Thursday, 30 June 2016

Corporate Social Responsibility in the Supply Chain: The need for companies to incorporate social responsibility into their supply chain design

Corporate social responsibility in supply chains deals with the social and environmental consequences that come as a result of the operations.  Firms need to work towards having a sustainable global supply chain, which is a lot harder than for focal businesses.  Global supply chains involve many more companies and have a wider reach, which makes things a lot more complex.

Corporate social responsibility (CSR) receives attention from political and public arenas.  Firms sometimes make the mistake of failing to be responsible, claiming it is not possible to see what happens in the supply chain on the other side of the world.  They often simply request their suppliers to be responsible and fail to change their own activities.  More progressive firms are using CSR as a market lever to build a respected brand that consumers appreciate and to expand their brand.

Corporate social responsibility includes:

  • Conducting audits of suppliers in order to spot areas that can be improved and to follow up on issues that have been previously discovered
  • Owning CSR initiatives using collaboration projects and running development sessions with suppliers
  • CSR involved in the decision making process
  • Paying premium for goods and services that do conform to CSR standards

Wednesday, 29 June 2016

Managing for Risk Readiness: The two levels of risk readiness and several specific steps to take

There are many risks in supply chains. Some common risks include breakdowns of transportation along with geopolitical risks or plant shutdowns and disasters. These risks have different impacts on revenue and customers, leaving the goods stuck in the upstream and empty distribution challenge.

In international logistics, there is a minimum of two levels where companies are responding to the risks, immediate risk readiness and preparing for risk in international supply chains structurally.

Immediate risk readiness includes four things:

·         Global sourcing and supplier rationalisation efforts are considered
·         Supplier hedges put into place
·         Inventory levels are increased to cushion any disruptions in the supply chain
·         Coming up with new transport scenarios and designing new networks

Structural risk readiness is an ongoing activity and firms now commonly have teams that dedicate their time to supply chain risk management. The activities that these teams undertake may involve creating contingency plans, risk protocols, being prepared for audits, training up staff and management and reporting the risk profiles to management.

Tuesday, 28 June 2016

Reverse Logistics: Factoring the Return Flow of Goods when Designing International Networks Reference

Reverse logistics is the goods flow that travels back up the supply chain. The reasons for reverse logistics include:

·         Repairs
·         Maintenance
·         Product returns
·         Recycling
·         Dismantling

Reverse logistics has an environmental component and service components and there are social responsibilities involved.  There are complications and activities that make reverse logistics different to forward logistics, such as:

·         Many to one distribution point
·         Less transparency and visibility
·         Complicated marketing and negotiations
·         Inconsistent inventory management
·         Speed no longer a priority in many cases
·         Common packaging issues such as damaged packaging
·         Non-uniformed product quality
·         Uncertain reverse costs
·         Forecasting is difficult as it’s hard to estimate what will be returned

Reverse logistics are not always incorporated into an international market. Many firms try to use the same system as the outbound distribution that isn’t always fit for purpose. There are often limited resources dedicated to reverse logistics and it’s not often seen as offering business value.

Monday, 27 June 2016

Organising for International Logistics: How can supply chains be better organised to meet the challenges of international logistics?

The three main elements of organising international logistics are:
·         Layering and tiering
·         Evolving role of plants
·         Reconfiguration processes

1.    Layering and Tiering
It’s important to consider a wide organisational setting along with the asset centralisation and localisation. Laying out the flow if information separately from the physical operations is used in global coordination and local operation.

2.    Evolving Role of Plants
The evolution of the role of plants focuses on achieving the targeted international capabilities of global efficiency, worldwide learning and local responsiveness, either separately or together. The way activities are performed and the changes in demand and location requirements all play their part.

3.    Reconfiguration Processes
A central issue is the required changes in international logistics pipelines. There can be large differences in reconfiguration paths across different companies, even where the companies use the same supply chain structure. The differences include:
·         Supply chain scope
·         Focus
·         Tendency
·         Timetable
·         Pace
·         Authority

Saturday, 25 June 2016

Chit Chat: How Does Crowdfunding Work?

Entrepreneurs are using crowdfunding as a way of raising finances. Crowdfunding makes it easier for the entrepreneurs gain access to funds without having to take out business loans or personal credit, approaching the bank or family and friends for funding. 

Crowdfunding provides a platform to reach a significant amount of investors and sharing the business plan and pitch to encourage investment. The idea is shared on a crowdfunding website (such as Kickstarter) and people can choose to send their own money if they wish.

There are normally two different types of crowdfunding, receiving rewards and equity crowdfunding. Receiving rewards is a traditional form of crowdfunding that provides investors with rewards as thanks for their investment. This could be a finished product or other merchandised based on the amount they invest.  Equity funding is when the investors become shareholders.

There are plenty of benefits to crowdfunding, these include:
·         You don’t need to worry about public speaking or creating a presentation.
·         You have a wider audience of investors
·         You can use social media to highlight your campaign and raise awareness
·         Your investors can be useful as they’re able to have a say and follow you on your journey

Three of the most popular crowdfunding websites to consider using are Kickstarter, Crowdfunder and Indigogo.

Friday, 24 June 2016

Challenges of International Logistics and Location: What are the risks in international logistics in terms of time and inventories, and how can they be addressed?

There are four main differences found in international logistics:
·         Extended lead time of supply
·         Extended and unreliable transit times
·         Multiple consolidation and breakpoints
·         Multiple freight modes and cost options

Extended lead time of supply
Long lead times are often quoted in order to efficiently manage the interface between production and sales teams in each of the different countries supplied. The long lead times buffer the factory so they are able to respond to local variations in the different markets.

Extended and Unreliable Transit Times
Time variations in international transport lead to increased inventory holding as this works to provide safety cover.

Multiple Consolidation and Break Points
Supply costs can be reduced by using consolidation. The economies of scale are achieved as the goods that are produced in different facilities are all put together to be transported to the common market.

Multiple Freight Modes and Cost Options
The freight mode options may change for each leg of the journey from the point of manufacture and the marketplace. These are air, sea, rail road and there are different options for each of these categories. Cost, availability and speed are all taken into consideration when deciding the freight mode to use for each leg.

Thursday, 23 June 2016

How can we picture the trade-offs between costs, inventories and lead times in international logistics?

Companies work to stay competitive on an international scale by reducing costs and improving services to their customers. There are two approaches that are commonly used, focused factories and centralised inventories.

Focused Factories
A focused factory strategy is when the company consolidates the production of products in specific factories. Each of the focused factories supply the product they produce on an international scale and they focus only on a limited segment of the product assortment.  The advantages include lowering the production costs through economies of scale and improved lead times. The disadvantages may include increased transportation costs and increased lead times because of the longer distances from the market.

Centralised Inventories
Consolidating inventories can bring cost saving benefits. The inventories are reduced to smaller numbers and the inventory management is coordinated across the supply pipeline.  By coordinating inventory, duplication is removed and the safety stocks are also reduced, saving logistics costs and lowering the distribution cycle times. Another benefit of centralised inventories is the ability to balance the demand peaks across regional markets using a central inventory.

Wednesday, 22 June 2016

Drivers and Logistics Implications of Internationalisation: What are the trade-offs between responsiveness to local markets and economies of scale?

Logistical implication of internationalisation

Internationalism has consequences for inventory, handling and transportation policies.  Centralising inventory over different countries can be advantageous as it can reduce inventory holding costs and inventory levels. The flip side is that product proliferation can increase because there’s a need to localise products and be able to respond to the opportunities to the local market.

Handling practices may differ depending on the country and there may be different regulations for transport and storage. The handling practices will need to be adjusted in order to fit in with the regulations and best practices can be implemented which will be of benefit to internationalisation.

Transport pipelines are expanded in order to cope with the different regulations in place within different areas and the different infrastructures while remaining focused on deliveries within time to market. These factors may drive localisation. However, global consolidation can be a driver for international centralisation.

Time to market
Global logistics pipelines are impacted by time-to-market and a couple of the major issues include inventory holding costs and product obsolescence. Product obsolescence is increased because of the time products spend in transit. Inventory handling costs can increase because of the lead times and delays that can occur at consolidation points and at customs and excise.

Global consolidation
Managers use global consolidation when they work to secure low-cost resources and make the best use of the assets. As a result, assets such as facilities and equipment are used to their fullest capacities and the economies of scale are maximised.

Risk in international logistics
International logistics have to consider the effects of the unexpected and how they will impact the supply chain so responses can be planned and managed. Risks include geopolitical threats, transport breakdowns and disasters.

Tuesday, 21 June 2016

What are the challenges of the urban environment in construction?

A large proportion of construction takes place in cities and construction logistics are challenged by demanding operation requirements in these built up areas.  Richer countries around the world are already extremely urbanised and the UN stated that 50% of the population were now living in urban areas and it’s expected to rise to 70% by 2050. Growth in cities will continue to have an impact on supply chains and the amount of construction taking place in cities will also increase because of this.  Pressure to create sustainable logistics in urban areas will be weighed on the shoulders of supply chain managers, including those in the construction industry.

Freight activity increases due to the demand caused by large commercial activities and large populations, for both domestic and commercial use. It’s vital that better use is made of the freight capacity that’s available and working in a way that will make it easier to share space in the city will also become increasingly important. 

The efficiency of construction logistics operations will demand tighter management with a focus on the sufficiency and safety. One safety aspect includes Construction Logistics and Cyclist Safety, which is an initiative to increase consideration for vulnerable road users.  Construction also has an impact on air quality and noise and urban freight can result in different conflicts between environmental issues, social issues and the economy. Urbanisation is an important trend in the construction industry and being aware of this trend is the first step to finding solutions.

Monday, 20 June 2016

What are the consequences of failing to manage construction logistics?

Failing to manage construction logistics has the following consequences:

Expense
Additional costs can be reduced by improving the organisation of logistics in constriction. Time is a huge expense and wasted time caused by delivery failures resulting in lack of materials, tools and equipment on site when it’s required.

Improving Construction
It’s harder to work and create excellent results on a site that is poorly organised and mismanaged. Interruptions caused by a lacking supply chain result in inefficient workflows. An adequate supply chain removes the interruptions and the overall quality of the work. It also has a more positive effect on the reputation of the industry as a whole, fewer delays results in a positive image.

Dangers on Site
Stock piling materials that are not immediately required increases the health and safety risks on site. Hazards increase and so do the risks of damage being caused simply because of the amount of handling and working around stored products on a busy site.

Saturday, 18 June 2016

Chit Chat: How to find the funding for your start-up

Here are five excellent ways to fund a start-up project.

1.     Crowdfunding
Crowdfunding is relatively new but it’s an excellent way of raising money. Create a crowdfunding campaign on sites such as Indiegogo and spread the word over social media, your website and via your Influencers. You need to add plenty of detail into the campaign, informing potential investors about the service or product, the problems it solves, where the money will be spent and future financial strategies to create profit and so on.

2.     Angel Investor
An angel investor may be just one person. The individual invests for a cut of your profits by taking part of your business and often provide mentorship as an addition to the deal.

3.     Venture Capitalist
Venture capitalists are normally a professional group that looks for startups to invest their money in. They are usually very supportive and provide plenty of resources in order to help your business develop. They take a large portion of your company and may require some control in the running of the organisation.

4.     Small Business Loans
Approaching the bank for a small business loan is often the first place entrepreneurs turn. You’ll need to provide detailed information and show the bank exactly where the money will be spent, down to the very last penny.

5.     Credit
Credit cards can be used if you have a good credit history. Asking the bank for a credit card may provide the initial funding you need to get going without giving up a portion of the business or control of the business.

Friday, 17 June 2016

What is the role of logistics management within construction?

Logistics management in construction needs to consider the way projects are developed and organised as it has implications for the structure of the supply chain. Another implication comes as a result of the purchasing activities in the supply chain that can involve high volumes that require efficient supplier coordination.  There is also a challenge regarding the large volume of waste in the industry that is a result of failing to manage logistics effectively.

Management needs to take on all of these problems mentioned above and find solutions that will create a solid and efficient supply chain, with minimal wastage and that make the best use of transportation and storage. Strategies need to be found to deal with issues such as:

  • Ensuring vehicles are loaded efficiently
  • Delivering at the right time without having to wait for access to the site
  • Reducing the amount of stockpiling to reduce costs and reduce waste caused by damage and deterioration
  • Coordinating efficiently across all activities
  • Ensuring materials arrive on site when they’re needed
  • Reducing the amount of returned and damaged items
Logistics management need to look at the way projects are developed and organised and consider the implications they have on the structure of the entire supply chain.

Thursday, 16 June 2016

What are the key transport and storage considerations for products?

Transport is a vital link in the supply chain for most products. The transportation links up all of the activities between the point of production and the point of sale and even the point of use. Transport links all of these activities. It is required for bringing raw materials and components to the point of production too. 

Transport is essential for the flow of materials and products and it has a big impact on costs.  The costs can be high if the product is of low value and needs to travel long distances, so it’s important to consider transportation when planning the supply of materials and products.

Storage

Storage costs include:
·         Physical costs of stock holding
·         Opportunity costs of holding stock
·         Goods losses during storage

There are several points where products can be stored across the supply chain. Each of the points involves product handling, which increases the total cost of the logistics. It’s necessary to decide who is responsible for these costs and who is responsible for the products while at these set stockholding points. The size of the facilities also affects the transport choices that are made, such as the size and choice of vehicles, how frequent transportation is required and so on.

Wednesday, 15 June 2016

Congratulations to Mr. Dean Locke on completing the 2016 London 2 Brighton Challenge (28-29 May 2016)

We would like to congratulate Mr. Dean Locke, Director of the Royale International Group on completing the 2016 London 2 Brighton Challenge. The London to Brighton Challenge is one of the UK's greatest endurance charity events starting from the city to the coast, across varied terrains through day and night, totaling 100 km in distance.  It is not one for the faint heart for it tests one’s stamina, fitness, endurance and determination to reach the finish line in Brighton. Dean was able to complete this walk in  22 hours 40 minutes. 

Dean would also like to thank all those who have supported and contributed to his choice of charity - the Great Ormond Street Hospital’s Charity (GOSH) in London.  Dean was able to raise over HKD50, 000 through JustGiving.com platform. The  funds raised will be donated to the GOSH hospital to support their continuous dedication in providing world-class care and pioneering new treatments and cures for childhood illness.  

Please note, donations to the hospital are still valid through Dean’s Just Giving page (https://www.justgiving.com/fundraising/Dean-Locke1]. Feel free to log in and contribute if you haven’t done so already.


For those who would like to know more about the Challenge, please visit the organizer’s page on http://www.london2brightonchallenge.com or search #L2Bchallenge for more photos & stories.


What are the Factors that Influence Logistics Activities?

There are four key factors that influence logistics activities that are associated with a product.

Volume to Weight Ratio

The volume to weight characteristics will have an impact on the cost of transportation. Products with low volume to weight ratios are often more efficient distribution systems than those with high ratios. The reason for this is because low volume to weight ratio products can make the best use of the carrying capacity of vehicles, storage spaces and handling equipment.

Value to Weight Ratio

Higher value products have a better change of absorbing the costs of logistics. Value to weight ratios allow for the distribution costs to be considered in terms of value per unit of the product. Low value to weight ratios often has higher transportation costs than those with high ratios. However, the storage costs for high value to weight ratios are usually higher than those with low value ratios.

Special Characteristics

Some of the characteristics that have an impact on the choice of transport, handling and storage systems include:

  • How fragile the product is affects the packaging and safeguarding of the product during transportation and handling
  • Perishability of the product affects the storage and transport requirements and times
  • Hazardous products may require following regulations and have an impact on the way the product is moved, stored and handled

Time Issues

Time variations are commonplace in construction logistics and this has an impact on efficiency. Larger projects involved long term planning and the flows to the site may span years. The volumes and weights of the deliveries will vary and the flow to the site will have a direct impact on the efficiency of the labour and the equipment on site.  There are other factors to consider including weather delays, traffic and congestion that may impact the timely arrival of materials. JIT principles are being adapted but the construction is so complex it’s necessary to take all the challenges into consideration for JIT deliveries.

Tuesday, 14 June 2016

Logistics and the Supply Chain

Logistics includes many aspects of a business, which is why it’s so important to coordinate activities such as: inventory management, finance, purchasing, marketing and production.  Flows between different companies also require logistics management.  Supply chain is an even wider approach that requires interaction between organisations that are working together in the chain and much of the interactions involve logistics management.

What is Logistics Management?

Logistics management is used to coordinate all of the activities in logistics and optimise them. It integrates logistics with functions such as finance, sales, manufacturing and IT. The supply chain management moves upstream and downstream ensuring all materials, resources and information flow to create value in the form of services and/or products.  A construction supply chain management decisions include multiple factors, including:

  • Transport operations such as the type of transport used and whether transport is operated in-house or contracted out.
  • Materials handling systems to use.
  • Interaction between the different activities in the chain.
  • Spatial aspects such as where to source products/materials and where to position distribution centres.
  • Interaction and roles of each party in the supply chain.

Monday, 13 June 2016

The Definition and Importance of Logistics

Logistics is defined as the ‘time-related positioning of resource’ by The Chartered Institute of Logistics and Transport. This definition shows the importance of time, which is now changing the ways that managers are planning and organising their logistics and supply chain operations. Logistics is also described as the five rights, which relate to the services or products being:

1.     In the right place
2.     At the right time
3.     In the right quantity
4.     At the right quality
5.     At the right place

Logistics definitions do vary but it does concern the movement and storage of goods and information.  Logistics for a manufacturing company could also include the procurement and sourcing of components and raw materials, inward traffic, materials handling, storage, distribution of finished goods and after-sales services.

Logistics is therefore essential as without its goods and materials would not be moved. Management has to work to reduce waste and control costs that can add up quickly, often increasing because of handling costs, storage costs, transport costs along with packaging and administration.

Saturday, 11 June 2016

Chit Chat: Social Media and eCommerce - Part 3

The use of social media is essential in order to be competitive in ecommerce. Social media needs to be integrated into your marketing strategy, and when integrated successfully it can increase traffic and conversions, increase brand awareness, increase customer engagement and be a useful tool to help your business grow. Here’s how to use social media effectively:

  1. Make sure all of your social media posts are optimised using your keywords and designed to appeal to your target audience.
  2. Don’t try the hard sales pitch, social media platforms are not the right place for this tactic. Entertain and inform your audience and balance out any promotions with content that your audience will appreciate and content they want to interact with.
  3. Don’t forget to add social sharing buttons to your website, product pages, email marketing campaigns and add details of where your customers can find you on social media platforms on your printed materials too.
  4. Visual content is extremely powerful on social networks. Invest in quality image creation to help attract the attention of your audience as they scan their newsfeeds and timelines.
  5. Work hard to build relationships with your customers. Use social networks to provide customer services and to find leads.
  6. Add a blog to your website and add regular content that can be easily shared on your social networks.
  7. Know the platforms your customers use and concentrate on these areas. Create consistent content and learn the platform so you’re able to get the most out of the time you spend on your social media management.
  8. It is hard to get noticed on sites such as Facebook without the use of paid advertising. Boost your posts and ensure the boosted content is created to appeal and attract engagement with your target audience.

Friday, 10 June 2016

What are the consequences of failing to manage construction logistics?

The consequences of failing to manage construction logistics are as follows:

  • Additional Costs - Additional costs are added by inefficient logistics in the industry. Waiting for materials and collecting materials, equipment and tools all eat into the working day, resulting in an increase of costs.
  • Poor Quality – Construction quality is reduced as a result of disorganised logistics. Delays and interruptions all have an effect on quality.
  • Poor Image of the Industry as a Whole – Construction sites are often littered with badly parked lorries and disorganised sites, with skilled people often being left to do unskilled jobs. This image doesn’t attract people to the industry. The amount of waste that ends in landfills is also a concern that damages the industry in a world that now cares about corporate social responsibility.
  • Long Project Times – Poor logistics results in extended time being required to complete construction projects.  Improving the organisation of logistics will save time and reduce costs.
  • Increased Health and Safety Risks – Products that are stored on site unnecessarily increase the potential hazards on site. Accidents can arise from the manual handling of products and by the secondary working of materials.

Thursday, 9 June 2016

What is construction logistics planning (CLP)?

A construction logistics plan creates a framework that can be used to improve the management of the different types of freight vehicle movements to and from the construction site.  The plan is used to improve the safety of the deliveries and the reliability too, minimising the environmental impact and reducing congestion. The CLP needs to be developed as part of the transport assessment and tailored to the requirements of each site.  The plan needs to consider:

  • Legal loading zones
  • Choosing the best freight operators who are committed to best practice
  • Consolidating deliveries
  • Using sustainable delivery methods
  • Combining efforts with other construction sites in the area
There are many benefits to be gained by using construction logistics planning.

  • Reducing the costs relating to deliveries
  • Improving security
  • Reducing time wastage by removing unnecessary deliveries
  • Reducing noise and intrusion
  • Improving the reputation of the industry and firm
  • The efficient use of vehicles
  • Reliable deliveries
  • Reducing fuel costs

Wednesday, 8 June 2016

What is the role of logistics management within construction?

Logistics is at the centre of construction activities and it receiving a lot of attention.  The increased attention and reliance on construction logistics has drawn attention to logistics management in construction and the fact that it has fallen behind logistics in other sectors, such as manufacturing and retail. 

The amount of waste in construction is large and this is down to poor logistics, which means logistics managers need to work hard to reduce the amount of waste by improving the logistics processes. Waste is caused by:
  • When vehicles are not loaded efficiently and have to wait for access because of poor scheduling
  • Poor use of time because the materials are not available on site
  • Stockpiling products excessively resulting in higher costs and increased risk of damage or determination
  • Failing to coordinate activities
  • Large proportions of returned and damaged items
Construction management need to work on all of the above points to improve logistics and reduce waste in the industry

Tuesday, 7 June 2016

What are key transport and storage considerations for products in construction logistics?

Transport is a key link in the supply chain and is required for the supply of most products. Transport is what joins everything together and it is as important in the construction industry.  Transport is essential for transporting everything from the raw materials to the finished products. 

It is essential as the flow of goods relies upon the transport but there are cost considerations too. Often the cost of the delivery cost will be high when lower value products are transported over long distances. So it’s important that transport issues are given attention and consideration when planning the supply of products and materials.

There are three key storage cost elements to consider:
·         Physical costs of stock holding
·         Cost of borrowing money or opportunity cost of holding stock
·         Cost of the goods that is lost during storage (theft or damages for example).

There are many points where goods can be stored over the supply chain and each point will require handling. When products or materials are handled multiple times, the cost of the logistics increases as labour and equipment is required.

Determining who is responsible for the storage and who will pay the storage costs needs to be taken into consideration. The storage size will also have an effect on the arrangement of transport.

Monday, 6 June 2016

What three factors influence logistics activities in construction logistics?

Construction logistics are impacted by global issues and the amount of products and materials used. There are large variations and special characteristics that need to be accounted for along with storage, handling and transport requirements.

·         Volume to weight ratio
Transportation costs are impacted by the weight and volume characteristics of a product. Distribution centres generally deal with products that have low volume to weight ratios more efficiently that those with high ratios as they tend to make full use of the carrying capacity of road freight vehicles, storage space and any handling equipment used.  The high-ratio products tend to take up more space and not make full use of vehicles or handling equipment constraints, increasing costs of storage and transport.

·         Value to weight ratio
Higher valued products have a greater potential for absorbing the logistic costs. Using value to weight ratio makes it possible to consider the distribution costs that are associated with products in terms of the value per unit. Products that have low value to weight ratios are often associated with higher transportation costs than those with high rations. The storage costs for high value to weight products are greater than those with low ratios.

·         Special characteristics 
Some of the other characteristics of a product that have an effect on the selection on storage, handling system and transport include how fragile the product is, perishability of a product and any hazardous characteristics.

·         Time issues also have an influence on the efficiency of construction logistics. Large construction projects will involve products flowing to and from site for long periods of time, sometimes years. The volume of materials, the vehicle movements and the nature of the items will also vary greatly. The flow of the materials has a huge impact on the construction project efficiency and the use of resources and labour. Weather and complex traffic patterns may influence the timely arrivals to a site. Just in time deliveries are now on the rise in logistics, but construction projects present many challenges that make JIT deliveries difficult to manage.