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Global Sheds: The Backbone of Supply Chain

If someone were to ask you to identify the major developments that had taken place in the global warehousing industry over the last decade, you might i...

Freddie Pierce
|Oct 22|magazine12 min read

If someone were to ask you to identify the major developments that had taken place in the global warehousing industry over the last decade, you might initially be hard pressed to think of any. After all, a warehouse is a warehouse; they store goods on their way to another destination. While the definition of the warehouse has not changed, as such, the way in which they operate has.

Global warehouses, also known as sheds, have faced increasing demands from retailers and distributors. In the last 10 years, warehouses have become automated in line with industry requirements, and there is now the issue of sustainability.

Location too has impacted the utilization of warehouses. With many Western companies outsourcing to China and India, the supply chain now covers a much larger geographical area. Warehouses are the one constant, if you like, in the supply chain.

Gursh Atwal, sales manager, AEB (International) Ltd, the supplier of global trade solutions, has observed the same trend: “The supply chain between supplier and customer has been extended and global warehousing has had to stretch to provide a robust, efficient provision for all parties.”

Providing visibility

The rise to prominence of e-commerce has also had a dramatic effect upon storage facilities, prompting the emergence of more technologically-advanced management solutions.

Atwal acknowledges that the rise of e-commerce has placed new demands on global warehousing to supply the right range and quantity of products.

Logistics specialists SBS Worldwide has found one such solution for the book publishing industry. Company chairman Steve Walker says: “Many book publishers took the decision to shift their printing to Asia to reduce costs, but did not then take the next logical step of reorganizing the complete supply chain.”

In response, SBS Worldwide came up with eDC (electronic Distribution Centre), which organizes the worldwide distribution of books from Asia, thereby reducing costs and cutting delivery times.

The key to this solution is visibility, which is something of a buzzword in the logistics industry at the moment. “The software gives everyone who needs it – production, accounts, and sales teams – access to the information about where the books are and when delivery can be expected, right from the pre-production stage,” explains Walker.

The need for accessible information is not restricted to book publishing though. International companies also require a high level of visibility throughout supply chain management.

Atwal says: “Warehousing has to provide the visibility and control to all parties of the stock coming in, being stored, and being despatched from the warehouse. The nature of data sharing and collaboration has a truly international perspective with barcodes being generated and applied at source in China.”

According to Atwal, 2D barcodes and RFID are “gaining traction” within warehousing. Also, voice-directed picking and robot palletizing systems are becoming more familiar sites in storage units. In addition, Atwal points to motion detector lighting, low energy usage lighting, and low carbon emissions forklifts being utilized as part of a greener strategy.

Warehouse systems

Green is now also a hot topic in the industry.

“Companies are now calculating and considering the total energy consumption of automation over the lifetime of the system as part of their procurement as well as their fulfilment process,” Atwal says.

Over time, energy efficient warehousing will become ‘the norm’. While there have been suggestions that companies will start to stipulate low carbon emissions from their warehousing providers, it is still early days.

Naturally, the economic climate has had its own impact on the industry. Gone are the days when warehouses needed to be fully-manned by a skilled workforce.

Today, automation can reduce the number of workers required in a storage area; whether that is good or bad for the industry is, of course, another topic entirely.

“Now that the economic situation has started to stabilize, interest in warehouse systems has generally increased, not by a huge amount, but it is distinctly noticeable,” remarks Atwal. “Companies have started an active search for warehouse automation systems in order to expand their businesses without necessarily increasing general headcounts.”

The question now is where will the industry go next? There are certainly further significant developments to be made in automation, and green is likely to climb its way up the agenda. Atwal acknowledges that cloud computing is being touted as “the next big thing”. However, he believes that “hybrid” is an emerging trend.

There is no disputing that warehousing has come a long way. “This stable environment is the backbone of the supply chain business, and will remain so for quite some time,” Atwal maintains. It continues to be an indispensable part of the supply chain and has embraced some of the most technological advancements.