From 2015 businesses in England will be required to separate out common recyclables rather than sending to landfill. Paper and card, plastics, metals and glass are the waste items being targeting first. From April 2014 the landfill tax rose to £80 per tonne so businesses should already being feeling the pressure to audit and review the waste in their organisation.
Packaging your warehousing goods
It is estimated that 57% of food packaging in the hospitality sector is sent to landfill. The first priority should be to reduce the amount of packaging being used, or improve it where there is evidence of repeated damage to products. Where a products packaging cannot be reduced or recycled, designers need to look again at whether it can be reused. Instead of a cardboard box, plastic trays can be returned, cleaned and used again.
What’s happening in the distribution world?
New lower emission HGVs have become a step closer after the Department for Transport (DfT) issued documents planning to enable HGV vehicles’ change to biomethane/natural gas. The gas is preferred due to it producing lower carbon emissions than diesel. The reports were prepared after a 2012 report by The Society of Motor Manufacturers and Traders (SMMT) as part of the society and it’s members Low Emission HGV Task Force. The Chancellor stated in the Autumn 2013 report that there is a need to incentivise the transport industry and it’s support network to move towards gas power for new HGVs. The business case has been secured by a promise that there will be a duty differential between gas and diesel until at least 2024.
Taking a look further afield at logistics and manufacturing
In the US, factories manufacturing white goods have posted 2 strong months back to back, with orders up 2.1 per cent in February and then 2.6 per cent in March. This is the good indicator that the US is recovering after poor performances in the Christmas run up. The demand increase on core capital goods is often seen as a good guide for business investment plans. The poor pre-Christmas performance is being seen as a result of the particularly cold weather to hit much of the US, as opposed to the markets slipping back into recession. The booming order book has boosted transport requirements in the US, with an 8.6 per cent increase in commercial aircraft orders and 4 per cent increase in transportation demand. Market Analysts are hoping that in the April to June period the warmer weather will boost demand to a 3 per cent growth, which will return to US to its best performance since the start of what is being called ‘ the Great Recession’ which officially ended in mid-2009.
When was the last time you reviewed your direct store delivery (DSD) operation? A survey in the USA has reported that 20% of companies with over 3000 employees could save $3 million (£1.78 million) and 50% could save $734,000 (£436,000) a year. These savings are all recovered through process evaluations. Some of the main points for improvement focussed around SKU proliferation – reducing inventory stockholding and using social media trends to more accurately predict the changing demand. There was also a strong cost reduction in man hours; with companies reporting up to 2.5 hours was wasted between order placement and final delivery.
More investment in the logistics industry
Are you still waiting to see what will happen next after the recession? Well it’s about time you started doing something! A recent survey found the number of investors proceeding with investments has jumped from 19% to 27% in an annual survey. Although there is a limited surge in new build warehousing, there has been a large spending boom in upgrades and automation as people are looking to optimize facilities which are showing as operating at 90-95% of their capacity utilization. Inventory control, handling, distribution processing and labour management are all being streamlined by the introduction of new technology and automated systems, with huge amounts of companies looking to expand operations in the next 2 years. The investment in IT is obvious when you see 33% of surveyed companies currently use an automated pick accuracy checking system, but 62% expect to have a system in place by 2016. After an extended period of cost pressure and staff cuts, companies are now finding their distribution networks struggling to cope with increased demand, and the complicated end to end network can see huge gains in worker productivity with the introduction of the correct automation software.
Plans are being drawn up to develop a new food sector hub on a 250-acre site on the outskirts of Dublin. It is being reported that the Government has approved the zoning and investment is in the region of 30 million Euros. There are already 2 companies committed to utilising the site as their Irish hub, with 75 per cent of the retail shelf space in Ireland being within 17 miles of the base, it is offering huge savings in transportation costs. Enterprise Ireland have been engaged to see if there is a possibility for developing incubator hubs to suit start up food companies. One of the objectives for the site is to become a centre for excellence and move away from pure distribution, including support services and research and development facilities. The development is bringing a camaraderie to the area with direct competitors working together to optimise their development plans and create co-operative distribution networks to ensure that they can compete with companies in the mainland UK.
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