Combating Driver Shortage Through Packaging

by Rich Lindgren, CPP
Chainalytics

If you pay attention to transportation and long haul trucking rates, you know that the current driver shortage is a real problem and is causing increased rates and reduced load acceptance ratios.  For more details on the driver shortage and how it effects transportation costs, check out this article by Michael Kilgore.

The most widely accepted solution to the driver shortage is to increase compensation for over the road truck drivers so that the profession remains competitive against other appealing semi-skilled construction jobs that are on the rise.  That will definitely help with the supply end of the equation and probably deserved for quality drivers, but at the same time those wage increases will just transfer through to your company in the way of rate increases across lanes.

Here is an alternative way of thinking about this problem from the the demand side of the equation.  Shipping less product is obviously not a solution to reduce demand and unless you own your fleet, you can't really hire or pay drivers more, you rely on your carriers for that.  So lets look at something you do have control of.  Believe it or not, it starts with your packaging, specifically your distribution and unit load packaging.

Do the Back of your Trailers resemble this?

By optimizing your packaging and increasing the density of your unit loads and thus leading to more goods shipped per trailer, you reduce your demand on your carriers and the over all system.  Kind of like adjusting your thermostat in the heat of the summer when you are not home, you are reducing impact on the grid and waste.  Empty cube space in trailer is probably the worst and most expensive kind of waste there is.

Many customers we help achieve 5-15% improvements in full truck load densities, which usually translates 10-15% less truck load shipments.  This improvement obviously generates immediate transportation savings but also reduces the demand on their carriers and improved load acceptance ratios.  Now while one company reducing a few truck load shipments a week is not going to solve the driver shortage by itself, but a small percentage shift across the market would.  Not to mention, this would result in significant savings for companies and a large reduction in truck emissions from a sustainability standpoint.

To learn more about Packaging Optimization, follow the link.

How Innovative Product Packaging Solutions Can Save Money

By Rob Kaszubowski, Packaging Engineering Manager

Who knew you could actually damage a product while placing it into its protective packaging? But that’s the exact problem Chainalytics packaging engineers recently tackled for a construction materials client.

The company’s heavy vinyl lined products were being scuffed and scratched when slid into their secondary packaging for shipment—creating significant costs from damage returns, warranty repairs, and service calls.  But abrasion during loading wasn’t the only problem: Products were often damaged during unloading from sliding the product back out of the box.

Abrasion damage created from sliding product into box

To add to the packaging failure complexity, the product came in multiple sizes and weights and was manufactured on multiple lines. The tact time for the packaging operation was less than 20 seconds, leaving little time to physically add any extra protection components. 

A streamlined solution to a multi-layered packaging problem

The Chainalytics’ packaging team developed a unique testing method to replicate the vinyl product sliding into a box using a variable speed conveyor-like system (think of a treadmill). Only in this case the process was reversed: The vinyl was placed in a fixed position with a determined weight applied and a strip of corrugated material was run across the vinyl at a speed that matched loading speeds on the line. 

Customized abrasion test created to solve for multiple damage solutions.

The test enabled the team to establish baseline damage that was replicable to typical damage seen at the packing line. From there, they were able to test multiple packaging attributes to determine the severity levels of any single variable including:

• packaging substrates
• materials from multiple corrugated vendors
• various board weights
• liner board combinations
• environmental conditions
• corrugation direction
• vinyl colors
• abrasion reducing coatings for corrugated

Solutions testing helps us create the optimal packaging system

After establishing the baseline damage of the current state, engineers ran the same test looking at possible concept solutions. Again, the unique test setup enabled testing multiple possible solution variations in a short amount of time while using minimal sample product for testing.

Following the solutions testing the team identified multiple solutions and was able to obtain quotes and perform costing analysis to determine the most feasible solution that would balance reducing the damage while not increasing packaging costs significantly. 

Ultimately, the innovative test setup and customized test protocol expedited the time it took to solve for damage, balanced extensive damage/returns costs with new packaging costs and created a net savings benefit.  The packaging team was able to identify a cost effective solution that was able to significantly reduce the abrasion damage from loading the product into the secondary packaging and was a transparent change for the operators at the manufacturing line.

If your team is struggling with a packaging issue and in search of a customized solution to help solve a customized problem, contact Chainalytics’ packaging professionals at Packaging@chainalytics.com or give us a call at +1 612 260 7845

Stickers or Lasers? The Change in Tracking Produce

Recently, I reread a story discussing a technology in which lasers are used to mark produce with the goal of eliminating those little labels on everything from apples to zucchini. 

As with most disruptive technologies, there are often unforeseen hurdles; consumer acceptance, immature technology, integration into business processes, etc. The laser marking technology was getting a lot of press a few years ago and it was projected to replace the produce stickers; aka Price Look-Up code (PLU) labels.  

What is a PLU Code?

The PLU code is a 4 or 5 digit human readable number that represents any of about 1400 unique produce varieties. 

Examples of Fruit Labeled with Laser Technology

The History of PLU’s

Many of you reading this will remember that for most of your life (prior to 1990) there were no PLU stickers on fruits & vegetables.  To add slightly more perspective, it wasn’t until the 1980s that it was common for grocery stores to have barcode check out systems.

So, the two obvious questions are:

• What changed in the grocery industry just prior to 1990 that would have created the demand to add what seems to be an overly obvious label?
• Why do we need a label on a banana or for that matter an apple?

It turns out there are very good reasons for a PLU code label.  

What Changed in the Grocery Industry?

Target announced in 2010 that it planned to add fresh food to half of its stores by the end of 2011.  However, Target is really the upstart big box store in the grocery industry, but growing fast.  Walmart has been into the grocery business a little longer; they started adding grocery sections to their stores in 1988 and boosted their presence in the grocery market with the launch of Neighborhood Market in 1998.  I honestly don’t know the back story, but hmm … that starting date is very coincidental. 

The fresh produce section of your local grocery store has gone through a pretty incredible transformation in the past 25 years.  In the old days the most exotic thing we could get were bananas, and sometimes supply was a little sketchy.  Sure, seasonal fruits and vegetables were available, but the seasons were very short.  Today, we have fruits and vegetables from all over the world with the biggest transformation in a supply chain of produce from Latin America and South America.  We can now get grapes and berries any time of the year, with very extended seasons for almost everything else along with a vast array of other regional and ethnic specialties. 

What Makes the PLU Label so Important? 

The PLU not only exactly identifies the produce with a human readable number, but there is a special barcode and a lot of information on the label.  Sure, the number identifies the specific type of apple (in case you’re wondering, there are 208 individual PLU code numbers for apples alone), but if the number is 5 digits and starts with ‘9’, then it is an organic apple and an ‘8’ indicates genetically modified produce … who knew?   

So how does all this tie together?  The short answer is that the PLU code label provides granular and timely information to the grocer that drives supply chain efficiencies.  The simplest benefit for the grocer is accurately charging the consumer.  There is now so much efficiency and information in the system that the grocer can offer a huge variety of products and bring them in just-in-time (JIT); they know what sells and what doesn’t.  The grocery check-out system provides pull through information to the supply chain to generate automated JIT re-supply from a central warehouse with minimal loss to ensure my local market will have fresh stock.

The PLU code label is just the visible component of this huge change in supply chain prowess; increases in computer processing power, broadband connectivity and let’s not forget to give a nod to the chemists.  Scientists have been tinkering for years with the chemical cues that ripen and delay ripening using ethylene gas and other molecules.  The modern day supply chain consists of many impressive elements, especially the packing & ripening warehouses that tailor the exact amount of ripening agent to certain varieties of produce just prior to shipping to the grocer.

I am not entirely sure how those labels are applied, but that is an operation I would very much like to tour.  Although I don’t like the inconvenience of peeling the PLU label off prior to use, I most definitely like the variety in my local grocery store.  

So what is hampering the laser etching technology from being implemented in some categories of the produce marketplace?  I imagine thin skinned products like plums or nectarines might be an issue, but think what about bananas and melons?  Perhaps this laser technology can even add local grower information alongside the standard PLU data to influence consumers to pick a farmer branded produce

. By Eric Carlson, CPP - @EricPkg

Pic from http://modernfarmer.com/2013/06/will-laser-tattoos-replace-sticky-labels/




Eric Carlson is a Senior Packaging Engineer on the Chainalytics Packaging Optimization team. His track record of success ranges from developing packaging solutions for high cost and complex systems to implementing net cost savings through supply chain damage reduction.