Digital Collaborative Supply Chain among Partners- A Singapore Case Study of 2 customers in chemical logistics
Digital Technologies and Collaboration can bring about tremendous benefits for partners in the supply chain.
We need the right mindset to treat service providers as equal partners to reap full benefits of technology and collaboration.
We want to present a case study of a 3rd Party Chemical Warehouse & Logistics company (3PW) and its Customer (STCo) – a company providing spares, supplies, provisions & consumables to ships operating in cruise, commercial, naval and offshore support categories. 3PW is a specialized company that handles dangerous and flammable chemicals apart from non-dangerous chemicals. STCo also has Warehouse facility to handle general chemicals, food & provisions including cold room warehouse. STCo relies on 3PW to handle all DG chemicals flowing through its supply chain.
Fusionova has been providing Software solutions for the 3PW Chemical Warehousing company since early 2000. We developed and implemented a web-based Warehouse management system in mid-2003 and upgraded the system multiple times to keep in tune with changing business requirements. 3PW handles about 70-80 customers apart from STCo all on a permanent basis. We implemented barcoding for all products coming into the warehouse and used mobile and wireless technologies to facilitate automated data collection, retrieval and accurate and error free processing of various functions within the warehouse. We automated various aspects of Billing and Invoicing involving complex calculations for different products and services provided based on Customer, SKU, UoM and Storage parameters. We thereby saved good number of man-hours spent on manual calculation and also eliminated errors, missed revenues and delays associated with manual work.
STCo was aware of the WMS implementation at 3PW and we were introduced to STCo by 3PW to explore WMS implementation at their Facility in 2017/18. However, discussions did not materialize then until early 2021. It was in Feb 2021 that we contacted STCo again to explore digitalization of their operations as we knew STCo handles variety of ship supplies and provisions.
The Problem and Challenge:
STCo used to operate under the following conditions in their own words:
We are managing multiple 3rd Party Distribution Centre’s at Singapore, for our customer. Singapore is earmarked as the Distribution Hub for their Asia-pacific business operations – the Central Inventory Hub for the region managing the distribution for Singapore Port and the Key Base Port in Hong Kong, Korea, Japan and Australia region. Our customer is a US based company and different Base Port in the region should have real-time visibility of Inventory at Singapore Hub.
We handle different types of chemicals for our customer and that includes general chemicals (NDG) to Dangerous chemicals (DG). We have a separate warehouse provider for handling and storage of dangerous chemicals (DG) as they require very specialized handling. DG warehouses are under licensing of relevant authority requiring adequate safety procedures, mechanisms, equipment and other requirements (such containment & fire protection system) to prevent spillage or fire to meet the safety requirements and annual auditing.
We receive both Non-DG and DG chemicals in FCL & LCL at our receiving area. Each pallet has multiple SKU (Items) packed in the shipment. We need to manually check and separate the Non-DG and DG chemicals from each other. Non-DG chemicals are sent for storage in Non-DG warehouse and DG chemicals are all sent to DG warehouse at another location.
All items in Non-DG warehouse are sorted and repalletized manually and recorded manually using excel spreadsheets – with details of product code, batch no, lot no, expiry date and other parameters including the specific Rack location where they are stored.
DG chemicals sent to DG warehouse has separate inventory list with details of incoming goods, location within the warehouse as well as details of outgoing goods.
Incoming inventory from customer is currently stored at multiple warehouses. Outbound orders from customer contains Non-DG and DG products in a single order. On receipt of outbound order, we need to manually identify the type of chemical – Non-DG or DG and pass the order information to respective warehouses for Picking, Packing and consolidation of the order for further order fulfillment as per customer requirement.
It is a challenge to keep track of inventory at different warehouses with different types of chemicals being stored at different warehouses with operational procedures and practices. We need to manually identify for each order the type of chemical (Non-DG or DG) and it a tedious affair to check the classification of chemicals every time. It requires lot of time to identify the chemical type and the warehouse where they are stored and to send either the incoming or outgoing information to respective warehouses and final consolidation and verification of the orders. Further, within the warehouse locating a product takes time as we are dependent on manual records. Sometimes, records may not be updated and people spend time locating an item or a specific product within the warehouse.
Managing Inward and Outward movement of goods to and from multiple warehouses handling different chemical types is bit of a challenge with manual records and manual processing. Too much dependence on human decision at every stage of the process leads to high probability of errors and time spent on tracking, tracing and order consolidation.
Lack of Consolidated Real-time information is a great impediment in achieving efficiency and effectiveness in the operations. This is further complicated with different types of chemicals being handled at different warehouses. Errors do happen due to over dependance on human to segregate chemical based on type and dispatch to relevant warehouse.
Customers request for Packing List for each Pallet. Manual document preparation and record keeping is tedious and time taking.
We need to keep track of all services we provide at multiple warehouses order wise and product wise and bill the customers. Manual tabulation, calculations and providing supporting documents are a tedious affair – time consuming and prone to errors.
Customers frequently ask us to provide Inventory and goods movement reports for different period according to each product code. We need to spend lot of time to generate relevant reports and by the time the reports are generated, lot of goods would have moved IN & OUT of the warehouse. We are hard-pressed to provide real-time goods flow and inventory information at different warehouses.
The Opportunity and Solution:
We are now working on a Multi-Warehouse Distribution Software project with STCo with some of the following objectives:
- Handle Multiple Warehouse & provide Single Integrated visibility of Inventory
- Automated Data uploads for goods information flow – eliminate or minimise data entry
- Segregate Non-DG and DG items on arrival & send them to separate warehouses (system driven)
- Ensure the chemicals go to the right warehouse & all product records are maintained accurately with location particulars
- Generate proper documents with Pallet Sheet for inhouse storage and 3PW storage – 3PW will get complete Packing List for each Pallet
- Storage at respective warehouses with chemical segregation based on chemical type storage criteria using Mobile PDA with barcode scanning
- Inventory list showing Non-DG and DG items with location / warehouse
- Real-time consolidated Inventory at multiple warehouses for Internal users at multiple warehouses, office and customers
- Monitor Product expiry, Low stock, Fast moving goods and other criteria as required.
- Generate Automated Invoices
- Generate Delivery Order for Non-DG & DG items
- Picking, Packing and Final verification of Non-DG and DG items in an order all using Mobile PDA barcode scanners
- Picking the right product / item from right location and right quantity
- Generate DO information with Palletsheet in detail
- Generate Analytical Reports on Warehouse utilisation, Revenue and Cost per order, Summary of Revenue & cost for a period by service / overall, Inventory and goods movement information.
- Allowing and sharing data exchange for goods flow information and invoicing between the 3PW and STCo systems
- Handle other Bonded items with special considerations
We hope to facilitate easy data exchange between our 2 customers, reduce repetitive manual data entry at multiple systems and share best practices for mutual benefit.
We hope such collaboration among partners in the supply chain can strengthen the relationship, bring cost savings, improve customer service levels and a win-win partnership.