IT thinking ?inside the box?

IT thinking æinside the boxÆ

      You probably noticed that a theme of this edition of American Shipper is centered on capacity constraints across modes and lanes.

      Our readers have made it abundantly clear that the lack of available space is the pain shippers and intermediaries are feeling this peak season.

      Much has been written on the nature of this capacity crunch including the lack of available trucks, drivers, containers, ships and aircraft. Far fewer discussions have focused on the importance of maximizing capacity inside of the box.

      'We are hearing horror stories of shippers trying to secure equipment and space,' said John Painter, vice president of worldwide sales at logistics technology provider LOG-NET Inc. 'There is an explicit need to have a tool to help them ensure they maximize the utilization in the container or trailer.'

      'Load configuration capability applies to any box or piece of equipment including FEU, flatbeds, railcars, trailers and more,' said Derek Gittoes, vice president of logistics product strategy for software giant Oracle Corp. 'Given that you have an assortment of products, what's the best way to load them into a container or any equipment for that matter?'

      Correctly configuring and stuffing loads within the box is important in general but some modes demand more attention than others. 'The biggest challenge here relates to ocean shipping,' Gittoes said. 'You have to book your space far in advance of the time when you actually load your container. Stuff does not always show up exactly as you planned it.

      'Inside of Oracle Transportation Management we call this application load configuration or planning,' he said. 'The tie-in to transportation management provides visibility to the product en route to be stuffed. This allows the plan to be reconfigured based on updates.'

      A number of technology providers provide load configuration and container stuffing systems and, like most logistics applications, deliver an array of models.

      'What differentiates our load configuration application is it's integrated into Oracle Transportation Management,' Gittoes said. 'It's not a bolt-on.'

      Similar functionality is available from other prominent transportation management systems (TMS) providers such as JDA Software, which acquired i2 Technologies in January. Standalone applications are also available from specialist systems developers.

      'The solution is designed to take into account weight, cube, dimensional and stacking constraints in an effort to maximize the utilization of a container or a trailer while meeting all the pickup and delivery parameters,' explained Razat Gaurav, group vice president of JDA Software Group. 'In addition to creating a three-dimensional configuration of the container or trailer, the solution also provides loading instructions that can be used at the docks.'

      This type of load plan is particularly important when the dimensions of the products are large and the density is low, which will often cause a shipment to 'cube-out' (surpass the space parameters of the box) before it would 'weight-out' (surpasses the weight limits imposed to transport the box).

      Measures of an item's fragility are a critical component of these load configuration systems. When an assortment of products is loaded into the same box these applications apply some intelligence to how they are stacked.

      Common sense would dictate that refrigerators should not be stacked on top of light bulbs and certainly these applications will tell you as much. What is more important is the less-obvious scenario where products in the same box might appear roughly equal in weight but differ in crushability.

      'Having the technology to enhance and maximize your stuffing procedure is very helpful,' Painter said.

      The benefits shippers and logistics services providers can expect from this type of applications can be summed up in a few key points.

      'The primary benefit is reduced transportation cost,' Gittoes said. 'By definition the more you get in that box the lower the per-unit cost becomes.' Today boxes, and capacity to carry them, are scarce, which makes cost more than a measure of what you pay per shipment. The opportunity cost associated with failing to get every possible item included in each shipment is very real.

      'Secondary benefits include reduction in damage to freight,' Gittoes said. 'The system looks at how you can load and stack product in the box.' This helps to ensure the least amount of loss possible.

      Gittoes outlined how more sophisticated users can leverage these systems for further benefit. 'If you're loading or delivering at multiple points there is a material handling and labor benefit. The system allows you to load with an understanding of unloading.' For example items destined for the first stop on a route can be loaded last so they are most accessible.

      JDA's Gaurav points out that all of these benefits also lead to a reduction in carbon footprint. 'By better configuring containers and trailers, shippers can significantly reduce the number of containers and trailers being shipped for the same amount of cargo leading to reduced fuel consumption' he explained.

      Shipment volume and variety will dictate the demand for a load configuration system. 'Every logistics provider should have this kind of technology,' Gittoes said. 'Large-sized shippers with significant import or export operations and multiple lines of business are also prime candidates.' These shippers will be more likely to    stuff    boxes with multiple products with varying dimensions and characteristics. Conglomerates such as Samsung may ship flat-screen televisions, air conditioners, and kitchen appliances in one load.

      Any shipper with far-reaching control over its supply chain should consider the benefits of these applications. Shippers who design their own load plans would not only save transportation cost and prevent damage; they can maximize the carrier capacity that is available to them by using the least space and equipment possible.