Amid rising demand for logistics services, the logistics sector is under ever-increasing pressure to achieve greater throughput and enhance efficiency – but without incurring more costs.

SICK Automation National Sales & Marketing Manager, Prishan Chain, sheds light on the ‘hidden factory’ within the logistics business. He identifies some of the inefficiencies that hamper business growth, and offers potential solutions that could unlock hidden potential for greater throughput and profit. He also explores the solutions of the future, discussing global trends. 

Many South African logistics companies have humble origins: it’s a story of a man with his truck, moving parcels. There’s usually a period of rapid expansion, prompting the business to assess its operations and identify how better to optimise them. With good reason: the freight and logistics market is estimated to generate a turnover of over R20 billion in South Africa *, and is growing fast. More than ever before, consumers are taking advantage of e-commerce platforms to shop without leaving their couch, and have goods delivered directly to their homes. Reverse logistics, too, are on the rise, as customers return goods that were incorrectly dispatched, were the wrong size/shape/colour, or were damaged in transit. 

The question for our ‘man with the truck’ is how do you achieve steady, sustainable growth, without snagging on the inefficiencies that undermine productivity, efficiency and growth? The answer is smart sensors and automation products. They present effective solutions in overcoming hidden inefficiencies across the logistics industry. 

At SICK, we’ve identified key inefficiencies that inhibit growth in the logistics industry. Each can be resolved with smart sensors, automation and clever design thinking. 

 4 common logistics inefficiencies:

Poor traceability or a supply chain that hasn’t negated losses and theft

Theft and associated losses present a major challenge for the logistics industry globally, undermining profits. Not surprisingly, parcel traceability and security are among the major drivers for demand of volume measurement sensors and barcode readers, which enable more efficient track-and-trace operations. 

The development of the security seal presented the industry with another tool to identify and prevent theft. The seal is, essentially, buff tape with a highly reflective quality. It enables the logistics service provider a means to identify and prevent possible theft.  

However, the security seal identification process might hamper productivity, if it’s not optimised and automated. While many logistics operations already have the existing hardware in place, the adoption of software upgrades required for the hardware to “read” the tape, is slow. 

The software upgrade simply makes it easier for existing conveyor cameras (which read barcodes) to automatically spot the security seal and determine whether it’s been tampered with (without slowing throughput). This yields a reduction in inventory losses which, in turn, means a reduction in shrinkage costs. It’s also beneficial that the software captures all the data in a digital format, accessible via digital platforms. This provides business owners with reliable and accurate insights that can enable further optimisation. 

In businesses that already have a high level of automation, technology upgrades such as these may have little bearing on profitability or throughput. Instead, the technology improves revenue recovery – increasing billing accuracy – and may improve safety and handling of product. 

In the pursuit of efficient operations, logistics businesses invest in technology and solutions that streamline and optimise processes. But to achieve true optimisation, the technology applied in different sectors of the business should interconnect. 

For example, warehouse management control software allows businesses to track every movement of every package. The software is programmed to understand how much space is available on each shelf, how much space each volumised parcel occupies, and whether another parcel will fit in front of or behind that parcel, on said shelf. Many of our high-end customers are using this software to optimise their storage space facilities and to pack or pick product more intelligently. 

SICK’s Localisation solutions, such as the Tag-LOC System, enable this connectivity. The Tag-LOC System is a hardware device that works alongside traditional vehicle trackers to collect vehicle data. With no monthly or annual subscription fees (only a once-off capital investment), this hardware device can be removed and refitted to other vehicles or tracking systems with ease. It can be connected to the warehouse management control software, giving business owners an umbrella overview of their operations and any challenges as soon as they arise.

Expansion instead of optimisation

Expansion is one way to grow – securing more warehouse space or adding to a fleet of vehicles. But the scope for expansion has limits and adds to business costs (increased spend on warehouse lease or increased vehicle maintenance costs, for example). It’s favourable to optimise an existing business, securing greater efficiency using current infrastructure. This may be through smarter conveyor and warehouse design, for example, which allow for handling of greater volumes without the need for larger warehouses. 

Another good reason for warehouse owners and manager to consider using SICK sensors in their operations is that smart sensors enable automation. It’s about putting accurately volumised and measured boxes not only on the correct shelf but also in a precise spot on that shelf, that picking and packing are more efficient (and productivity is maximised). Sensors eliminate human error, too. 

Sensor options include:

RFID tags on boxes for traceability within the warehouse, to ensure they’ve been moved or deposited in the correct location.

Sensors (e.g. Pick-to-Light from SICK) control access and stock removal, indicating where product or boxes should be picked from during the packing process. This prevents mix-ups or missing items, while optimising traffic through the warehouse.

Something else to consider when reviewing optimisation solutions is reverse logistics. Ensure your conveyor systems and warehouse can run in reverse, too, to accommodate this if necessary (e.g. if your warehouse processes product returns). 

Neglecting safety 

Let’s address the misconceptions surrounding safety: that safety measures don’t deliver ROI, and that they hamper productivity.

Safety measures don’t demonstrate ROI in the short term. But they do prevent injury to personnel and the losses resulting from damage to product or property. Therefore, over the medium- to long-term, safety measures add value to the business by negating the losses/damage. Additionally, a safer working environment is a key indicator of employee satisfaction. 

Safety solutions also enhance productivity. Consider that a breach in safety protocols may result in a processing halt, negatively impacting productivity. 

Key to the adoption of safety solutions is effective change management, which explains to personnel what the safety technology is, its purpose, correct utilisation and its benefits.

Safety sensor options include:

Safety sensors on forklifts prevent collisions in the warehouse. They also ensure the correct positioning of the vehicle for release or pick-up of product – especially important when the product is on a pallet 8 or 10 levels high, for example, and the risk of pallets falling over is high.  The SICK Backup Assistance System is the ideal solution in this regard.

Sensors that measure deceleration, acceleration and angle (e.g. SICK’s Inertial Sensors) ensure a forklift or other mobile warehouse asset is moving products optimally and adhering to safe routes and speed limits. 

 2 trends to watch:

Data and analytics should be easily accessible, without compromise to security

As businesses increase their reliance on automation, access to data and data analytics become more significant too. Customers want to be able to view data from mobile devices, in real time, and in a user-friendly format. However, it is important that data security and integrity remain uncompromised. 

Automated vehicles and dark warehouses

A big trend in the European and US markets is the AGV or AGC – automated guided vehicles or cars – and dark warehousing (i.e. where human input is limited to a minimum and most of the work is carried out by robots and other automated equipment). These systems will replace long pieces of conveyor that move boxes across a warehouse and divert them into chutes. They independently move boxes from receiving through to dispatch (even over long distances) without error or collision. This optimises the material flow through the warehouse, enhancing efficiency. 

In a cost-sensitive South African market, some of these solutions may appear to be grudge purchases. But when done right, the installation of smart sensors and solutions is an investment in efficiency, productivity and improved operations. This is most easily achieved when you partner with a specialist who provides turnkey service, including support and training. 

It’s the early adopters of technology who realise the benefits of sensor-enabled automation, achieving sustained enhanced throughput and effective cost management. 

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