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BCom SCM - Logistics Management
BCom SCM - Logistics Management
BCom SCM - Logistics Management
LOGISTICS MANAGEMENT
Module Guide
Copyright © 2021
MANCOSA
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Bachelor of Commerce in Supply Chain Management
LOGISTICS MANAGEMENT
Preface.................................................................................................................................................................... 3
References.......................................................................................................................................................... 126
i
Logistics Management
List of Contents
List of Tables
Figure 5.7 Forces that affect managerial decision-making in the current environment ..................................... 95
Figure 7.2 Diagrammatical representation of the forward and reverse flow of logistics .................................. 115
Preface
A. Welcome
Dear Student
It is a great pleasure to welcome you to Logistics Management (LM7). To make sure that you share our passion
about this area of study, we encourage you to read this overview thoroughly. Refer to it as often as you need to,
since it will certainly make studying this module a lot easier. The intention of this module is to develop both your
confidence and proficiency in this module.
The field of Logistics Management is extremely dynamic and challenging. The learning content, activities and
self- study questions contained in this guide will therefore provide you with opportunities to explore the latest
developments in this field and help you to discover the field of Logistics Management as it is practiced today.
This is a distance-learning module. Since you do not have a tutor standing next to you while you study, you need
to apply self-discipline. You will have the opportunity to collaborate with each other via social media tools. Your
study skills will include self-direction and responsibility. However, you will gain a lot from the experience! These
study skills will contribute to your life skills, which will help you to succeed in all areas of life.
MANCOSA does not own or purport to own, unless explicitly stated otherwise, any intellectual property
rights in or to multimedia used or provided in this module guide. Such multimedia is copyrighted by the
respective creators thereto and used by MANCOSA for educational purposes only. Should you wish to use
copyrighted material from this guide for purposes of your own that extend beyond fair dealing/use, you
must obtain permission from the copyright owner.
B. Module Overview
The Bachelor of Commerce in Supply Chain Management degree is a dynamic programme designed to give
candidates specialist knowledge within the growing field of supply chain management. A well implemented
supply chain management system has been identified as a key tool in the success of today’s leading
businesses.
Supply chain management involves the co-ordination, production, shipment and delivery of goods from the
point of production to the point of consumption.
Students enrolled on the programme will be exposed to the learning areas of operations, supply chain
management, logistics and purchasing. Students will obtain in-depth knowledge in the field of supply chain
management.
The module is a 15 credit module at NQF level 7.
Students are expected to read the introduction and then work through the text. Each unit of study will include
either an activity or task that will assist in you better understanding the unit. Please work through all activities
and ensure the prescribed and recommended readings are consulted.
The ability to develop and implement Strategic supply chain plans are explored to
strategic supply chain plans enable student to develop and implement these
plans.
The skills and knowledge to analyse the The performance of supply chain partners and
performance of supply chain partners and methods to improve supply chain performance are
develop methods to improve supply chain analysed to gain skills and knowledge in these
performance areas
The ability to analyse and interpret Strategy formulation and decision making in
information to facilitate strategy formulation supply chain management is explored to allow
and decision making in supply chain students to develop the ability to analyse and
management interpret information to facilitate strategy
formulation and decision making in the field of
supply chain management
Be able to apply and integrate knowledge to Complex supply chain problems are investigated
solve complex supply chain problems to allow students to gain skills to be able to apply
and integrate knowledge to solve these problems
Understand the concepts and functions The concepts of logistics management and the importance
of logistics management and the of logistical decisions are investigated to develop the
importance of logistical decisions. students understanding of logistics management.
Discuss site selection, design of facilities The concept of site selection is explored to enable
and operations of a warehouse. students to discuss the implications of choosing the correct
site.
Investigate the role of packaging and The different aspects of packaging and materials handling
materials handling in logistics are investigated in order for students to acknowledge the
management. impact on logistics management.
Compare and contrast the various modes The various modes of transport are compared to enable
of transport and recognise the students to choose the best mode of transport.
significance of global logistics
The concepts of global logistics are examined to enable
students to understand the significance of global logistics
on the logistics function.
Examine how information systems Information systems are examined to determine how they
support logistics communication and support communication between logistics partners.
customer service.
The benefits of information systems are explored to enable
students to understand how it can improve customer
service
Explore the importance of reverse Reverse logistics concepts are explored to understand its
logistics and waste management on the impact on the logistics function.
logistics function.
Waste management is discussed to enable students to
discover the importance of proper waste management.
Learning time
Types of learning activities
%
Syndicate groups 0
Independent self-study of standard texts and references (study guides, books, journal 60
articles)
Other: Online 10
TOTAL 100
G. Acronyms
The purpose of the Module Guide is to allow you the opportunity to integrate the theoretical concepts from the
prescribed textbook and recommended readings. We suggest that you briefly skim read through the entire guide
to get an overview of its contents. At the beginning of each Unit, you will find a list of Learning Outcomes and
Associated Assessment Criteria. This outlines the main points that you should understand when you have
completed the Unit/s. Do not attempt to read and study everything at once. Each study session should be 90
minutes without a break
This module should be studied using the prescribed and recommended textbooks/readings and the relevant
sections of this Module Guide. You must read about the topic that you intend to study in the appropriate section
before you start reading the textbook in detail. Ensure that you make your own notes as you work through both the
textbook and this module. In the event that you do not have the prescribed and recommended textbooks/readings,
you must make use of any other source that deals with the sections in this module. If you want to do further reading,
and want to obtain publications that were used as source documents when we wrote this guide, you should look
at the reference list and the bibliography at the end of the Module Guide. In addition, at the end of each Unit there
may be link to the PowerPoint presentation and other useful reading.
I. Study Material
The study material for this module includes tutorial letters, programme handbook, this Module Guide, a list of
prescribed and recommended textbooks/readings which may be supplemented by additional readings.
Recommended Readings
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A value chain perspective. Fifth Edition.
Oxford University Press
Harrison, A & Van Hoek, R. (2014). Logistics Management & Strategy Competing through the Supply Chain.
Fifth Edition. Prentice Hall International Edition
Wisner, Tan, K, Leong, G. (2012) Supply Chain Management A Balanced Approach. Third Edition. South
Western
K. Special Features
In the Module Guide, you will find the following icons together with a description. These are designed to help you
study. It is imperative that you work through them as they also provide guidelines for examination purposes.
LEARNING The Learning Outcomes indicate aspects of the particular Unit you have
OUTCOMES to master.
A Think Point asks you to stop and think about an issue. Sometimes
THINK POINT you are asked to apply a concept to your own experience or to think of
an example.
You may come across Activities that ask you to carry out specific tasks.
In most cases, there are no right or wrong answers to these activities.
ACTIVITY
The purpose of the activities is to give you an opportunity to apply what
you have learned.
At this point, you should read the references supplied. If you are unable
READINGS to acquire the suggested readings, then you are welcome to consult
any current source that deals with the subject.
PRACTICAL
Practical Application or Examples will be discussed to enhance
APPLICATION OR
understanding of this module.
EXAMPLES
You may come across Knowledge Check Questions at the end of each
KNOWLEDGE
Unit in the form of Knowledge Check Questions (KCQ’s) that will test
CHECK
your knowledge. You should refer to the Module Guide or your
QUESTIONS
textbook(s) for the answers.
You may come across Revision Questions that test your understanding
REVISION
of what you have learned so far. These may be attempted with the aid
QUESTIONS
of your textbooks, journal articles and Module Guide.
Unit
1: Introduction to Logistics
Management
1.2 Logistics management definitions Explain the definitions and concepts of logistics management
and concepts
1.4 Levels of logistical decisions Examine the different levels of logistical decisions
1.5 Logistics management activities Evaluate the various logistics management activities
Prescribed Reading/Textbook
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic
Logistics Management: A supply chain management approach.
Second Edition. Van Schaik Publishers
Recommended Readings
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A
value chain perspective. Fifth Edition. Oxford University Press
Harrison, A & Van Hoek, R. (2014). Logistics Management &
Strategy Competing through the Supply Chain. Fifth Edition. Prentice
Hall International Edition
Wisner, J, Tan,K, Leong,G. (2012) Supply Chain Management A
Balanced Approach. Third Edition. South Western
1.1. Introduction
No region is able to function as an island in which they are able to produce all the products that they need. To
ensure the needs of the population are met, there will need to be a mechanism in place to procure goods and have
them at the right place at the right time. This mechanism will need to ensure goods can be procured and allow for
these goods to be available for consumption, distribution or storage (Pienaar and Vogt, 2016:1). Over the year’s
consumers have become increasingly empowered with lots of information that is available at their fingertips, this
has made consumers even harder to please. Globalisation has created a universal market and the needs of
consumers are constantly changing, this has necessitated a revised method of providing goods to consumers
(Pienaar and Vogt, 2016:1).
For many years, procuring goods and materials management was largely viewed as function of the marketing and
operations department. Since the 1990s there has been a shift with a large focus on Supply Chain Management
and the use of a value chain. This has brought logistics to the forefront of the fundamental activities of a company.
Globalisation, informed and well educated consumers as well as the increasing use of technology has resulted in
Logistics Management becoming a major business function (de Villiers, Nieman and Niemann, 2019: 4).
Logistics can be separated into five different types as depicted in figure 1.1 below.
Military logistics: as the name suggests, it pertains to the delivery of goods that are needed in the military.
Ammunition, medical supplies as well as spare parts are examples of goods moved in military logistics. The
aim is to have the right product delivered at the right place and timing is crucial.
Engineering logistics: similar to military logistics and refers to concepts such as integrated logistics support.
Business logistics: refers to finished goods. The activities are commercial in nature. This term is generally
referred to as logistics.
Production logistics: this refers to logistics that occur between the time the raw material is procured up until
the completion of a finished product. It is these logistics activities that enable the manufacture of a good.
Reverse logistics: the actions that relate to waste disposal and returns. This flow will be in the opposite direct
of the other four types of logistics (de Villiers, et al., 2019: 4-5).
Activity
Plan
Implement
Control
a) Plan: Planning and preparation in logistics includes a variety of activities, such as the selection of the site in
which operations will be based, the number of people that can be accommodated, production capacity as well
as the correct location in relation to the supply chain. The appropriate carriers will need to be selected in line
with the location. A key factor in planning is the use of third party and fourth party logistics.
b) Organisation implementation: refers to the positioning of resources and the design of production and
distribution activities to best suit the needs of the customers and the supply chain. The end result is to ensure
that the firms goal is the met in the most efficient and effective manner.
c) Control: is inclusive of the actual scheduling and mapping of trips, vehicles and staff. A key factor is the
constant monitoring and evaluation of performance. Monitoring and evaluation will allow for remediation
(Pienaar and Vogt, 2016:11).
Revision Questions
Strategic Level
Tactical Level
Operational Level
Strategic level: These decisions that will have a holistic impact on the firm. These decisions will focus on
the long term functioning of the firm; an example would be customer zones. Strategic decisions are made
by top level management.
Tactical level: These decisions are taken over a medium timeframe approximately a year. Tactical
decisions are made by middle level managers.
Operational level: Are decisions that are taken on a daily basis. Operational decisions are made by
frontlines managers or supervisors (Pienaar and Vogt, 2016:12).
Think Point
Research the company and describe the different decisions that may
take place at the different managerial levels.
a) Demand forecasting: refers to the prediction of the amount of goods that may be needed for the short or
long term future. The future forecast is needed by all participants in the supply chain. Having a solid
understanding of the demand levels will allow for the appropriate volumes of goods to be produced and
moved to the required locations. These forecasts will have a knock on effect on the marketing, sales as
well as manufacturing functions.
b) Facility site selection: the selection of a location, the number of staff and the required facilitates are
strategic decisions taken by top level management. A key consideration in selecting an appropriate site
is the resources that will be needed for efficient operations and the various markets that will be serviced.
A location will need to be selected based on the inbound and outbound activities that are depicted below.
Having a strategically chosen location will ensure the transport routes are easily accessible and the raw
materials are easily acquired. Various costs such as labour, transport, security and other utilities will need
to factored in.
c) Design: The plant will need to be designed to accommodate the various modes of transportation that will
be used. The use of automated facilities will necessitate a design to support these automations.
d) Procurement: this is a key function in the supply chain with a focus on the acquisition of raw materials,
semi-finished goods and finished goods. The acquisition of these goods are an ancillary function to
enhance the functioning of the supply chain. Supply chain partners will need to be carefully assessed and
selected as the dependability of the partners will determine the dependability of the logistics function. It is
imperative for firms to develop and maintain good relationships with their partners.
e) Materials handling: pertains to the movement of goods that are either semi-finished, finished or in their
natural form. If materials handling is executed correctly, the productivity within the facility will be increased
and costs related to processing, storage and inventory will be reduced.
f) Packaging: is needed for the protection of goods. Goods are moved across various routes and intermodal
transportation can be utilised. All materials that are used to cover up a goods are referred to as packaging
materials. Packaging materials also provide a sense of identification. Scanners and increases in
technological bar coding have increased the efficiency in identifying goods via packaging.
g) Warehouse management: warehouses are storage facilities in which inventory is stored for a period of
time. In most cases the goods produced will not be immediately consumed by the end customer and will
need to be moved. The longer the time period for storage, the greater the costs incurred. It is therefore
imperative to practice warehouse management and take into consideration the location, capacity and the
possible lease or acquisition of this facility. The level of automation will also need to be considered.
h) Inventory management: a trade-off of between the holding of inventory and the possibility of having a
stock out will need to conducted. The downside of holding too much inventory is the cost and the downside
of holding too little inventory will be the loss of customers and reputational risk. Inventory management is
directly affected by demand forecasting.
i) Order processing: refers to the activities related to fulfilling the consumer’s orders. The correct details for
orders, credit checks and despatch of the goods are essential. The increased advancements in
technology have decreased the time limit to receive, process and dispatch goods.
j) Logistics communication: the key activity that links all the other activities in the supply chain is effective
communication. Communication is needed between firms and clients, their suppliers as well as the other
departments in an organisation. Effective communication creates coordinated logistics.
k) Transport: is a critical logistics activity and is essential to having goods delivered to customers at the right
time and in the right place. There are various considerations that must be taken into account. The choice
to acquire vehicles, the type of vehicle, the mode of transportation and the associated routes must all be
carefully considered.
l) Reverse logistics: as the name suggests, it will refer to the reverse flow of goods. Goods that are received
by a consumer and will need to be returned, or the eventual waste products. There is an increased
pressure from governments for business to act responsibly and ensure recycling and sustainability are
being practised.
m) Customer service: excellent customer service can provide firms with a competitive advantage. A firm may
be able to provide superior goods are lower prices due to the efficiency of their logistics functions. After
sales service is a crucial factor in customer satisfaction. The manner in which returns and defective
products are handled will be dependent on the logistics function (Pienaar and Vogt, 2016:13-16).
Logistics Management can be categorised into two focus areas: supply management and distribution management.
Supply management includes inbound activities such as the procurement and transportation of raw materials to a
production/manufacturing site. The raw materials will then be processed into semi-finished or finished goods.
These goods will be stored in distribution centres/warehouses. Distribution management entails the movement of
goods to the end consumer. Various modes of transportation can be used to deliver the goods to wholesalers and
retailers. Last mile logistics will be the final mode of transportation that is used to deliver the good to the end
consumer (de Villiers, et al., 2019:5).
Case Study
Pamba Easy Meals is a relatively small soya food processor in Tzaneen. After a modest
beginning the company moved from strength to strength and is currently the biggest of its kind
in the Limpopo province. The company has been growing at an average growth rate of 10%
over the past three years. In spite of negative market conditions during the past 12 years, the
company has managed to survive. The companies’ viability is insured through quality
improvement, product innovations and unique customer service. Pamba Easy Meals is a
relatively small manufacturer of soya based products, serving the geographical markets of
Limpopo, Mpumalanga, Gauteng, North-West province, Namibia and Botswana with a broad
product line. Pamba market their products through a network of sales representatives. The
representatives report that there is a strong pressure to increase the service to retail chain
stores. They report that the retail buyers are raising questions about the number of stock outs
that they have recently been experiencing. These buyers have even suggested that they might
switch to other brands, if the service is not improved. Pambas’ product lines focus on varying
additions of dehydrated vegetables, herbs and spices, vegetable oils, starches, flavourants,
rice and noodles. Other products are gravy, custard, jelly powder, cool drink powder, milk-
blend powder and rooibos tea. Pamba caters for the lower income groups in the rural areas,
which are dependent on non-perishable foods. The target market is served mainly by
agricultural cooperatives and Pamba is the main supplier of soya products. Other target
markets are retailers, caterers, and pre-packers of ration packs, wholesalers as well as
entrepreneurs involved in primary school feeding schemes. All products are delivered on order
as stipulated. Pamba makes use of their own transport for distribution to the outsourced
warehouses. Although they strive to maintain low transport costs, the costs are still high due
to the negative effects of economic fuel factors and fleet maintenance. Products are produced
in Tzaneen. Production takes place in large batch quantities in order to maintain low production
costs, and to ensure consistent production quality. As items are packed they are generally
transported to the warehouses in mixed truckloads. Product inventories are normally stored
around the country in five outsourced warehouses. The sales representatives call on
customers and generate orders, which are sent by email to these outsourced warehouses.
The outsourced warehouses then arrange transportation to the retail customer. Orders are
generally small, amounting to five or six cases per order, or about 150 kg to 200 kg at a time.
These orders are delivered using contract carriers, selected individually by each outsourced
warehouse. The costs are then billed to Pamba. Transport costs are high, because of the small
shipments. Delivery schedules vary by carrier; some provide fast and reliable service, while
others have been erratic to the point that customers have commented on poor delivery service.
The location of the current customer base is 60% in Limpopo, 20% in the North-West province,
10% in Mpumalanga, 5% in Botswana and 5% in Namibia. Pamba’s management is divided
into two major departments. One is marketing and sales, and the other is production. (There
are also several smaller staff units for human resources, purchasing and finance.) Production
is the older of the two. Marketing came about almost as an afterthought and had a difficult time
establishing credibility within the company. Production is responsible for scheduling production
as well as arranging transportation and maintaining inventory in the warehouses. Staff
members are motivated by a production bonus on a weekly basis. Staff are informed of
marketing and production objectives as well as any problems that may have occurred or may
occur. Employees receive in-house training and current employees fill new positions. Staff are
encouraged to improve their housing, by means of loans granted by the company. All staff
members receive the benefits of a pension fund as well as a medical aid fund. Due to the
above-mentioned incentives, the company maintains a high level of team spirit and motivation,
with low personnel turnover. Customer service is improved by constant communication with
the sales representative network. In the event of an emergency, customer service is rendered
as per cost. Pamba takes products not sold and damaged back for credit. No order is too big
or small for Pamba. The local crops of soya beans do not fulfil the local demands, therefore
necessitating soya bean imports. The meat industry also makes use of texturized vegetable
protein, leading to a further shortage of soya beans. Currently there is only one supplier of
texturized vegetable protein in South Africa, situated in Mokopane, approximately 150 km
south-west from Tzaneen. This main supplier has obligations in terms of foreign contracts,
leading to shortages. Due to the volatile exchange rate, it is too costly to import soya beans.
Over the past months there has been an erratic supply of the basic raw material leading to
Pamba being unable to meet its demands. There are a variety of role players in the soya food
industry. Competitors in Pamba’s market are Nutritional foods, Imana, Ayos and Umgeni. As
in most industries there are many new entries, but they do not survive and leave the market
quickly. Pamba’s quality, product differentiation, price and service offerings are most
competitive.
Source: Villiers, G. d., Nieman, G., Niemann, W. (2017). Strategic logistics management. Fifth
Edition. South Africa: Oxford University Press.
Identify three logistics activities and substantiate your answer with statement from the case
study.
1.6. Summary
Logistics has been around for a long period of time, it gained popularity in the 1990s and was seen as the part of
the supply chain that is responsible for planning, implementing and controlling the forward and reverse flow of
goods. Different concepts and types of logistics were examined in this study unit. The different management levels
at which logistics decisions are made were discussed with a focus on the timeframe of these decisions. Inbound
and outbound activities were differentiated and a graphical representation of logistics management was provided.
The unit concludes with a brief description of the various logistics activities that are performed.
Knowledge Checks
Please ensure you read your notes before attempting the questions.
1. Logistics can be placed in different categories. Which of the following refers to the
categories of logistics?
a) Military logistics
b) Engineering logistics
c) Business logistics
d) Production and reverse logistics
e) All of the above
2. Logistics has different levels of decision making. Which level of decision making covers
the long term functioning of the logistics activities.
a) Strategic level
b) All levels
c) Operational level
d) Tactical level
3. Distribution management includes which activities
a) Receiving goods
b) Loading goods to be delivered to a wholesaler
c) Sorting of goods to be stored in the warehouse
d) Labelling
4. Packaging is an essential logistical activity. Select the option that best describes the
function of packaging
a) It is needed for protection
b) Packaging can provide a sense of identification
c) Packaging can assist in the sales and advertising
d) All of the above
e) None of the above
Solution
Logistics can be defined as the series of activities in the supply chain that allow for the planning, implementing
and controllingl of activities. Logisitics managment involves inbound and outbound actitives. Essentially there are
five types of logistics:
1. Third part logistics is the middle man or the third party that completes activities on behalf of the firm. A
firm may contract certain logistics activities to a contractor. This contractor will then be referred to as the
third party.
2. Fourth party logistics is the extension of third party logistics, this is when an entire supply chain is
contracted to another firm. Please consult your prescribed and recommended readings for more
detailed explanations of third and fourth party logistics.
3. The delivery of ammunition such as guns and bullets to soliders. The delivery of medical supplies to war
torn/pandemic areas.
4. Global positioning system to for improved track and traceability.
5. The return of goods or the recycling of goods such as empty lotion bottles.
Tactical – The medium term decisions such has the supplier and partners that will be utilised. Barloworld makes
use of third party logistics and fourth party logistcis.
Operational – the operation decisions are for short term and will refer to the day to day activities which will
include the specific routes that will be utilised.
The answers will vary based on the firm that was chosen. Please use the internet to review other examples.
Knowledge checks
True or False questions
a) True
b) True
c) True
d) False
e) True
Unit
2: Demand Forecasting and
Forecasting Supply Chain
Requirements
2.5 Selecting appropriate forecasting Distinguish the ability to select appropriate forecasting
techniques techniques
Prescribed Reading/Textbook
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic
Logistics Management: A supply chain management approach.
Second Edition. Van Schaik Publishers
Recommended Readings
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A
value chain perspective. Fifth Edition. Oxford University Press
Harrison, A & Van Hoek,R. (2014). Logistics Management &
Strategy Competing through the Supply Chain. Fifth Edition. Prentice
Hall International Edition
Wisner, J, Tan, K, Leong, G. (2012) Supply Chain Management A
Balanced Approach. Third Edition. South Western
2.1. Introduction
Demand forecasting benefits both the buyer and the seller. Imagine you are browsing through a catalogue and see
the exact smartphone that you want. You go into the shop and look for it, but it is not on the shelves. You enquire
with the sales staff and they inform you that the product you want is out of stock. This is very disappointing and
you may decide to buy a substitute product or you may choose to even keep your old product, after you have tried
numerous ways to get the desired product. This situation will not benefit you and it will negatively impact the
business. Hence the need to have the products available when the consumer needs it. This will only happen if
demand forecasting is done correctly. When the firm is able to correctly anticipate (forecast) the demands of
consumers, they will be able to better satisfy their demand in the short and long term. Demand forecasting is
primarily performed by the sales and marketing teams and this information is crucial for the efficient functioning of
the manufacturing and logistics department. A common view expressed by Al Enns, the director of supply chain
strategies at Motts North America is that if one can get the forecast right, then everything else will flow better as
you are operating from a proactive versus a reactive state of mind (Pienaar and Vogt, 2016:112)
It can be difficult
Short period is
better than a long
period
It is difficult to get the forecast accurately and sometimes it can be regarded as impossible. Various unexpected
activities such as pandemics, natural disasters and acts of terrorism affect the accuracy of the forecast and reduces
the level of certainty. The main purpose of forecasting is to create good and close to accurate forecasts over short
and long periods of time. The main objective is to keep the margin for error as low as possible.
In most cases firms find that it easier to generate a forecast for a group of items instead of a single item. In the
event of generating a forecast for single item the margin for error is much greater. However, if one were to generate
a forecast for an entire line of products then if some were more accurate than others, it will even out the forecast.
For example, if Nestle were to complete a forecast for a single item such as Kit Kat, it may be harder to forecast
accurately. However, if Nestle were to generate a forecast for all confectionery items then the forecast may be
more accurate due to the fact that the deviations balance out (Pienaar and Vogt, 2016:112).
Forecasted 15 14 13 14 11
demand
(000 000s)
Actual 11 10 13 13 10
demand
(000 000s)
Deviation 4 4 0 1 1
In the above table, the deviation for a single item such as Kit Kat is 4 000 000. However, if the manufacturer
generates a forecast for multiple items then the forecast figures may be more accurate as they cancel each other
out. The calculation will be as follows:
(4+4+0+1+1) = 10 000 000
10 000 000/5 = 2 000 000
Forecasts that are provided over a short of time period has proved to be more accurate than the longer-term
forecast. With the short term, there would be fewer uncertainties therefore making it easier to predict. The long-
term forecast may be affected by unexpected circumstances. In general, most economic indicators provide
predictions for a short period of time, such as inflation and interest rates (Pienaar and Vogt, 2016:112).
The following factors should be used in evaluating the forecast values. The following factors are the foundations
of a good forecast.
The forecast must be of a timely manner. When generating a forecast, the time period should allow for
the implementation of changes due to unforeseen circumstances.
The forecasts must be reliable and trustworthy, if forecasts are generated and they constantly produce
unreliable and inaccurate results, this will limit the credibility of the forecasts that will be generated in the
future. One needs to produce accurate and reliable forecasts to allow for improved decision making by
various stakeholders.
It is imperative for the forecasting teams to communicate with the decisions makers and inform the
decision makers about the assumptions and conditions that were used in the forecasting process. Should
the assumptions and conditions change, then It must be communicated to the decision makers.
Forecasts must be customised to suit the users of the forecast. If the forecast is going to be used by the
manufacturing department, then it should be in units as that is the accepted measure for the
manufacturing department. The finance department will need forecasts that are in monetary units (Rands
/ US Dollars) as that is the accepted measure for the finance department.
The selected forecasting technique must be relevant thus ensuring the data that is used is appropriate for
the technique. The data should be factored into the forecasting technique.
It is essential for the benefits accrued from forecasting to outweigh the cost of the implementing the
forecasting techniques.
The forecast must adequately address the uncertainty. One way to achieve this will be to include limits:
an upper and lower limit. Forecasting teams must analyse the accuracy and the limits on previous
forecasts to provide a basis for future forecasts (Pienaar and Vogt, 2016:112).
Revision Questions
Please read your notes carefully before attempting the revision exercise
Quantitative Qualitative
forecasting forecasting
Jury of
Explanatory
executive
models
option
Sales force
composite
Consumer
market survey
b) Explanatory models can also be referred to as regression models. With this type of forecasting technique,
related variables can be used to formulate a mathematical relationship in which the demand for a variable
and the associated factors that causes a consumer to demand that particular product are reflected. For
example, the number of air conditioning units that are demanded by consumers may be affected by the
temperatures, the humidity and the disposable income. A mathematical equation can then be created
(Pienaar and Vogt, 2016:113).
a) The Delphi method utilises the knowledge of a panel of experts. All panel members are guaranteed
anonymity, there are between five to seven experts. The selected panel will not meet and discuss their
views, they can be geographically dispersed. The following process will be followed in the Delphi
technique
Step 1: the panel of experts will be selected.
Step 2: questionnaires pertaining to the variable that needs to be forecasted will be provided to all the
members on the panel.
Step 3: the results from the questionnaires are collected and then summarised.
Step 4: the summarised and transcribed results from the questionnaire are provided to the panel members
for a further review.
Step 5: the panel members will take into account the views shared by the other panel members and make
their revisions.
Step 6: step 3, 4 and 5 are repeated until there is a general consensus.
b) The Jury of executive option uses the judgement and experience of managers and executives to make
forecasts, this is a subjective method of forecasting as it relies on the personal opinions, experience and
frame of reference of the manager/executive. It will be advantageous to have people from different
functional units thus providing a diverse knowledge mix. Meeting sessions will encourage participation.
c) The sales force composite is focused on the sales unit of the business. All sales staff from across the
different regions are requested to provide forecasts for his or her region, these forecasts will then be
combined to produce a national forecast.
d) A consumer market survey is used to gather information from existing customers and potential customers
regarding their future plans to purchase. These surveys will shed light on their buying patterns (Pienaar
and Vogt, 2016:113).
Think Point
If you were asked to provide a forecast on the expected amount of cans of coke that will be
sold per day and given access to previous sales data for the last 365 days.
Step 1 The need and purpose for the forecast must first be established. All objectives regarding
the forecast must be clearly specified.
Step 2 The items or the units that will need to be forecasted must be decided upon. It is
important that forecasts are customised to the respective departments or regions. If they
are not customised for department, they may not be useful.
Step 3 The time frame for the forecast must be decided on. It can be daily, monthly or annually
(dependent on the use and the product).
Step 6 The model that was selected in step 5 will need to be validated. This can be done by
evaluating the various models and assessing the perfect fit based on historical data.
Step 9 The results will need to be tracked. It is important to measure the forecast with the actual
values. This will improve future forecasts
Activity
Read through this blog post by Anita Raj on the supply chain forecasting from a
technological perspective.
We are operating in the digital industrial era where technologies are evolving rapidly to
create a more efficient, more productive, and more agile factory. With the advent of the
IoT and the complexities involved in operating a global supply network, today’s
manufacturing companies are more interested than ever before to get a sense of the
future. After all, it is important to know how certain events could impact operations in
the future and what companies can do to mitigate unforeseen risks due to volatile
production conditions to efficiently manage warehouse operations.
While predicting the future may not be completely possible, what companies do have
are a bunch of intelligent and powerful solutions that can give an accurate picture of
their supply situations and the elements that influence their production cycles. Thanks
to advances in technology, including Machine Learning, Artificial Intelligence (AI),
Robotics, etc., companies are able to orchestrate continuous collaboration between
supply and demand, planning and fulfilment, expectations, and customer satisfaction.
In fact, a recent study revealed that accurate forecasting was one of the topmost
priorities for manufacturing companies as modern manufacturing continues to develop,
diversify, and expand to new regions of the world.
supply chain forecasting for efficient warehouse management and better shop floor
control.
Forecasting helps by giving accurate indications needed to plan production cycles and
helps managers operate with more agility, transparency, and flexibility and the
readiness to adapt to changing production environments as well.
efficiency, overall productivity, and profitability. Adequate visibility into the supply chain
using data from equipment, processes, and products can help determine where
bottleneck operation occurs and eventually boost safety and throughput while
extending the life of key processing and material handling equipment.
Accurate supply chain forecasting helps gain visibility and analyse existing data with
valuable insights. This can give operations managers the necessary functional
intelligence for bottleneck elimination at the source.
Supply chain forecasting has a long term impact on operational cycles, touching each
and every aspect of the value chain. Therefore, accurate forecasting can be highly cost-
effective at every step leading to a higher throughput.
AI-driven Supply Chain Intelligence – Now achieve operational efficiencies across the
shop floor
When supply chain forecasting happens through the powerful realms of AI, this can
result in superior operational outcomes. All of this with minimal effort of time, resources,
and human involvement. AI provides the supply chain with contextual intelligence which
can be used to reduce the operating costs, eliminate wasteful processes and
bottlenecks and accelerate decision making. With the introduction of AI, manufacturing
companies can work on enhancing factory scheduling and production planning, by
analysing different issues at several levels and then optimize them.
Source: Raj, A. (2020). Importance of Supply Chain Forecasting for Plant Managers.
[Online]. Available: https://www.supplychainbrief.com/forecasting/logistics/?open-
article-id=13117366&article-title=importance-of-supply-chain-forecasting-for-plant-
managers&blog-domain=throughput.world&blog-title=throughput
Are you able to create a presentation in which you explain the need for forecasting?
The presentation should be approximately 15 minutes with PowerPoint slides.
1 Monday 1 67
Tuesday 2 54
Wednesday 3 51
Thursday 4 46
Friday 5 62
2 Monday 6 66
Tuesday 7 55
Wednesday 8 47
Thursday 9 45
Friday 10 64
3 Monday 11 75
Tuesday 12 58
Wednesday 13 56
Thursday 14 49
Friday 15 71
4 Monday 16 76
Tuesday 17 57
Wednesday 18 53
Thursday 19 50
Friday 20 69
5 Monday 21 78
Tuesday 22 60
Wednesday 23 54
Thursday 24 53
Friday 25 80
6 Monday 26 81
Tuesday 27 63
Wednesday 28 58
Thursday 29 52
Friday 30 83
The first 20 responses from table 2.4 have been plotted on the graph depicted below. Figure 2.3 is a graphical
representation of the responses and can be interpreted as a line graph.
There are four basic patterns of data that can be observed in the figure below: level, trend, seasonal and cyclical.
These patterns have their own unique shape as seen in figure 2.4 below.
Level or horizontal data: can also be called stationary data. The data will fluctuate around a mean that is
constant. This data pattern can be observed for products which have a predictable demand and are
essentially in the mature stage of their life cycle. The variable does not increase or decrease over time.
Trend or non-stationary time series: is when an increase or a decrease of the variable can be observed
over time. It can take on a linear pattern.
Seasonality: this can be seen as a pattern that is repetitive for a timeframe. An example would be
restaurants that experience a peak in sales over the Friday and Saturday followed by a decrease in
Monday sales.
Cycles: this type of pattern is linked the business cycle. Products that are linked to economic variables
such as the interest rate or a recession will exhibit a cyclical pattern (Pienaar and Vogt, 2016:115).
Once the data pattern has been correctly identified, the historical data observed and the time frame noted. The
table below can be used to select the appropriate forecasting technique.
Holt- Winter’s additive and Trend and At least 4 or 5 per Short to medium
multiplicative seasonality season
Causal (cross sectional data) Can handle Minimum 10 Short, medium and long
almost all data observations per
patterns independent variable.
Readings
You will need to read the entire section on quantitative and qualitative techniques.
The below links can serve as additional sources that can be consulted
https://scm.ncsu.edu/scm-articles/article/forecasting-methods
https://smartcorp.com/?utm_source=Google&utm_medium=Ads&utm_campaign=B
est&gclid=EAIaIQobChMI6-
aGoKDg6QIVFeDtCh3bRAHtEAAYASAAEgLWH_D_BwE
2.6. Summary
Forecasting and the impact of forecasting was reviewed in this unit. Further to that, the various features of forecasts
were discussed. Thereafter the two broad categories of forecasting were explained: qualitative and quantitative.
The different quantitative and qualitative methods of forecasting were examined. Explanations and graphical
representations of patterns were provided. The unit concluded with an explanation of the method used to select
an appropriate forecasting technique.
Knowledge Checks
a) It can be difficult
2. There are two general types of forecasting, identify the two types
3. Historical data can be plotted on a graph to reveal four basic patters. Which
pattern of data can be referred to as stationery data.
a) Level or horizontal
b) Trend
c) Seasonal
d) Cyclic
a) Surveys
b) Responses
c) Quantitative data
d) Resources
e) Candidates
e) Time series
Solution
1. Demand forecasting is the act of predicting future demand using a variety of tools.
2.
Forecast must be timely
All forecasts must be relaible
Effective communication is essential
The technique must be relevant to the data pattern
The forecast must be cost effective
Forecasts must be able to address situations of uncertainty.
3.
False
True
False
True
True
Activity 2.4
Readings 2.5
The additional readings provide alternate perspectives for qualitative and quantitative forecasting.
Knowledege checks
1. E
2. A
3. A
4. C
5. D
Unit
3: Site Selection, Design of
Facilities and Warehouse Management
3.2 Why firms use warehouses and Assess the reasons to use warehouses and distribution
distribution centres centres
3.3 Site selection, warehouse design and Explain the factors affecting site selection and warehouse
layout design and layout
3.6 Common warehousing problems Evaluate the common warehousing problems faced by
organisations
Prescribed Reading/Textbook
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic
Logistics Management: A supply chain management approach.
Second Edition. Van Schaik Publishers
Recommended Readings
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A
value chain perspective. Fifth Edition. Oxford University Press
Harrison,A & Van Hoek,R. (2014). Logistics Management & Strategy
Competing through the Supply Chain. Fifth Edition. Prentice Hall
International Edition
Wisner,J, Tan,K, Leong,G. (2012) Supply Chain Management A
Balanced Approach. Third Edition. South Western
3.1 Introduction
The logistics function is integrated with warehouses/distribution centres. Logistic activities are spatially dispersed
and rely on storage facilities to store and distribute the goods. The design of the warehouse must be suited to the
level of automation that is needed, the types of products as well as the design of the facility. There are costly
implications to the warehouse not meeting the requirements of the logistics function as this will not be easily
changed over the short term. A warehouse will need to be designed to facilitate effective entry and exit and easy
access to the facilities. Safety and quality standards must be implemented. This study unit will examine the nature
of warehouses, their location and the optimal design in relation to the supply chain (de Villiers, et al.,2019:61).
Movement
Storage
Main purpose of the warehouse
Can be categorised into four Information transfer
Goods can be stored in a
key actvities: receiving, warehouse for short or long
transfer, order selection and period of time. Information moves when the
shippping goods move.
Bufffer/safety stock is held
Information is transferred when
goods are moved or stored.
There are many reasons as to why a firm would utilise a warehouse. The following list sheds light on the various
reasons as to why a firm would use a warehouse.
Firms try to achieve economies of scale in order capitalise on cheaper costs per unit, which necessitates
storage space for those large volumes.
Firms try produce a high volume of products to spread out the costs over the large volume of products.
This can be referred to as production economies and will result in a firm requiring storage spaces.
Firms purchase large quantities of goods to obtain discounts. These firms will buy in bulk and will need to
store these goods in a warehouse.
Firms that supply essential items such as medical supplies will need to ensure they have stock on hand,
these will need to be stored in warehouses.
A firm will need to ensure the customers are receiving their products as and when they need it. Stock outs
will need to be prevented and this will necessitate firms storing stock in a warehouse.
Most firms anticipate consumer demand quite accurately however there are times when the market
conditions unexpectedly change, this can result from celebrity endorsement or seasonal changes. Firms
will only be able to meet customer demand if they have adequate stock in storage.
Firms supply customers that are geographically dispersed and will need to have warehouses to
accommodate for the time and space difference.
Warehouses help firms to save on last mile logistics by making goods available closer to the consumer,
this is achieved by having warehouse that are geographically dispersed.
Manufacturing firms will need to store parts for their production process. Firms may opt to have a
warehouse in which these parts are stored so that internal processes are completed more efficiently.
Firms that practise a Just in Time approach to manufacturing will need to have goods/parts in a nearby
accessible location, this can be achieved with a warehouse.
Warehouses allow for firms to store finished goods which will allow the firm to keep a steady flow of supply
to retailers and wholesalers, once stock is finished, it can be quickly replenished.
Warehouses act as an important link between supplier and the producer, warehouses provide an
intermediary function in which they facilitate movement between producer and supplier (de Villiers, et al.,
2019: 58-60).
Think Point
Most firms use warehouses to limit the amount of time that goods are in last mile logistics. The last mile in logistics
refers to the time it takes to get the goods to the final consumer. If a firm has one central manufacturing plant, it
would need to have regional warehouses to ensure the products reach customers timeously, this decreases the
time a product will spend in last mile logistics (Pienaar and Vogt, 2016:330).
The storage space must be calculated. It would be a mistake to build the warehouse too small. This is a
critical step and must be well thought out,
Careful consideration for aisles in the workshop is needed. Should a warehouse use forklifts there will
need to be clearly demarcated aisles which allow for manoeuvrability of the forklift and easy picking.
A decision on the cubic capacity must be made and whether horizontal and vertical shelving will be used.
Items must be strategically positioned close to entry or exit points. Items that stay for longer periods of
time in the warehouse may be positioned at the back of the warehouse. Items that are going to be in for
a short time will be stored close to exit points.
It is advisable to invest in software to create the best layout in which the space is fully utilised. Software
will facilitate automated grids.
Ensure high level storage is fully utilised. The best warehouse layout will make maximum use of the area.
Stock will be stored horizontally and vertically, as high as possible. However, all safety considerations
must be factored in. Warehouses need to comply with safety requirements and all necessary safety
measures must be followed. There must be fire monitors/sprays attached to the roof. Warehouses that
make use of high level shelving must take care to ensure there are ample guard rails and safety features
in place to prevent accidents associated with the height. All safety precautions must be taken to prevent
injuries and fatalities such as proper entry and exit routes and proper safety on the aisles if forklifts are
being used. All staff must receive training and regular risk assessments must be conducted.
The size of the stock and the materials handling equipment used in a warehouse will need to be factored
in the layout. The aisles, entrance and exit points will need to be structured to allow for streamlined
movement of goods.
The team planning the warehouse layout will need to use work flow principles to facilitate efficient
movement of stock and ideal sequencing of activities (de Villiers, et al., 2019: 64).
Case Study
Vespa Scooters
Vespa Scooters is a well-known international brand and a popular European brand. Two
hundred motor scooters are delivered daily to the Vespa warehouse in Dierdorf, Germany,
and these need to be distributed cost effectively throughout Germany and the European
Union. Vespa face some interesting problems. Until recently, the scooters were packed in
elaborate, costly packaging, which increased both their handling and packaging expense.
The packaging also could not be reused from a reverse logistics perspective and was
discarded once the customer had received the delivered product. Interroll, the warehousing
specialist, was called in to offer some solutions. The company suggested strong, lightweight
aluminum pallets, since these could be stabilised by special roller rails in the warehouse
design and would not bend easily. The risks in the supply chain owing to packaging damage
were significantly reduced, as well as the exposure to damage and delivery problems from
the customer’s point of view. Scooters are not the easiest items in the world to store, owing
to their strange shape and the fact that they do not fit easily into nice cubes (the dream of all
logisticians!). Their packaging and storage thus required careful consideration and planning.
A three-level space-saving flow storage system was designed to organise 1 620 motor
scooters stored in the warehouse, securely lashing them to special aluminium pallets.
Special centering guides were also used to position the aluminium pallets exactly.
Mechanical speed controllers were used for gentle, impact-free movement: this was
important since the loaded pallets had a very high centre of gravity. In other words, gravity
and momentum were used to move the pallets along the racks, and this reduced the costs
of energy consumption in the warehouse. Interroll suggested aluminium pallets since they
organised the warehouse neatly, and this enabled quick identification of the 37 types of
scooter stored (37 types of stock-keeping units or SKUs). The order consigning of stock on
a FIFO (first in first out) system in the warehouse was much easier and more logical. One of
the significant advantages, however, was the reusability of the aluminium pallets. They could
be recycled over and over again, thus reducing the packaging cost to almost zero, and this
was also great for the environment. Good logisticians explore the greenest solutions possible
and try to reduce waste and packaging in the modern, fast-paced disposable consumer
society. Little wonder Vespa, with the aid of Interroll, remains a major player in the scooter
market of Europe and the world. The inbound receiving and put-away process for Vespa has
been significantly improved and simplified. This has also resulted in the order picking and
outbound shipping process moving more efficiently. The faster and more accurately the items
can be put away and then picked, the better. Faster turnaround times in picking result in
better customer satisfaction downstream as goods head on their outbound route to
customers, or customers’ customers. Warehouse design can create significant process flows
or bottlenecks in the inbound or outbound flow of goods. Ideally the flow of inbound and
outbound goods should be precise, and this normally only happens in well-planned and well-
designed warehouses.
Source: Villiers, G. d., Nieman, G., Niemann, W. (2017). Strategic logistics management.
Fifth Edition. South Africa: Oxford University Press.
Can you discuss the benefits of a good warehouse design with reference to the case study.?
Value added This includes sorting, assembling, kitting, repacking and labelling. Some warehouses
services might receive a large consignment of goods and then repackage these goods into
labelled boxes.
Assembly function Some warehouses may perform assembly functions. Baby strollers may be
assembled and delivered to the consumer.
Break bulk Warehouses create break bulk by breaking a larger consignment into smaller units to
be shipped to different customers.
Revision Questions
Example: Pick and Pay has distribution centres across the country due to their national footprint. This means they
need warehouses in all provinces that have materials handling equipment as well as their own delivery vehicles
Pick and Pay provides many different products to their consumers and these are generally classified as Fast
Moving Consumer Goods (FMCG). Pick and Pay will receive consignments of stock from various manufacturers.
Such as Nestle, Tiger Brands, ABI, Unilever, Beacon, Mondelez, and KOO. These goods will come in and be
“crossed over” in the distribution centre and loaded on a delivery vehicle destined for a specific store.
Cross docking will only work if the following factors are satisfied:
There is a continuous flow/demand for goods to the consumers/retailers
A cross-docked managed load (CML) allows for identification and the sorting of all the items within the distribution
centre. Once the goods have been received in the warehouse, they will be checked against the delivery note from
the supplier and these items will be sorted in readiness for having them sent to the downstream customers.
A joint- managed load (JML) has stock with the identification codes already on them. They are received in the
warehouse and then sorted out to create a consignment. By having goods already labelled, it eases the pressure
of cross-docking staff and reduces the margin for error.
A supplier-managed load (SML) is when the supplier of the goods will label all the goods and have them sorted
into specific groups for downstream customers as per their order. These items can be stocked on pallets. This
allows for the pallets/carrier of goods to be transferred from the inbound to outbound sections of the warehouse
(Pienaar and Vogt, 2016:332).
Think Point
Now that you have a better understanding of cross docking. Take some time to view videos
on what cross-docking actually looks like and the various ways in which cross docking is
performed.
You can go onto YouTube and type in cross-docking into the search bar, there you will find
many videos that you can view to give you a better picture of cross docking,
Alternatively, you can also go through the your prescribed and recommended readings to find
pictures for cross docking.
Storage space
utilisation
Information Warehousing
gaps equipment
Labour intensity
Amazon distribution centre: using robots to increase efficiency and reduce costs
Amazon is well known for the efficient distribution of books and other materials across
North America and other parts of the globe. When one has so many global customers,
efficiency of operation is of paramount importance. In the past, workers in the Tracy
distribution centre near San Francisco in the US walked many kilometres back and
forth in the aisles to pick items ordered by customers and then prepare them in the
staging area for outbound shipment to end customers. The massive distribution
centre, approximately 28 football fields in size (or 112 000m2) has over 1 500 full-
time employees and a number of part-time workers. These workers use various
automated materials handling devices such as pallet jacks and other tools to move
and pick stock. More recently a rather strange device was added to the warehouse:
robots. Many robots. The 3 000 new robotic materials handling machines glide swiftly
around the warehouse and receive digital commands that are beamed wirelessly to
them from a centralised computer. Essentially their “boss” giving them instructions is
not a human, but rather a computer with carefully coded input data (i.e. collect this
from this exact location and move it to this exact (GPS) location). Each of the squat
orange robots can slider under a stack of shelves that is 1.5 meters wide, holding
1.65 tons of books and other merchandise stored in the distribution centre. Because
the robots can slide underneath the shelves, these shelves can be stacked very close
together so that the warehouse can hold even greater stock levels. All smart
warehouses utilize both their vertical and horizontal space optimally, so by stacking
shelves closer to one another, both vertical and horizontal space are optimized. The
Tracy DC now holds approximately 20 million items at any given time, from bottles of
steak sauce to high-end headsets, to books, PlayStations and video games. The
robots cost Amazon millions of dollars, but the company claims to have seen a
reduction of 20% in their operating costs. Amazon also argues that the fleet of robots
could save the company in the direction of $900 million a year in labour costs.
Amazon faces tough competition in difficult economic times globally from rivals like
Google and eBay, so using technology to keep costs down is always a smart move if
one gets a good return on investment (ROI) or a good return on the assets purchased
(ROA) (in this case it is the significant capital or money paid for the robots, and
whether these will indeed reduce operating costs and labour costs sufficiently)
3.7 Summary
In this study unit the concept of a warehouse was defined as well as the purpose and key functions of the
warehouse. Inbound and outbound activities were reviewed as well as the different types of equipment one might
come across in a warehouse. The success of a warehouse is dependent on the site selection. In designing a
warehouse, there are certain steps that one must follow in conjunction with the guidelines for a smart warehouse
layout. These steps and guidelines allow warehouse designers to plan for the future whilst ensuring they make
maximum use of the space they have. The various activities that take place in a warehouse were discussed. There
was a special focus on cross docking. The study unit concludes with the some of the common problems that faced
by warehouse managers.
Knowledge Checks
c) The movement of goods from the primary sector to the tertiary sector
a) Pallets
b) Forklifts
c) Shelving
Outbound warehousing activties relate to finished goods that are waiting to go to the downstream consumer.
1. A
2. A
3. D
4. D
5. C
True or False
A. True
B. True
C. True
Unit
4: Packaging
4.2 Definition and functions of packaging Explain the definition and functions of packaging
4.3 The role of packaging in logistics Examine the role of packaging in logistics
4.6 Integrating technology with Illustrate the importance of integrating technology with
packaging and containerisation packaging and containerisation
Prescribed Reading/Textbook
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic
Logistics Management: A supply chain management approach.
Second Edition. Van Schaik Publishers
Recommended Readings
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A
value chain perspective. Fifth Edition. Oxford University Press
Harrison,A & Van Hoek,R. (2014). Logistics Management & Strategy
Competing through the Supply Chain. Fifth Edition. Prentice Hall
International Edition
Wisner,J, Tan,K, Leong,G. (2012) Supply Chain Management A
Balanced Approach. Third Edition. South Western
4.1 Introduction
Packaging is a crucial component of the supply chain and has an indirect impact on customer satisfaction. Imagine
yourself purchasing a pair of white sneakers and they arrive at your doorstep in a plastic bag and when you
examine the pair of sneakers, they are slightly damaged and this means you need to return them and await a new
pair. Even though you have saved up money for two months to get this pair of sneakers. How would that make you
feel? Having the correct packaging will allow goods to remain in the condition that they were meant to be.
Packaging allows goods to be moved from different sections in the warehouse without having to be overly
concerned about the product being damaged rather, the focus can be on the efficient movement of the goods.
Over the last few years there had been an increased focus on the packaging materials that are used. In some
instances, packaging materials can serve as value added services (Pienaar and Vogt, 2016:280).
The functions of packaging are depicted in Figure 4.1 below and further explained.
Containment
and protection
Apportionment
and unitisation
Convenience
and
communication
Containment and protection: Containment and protection is especially important for carrying liquid, fragile items
as well as hazardous materials. The packaging will be critically important for the goods to remain in their expected
condition. Features such has the design and the ability to open a product and reseal it must be considered.
Packaging serves a dual purpose in protection, it protects the contents from being destroyed and in the case of
bio hazardous materials, it protects the various participants in the supply chain that come into contact with the
product as well as the community at large. In selecting the appropriate packaging for the product one will need to
consider aspects such has temperature, movement, abrasion as well as tampering.
Apportionment and unitization: Apportionment is the process assigning a product into units that are easily
managed and will be able to be transported and moved easily. In the case of cold drinks. They come in a variety
of sizes and containers. Unitisation will refer to the way in which the carrier is loaded to transport the goods.
Convenience and communication: One must consider the ergonomics of moving the packages, how easy it is
to open, handle, reseal as well as dispose of the product. Many retailers favour shelf ready packaging, thus
providing efficient solutions for the retailer due to decreased handling. Advances in technology such as radio
frequency identification (RFID) tags support a faster and more accurate flow of communication (Pienaar and Vogt,
2016:282).
Readings
Please refer to your prescribed textbook: Business Logistics Management – chapter 12.
If you are unable to acquire the suggested readings, then you are welcome to consult
any current source that deals with the subject. This constitutes research.
Logistics communication: when stock is being moved along the supply chain, the various logistics activities
will need to be tracked and reported on. Having the necessary information on the packages as well as the
right information systems makes this possible.
Materials handling: packaging allows for robust handling of the goods as they progress through the various
channels.
Parts and service support: if packages enable the fast distribution of various parts and if the correct information
is provided with service kits then repairs can be executed easily.
Return goods handling: correct packaging facilitates easy return of products; with e-commerce some returns
policy insist of goods being returned in original packaging to make it easy for all the participants.
Reverse logistics: as mentioned above, the correct packaging will assist the returns which is part of the reverse
flow of goods.
Sales: good packaging protects the product but great packaging provides a good description as well as added
advertising.
Safety: packaging is essentially for safety of a product especially in the case of medical products (Pienaar and
Vogt, 2016:281).
Take a moment to think about the following products and the benefit of correct packaging.
Contraceptive pills
Cell phones
Make-up products
Contact lens
Food
Sun glasses
For one to develop a packaging system that functions well, one would need to consider all the participants in the
supply chain. Neglecting certain partners will result in inefficient designs. The involvement of all participants will
result in the focus on the supply chain and create gaps for sub optimisation but careful consideration must be given
to the downstream customers to avoid waste. Sustainability is a key factor and care for the environment must be
shown. It is advisable to consider packaging in a broader perspective and it should be regarded as the business
opportunity. (Pienaar and Vogt, 2016:288).
There are four different ways in which this can be approached as depicted in figure 4.2 below. The first option is
what is most practised, however the expectation is to have packaging be seen as an innovation driver that occurs
with product development (Pienaar and Vogt, 2016:288).
Be an innovation
driver and
Allow packaging to improvement of the
be the innovation packaging and
products
Packaging is
integrated with the
Packaging is comes development of the
at the end of the product
product
development phase.
Case Study
UTi Sun Couriers was founded in 1981 and specialises in the movement of parcels,
envelopes and freight to and from any address in South Africa and the BNLS countries
(Botswana, Namibia, Lesotho and Swaziland). Its distribution network consists of 36
branches, including six hubs and four BNLS branches, and reaches 400 towns on a
daily basis and a further 1 044 towns on a bi-weekly or ad hoc basis. During an
average month, UTi Sun Couriers collects and delivers 1,2 million parcels through
this network.
In 2008, UTi Sun Couriers launched its UTi Pak and Pak prepaid boxes. The Pak box
measures 10 × 30 × 40 cm, and is designed for shipments of up to 2 kg in weight.
The Pak is 20 × 30 × 40 cm in size and can safely carry up to 5 kg. The boxes are
custom-designed to be tamperproof and sturdy.
The Paks are sold to customers at a flat rate (i.e. the cost of the box includes both the
packaging and the transport of the shipment). A special barcoded prepaid dispatch
note was also designed to help clearly identify prepaid shipments. This dispatch note
is pasted onto each Pak before it is sold to the client.
The Paks are targeted at freight originating in regional towns, with the intention of
increasing freight coming out of those towns to which freight flow has traditionally
been relatively one-directional. They can be sent to any main or regional centre
serviced by UTi Sun Couriers within South Africa. Clients can use the barcoded
dispatch note number to track their parcels on Sun Courier’s website
(http://www.sun.co.za) or they can call the national contact centre.
Source: Pienaar and Vogt (2016:302).
a) Explain how UTi Sun Couriers modified their packaging solutions and the
benefits that they were able to accrue.
4.5 Containerisation
Firms use different modes of transportation in their logistics function. In some instances, firms may need to use
multiple modes of transportation to deliver the products to the consignee. Special standardised containers will be
needed to move to the cargo on freight trains, ships and trucks. Containerisation has drastically improved the
efficiency of intermodal transportation as it allows for much faster loading, transloading as well as offloading the
containers (Pienaar and Vogt, 2016:363). Picture 4.1 below depicts containers that are being transported via ship
which will be loaded onto trucks.
Revision Questions
There has new developments and packaging and containerisation with a focus on technology which has created
new opportunities for firms, it is essential for firms to integrate technology with their packaging solutions.
The following Figure 4.3 shows the four technological innovations that must be researched.
Time- Biosensors
Auto ID Active
temperatiure and
technologies Packaging
sensors Packaging
Decrease in materials handling leading to RFID has a huge cost implication as the entire supply chain
overall efficiency. will need to be upgraded to a bar code system. This will result
in an increase in cost all along the supply chain.
Improved traceability
Source: Pienaar and Vogt (2016:300)
quality and dynamic shelf life. However, this will require significant investments from all participants in the supply
chain (Pienaar and Vogt, 2016:301).
Think Point
Take some time to research the abovementioned ways in which technology can be
integrated with packaging and containerization.
Are there any new innovations that you can add to the list?
4.7 Summary
In this unit a definition of packaging was provided and the associated function of packaging was discussed with a
focus on the new packaging solutions. Packaging has a multitude of benefits and if used correctly packaging can
even enhance the marketing and sales function. The role of packaging was reviewed to provide a holistic
perspective on the need for the most suitable packaging. Containerisation and compatibility with packaging was
also reviewed. The study unit concluded with a look at new technological innovations that will shape the future of
packaging solutions.
Knowledge Checks
a) Auto ID technologies
b) Active packaging
A. Product packaging can be designed upon completion of the entire design of the
product as the packaging is supplementary to the product
B. Containerization will assist in movement of goods as some goods may need to be
moved using different modes of transport (intermodal)
Case study
Packages move much quicker in the supply chain. The use of barcodes allows customers to track packages which
creates better customer satisfaction.
d) Should packaging be left to the final stages of the product, then there is no integration with technology and
packaging. Packaging must be developed in line with the products to enhance the product.
e)
Auto identification technologies
Active packaging
Time temperature sensors
Bio sensors and packaging
True or False
A. False
B. True
Unit
5: Transport Management
and Global Logistics
5.2 Functions and importance of Examine the functions and importance of transport
transport
5.3 Modes of transport Evaluate the characteristics of the different modes of transport
5.4 Transport mode comparison Compare and contrast the various modes of transport
Prescribed Reading/Textbook
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic
Logistics Management: A supply chain management approach.
Second Edition. Van Schaik Publishers
Recommended Readings
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A
value chain perspective. Fifth Edition. Oxford University Press
5.1 Introduction
Transportation allows for the movement of people and freight. To have a transport system implemented an
economy will first need to the infrastructure for the different modes of transportation. To have vehicles on the road
you will need to have roads, to utilise rail transportation, there will need to rail roads, the use of water transportation
is dependent on the harbours and ports and the use of air transportation is dependent on the airports.
Transportation has evolved from the days of the horse drawn carriage into a systematic and well planned network.
Freight transportation is primarily conducted by the roads in South Africa. Rail transportation is preferred for bulk
materials that need to be transported over long distances. Air cargo is generally used for specialised cargo and
commands a much higher price. OR Tambo, King Shaka International and Cape Town International are the main
airports that transport cargo.
Freight transport should not be allowed to function on the road network, it is recommended that freight transport
be completed outside of normal working hours. It may be better to have freight moved over the rail network as rail
networks can accommodate bulk containers, break bulk and pallets.
Transportation networks necessitate the need for economic instruments to assist in the upkeep of the infrastructure
as well as the regulation of the volume of traffic. Furthermore, freight transport will need to have specific
components such as truck stops, staging areas, industrial areas as well logistics parks (de Villiers, et al., 2019:
160).
The Technical Transport Planning Guidelines for Comprehensive Integrated Transport Plans of the Department of
Transport suggest the following guidelines for freight transport (Department of Transport, 2009: 111–118):
Overloading
Hazardous goods movement
Dangerous substances
Heavy vehicle corridors
Freight routes
Incident management
Intelligent transport systems
Traffic management
Abnormal transport
Facilities such as truck stops and staging areas
Truck safety
Cargo security
Modal split
Toll roads
Equipment configuration
Reverse logistic
Mobility
Accessibility
Mobility can be described as the movement of freight or passengers all across the supply chain. Accessibility
refers to the ability to receive the goods. Accessibility will only be possible if there is adequate infrastructure which
may be limited in the rural areas. The mobility and accessibility function can be further classified into three functions
viz. inbound, onsite and outbound transportation.
Inbound transport: pertains to the movement of raw materials such as wood or parts from suppliers. Inbound
transportation can be moved on rail, water and road networks and they can be moved in large loads.
Onsite transportation: will refer to the transportation on site such as a warehouse. Vehicles such as forklifts can be
used to move pallets and break bulk (bags and drums). On site transportation will move raw materials from inbound
transportation to production facilities in which they will be transformed into finished products. Once these goods
have been transformed they can be moved to the finished stores part of the warehouse.
Outbound transport: refers to the movement of finished goods. Finished goods can be loaded on pallets and
transported on tautliner trucks. The goods will be moved to distribution centres and in some cases to the final
consumer (de Villiers, et al., 2019: 70). The three functions of transport are depicted below in Figure 5.2
Think Point
Research inbound, onsite and outbound transportation. Provide specific examples for
each type of transportation.
Pipelines
In addition to the five primary modes of transportation, there are two modes of secondary transportation as depicted
in Figure 5.4 below.
Conveyors
Rail transport
Rail transport entails the movement of goods via the rail road network. This is dependent on the infrastructure
throughout the country. There are three models used in rail transport.
Freight Demand Model (FDM): this focuses on the economic activity as a value of the production. It will look at the
location in which goods are produced and the area in which they are consumed. Based on that a set of forecasted
figures can be generated for a long period of time such as 30 years. Hence the focus is on long term.
Transportation model (TM): the focus with this model is on the relationship that exists between consumption of
products in each area and for the specific type of good. The TM will determine the route and the mode of
transportation. The TM is essentially a geographic information system that was developed by Transnet. TM
fundamentally connects the 365 districts and offers users the opportunity to run various flow scenarios, including
modal market shares, to determine demand for rail.
Market Share Model (MSM): MSM has been specifically developed for planning rail transport and it looks at how
shifts can be made from road to rail users. It looks at how the market share will change for the different products.
With the MSM, planners will be allowed to plan long term strategies (de Villiers, et al., 2019:163).
Water transport
Water transportation can be facilitated through ships, and other deep sea vessels. Harbours, ports as well as
canals and inland waterways are crucial connectors for water transportation. The design of ports is crucial as the
vessels will be entering and leaving ports (de Villiers, et al., 2019:165).
Air transport
Air transport is a quick and expensive mode of transportation. It provides a fast solution over medium and long
distances. However, due to the cost factor it may be recommended to use another mode of transportation. Air
transportation works using the hub and spoke method in which various origins and locations can be used by being
connected through large airports. A key infrastructure requirement with air transportation is airports. Countries
have large and small airports and this will affect the quantities of cargo. Connectivity allows for greater access to
local and international markets. A research report in 2010 indicated that there were 66 routes per week at the time
which connected South Africa to various international conglomerates (de Villiers, et al., 2019:165).
Pipelines
Pipelines are generally used for liquid or gas and they are underground. Crude oil is transferred via pipelines.
Pipelines offer a cost advantage and will allow for cost effective movement of precious commodities. Companies
will need to pay landowners for the right to have a pipeline erected, maintained and used on their property.
Unfortunately, this disrupts the natural agriculture and will have a negative impact on the vegetation and livestock
on the land. Specific agreements are needed for pipelines to be erected (de Villiers, et al., 2019:167).
Waterways are natural passages similar to rivers and streams that allow for ships/boats to pass. Canals can be
regarded as a deliberate waterway that is constructed which will allow for boats and ships to pass through. Canals
and waterways will assist in water transport (de Villiers, et al., 2019:161).
Revision Questions
Read through the blog post to get a better understanding of the different modes of transport.
There are not only a ton of transportation companies in Toronto to choose from, there are
various transport methods as well. There are a number of different modes of transportation
in the logistics industry, each having its own merits and disadvantages. From road, railway,
marine, and air transportation, the method that you select depends on a few factors. For
example, industries that need to transport heavy products opt for railway transportation
along with road and Maritime transportation. These methods have the ability to
accommodate heavier products, making them the ideal choice over air transportation. In
this post, we’ll discuss five common types of transportation in the logistics industry:
roadway, rail, marine, air, and intermodal transportation. Hopefully, the pros and cons of
each method can aid in your decision when looking to transport goods from Atlantic Canada
to Toronto and vice versa.
ROAD TRANSPORTATION
There are many advantages to road transportation, especially for companies who rely on
fast delivery to retain their customers. If goods are meant to be transported immediately to
the Maritimes from Mississauga, for example, your best bet would be ground shipping
transportation. Water transport is notoriously slow, and it can be a hassle to book railway
transportation.
Maritime trucking to Mississauga and other locations is more cost-effective than other
options; with rail transport, if there isn’t a railway that leads to your desired destination,
you’ll have to build it, which can be a costly investment. However, there are roads that lead
to pretty much everywhere, and are built and paid for by the government; more often than
not, you’ll only have to pay a small fee to use them. Roadway transportation to Atlantic
Canada from Mississauga can also be cost-effective since it provides door-to-door or
warehouse-to-warehouse service. This allows cartage, as well and loading and unloading
expenses, to be significantly lower compared to other methods.
RAIL TRANSPORTATION
Rail transport also offers huge carrying capacities, which can grow to fit your needs. Unlike
trucks or boats, which have a fixed about of space that can’t be exceeded, additional
wagons can always be added to trains if you need more room. In addition to all the benefits
for you and your company, you’ll also be giving great opportunities to surrounding
communities. Rail transport can provide employment opportunities to both skilled and
unskilled workers, making it a positive choice for the entire community. The biggest
disadvantage, however, is that if there are delays in the transportation, it can actually take
much longer to get your freight delivered than with other methods of transportation. With
rail transportation, you need to schedule container drop off and pick up at the terminals
which could end up taking a long time.
MARINE TRANSPORTATION
Marine transportation is notoriously slow, but that doesn’t matter when a product has a long
lead time. This is a great option for those looking to ship bulky items that aren’t in much of
a rush. Often cheaper than road transport, ships are usually the main cost that you’ll incur—
you won’t have to worry about road tolls and other similar charges. While roadway
transportation can easily be delayed by rain or other types of inclement weather, the same
conditions may not affect marine transport.
The main disadvantage of marine transport is that it can be difficult to monitor the exact
location of the goods in transit, which can be a deal-breaker for some. As you’ve read in
our past posts, being able to track freight is a common expectation of consumers who order
things from online retailers and can affect their purchase decision. While there are many
advantages to marine transport, the downside of the lack of ability to closely track the exact
whereabouts of the specified freight can be crucial.
AIR TRANSPORTATION
Air transport is extremely useful for many reasons: it`s convenient, fast, and doesn’t have
to compete with natural barriers. While road transport is the quickest way to deliver goods
that only have a short distance to travel, air transportation is the fastest option for freight
that have a further destination—it’s even regarded as the best mode of transportation for
perishable goods for this reason.
In addition, air transportation doesn’t require the infrastructure investment that railways do;
airplanes fly freely, which means you don’t need to spend the initial cash building a pathway
to your destination for it to get there! The lack of barriers also means that it’s accessible to
all areas, regardless the obstruction of land. However, one main disadvantage is that
planes can easily be affected by pretty much any type of inclement weather. Whether it’s
rain, snow, or high winds, your shipment is likely to get delayed if any weather condition
becomes extreme.
INTERMODAL TRANSPORTATION
As you’ve probably noticed through reading this post, each method of transport has its
advantages and disadvantages. What if you could combine the pros of each method to
create one innovative method? That’s exactly what intermodal transportation is.
Intermodal transportation offers the best of both worlds: it combines various transportation
methods to give you the fastest shipping time possible. Not only is this method time-
efficient, it’s cost-efficient as well. More shippers are taking advantage of the option to reap
the benefits of the cost savings, environmental benefits, and highway safety results. With
the lower rates, predictable pricing, standardized transit schedules, and flexibility,
intermodal transportation is continuing to rise in popularity.
Philburn Logistics Inc. is one of the top freight companies in Mississauga and the GTA. We
are an asset-based trucking company operating out of Mississauga and offer both TL and
LTL shipping services to all of our clients and ship throughout Ontario and the Maritime
Provinces.
If you’re searching for a transportation company in Toronto that can meet all of your needs
and more, then Philburn Logistics Inc. is the company for you. Getting your freight to its
destination isn’t our only goal—we strive to exceed your expectations and deliver your
goods in perfect condition while getting it to its destination on time. While our distribution
centre is based in Toronto, we ship throughout the entire province and even as far as
Atlantic Canada. If you’d like to take advantage of our exceptional serviced and affordable
rates, contact us today.
Performance based standards In Australia a performance based standard scheme has been tested
for the heavy vehicles. South Africa is piloting a PBS/Smart truck
demonstration project in which vehicles will be tested whilst they are
performing each manoeuvre. The performance parameters of the
vehicles will be compared to the minimum and maximum safety levels.
Electrification of freight traffic There has been an increasing demand to have transportation more
environmentally friendly and to achieve a reduction in carbon
emissions. Consumer vehicles such as the Toyota Prius have
achieved this. The spotlight is now on freight vehicles and the ability
to come up with innovative concepts. Siemens have developed an
alternative resulting in electrification of freight traffic.
Driverless trucks Rio Tinto has launched initiatives such as Mine of the Future
programme, part of this initiative is focused on improving safety on the
roads. This includes cutting edge technology is autonomous haulage
system trucks. This is set to have an impact on the efficiency of trucks.
Driverless trucks are not a completely new phenomenon. This
technology has been used for passenger transport in places such as
Dubai.
Road container economics Future trends in containers suggest a move to allowing road transport
carriers to carry over 105 tons which is the general norm. It is expected
that this will increase to two 12 m containers in a truck and trailer.
However, this must not exceed 30m. This practice currently takes
place in Brazil.
Truck and trailer lift axles Most trucks and trailers are designed with lift axles which are
mechanically lowered or raised. Technological innovations will allow
for the axles to be lowered and raised by a computer-controlled airlift.
Light rail DVB cargotram This technology was designed to reduce the traffic in inner-cities by
moving cargo on tram tracks. Tram tracks runs on the existing
infrastructure, requiring only minimal freightline construction.
City refuse disposal A key point in transportation is to reduce traffic in high density areas.
The innovative tram was developed to move garbage collection away
from roads. This reduces the time it takes to move garbage away from
cars.
Driverless freight trains AutoHaul is the leader in this technology, having developed the first
completely autonomous heavy-haul, long distance railway system.
Double stack rail transport Double-stack rail transport is a form of intermodal freight in which a rail
road car will have two intermodal containers stacked on it. This has
been used in North America. Using double stack technology will
essentially halve the cost and result in greater efficiency.
Freight shuttle system This system was developed in response to the need for a system that
is suitable for high volume traffic between two points with a maximum
distance of 600 miles. This is a frequent occurrence at marine ports,
border crossings and land ports.
Logistics platform This is a type of logistics platform based on the principle of intermodal
transport. Intermodality increases the profitability of the location and a
type of synergy between all operators.
Terminal of the future This had been practised in Finland. DB Schenker Logistics It combined
four locations and operations inclusive of land transport, air and sea
freight in one building. The centralising of operation will result in an
improved efficiency and streamlining of cargo flows between the
different transport modes.
Picture 5 below depicts the future of freight and the demonstration of driverless trucks. TuSimple, an autonomous
trucking firm with operations in the U.S. and China plans to demo their driverless trucks in 2021
Source: CBS Interactive Inc, (2020). Driverless trucks being tested right now on public roads. [Online]. Available:
https://www.cbsnews.com/news/driverless-trucks-being-tested-on-public-roads-60-minutes-2020-03-13/
Picture 5.2 below depicts an example of a freight shuttle system in Texas which was designed to suit the
intermodal network.
Figure 20
Source: Texas A&M Transportation Institute, (2020). Freight Shuttle System [Online]. Available:
https://tti.tamu.edu/freight-shuttle/
Case Study
Sanchia Temkin
In spite of last week’s news that the trade and industry department had eased its
restrictions on textile and clothing imports from China, industry experts say the quotas
may result in extra administration costs and business risks for importers. Importers of
goods that could be subject to the restrictions need to ensure that their goods are
cleared correctly, especially with regard to the country that they originate from, says
André Erasmus, senior manager, indirect tax, at Deloitte. Erasmus says that in the
past many goods were manufactured in China and exported from Hong Kong. In such
cases the goods were often declared as originating from Hong Kong, although they
were not manufactured there. In such instances the duty rates remained the same. Now
that imports from China are subject to restrictions, importers found to have declared
goods from Hong Kong which originated in China may have to forfeit their goods. China
is a preferred trading partner for many African countries, says Mark Casey, corporate
finance partner at Deloitte. He says this is because Chinese firms are less risk-averse
than some western firms and because they take a longer-term view on investment.
Although trade between China and the West is small, it is growing fast. The quota
system came into effect from January 1 this year, after complaints by South African
trade unions that Chinese textile imports were having a negative effect on the domestic
industry. It places restrictions on 31 product categories of clothing and textiles from
China. PricewaterhouseCoopers senior manager, indirect tax, Herman Fourie says the
quotas give an unfair advantage to firms that are in the business of importing goods
from China in that they are given a bigger quota than new entrants to the industry. “It is
unfair for those global firms that want to start importing from China.” Says Erasmus:
“The quota restricts the importation of goods only China is willing to manufacture and
certain branded goods for which South African importers do not have exclusivity and
will never be sourced from SA.” The goods are not allowed to be shipped to SA without
a permit. Erasmus says this creates difficulties for goods cleared into bonded
warehouses as these goods are not allowed to be warehoused in volumes in excess of
those stated on the permit. Goods destined for export must be cleared at the time of
entry into SA, including those destined for Botswana, Lesotho, Namibia and Swaziland
(the BLNS countries). Goods shipped under the quota will require additional
administration and costs as shipments will have to be split and shipped to different
destinations separately and importers will have to implement controls to monitor their
quota balances. If more goods are shipped than are allowed by the permit, the whole
shipment will be confiscated. The restriction applies only to SA. Any direct imports into
any of the BLNS countries are allowed without restrictions. However, once the goods
are imported into SA from the BLNS country and it cannot be proved to the satisfaction
of the South African Revenue Service (SARS) that they are not of Chinese origin, the
restrictions will apply. Erasmus says there appear to be anomalies in terms of the rules
of origin that need to be applied to determine whether sufficient value has been added
to determine the origin of the goods. SARS is applying the rule that at least 25% value
needs to be added to Chinese inputs in order for them not to be subject to the permit
requirements. Virusha Subban, a tax associate at Edward Nathan Sonnenbergs, says
it would not be unreasonable for retailers to expect some delays in the starting-up
phase, as SARS and the International Trade Administration Commission would be
actively monitoring imports from China. “This should entail a verification of the
correctness of what is declared on a bill of entry; examination of the actual goods that
are imported and a cross-check as to the allowable quota per importer on the SARS
electronic database.” Importers should also ensure that, despite the fact that SARS will
have the quotas per importer captured on its electronic database, they must always be
in a position to display a valid special import permit certificate. It is advisable that a copy
of the certificate be annexed to the bill of entry to avoid inordinate delays in obtaining
clearance of the goods, she says. According to recent trade statistics published by
SARS, the quota system seems to have borne fruit as far as limiting textile imports are
concerned. Imports of textiles and textile articles were reported to be down by R370
million from January last year. “We can expect this decrease to continue and even more
so towards the end of the year once the quota for this year has been utilised,” says
Erasmus. “What we do not know is to what extent this reduction of almost R370m is
filled by South African production.” If this decrease in imports is not filled by other
sources, there might be an increase in prices to consumers, he says.
Source: de Villiers, G. d., Nieman, G., Niemann, W. (2017). Strategic logistics
management. Fifth Edition. South Africa: Oxford University Press.
Discuss the impact of cheaper imports on South African supply chains.
Political and
government
conditions
Different
Competition languages
and cultures
Different
Different legal
channel
systems
members
Gloabal Scene
Exchange
Longer
rate
distances
fluctuations
Rules and
Pricing
regulations
To function successfully in a global environment, careful attention must be paid to the abovementioned factors.
Should organisations want to participate in the global market they will need to create world class logistics and
supply chains to cope with the demands of a global village. There are nine key trends that organisations will
need to prepared for if they want to compete globally (de Villiers, et al., 2019: 306).
Networked economy
Cost pressure
Globalisation
Talent shortfalls
Volatility
Sustainability pressures
New technology
Based on the above, it is clear that organisations will need to spend a lot of time working on their strategy for going
global. There are various factors that must be considered and the interrelated factors will need to be examined.
Organisations will need to understand the forces that will affect the supply chain to help them make better
decisions. Figure 5.7 lists the various forces that shape the environment in which managers are expected to make
decisions.
Competitive pressure
Customer expectations
Role shifting
Financial pressures
Global capacity
Globalisation
Time compression
Technological innovation
23Figure 5.7 Forces that affect managerial decision-making in the current environment
Source: (de Villiers, et al., 2019:70).
Readings
The impact of globalization on the supply chain
An increasing number of South African companies are engaging in global activities that
involve importing and exporting finished products, components and materials across multiple
borders and through different trade routes by land, sea and air. At the same time, they are
faced with growing competition from overseas companies entering the local market. Both
sides are being driven by the same challenges of shrinking margins, slowing domestic
demand and increasing competition, and by the lure of greener pastures.
In today's world, companies not only need to be agile, flexible and responsive, they need to
drive continual innovation throughout their businesses and supply chains to differentiate
themselves to remain competitive.
Globalization and widespread Internet connectivity are giving rise to extended and
interconnected supply chains that crisscross the globe. As companies venture into new
markets and deal with suppliers and customers across borders, their supply chains become
more complex and are a higher risk to business continuity. Added to this, ever changing
consumer demands, increasing regulatory and sustainability requirements, and steadily
decreasing natural resources are directly impacting businesses and their supply chains
worldwide.
As international supply chain expert Douglas Kent pointed out during a presentation recently
hosted by SAPICS at Barloworld Logistics, the further businesses move away from their own
markets the more they face lesser known or unknown risks. These include, natural disasters,
political unrest, continuing reliance on oil, fragmentation along the supply chain, sudden
demand shocks, export and import restrictions, terrorism, and different compliancy
requirements for different countries.
Ways to mitigate risks include finding alternative sources of supply and trade routes, and
partnering and collaborating with supply chain specialists and trading partners. The GE
Global Innovation Barometer 2013 study shows that companies are realizing that
partnerships are the fastest way to achieve scale by providing critical insights into new
markets and customers and access to better technologies.
Partnering and collaborating with suppliers and other supply chain entities includes sharing
data and information, which can give rise to trust issues. But visibility across all their extended
and interconnected supply chains is an imperative for companies conducting business
globally.
As companies expand beyond their national borders, they are under increasing pressure to
deliver a high level of customer service at an acceptable cost, while achieving a strong profit
performance on a global scale. This includes the ability to help their customers improve their
supply chain processes and reduce costs.
The challenges and opportunities of globalization and the growing complexity of supply
chains are pushing them higher up the boardroom agenda for discussion and scrutiny.
Developing nations are playing an increasingly significant role in the global economy, with
41% of the world's GDP expected to come from emerging markets by 2015.
In a recent report, "Manufacturing the future: The next era of global growth and innovation",
McKinsey & Company predicts that by 2025 a new global consuming class will have emerged
and the majority of consumption will take place in developing economies.
export their products and services globally within months. Globalization increases the need
for countries to optimize their road, rail, airport and sea port infrastructure and provide slick
cross-border clearance.
In South Africa there is a need to build an interlinked rail and port infrastructure, supported
by road. More inland port terminals are also needed, and systems must be put in place to
enable cargo to be moved quickly and efficiently between road and rail. According to the
National Planning Commission (NPC), 96% of South Africa's exports are conveyed by sea,
which underlines the importance of the country's ports.
Forward-thinking local companies are taking measures to lessen the impact of the current
inadequate transportation infrastructure on their businesses. These include partnering with
supply chain service providers to assist them in strategic route planning, optimising transport
modes, using more fuel-efficient vehicles, having the right technology systems in place and
generally improving logistics processes.
Source: Temple, S. (2013). The impact of globalization on the supply chain [Online],
available:
http://pressoffice.mg.co.za/barloworldlogistics/PressRelease.php?StoryID=247928
5.7 Summary
The role of transportation in the supply chain was identified and the purpose of transport was clearly explained.
Inbound, onsite and outbound transportation were compared and contrasted. The five primary modes and two
secondary modes of transportation were discussed. The five different modes of transportation were compared to
each other to provide a better understanding of the benefits and limitations for each mode in relation to the type
of goods that need to be transported. The future developments in the transportation industry were examined and
the study unit concluded with a look at global logistics and the various considerations that one needs to be
mindful of when going global.
Knowledge Checks
Please ensure you read your notes before attempting the questions. Indicate if the
following statement are True of False.
Readings 5.6
Ensure the readings are completed.
Unit
6: Logistics Information Systems
and Customer Service
6.2 Logistics information systems Examine the characteristics and importance of logistics
information systems on logistics communication and customer
service
6.3 Customer service elements and Explain customer service elements and dimensions
dimensions
Prescribed Reading/Textbook
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic
Logistics Management: A supply chain management approach.
Second Edition. Van Schaik Publishers
Recommended Readings
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A
value chain perspective. Fifth Edition. Oxford University Press
6.1 Introduction
According to de Villiers, et al. (2019: 209), communication is a key element in the supply chain, whenever goods
and money are exchanged there would be a subsequent exchange of information. This information pertains to
details such as quantity, price and destination. An information system can be defined as a set of interrelated
components that collect, process, store and disseminate information to various stakeholders internally and
externally. The information is essential used in supporting the flow of goods from the point or origin to the point of
consumption. Information systems are dependent on sophisticated computer hardware and software (de Villiers,
et al., 2019: 209).
According to de Villiers, et al. (2019: 212), a centralised information system will be the opposite. The data for all
departments are maintained in one central repository and individual departments have access to data for all
departments.
According to de Villiers, et al. (2019: 209), the key benefits of a centralised information system for logistics are as
follows:
There is an elimination of duplication and redundancy in the data that is stored.
There is easier access to information for all departments
Information will be accessible in real time for all departments
Centralization of data allows for greater control over business processes
Human resources management, inventory management and materials handing will be enhanced through the
real time access.
Customer interaction will be improved
Case Study
Heineken
Heineken (the client) once again approaches Nampak for 500 000 beer bottles (finished
goods). But this time, Heineken needs the bottles urgently so as to respond to uncertain
demand from their customer, which is hosting South Africa’s biggest music festival ever,
featuring national and international artists. The Nampak sales team does not have real-
time access to information regarding inventory. So they approach the inventory
department to check the availability of 500 000 beer bottles. This process takes time, and
Heineken (the customer) chooses another vendor (e.g. Consol glass), leading to loss of
revenue and customer dissatisfaction. Now suppose that, when 500 000 beer bottles are
out of stock, the sales team approaches the production planning team to manufacture
the bottles for future demand. The production planning team checks the availability of
cullet, soda ash, limestone and silica sand (required raw materials). However, raw
material information is separately stored by the production planning department as well
as the inventory department. The storage of inventory information by two separate
departments gives rise to data maintenance costs. A particular raw material (soda ash)
required to manufacture the bottles is available in the inventory, but according to the
database of the production planning team, soda ash is out of stock: in other words, the
databases of the inventory and production planning departments are not synchronised or
integrated. So the production planning team places an order to CHC (supplier) for soda
ash (raw material), which then gives rise to material and inventory holding costs. Once
the raw material is available, the shop floor department suddenly realises there is a need
for more personnel. The shop floor department approaches HR, and HR hires temporary
employees at higher than market rates; thus labour costs increase. The production
planning department fails to update the finance department regarding the raw materials
purchased. As a result, the finance department defaults the payment deadline set by the
vendor CHC, causing Nampak’s loss of reputation and possible legal action by CHC (the
vendor).
Heineken (a customer) approaches the Nampak sales team to buy 500 000 beer bottles
(finished goods) on an urgent basis. The sales team has real-time access to the inventory
levels, which are updated by the inventory department on the centralised system. The
Nampak sales team promptly responds to Heineken regarding availability of stock,
leading to increased revenue and customer satisfaction. In case manufacturing is
required, the sales team updates the centralised database; which automatically alerts the
production planning department in terms of materials required. The production planning
team checks the availability of the raw materials in the centralised database, which is
updated by the inventory department. Thus data duplication is avoided and accurate data
is made available. The shop floor team updates their manpower status regularly in the
central database, and this can be accessed by the HR department. In case of a shortage
in terms of the workforce, the HR team starts the recruitment process with considerable
lead time, so as to hire suitable candidates at market price; thus labour costs are kept to
a minimum. Furthermore, vendors can submit their invoices directly on the centralised
information system, which can be accessed by the finance department, leading to timely
payments and prevention of defaults, or legal action being taken against the provider.
Pre -transaction
elements
b) Transaction elements
The transaction element includes the elements that result in the sale and delivery of the product. This is dependent
on the following factors:
Product availability results in the customer having the product when they need it. Stock outs will not be
beneficial.
Order convenience refers to the ease in which a customer can place the order with the necessary forms
and terminology.
Oder cycle is the time it takes for the customer to receive the stock form the time the order is placed until
the delivery. This is inclusive of order picking, communication and processing.
Quality assurance refers to the quality of the delivery and the goods.
The most suitable transport and logistics service must be selected.
Expedited shipments should be considered and will reduce handling time
A suitable product substitution policy should be in place to allow for substitutions (Pienaar and Vogt,
2016:154).
There are various dimensions regarding customer service from a logistics perspective. Bowersox and Closs (1996)
identify three dimensions:
Availability
Operational performance
Reliability
The first dimension is one of availability. A customer will not be able to purchase a product if the product is not on
the shelves as and when the consumer needs it. Availability also pertains to the an organsations ability to have the
correct inventory on hand to respond to consumer demands so that the organisation is able to provide the right
products to the consumer at the right time. Consider the Christmas period, if the Christmas goods arrive late, after
Christmas day and there are delays in having the christmas goods on the shelves, those goods may not be sold
after the 25th of December. Stockouts are indicative of products that are not available when the consumer needs
them and can be indicative of an organsition not holding the correct amount of inventory or safety stock. An
organisation therefore needs to strike a balance between the desire to reduce inventory carrying costs and meeting
customers’ expectations of availability (de Villiers, et al., 2019: 194).
The second dimension is operational performance and is concerned with the various activties that are completed
in the supply chain. Special consideration is paid to the speed of the supply chain and relates to the time it takes
to get the order to the consumer. All consumers prefer a shorter product cycle and without a compromise in quality.
Consumers also expect consistency in deliveries and a certain level of customer service. Consistency can
essentially be described as the organisation’s repeated ability to provide a certain level of service. In terms of the
order cycle, if an organisation is known to always require a specific time period before an order is delivered. If the
time period remains the same, over and over again. This knowledge of this enables the customer to plan
adequately.
It is only normal for organisations to be faced with unusual demands from customers and demands that constantly
change. Should an organisation want to keep their customers happy they must strive to meet their demands and
create a sense of loyalty from their customers, one way to achieve this is to ensure the customer demands,
regardless of how unusual they are, are being met. This requires a level of flexibility from the organisation. A further
factor in operational perofrmance is the ability to minimise malfunctions and abnormalities (de Villiers, et al., 2019:
194).
The third dimension is reliability and is concerned with the organsiations ability and their willingness to provide
accurate and timely information to customers regarding their orders as well as the related activities of the suppy
chain. Providing customers with timely and accurate information will allow customers to make better decisions.
Should customers be misinformed than they may face disappointments and losses (de Villiers, et al., 2019: 194).
According to de Villiers, et al. (2019: 194), an organization should try to establish efficacious customer service
strategies which will translate into a competitive edge. This is essential for an organization to survive in an ever
changing and dynamic environment.
Revision Questions
It is therefore imperative to have a customer service strategy in place. However one must be cognisant of the fact
that the organisation will be spending money on exceuting their customer service strategy, herin lies a trade off
decision between levels of customer service and and the cost factor in implementing a customer service strategy.
In most cases the improvement of logistics activities will definitely improve the customer service levels and may
improve the revenue stream but this will come at a cost. The accrued revenue must be greater than the cost of
implementing this customer service strategy as this will definitely impact the profitabiity of the organisation (de
Villiers, et al.,2019: 196 -2020).
Organisations can choose between the following customer service service strategies:
Customer strategy based upon consumers reaction to stock out
Customer/revenue trade-offs
ABC analysis
Customer service audit (de Villiers, et al.,2019: 196 -2020).
DISTRIBUTION SYSTEM Pertains to the organisations ability The accuracy, speed and
INFORMATION to respond to their customers consistency in which information is
information requests. relayed to consumers.
DISTRIBUTION SYSTEM Relates to the efficiency in which The speed of response time and
MALFUNCTION the logistics function is able to deal the time taken for correction and
mitigate and resolve malfunctions recovery.
arising from a distribution system
malfunction. (i.e. damage claims
and errors on billing documents).
POSTSALE PRODUCT Refers to the effectiveness and Response time for product support
SUPPORT efficiency in providing support to and the quality of response
the consumer after the delivery provided.
has taken place as well as the
technical information provided.
Think Point
Can you provide examples on various mechanisms that a logistics company can
have in place for post-sale product support?
6.5 Summary
A logistics information system was looked at and the two fundamental types of logistics information systems:
centralised and decentralized information systems were examined. A hypothetical example for a decentralized and
centralized information system was looked to provide a more holistic view of the benefits and limitations of the two
types of systems. Thereafter, customer service in the context of logistics management was discussed and the
three elements of customer service was highlighted. In addition to the customer service elements, the different
dimensions of customer service were also reviewed. The unit concludes with insight on the creation and
implementation of a sustainable customer service strategy and the various measures that one can use to ascertain
the effectiveness of the customer service strategy.
Knowledge Checks
Column A Column B
Different departments have real time access to information allowing for improved decision making. Sales,
production, inventory and all other departments function cohesively due to real time access.
a)
All department have access to a central repository of Access is restricted to the department
information
A specific contact number is used to facilitate faster exchanges, returns and malfunctions. Improved mechanisms
in place to support the pick-up of carriers.
1. E
2. D
3. A
4. C
5. B
Unit
7: Reverse Logistics and
Environmental Management
7.2 The impact of reverse logistics Analyse the impact of reverse logistics on a supply chain
on a supply chain
7.3 Reverse logistics activities Assess the various reverse logistics activities
7.5 Environmental management Explain the impact of environmental management on reverse logistics
and waste management
Prescribed Reading/Textbook
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic
Logistics Management: A supply chain management approach.
Second Edition. Van Schaik Publishers
Recommended Readings
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A
value chain perspective. Fifth Edition. Oxford University Press
7.1 Introduction
Logistics is a common term and gives the indication of movement. Reverse logistics refers to the reverse flow of
activities and involves all activities for a reverse flow of goods. Goods, demand information and money will move
in the opposite direction to primary logistics. Reverse logistics focuses on waste management inclusive of
collection, transport and disposal of non-hazardous waste. It is clear from above that reverse logistics has a focus
on the movement from the point of consumption to the point of origin and will entail recalls and recycling (de Villiers,
et al., 2019: 147).
Political
Environmental Economic
Legal Social
Technological
A key factor from the PESTLE environment is the pressure for sustainability. There is a need to focus on the
sustainability and the environment which has placed added pressure on reverse logistics to comply with ISO 14 001
standards and take more responsibility for the end of the life of products. In the case of plastic bottles, there is a
huge focus on the reduction of plastic waste and the need to recycle to reduce the plastic waste accumulating in
the oceans. Additionally, consumers have increasingly shown an interest in greener products which necessitates
the need for innovative designs to meet the “green standard” (de Villiers, et al., 2019:148). Figure 7.2 below
provides a diagrammatical representation of the forward and reverse flow of goods.
Forward flow
Reverse flow
26Figure 7.2 Diagrammatical representation of the forward and reverse flow of logistics
Source: de Villiers, et al. (2019: 149)
Think Point
Imagine you purchase a pack of six soft drinks, these soft drinks are usually carried
in plastic/glass bottles.
parts of the logistics chain to facilitate movement and/or storage. Owners will have their names stencilled on these
carriers to prevent theft and will sent in the reverse direction (de Villiers, et al., 2019:150).
Revision Questions
Reverse logistics differs from other activities in that there is no value added to the actual product with the cost.
This makes it even more important to continuously monitor and review the reverse logistics cost. A key factor is
the cost of value carriers. Value carriers have an initial estimated lifetime and organisations that spend too much
on these carriers will have to deal with the cost for the lifetime of the carrier. Value carriers must be responsibly
and economically disposed of at the end of their lifetime (de Villiers, et al., 2019: 155).
Dumisani Baloyi is a “born entrepreneur”. However, he currently works as a team leader in the
distribution centre for a manufacturer of multiple brands of consumer goods. He notices that a
limited amount of customer returns makes it back onto the shelves of the distribution centre.
His employer measures employee morale by the number of suggestions received from the
employees per month. Dumisani has, on three occasions, suggested to management that
something should be done about the waste of “good” customer returns. During the adjudication
of the last round of suggestions, management offers an outsourcing contract to Dumisani to
manage their reverse logistics.
Source: de Villiers, G. d., Nieman, G., Niemann, W. (2017). Strategic logistics management.
Fifth Edition. South Africa: Oxford University Press.
Can you provide suggestions on how to manage reverse logistics for Dumisani?
ISO 14000 is used to monitor the progress of companies towards compliance with the environmental standards.
The ISO 14000 series of standards prescribes external audits by professional auditors. The ISO 14 000 is not
mandatory for all organisations. However, ISO 14 000 is an excellent and holistic approach to efficient
environmental management. ISO 14000 will require a comprehensive commitment from senior management for
successful implementation (de Villiers, et al., 2019:155).
ISO 14 000 prescribes a formal management of the environment and is inclusive of the following key variables as
depicted in figure 7.3 below Thereafter a brief overview of the actions needed by an organization to successfully
implement the ISO 14 000 standards will be provided.
Environmental
policy
Comprehensive
Strategy
approach
Training &
communication
It is essential for the levels of management to fully support the commitment to environmental management by
having organizational policies in place to entrench the support of management and key stakeholders. Flowing from
the policies, there needs to be adequate strategies in place to effectively implement the policy. The policy and
strategy will enable organizations to apply the necessary structures to support environmental management (de
Villiers, et al., 2019: 155).
Organisations will need to provide sufficient training and communication to all members within the organization to
fully capacitate the staff on the initiatives. Once all staff have been informed and trained the organization can start
to implement the measures for monitoring the organizations compliance. A review and auditing process must take
place as a mechanism to assess the level of compliance, these audits can be internal and external. All
organizations must be mindful that compliance with the ISO 14 000 standards is a comprehensive task that
requires effort, time and resources. However, the benefits are equally comprehensive and will greatly assist in
marketing the firm’s products (de Villiers, et al., 2019: 155).
Case Study
Imagine that you have been appointed as environmental officer for Tutti-Frutti Drinks,
a Durban-based South African manufacturer of fruit juices and carbonated beverages.
Tutti-Frutti currently sells its products in KwaZulu-Natal, Gauteng and the Free State,
but wants to expand its market into the rest of South Africa and the African continent.
Currently, Tutti-Frutti sells its fruit juices in one-litre plastic sachets in the local market,
and the carbonated beverages in 340 ml clear-glass bottles. The non-returnable glass
bottles are packed in wooden crates with limited stackability for distribution to spaza
stores, supermarkets and restaurants. The plastic sachets are placed in stackable
plastic crates for distribution. Tutti-Frutti has a fleet of eight- to ten-year-old trucks for
deliveries.
Tutti-Frutti realises that it will have to re-evaluate its supply chain if it wants to become
more environmentally friendly. You have been asked to provide input as to the
logistics and environmental requirements that the new supply chain will have to meet.
Creating compost
from garden refuse:
Separation at the
Grass cutting and
source: the most Scavenging: Street pick up:
leaves are
effective. Waste is Separation of waste Paper and boxes
separated from the
separated into at the waste will be left on the
waste and
different bins at the disposal site pavement
delivered to a
source
garden waste
disposal site
Video Activity
https://www.youtube.com/watch?v=HjNv_iTsXn8
https://www.youtube.com/watch?v=I_fUpP-hq3A
https://www.youtube.com/watch?v=14r7f9khK70
Once you have watched these videos you can review your study guide content in
relation to the videos that you have watched to get a better picture of waste
management, you can also note down additional points regarding waste
management.
7.7 Summary
In this unit reverse logistics was explained and the impact of reverse logistics on supply chain activities were
reviewed. The PESTLE framework was looked at to better understand the effect these factors will have on reverse
logistics. A diagrammatical representation of forward and reverse logistics was provided to better understand the
flow of goods. Value carriers were discussed highlighting the need for value carriers and the amount of money that
is spent on value carriers. The financial implications of reverse logistics were discussed and the need to monitor
and control the cost. The unit concludes with a look at waste management and the various requirements to
implement the ISO 14 000 standard.
Knowledge Checks
Students to use their knowledge from the unit, the following should be included
Students can provide suggestions along the lines of improved design, change in material and improvement of the
fleet.
Student to watch videos as per the links that are provided. Students will get a better picture of waste management
and the various methods that can be employed.
False
True
False
True
True
References
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic Logistics Management: A supply chain
management approach. Second Edition. Van Schaik Publishers.
CBS Interactive Inc., (2020). Driverless trucks being tested right now on public roads. [Online].
Available: https://www.cbsnews.com/news/driverless-trucks-being-tested-on-public-roads-60-minutes-
2020-03-13/ [Accessed:05 May 2020].
Philpott, M. (2019). WHAT ARE THE DIFFERENT MODES OF TRANSPORTATION IN LOGISTICS?
[Online]. Available: https://philburn.com/what-are-the-different-modes-of-transportation-in-logistics
[Accessed: 25 May 2020].
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A value chain perspective. Fifth
Edition. Oxford University Press.
Raj, A. (2020). Importance of Supply Chain Forecasting for Plant Managers. [Online]. Available:
https://www.supplychainbrief.com/forecasting/logistics/?open-article-id=13117366&article-
title=importance-of-supply-chain-forecasting-for-plant-managers&blog-domain=throughput.world&blog-
title=throughput [Accessed: 15 May 2020].
Sterdts. (2016). Our services: Covering all aspects of international shipping & logistics. [Online].
Available: https://www.sterdts.co.za/our-services [Accessed 14 May 2020].
Temple, S. (2013). The impact of globalization on the supply chain [Online], available:
http://pressoffice.mg.co.za/barloworldlogistics/PressRelease.php?StoryID=247928 [Accessed: 01 May
2020].
Texas A&M Transportation Institute, (2020). Freight Shuttle System [Online]. Available:
https://tti.tamu.edu/freight-shuttle/ [Accessed 06 May 2020].
Bibliography
de Villiers, G., Nieman, G. and Niemann, W. (2019). Strategic Logistics Management: A supply chain
management approach. Second Edition. Van Schaik Publishers.
CBS Interactive Inc., (2020). Driverless trucks being tested right now on public roads. [Online]. Available:
https://www.cbsnews.com/news/driverless-trucks-being-tested-on-public-roads-60-minutes-2020-03-13/
[Accessed:05 May 2020].
Harrison, A & Van Hoek, R. (2014). Logistics Management & Strategy Competing through the Supply
Chain. Fifth Edition. Prentice Hall International Edition.
Philpott, M. (2019). WHAT ARE THE DIFFERENT MODES OF TRANSPORTATION IN LOGISTICS?
[Online]. Available: https://philburn.com/what-are-the-different-modes-of-transportation-in-logistics
[Accessed: 25 May 2020].
Pienaar, W.J & Vogt, J.J. (2016). Business Logistics Management: A value chain perspective. Fifth
Edition. Oxford University Press.
Raj, A. (2020). Importance of Supply Chain Forecasting for Plant Managers. [Online]. Available:
https://www.supplychainbrief.com/forecasting/logistics/?open-article-id=13117366&article-
title=importance-of-supply-chain-forecasting-for-plant-managers&blog-domain=throughput.world&blog-
title=throughput [Accessed: 15 May 2020].
Sterdts. (2016). Our services: Covering all aspects of international shipping & logistics. [Online]. Available:
https://www.sterdts.co.za/our-services [Accessed 14 May 2020].
Temple, S. (2013). The impact of globalization on the supply chain [Online], available:
http://pressoffice.mg.co.za/barloworldlogistics/PressRelease.php?StoryID=247928 [Accessed: 01 May
2020].
Texas A&M Transportation Institute, (2020). Freight Shuttle System [Online]. Available:
https://tti.tamu.edu/freight-shuttle/ [Accessed 06 May 2020].
Wisner, Tan, K, Leong, G. (2012) Supply Chain Management a Balanced Approach. Third Edition. South
Western