How innovative collaborative logistics platforms can help drive more efficient and sustainable freight operations

He was one of the founding fathers of the USA, but Benjamin Franklin also had a talent for conjuring up idioms as profound as they were satirical. It was Franklin for instance, who is often credited with the prescient saying that “nothing is certain in life except for death and taxes”. However, if Franklin were alive today, he might also have extended the truism to include traffic jams.

And as one of the most accomplished scientists and innovators of his day, Franklin may have championed collaborative logistics platforms too, which seek to minimise dead-end miles, consolidate loads, and in doing so, reduce emissions, as a solution to alleviating Britain’s clogged road arteries.

Take a recent body of research by Inrix, a global traffic information supplier, for instance. Astonishingly, it revealed that each year motorists spend an average of 32 hours stuck on Britain’s gridlocked roads in rush hour periods.

And according to the DfT, it is the journeys made by vans –  trips which last year collectively exceeded 49.8 billion miles – that are putting added strain on the UK’s creaking transport infrastructure. Last year, for instance, DfT data highlights that van traffic increased by 3.6 percent.

Wasted miles…

But it is not just the millions of miles covered by commercial van fleets, and the UK freight sector as a whole that is the central issue. Instead, it is the number of journeys each van or truck makes every year when it is travelling empty. A study by the Institute of Mechanical Engineers, last year, estimated that in the UK approximately 30 percent of all commercial vehicles make journeys where no load is carried.[i]

Perhaps this is the most compelling argument yet for innovative freight exchange platforms using real-time data to help large virtual fleets, which sometimes number tens of thousands of vehicles, to maximise payload efficiency, reduce empty running and minimise emissions in the process.

Douglas Norris

Collaborative logistics and the data age – a game-changer?

So what role can collaborative logistics play in the future of road freight? Having spent almost two decades working for multinational technology giants, IBM and Compaq in both logistics and distribution, it is an area that Doug Norris is very fluent in.

Norris, who is National Officer for the Chartered Institute of Logistics and Transport for Scotland (CILT), says, “While it would be wrong to suggest that collaborative logistics platforms can solve all of the challenges facing the freight sector and the nuanced and highly complex supply chains that operators must navigate, I believe that in the future, freight exchange platforms which specialise in helping operators identify and take advantage of available capacity in real-time, will have an important role to play in the data analytics dominated logistics landscapes of tomorrow.”

One-way flow…

Norris, who before joining the CILT seven years ago, worked to improve transport in Scotland’s northern corridors and its islands, says that “the spare load capacity narrative” will be intensified by an increasing number of “one-way product flow supply chain networks”.

Norris, explains, “Take Scotland for example. It has a population of 5.4 million people and is a net exporter. Whisky, shortbread and textiles are some of its biggest exports. Sales of whisky alone which adds around five billion pounds of value to UK economy each year, with exports earning £125 every second. But despite the large amount of revenue that is accumulated each year from the whisky trade, logistically the industry has not yet found a way to reduce its empty miles count, as when each consignment has successfully been delivered to port, and the majority shipped to the USA, France and Singapore, the vehicle or container carrying the whisky is likely to travel back to Scotland empty.”

The future of logistics is collaborative and intermodal…

So how do the freight and logistics sectors overcome the issue of uneven flow? Does it mean reshaping and remodelling the entire freight supply chain architecture, or could the gilded age of data provide the freight industry with the answers it needs to solve the spare capacity conundrum?

In the UK, the Institute of Mechanical Engineers [i]believes that Britain needs to put a national masterplan in place, which creates greater synergy between the different logistics arms which handle the movement of freight on road, by rail and by sea. It is a view shared by Doug Norris too.

But how exactly can freight exchange platforms make a difference? Norris explains, “In the world of big data, the key is interoperability. It is about building up a collective and complete real-time picture of intermodal freight movements, and making that information available to operators. Take Scotland for example. Every day, there are probably 100 containers that are sent by train from Daventry in Northamptonshire to Scotland’s two main distribution outlets in Mossend and Grangemouth. The probability is that if there was technology available that could forensically break down and track each single load in real-time, there would be opportunities to take advantage of unused capacity. However, identifying exactly how much, where, when and how to integrate the different modes of transport, so that operators are able to share loads remains the greatest obstacle to negotiate.

Continues Norris, “But as key industry data becomes more ubiquitous and technology companies develop better systems to disseminate and sift through large data sets in real-time, in theory at least, collaborative logistics platforms who in the future can pin-point consolidation opportunities, such as potentially utilising the Royal Mail’s gargantuan virtual fleets, and at the same time work out the cheapest modal route for an operator to transport goods from origin to endpoint, could help the industry shed wasted miles.”

However, for the ‘physical internet’ to really take hold, won’t the UK’s roadside infrastructure, its lorries and logistics centres need a radical technological overhaul?

“Not necessarily,” says Norris. “By taking the relatively simple step of fitting a secure wireless tracking device to a pallet which can communicate current real-time position, a collaborative logistics platform would know when the product was collected from the customer, the vehicle transporting it, its location, its ETA, the journey milestones and, most importantly, the cross-docking opportunities. If in the future, the freight industry has this level of visibility, and has access to real-time platforms that can work out the cheapest, most efficient and most compliant intermodal routes, even if, counter-intuitively, it could mean temporarily moving a load sideways rather than forward to keep margins low, then potentially I could see this being of benefit to the industry.”

Leading-edge Data hubs…

But in this exciting age of big data analytics, many collaborative logistics networks, may take on a new role. As the data economy flourishes, to what extent is it realistic that compliant platforms, that have successfully integrated large virtual fleets onto their exchanges, may one day become repositories of information, providing an invaluable link for manufacturers and academia to conduct real-world studies and pilots?

Norris comments, “I think in the future, theoretically speaking of course, and subject to members agreeing that their data can be shared, then collaborative logistics have the potential to become important data hubs. For example, large tyre companies and fleets could benefit from an information sharing partnership. With real world data, OEMs can develop more fuel efficient products and advise on optimum tyre pressure, which helps operators keep on top of wafer-thin margins and also lower greenhouse gases. The FTA and Bridgestone, use data drawn from its Carbon Logistics Review, to collaborate in this way.

“Furthermore, oil companies might also gain too. While Euro 4 and 5 standards have dramatically improved emissions reduction, there is much work to be done to improve fuel economy, which for some HGVs is only seven to eight miles per gallon. Perhaps there is an opening there for freight exchanges to help engineers and scientists with their research, and for OEMs to use the floating data they collect to produce more efficient powertrains.”

 

[i] Supply Management

30% of UK vehicles travel empty

By Andrew Allen

Date: 23.06.16

https://www.cips.org/supply-management/news/2016/june/30-of-uk-commercial-vehicles-travel-empty/

Scotch Whisky Association

http://www.scotch-whisky.org.uk

All figures relating to whisky exports confirmed by the Scotch Whisky Association and can be found in the “Scotch at a glance report 2016” below.

http://www.scotch-whisky.org.uk/news-publications/publications/documents/scotch-at-a-glance-201617/#.WcPabK2ZMdU