M2M can optimise the logistics of route planning and the different deliveries a fleet must accomplish, says Val Moodley, acting GM and head of Cloud Portfolio at MTN Business SA
The transport and logistics industry could improve its operation systems should it consider entering the telemetry market and embracing machine-to-machine (M2M) technology, says Val Moodley, acting GM and head of Cloud Portfolio at MTN Business South Africa.
The steady growth of the M2M industry has been triggered by the need to improve operation systems and delivery of services in a manner that would catapult the industry into the next level of quality assurance. This can be achieved through tracking goods in transit, monitoring and maintaining vehicle and driver safety, and increasing the reliability and efficiency of fleets, Moodley says.
“The success of the recent MTN Business Mind2Machine Challenge highlights some of the opportunities available for various industries to save on operational costs and to capitalise on potential growth,” she says.
Entrepreneur Moses Joseph Mayimela was one of the winners of the challenge, with his prototype monitoring system that allows for the tracking of perishable and non-perishable goods that are being stored in fridges and transported by vehicles over long distances. The system provides an early warning prompt to help ensure the goods arrive at their intended destinations in good condition.
According to Frost & Sullivan, South Africa’s vehicle telematics will grow at a yearly rate of 12.5% from 2014 to 2021, with the telematics market penetration projected to reach 17% by 2018. KPMG believes that technology is not embraced in the logistics space in South Africa and this is one of the challenges facing the industry. The company advises that measures should be put in place to strengthen the links in the logistics where deficiencies are uncovered.
“If embraced and implemented properly, M2M has numerous abilities to provide South African fleet managers with useful information regarding fuel usage, routing, and vehicle diagnostics, thereby saving fuel, lengthening vehicle lifespan and increasing efficiency – all of which reduce operating expense,” says Moodley.
“M2M can optimise the logistics of route planning and the different deliveries a fleet must accomplish, ensuring that the loads are transported in a timely manner with the fewest kilometres driven,” says Moodley. “Fleet managers can also monitor vehicle performance and handle vehicle maintenance scheduling, ensuring that all vehicles are being driven in good condition and reducing maintenance costs and breakdowns.
“With the continent attracting international investment interest, the spotlight continues to shine on the machine-to-machine solutions that drive sustainable growth and capitalise on the power of a bold new digital world,” Moodley concludes.
With a growing logistics network between SADC countries, it’s important to keep mind of the requirements to operate successfully in a diverse and often challenging African environment. We recently published an article in which Hennie van Wyk, general manager at Crossroads Distribution, a logistics company that provides a range of supply chain solutions, highlighted three areas Logistics partners have to get right. We asked Van Wyk to tell us more about operating in Africa.
What is necessary for a successful logistics/distribution operation in Africa?
Hennie van Wyk: Experienced management with integrated management systems including warehousing of goods, reliable vehicles and a driver team to support management effectively and accurately in decision-making. Reliability and to be on time goes a long way, especially with extended long-distance cross-border trips.
What are some of the biggest challenges logistics companies are facing in Africa?
Van Wyk: Inadequate road infrastructure and mechanical as well as operational backup.
Transiting procedures – non-harmonised transport rules and standards (user charges, cross-border charges, insurance, etc.)
Limited and uncoordinated customs working hours
Infrastructure impediments which negatively impacts on cross-border road transportation
Longer journeys that lead to higher production cost
High cost impacted by changes in the demand cycle.
How does the development of new ports and hubs influence operating in Africa, specifically SADC countries?
Van Wyk: New ports and hubs will increase road transport volumes, with a lack of rail transportation as an option. It will also change the game plan depending on where volume will be moving from and to, and will impact on the on existing hubs or infrastructure.
Based on the outcome of the Programme for Infrastructure Development in Africa (PIDA), the overall transport sector is to work towards an integrated continent where transport infrastructure and services enable the free movement of goods and people as summarised by the following statements:
• Improving the connection between African capitals and major centres with modern, paved roads;
• Satisfying demand at the least cost and by prioritising landlocked countries, while minimising the environmental impact;
• Developing modern African Regional Transport Integration Network (ARTIN) corridors and air transport services to bring the performance up to international best practice levels with regard to efficiency, cost, reliability and safety.
• The SADC Transport Sector Plan (TSP) is in line with the PIDA outcomes as described above.
• Furthermore, the PIDA Priority Action Programme (PAP) for the transport sector contains four major programmes in the SADC region, namely: North‐South Multimodal Corridor, Central Corridor, Beira and Nacala Multimodal Corridor and Southern African Hub Port and Rail Programme.
The TSP contains significant projects around the North-South Multimodal Corridor, as well as the Beira and Nacala Multimodal Corridor. Most of the projects are, however, centred in the vicinity of Dar-es-Salaam in the Central Corridor, with a concentration of projects in the Southern African Hub Port and Rail Programme.
Technology must-haves for operating in Africa?
Van Wyk: Integrated onboard management systems will assist with more effective operations and management.
Vehicle Tracking, onboard cameras, e-pod and load volume control systems, for example, Bartech or similar technology on fuel transport tankers.
Onboard vehicle fuel and technical monitoring systems via cell technology.
Onboard driver monitoring system which can be utilised to assist driver training and improve bad driving habits.
What are some significant changes supply chains in Africa are experiencing?
Van Wyk: Volume increase by road, change in commodity demand and price cycle, congestion, safety and compliance, and the integration of systems to accommodate regional challenges in the road transport corridors and borders posts.
What can be done to address the complexity of logistics and distribution in Africa?
Van Wyk: The integration of the SADC community systems interface can go a long way to assist in the distribution of products throughout the region.
For transport to play its role and to impact effectively on the integration of the SADC, multi-model transport systems should be developed. The SADC regional master plan (RIDMP) represent a step towards the creation of integrated regional transport infrastructure and operations inter alia through the construction of missing links as well as through the establishment of multi-modal interchange facilities along strategic transport development corridors.
SADC has formulated policies and strategies for regional integration in support of economic growth and development. The economic benefits expected from regional integration, as shown elsewhere around the world, include increased market size, improved intra-regional trade and investment flows, and increased transfers of technology and experience.
Hennie van Wyk answered the questions with some input from Pieter Verster who assists with Xborder operations at Crossroads.
The lacklustre economy, consumers’ desperate financial position and affordability of vehicles are three key areas that will stunt the growth of the South African automotive industry this year, says audit, advisory and tax services firm KPMG. According to KPMG auto- motive sector partner Gavin Maile, the local automotive industry will continue to decline, as the country currently has “extremely sluggish” gross domestic product (GDP) growth of about 0.7%.
“South Africa would need to maintain a GDP of 4% before any decent growth in vehicle sales can take place. Also, we foresee that a hike in interest rates, inflation and the low GDP will not help ease the pressure on the consumer in 2016,” he warns. Further, KPMG senior industry analyst Ashleigh Raine-Botha says local motor manufacturers will also feel the pinch of the exchange rate weakness on both imported components and vehicles and, subsequently, will need to increase their prices.
“Overall, the picture does not look good – consumers are in the weakest position that they have been in for a long time and are facing increases in every direction, as electricity and water prices will most likely rise, along with rates for vehicle services and spare parts,” she points out. Maile and Raine-Botha agree that the devaluation of the rand against most currencies at the end of December has rubbed salt in the wounds of motor companies that import vehicles or components.
“Companies that produce vehicles locally are also impacted on by the foreign exchange rate which has taken its toll on the cost of importing components used to manufacture vehicles. The low oil price has shielded South African motorists from a massive increase in the fuel price, but, consider the implications when the Brent crude oil price increases. This will affect our fuel price drastically, making fuel costs for any consumer or logistics operation extremely expensive,” Maile explains.
He adds that the weakened economy has made the market less conducive for buying and even operating vehicles, as highly indebted consumers face increases in insurance, fuel and other services, which significantly influence being able to afford and maintain a vehicle. New Mobility Despite the difficulties that the automotive industry faces, a new movement in mobility is being followed to mitigate issues such as rising fuel costs and expensive services. “The global movement to becoming more environment- friendly has driven the notion that smaller combustion engines and electric engines are often more powerful and cheaper to operate. KPMG surveys on this matter have noted that more people are turning to alternative power sources for their vehicles. Consumers will soon realise this is the future,” Maile highlights. While there is a global shift towards using alternatively powered vehicles, such as electric cars, Raine-Botha explains that infrastructure to accommodate electrical cars in South Africa is not yet on par with the advanced economies. “The hindering factor for such vehicles is the lack of an adequate infrastructure for charging purposes. Until that is well established, the market will not take off.
The onus is on both government and the private sector to ensure that this is taken care of before we are likely to see good growth in sales of electric vehicles.” She concludes by indicating that Nissan and BMW announced a partnership to investigate the possibility of creating infrastructure for electric vehicles, adding that “this shows initiatives are in place by the private sector”.
Global logistics and transportation firms have expanded operations in Africa despite infrastructure challenges — or because of them — in a sector that holds huge potential and opportunities for investors, according to a guest column in AfricaTimes by entrepreneur and legal consultant Erukilede Julius.
The shipping numbers speak to the positive outlook for Africa’s logistics business, said Charles Brewer, managing director of DHL Express Sub-Saharan Africa, a leading logistics company. In light of the economic pressure Europe is experiencing, DHL’s dependency on Europe has been reduced, while Intra-Africa trade has picked up significantly, Brewer said.
E-commerce has helped to grow African logistics business. More Africans are buying online rather than at physical shops. The size of the outsourced logistics market in Africa has grown by 38.4 percent in the last four years.
But sub-Saharan Africa remains a challenging frontier for many companies, despite recent growth and investment in the sector, according to the 2016 Agility Emerging Market Logistics Index report. More than 43 percent of the 1,100 global logistics industry executives surveyed said they have no plans to set up in Africa; 21.2 percent said their companies have operations in the region. Another 12.7 percent said they plan to enter African markets.
Africa probably isn’t the best destination for companies looking for fast returns, Julius said. For businesses with a long view, it holds huge potential. “The continent needs better transport infrastructure, more connectivity across borders, and an improved business environment.”
Other than South Africa’s relatively developed transport and logistics infrastructure, African countries are struggling. Roads are the most common mode of transport, but are poorly developed. Regional road and rail networks are few and far between. Just 27.6 percent of Africa’s 2 million kilometres of roads are paved, according to a 2008 report by the OECD (Organisation for Economic Co-operation and Development).
Of those paved roads, 19 percent are in sub-Saharan Africa, versus 27 percent in Latin America and 43 percent in South Asia. Just fixing the existing thousands of kilometers of roads that need attention will require huge investment.
Absence of good roads makes transportation and logistics expensive in Africa. Transport costs throughout Africa average 14 percent of the value of exports compared to 8.6 percent in all developing countries, and can be as high as 50 percent of export value for Africa’s 15 landlocked countries –56 percent for Malawi, 52 percent for Chad, and 48 percent for Rwanda, according to the OECD report.
Moving goods across borders can cost official and unofficial fees that amount to extortion.
In Africa, it takes 39 days to export a container of goods including documentation, inland travel, customs clearance, and port or terminal handling compared to 26 days in East Asia or 15 days in high-income OECD countries, according to World Bank’s Doing Business report. Shipping costs an average $2,201 per container compared to the median estimate of $864 for East and Pacific Asia countries.
This is where businesses with long-term strategies can get rich. Ghana, Kenya, Nigeria and South Africa are the most promising logistics markets in sub-Saharan Africa, according to the 2016 Agility Emerging Markets Logistics Index.
Transportation and logistics of food and agri-business will be key, according to Analytiqa. Facilitating this trade will require improvements in cold-storage services.
“There is a huge amount of optimism from (third-party logistics providers) about the future of logistics markets across Africa, as economic growth drives stronger consumer demand and creates higher market attractiveness for retailers and manufacturers alike,” said Analytiqa research director Mark O’Bornick.
If Africans don’t identify these opportunities and take advantage of them, foreigners will, Julius said.
South Africa’s transport sector, despite accounting for 60% of total logistics costs, could be nearing a stalemate. Owners and operators, even at their most efficient, are at the mercy of escalating road tariffs, upped driver fees, rising maintenance costs, and, of course, erratic fuel prices. For transport-hungry South Africa, the well-being of its logistics sector is crucial.
“We are running out of options,” cautioned Zane Simpson in his presentationof the Logistics Barometer, launched in June 2015 by Stellenbosch University.
Logistics embraces not only the transportation of goods or people, but the organisation of all links in an immense supply chain – from source to warehousing, inventory, and even security. It is therefore not only transportation methods that need a rethink, but changes to all the links that impact rising costs.
A farm nearer the fork
Different to Europe, where most agricultural goods are produced within a small kilometre radius of the point of sale, South Africa’s transport distances are extensive, compounded further by inland mineral reserves that must be transported to seaports. Inland Gauteng especially has a high demand for goods, requiring long-distance carriage.
Based on the current rate of demand growth, freight is likely to triple over the next three decades from the current 781 million tons moved annually. “Imagine three times the number of trucks on our road network and the impact this would have on road infrastructure, traffic and delivery times. If we don’t change, a system shock is inevitable,” explained Simpson.
“What we can still change is behaviour on the demand side. Consumers are spoilt for choice,” says Simpson. “By demanding less variety, consumers will inevitably reduce the amount of transport needed, saving money, resulting in less road congestion, and ultimately benefiting our environment. The logistics industry too must be transparent about these benefits.”
Consider all options
“There has to be a change in the way goods flow between points; whether it be driven by technology or by this reduction in the variety of brands and options on offer to consumers.”
In cases where no alternative exists other than to convey goods over long distances, Intermodal transport (moving containers using multiple transport modes) could have a dramatic impact but requires significant investment into rail systems. “The future,” says Simpson, “would have to include a fixed mode of transport.” Simpson and his team proposes that all other conveyance options; alternative technologies, even the unconventional, need be considered.
“3D printing items close to source, for example, rather than having to transport from afar would help to reduce transport demand and subsequent costs. Seemingly ridiculous ideas even, such as building a canal between KwaZulu-Natal and Gauteng, long distance conveyor belts, or drones, need to become part of mainstream conversations if we are to reduce logistics costs,” he says.
“Overall, instead of trying to reduce transport costs in isolation, we need to work hard at economic growth, which will solve more problems than just increasing logistics costs,” Simpson says.
South Africa’s iconic Blue Train could be recapitalised and expanded following the announcement of a new public–private partnership between State-owned freight logistics utility Transnet and tourism and leisure group Sun International. Print Send to Friend 0 5 The five-star luxury “hotel on wheels” – which was first launched in 1923, upgraded in the 1930s and re-entered service in 1946 after the Second World War – remains a popular tourist attraction for domestic and, especially, international tourists.
However, with occupancy rates having fallen to 70%, along with profitability, in April, Transnet invited bidders to submit proposals to partner with it in developing and piloting a new marketing strategy for an initial period of up to 18 months. Sun International was among two of five initial bidders short-listed and on Tuesday acting Transnet CEO Siyabonga Gama announced that the gaming and hospitality company had been selected as the winning bidder.
A joint business plan would be developed over the coming six months, outlining a new “value proposition” for the train, which was likely to include new investments, route expansions and possibly the integration of gaming into the experience. Also on the cards was the creation of package deals that made it more accessible to domestic tourists. Domestic tourists generally viewed the train as out of reach, with packages of between R13 000 and R21 000 per person sharing, depending on the season.
Speaking at the announcement, held in the Blue Train Lounge at the historic Pretoria Station, in Gauteng, Sun International CEO Graeme Stephens said it was premature to offer details as to the future commercial terms and investment plans. However, he promised that Sun International would include black economic-empowerment partners in any future commercial arrangement. Stephens saw significant opportunity to extract synergies between the Blue Train and the group’s own five-star properties, including the Table Bay Hotel, The Palace of the Lost City and the Royal Livingstone, in Zambia – destinations that were all accessible by rail.
“In the preliminary phase it’s about tapping into the understanding we have of the various source markets and Transnet’s understanding of rail to evolve a business plan,” he explained, adding that investment and routing decisions would flow from that plan. Gama indicated that Transnet, which was focused on freight logistics, but had retained the Blue Train as its last passenger-rail business offering, hoped to tap into Sun International’s understanding of the fast-evolving tourism market, as well as its package and booking systems.
He expected Blue Train occupancy to rise to between 90% and 100%, but stressed that Transnet was also keen to back a growth strategy, which could involve investments into additional trains and coaches and the opening of new route networks. Transnet’s goal was to recapitalise the Blue Train, “which may include building new state-of-the-art train sets”, in partnership with private sector investors and operators. “At the moment we have two sets of the Blue Train and in future we may be able to build many more to extend the reach and footprint of the Blue Train,” Gama said.
Transnet recently allocated two new electric locomotives to the Blue Train, which employed over 60 people. But the current train set, which was almost 40 years old, had become expensive to maintain and operate. “We believe there is an opportunity to optimise the Blue Train by including more destinations, such as the national parks, and to recapitalise it to make it a much more sustainable offering.”
E-commerce, the electronic trade of goods and services, is reshaping the world of logistics and “forcing logistics providers to step up”, says logistics provider Dachser South Africa (SA) MD Detlev Duve. Print Send to Friend 0 0 “E-commerce is driving changes in customer needs and changes in the industry,” he says, noting that e-commerce entrepreneurs require a logistics partner “that understands this new dimension of logistics and can provide end-to-end services”.
Duve believes that, with the right logistics partner, retailers can reap the business benefits of improved communication, transparency in the supply chain, improved customer satisfaction, cost reduction and efficiency improvements. He points out that, from the moment an online order is placed to when it is selected, packed and shipped, every step in the process must be handled efficiently, consistently and cost effectively. “Evolved logistics partners provide solid warehousing infrastructure and value-added services that enable e-commerce businesses to outsource this entire process,” says Duve.
He advises businesses looking to secure a logistics partner to ensure that the provider can deliver tailor-made solutions that fit their unique needs and requirements. “In the world of e-commerce, same day or next-day delivery is a necessity, says Duve, adding that companies, therefore, need to ensure that their logistics partner is capable of this, and that they have a proven track record. He further highlights value-added services as another essential facet of a logistics partner. “Value-added services include the quality control of goods at the time of pick-up at the supplier’s warehouse, product finishing tasks, sleeving (foliation) or repackaging into new cartons,” Duve says.
Value-added services can also include product- orientated services, such as quality control, product refinement, assembly and disassembly work, as well as packaging and repackaging. Meanwhile, process-orientated value-added services can include order management, labelling and/or price marking, as well as the processing of returns or complaints. “Evolved logistics companies can perform all these necessary tasks,” says Duve. He adds that Dachser SA’s launch of a new head office, sales and logistics centre, including an extended multi-user warehouse facility in Gauteng, will enable the company to enhance its offering.
Extensions to the company’s facilities in Pomona, in Kempton Park, Ekurhuleni, include an additional 3 000 m2 of warehouse space, offering 4 300 pallet positions to industry in South Africa. The new centre, which was officially launched in February, provides Dachser SA’s clients the opportunity to save on their business costs, as they avoid needless inventory and complex handling outside their core capability. Dachser is now part of a handful of companies that offer this facility in South Africa, notes Duve. “We’ve taken our full logistics centre up a notch. As a logistics partner, we can effectively use our warehousing capacities to the fullest through flexible consolidation of multiple customers’ goods in our multi-user warehouses,” he says.
“The industry is changing and there are considerable price pressures,” says Duve, stressing that Dachser has always innovated according to clients’ needs. “We hope that this new warehousing facility will inspire clients, in turn, to be inspired, grow and to dare to venture into new projects that previously would have been too costly, ” he concludes.
Johannesburg – There is an old Chinese saying: “When you want to make the lives of the community better, build a road.” Building of roads and public transport infrastructure therefore goes beyond asphalt and bitumen.
Most importantly for us who have lived under a system of separate development, the government now has an opportunity to re-fashion apartheid geography and to spatially reconfigure the Gauteng city region along the five development corridors as identified by the provincial government.
Over the next couple of years, the work of the Gauteng Department of Roads and Transport will focus on a number of high-impact transport projects.
These include the Aerotropolis around OR Tambo International Airport, the extension of the Gautrain, the development of a new freight and logistics hub known as the Tambo-Springs Inland Port, the roll-out of the bus rapid transit systems in Joburg (Rea Vaya), Tshwane (A Re Yeng) and Ekurhuleni (Harambi), and last, the revitalisation of Metrorail.
Cumulatively, these projects will create over half a million jobs during and after the construction phases.
They will stimulate economic growth, particularly in Ekurhuleni, whose manufacturing sector has been slumping.
The Aerotropolis and the Tambo-Springs Freight and Logistics Hub will greatly boost intra-African trade. According to the UN Conference on Trade and Development Report 2013, the average share of intra-African exports of merchandise was 11 percent compared to 50 percent in developing Asia, 21 percent in Latin America and the Caribbean and 70 percent in Europe. We believe the Aerotropolis and the Tambo-Springs Freight and Logistics Hub will greatly impact on our export figures.
Metrorail remains the primary mode of mass transit for a million commuters in Gauteng who use its trains daily. To improve their daily commute, the Passenger Rail Agency of South Africa is modernising this mode of transport through the acquisition of new coaches. We are also integrating our rail system with the bus systems and Gautrain so that commuters can travel faster and with ease. As part of this, we hope to expand the Gautrain to link Tembisa with Lanseria Airport.
Transport developments should be seen against the backdrop of the new human settlements which are being spearheaded by the private sector and supported by the government. New housing developments such as Steyn City, Waterfall City, River City and Savannah City will grow the population of our province, while transforming our municipalities.
We are working with road and transport officials in different spheres of the government to ensure appropriate road and transport networks are in place to accommodate the additional users.
The public transport and road infrastructure deficit in sub-Saharan Africa remains a challenge as this leads to higher production costs and undermines competitiveness. We have to overcome this deficit progressively as it acts as a constraint on economic growth. This also means that we will continue to maintain the existing road network as we build new roads.
Hence, we are investing heavily in the upgrade of the N12 and N14 freeways, the completion of William Nicol Drive and the R511 from Erasmia to Diepsloot/N14.
In addition, we will rehabilitate and upgrade arterial roads such as the K46 from Fourways to Randburg, the R82 between Eikenhof and Walkerville, and Cedar Road between Runnymead Road and Witkoppen Road.
Annually, the provincial department processes over 250 000 driving licence booking slots. This front-line service as provided by Driver Licence Testing Centres remains a critical meeting point between the department and residents. We aim for this service to be of a good quality and also free of corruption.
To achieve this, the department has implemented 24 computerised learner licence testing centres, which diminishes the role of examiners in conducting learners’ licence tests. In addition, the provincial department with key stakeholders also launched an anti-corruption campaign in Diepkloof, Soweto, in March.
Also, we are expanding our capacity especially to historically disadvantaged communities. During this financial year, we will build two new driving licence testing centres in Kagiso and Sebokeng.
In recognition that a driving licence still remains a key aspiration for many South Africans, in particular our youth, we are partnering with the Gauteng Department of Education to assist grade 11 and 12 pupils to register for learners’ licences.
All spheres of government have made significant investments toward safer, more reliable, affordable, accessible transport systems of the highest standard.
Through the 25-year Integrated Transport Master Plan, we hope to encourage commuters of all socio-economic categories to switch to public transport. Let us move Gauteng forward by using public transport.
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Recently, research firm Gartner released a report on the importance of the Internet of Things (IoT), a buzzword that simply refers to the connectivity of physical objects, devices and products not technically considered computers.
Many of these connected devices are, in fact, elements found along the supply chain – including smart palettes, trucks, refrigerators, home alarm systems, forklifts, even watches and other wearable technology.
Based on the latest available stats, there are currently 15 billion connected devices, with this number set to increase to about 50 billion by 2020. In its research, Gartner points out that this massive increase in internet-connected physical devices will “significantly alter how the supply chain operates.”
It is critical to point out however, that one of the most crucial elements within this system of connectivity is the software or management systems that link these items. Without effective software management systems to gather, analyse and share this constant flow of information, the Internet of Things has no real benefit to logistics companies.
For companies involved in supply chain and logistics, these controlling systems, apps and technologies are the difference between failed or successful real world deliveries.
The benefits from the Internet of Things means are most profitably leveraged through the real-time access to, and analysis of, more and deeper data. The compiling, evaluating and sharing of this data amongst various players within the supply-chain ensures for example, in-transit visibility – meaning these smart systems enable companies to make decisions, avert disasters, and manage clients in an incredibly competitive environment.
An application of this kind of system is VSc Solutions’ transport management solution that enables real-time visibility of vehicle movements against a delivery plan, allowing for the proactive management of issues as they arise during the day.
Within the South African transport environment and its specific challenges, the benefits from this type of system are manifold, for example when it comes to the role of drivers within the transport chain. While technology may replace people in many areas of industry, human drivers will still be an integral part of moving goods from one end of the supply chain to the next.
Wearable technology, such as the Apple Watch and other similar technologies, is ready to be applied to supply chains in order to enhance inputs into planning and route compliance software. This technology, integrated into the system, can both protect and monitor drivers, leading to multiple benefits for both drivers and logistics companies.
The key benefits of incorporating Bluetooth and wireless technology into wristbands, similar to watches, center on their ability to measure the rhythm of the wearers’ heart, ensuring reliable information, even being able to ascertain if a driver is under stress. For example, a sudden jump in heart rate will indicate a stressful event such as a hijacking, enabling the control center to send for help in case the driver is unable to raise the alarm.
Ultimately, the Internet of Things, and all the related elements are technological tools that enable businesses to provide better service to customers. In order to remain competative within the regional or global sphere, logistics companies need to embrace these tools and find partners to assist them in leveraging the most possible benefits.
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South Africa’s logistics costs reached R393-billion in 2013, equating to 11.1% of the country’s gross domestic product (GDP), which does not compare well with the figures of North America, at 8.8%, and Europe, at 9.2%, Stellenbosch University’s (SU’s) newly launched Logistics Barometer South Africa 2015 reports.
However, South Africa fared better than South America, whose logistics costs were 12.3% of GDP, and Asia Pacific, at 12.8%.
Changes in input costs were expected to increase this percentage for 2014 and 2015, as South Africa’s economy was transport intensive.
The country was one of only three that routinely measured and reported logistics costs as a percentage of GDP in a quantitative manner – the others being the US and Brazil.
The barometer, launched on Monday, was aimed at strengthening the research published by the Council for Scientific and Industrial Research (CSIR) and Imperial Logistics in the State of Logistics surveys for South Africa over the past ten years.
“This is an exciting development for SU as we are launching a product that is of great importance to the industry.
“This research serves the country as a whole as it is used for strategic decision-making on a provincial as well as national level. It provides regulators, policy makers, infrastructure owners, economic planners and others who operate in the logistics field with intelligence to deal with the issues identified. This research puts SU on the cutting edge in terms of calculating logistics costs using international benchmarks,” SU researcher Zane Simpson said.
The Logistics Barometer identified transport as the most significant portion of logistics costs in the country. South Africa’s GDP constituted only 0.44% of the global GDP, yet 0.6% of the world’s road networks and 2% of the world’s rail network were in this country.
South Africa accounted for more than 1% of the world’s tonne-kilometres, 1.7% of the world’s container trade and 5.1% of the world’s dry bulk trade. More than 80% of transport costs were owing to road transport, with rail tariffs contributing between 11% and 13%, and pipeline tariffs 2% or less in recent years.
The biggest contributor to road transport costs was fuel. Even with reduced tonne-kilometres in 2013, the total fuel bill was still higher than in 2012, owing to a higher diesel price.
The totals for some of the variable costs – Including driver wages, depreciation and insurance – have seen a slight decrease. However, this was not owing to a drop in input costs, but rather a slight change in industry behaviour, Logistics Barometer contributing researchers and editors Nadia Viljoen and David King warned.
“The Logistics Barometer will have an international impact through the reputation of the underlying research and the long-standing collaboration between SU and other researchers globally. “Our work is noticed by researchers around the world and used as an example of only a few countries where this measurement is repeated annually and used regularly. We now have 11 years of consecutive logistics costs measurements, and are proud to be leaders in this field,” Simpson commented.
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