a key part in meeting such a need – delivering positive returns, often by improving manufacturing cycle times.” Potts says.

There are plenty of automated products on the market, says Turner, from “Packing stations equipped with tape and void fill (secondary packaging materials, used to fill excess spaces inside a container to protect the product from damage during delivery or shipping) packaging dispensers, integrated with conveyors, automatic strapping machines and case tapers.” All of which can help to make the average packing operation, a “speedy process”, he says.

Optimising packaging through the latest technologies

The use of technologies like cameras and vision software, have increasingly helped to reduce errors, and therefore eliminate waste in the supply chain. Potts agrees, and says that using such technology helps to reduce “costly mistakes”. He says: “The current manual off-line quality routines are now becoming automatic, providing 100% product inspection capabilities. New closed loop systems offer the ability for machine systems to self-correct, which allows for a higher degree of quality performance and compliance.”

There have also been several improvements in the internal supply chain, as an expansion of new technologies has provided greater visibility of packaging products. Potts agrees: “We are able to encode our products with digital marks and data which can be re-read via image processing software, allowing for the auto setting of downstream production processes. This provides a greater accuracy and performance, reducing setting times and removing human mistakes and errors.”

There are all sorts of technology initiative available in the production of packaging, as Turner explains that there are infrastructure options which include “collapsible crates with integral RFID technology, where the assets can be used time and time again, whilst traceability enables asset management accountability and loss prevention.” Most importantly is how manufacturers and retailers choose to utilise technology to help scale their operations.

So what has 2020 taught packaging specialists?

 The obvious trend we saw in 2020, was a sudden surge in orders as people were asked to stay at home. The convenience of online shopping led to even more packaging, so what have packaging users learned from this peak? Scaling operations up simply is not enough, says Gurdip Singh, CEO of Kallik, he explains that “scaling up manual and ‘traditional’ packaging processes will not be sufficient to satisfy consumer demand.” Rather, there needs to be a focus on automating “as many processes as possible”, to help ease the burden being placed on companies by the current demand, he says. Adding that adopting cloud-based operations that are “already certified and validated compliant with national and global regulations will ensure businesses can deploy the latest technology without fear of extensive in-house testing, integration and certification.”

Importantly, retailers need to consider how to create a sustainable supply chain, while also scaling up operations to keep up with demand. Failing to consider sustainable options, and failing to aim for a circular supply chain, will bring a cost not only to the company itself, but more importantly to the planet. Potts explains that DS Smith has seen a trend among retailers to “rationalise” their packaging: “Whilst offering “right-size” and “multiple-size” packaging, using no more material than necessary and enabling effective transport.”

Potts adds that one of the main concerns in 2021 will be how to manage returns sustainably: “A key area in 2021 will be the evolution of ‘the last mile’, with new delivery options and an increasing need to have packaging being fit for purpose. In several high-volume categories, a big challenge is around managing returns.” With consumer interests evolving so quickly, it will be essential that retailers keep up with changing volumes, while also managing the amount of waste they produce.

Admittedly, many issues with previous supply chain models were highlighted during the first lockdown, and some retailers were simply not ready for the sudden surge in orders, despite there being a steady upward trend in online buy over the last couple of years. What retailers, manufacturers, and packaging experts need to do now, is be prepared for the new era of buying. Online orders do not look set to slow any time soon, especially as the pandemic has highlighted the ease of shopping from a computer or cell phone. Scaling up operations, and keeping up with the speed at which some of the online giants deliver orders, while also scaling back on the amount of new plastic in the supply chain, is going to be essential. Turner agrees and adds that “With the demand growing at the rate it has, packing operations are failing due to the lack of speed and agility required to satisfy orders. Ensuring the right size cartons are used, filling with less void fill, means more parcels can be processed.”

Clearly 2020 was a wake-up call for packaging suppliers, and more needs to be done to incorporate technologies like automation and data analysis, which will not only speed up operations, but also help to scale supply up in line with demand. Technology will also help to create a circular packaging supply chain, where less waste is produced, less new plastics are introduced, for a more sustainable operation.

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