The evolution of Third Party Logistics Services has experienced marked advancements in the decades since the inception of outsourcing supply chain operations.

Traditional Warehouse Management Systems were a basic transactional processing engine supported by software to manage inventory and delivery functions. Today, the seeming insatiable consumer demands and online realtors like Amazon have created the need for the next generation WMS.  Vendors are stepping up to the plate and developing functionalities and solutions that meet the complex needs of today’s companies. 

Most manufacturers pay all sorts of attention to packaging design from a visual attraction standard, yet little time is spent on the consideration of packaging optimization. There has been a major paradigm shift from brick and mortar shelving exposure to the Amazon environments.  An equally significant shift in packaging needs to be addressed. The packaging appeal has lost its' touch since most of our purchases these days are not off the shelf, but off the UPS truck. The fancy packaging of your most recent purchase arrives in a plain brown box. In the haste, to open the box, I suspect little attention is paid to the shiny, multi-color packaging of the item. Personally, I tend to destroy the box to get to the quick start guide. The cost of that shiny multi-colored packaging can be staggering, often times, exceeding the value of the item itself. So, is this expensive marketing ploy really necessary these days? Probably not. What is important is optimizing the packaging size in order to minimize shipping costs. This is particularly relevant in the recent dimensional weight environment that most shippers have adopted. 

Like with most things change tends to generate more fear than optimism.  The robotics and technology trends are generating similar concerns among the unskilled worker population. Historically robotic applications have been limited to repetitive, mundane manufacturing functions; that too is likely to change.  Technology and robotics engineering is constantly evolving to expand their use in more complicated processes. A somewhat dated study from economists at MIT and Boston University published by the National Bureau of Economic Research attempts to quantify the effects of industrial automation on American employment. It found that between 1990 and 2007, each robot added to the workforce reduced employment in the local commuting area by three to six jobs.  The addition of one robot per thousand workers also lowered wages by 0.25% to 0.5%. Overall, the report estimates robots cost the US between 360,000 and 670,000 jobs total during the span in question.

Robotic Applications in Warehouse Operations

Automation and robotics has been in place in the Logistics industry for years.  Most prevalently in the warehouse and distribution centers. Warehouse-based robots help increase efficiency and productivity when performing product retrieval tasks. At warehouses operated by The Gap, Staples and Zappos, for example, autonomous robots receive information about a product required for an outgoing order. The self-propelled robot navigates the warehouse, finds the product and transports it back to a human operator who processes the order. The robots continually rearrange the warehouse to place popular products around the facility's perimeter, reducing the time spent to route these products to employees. It may not be time to panic about job security just yet. The reality today is that these automated warehouses are typically highly mechanized environments that still employ people in key functions. An example would be a modern sorting center which has much higher productivity and accuracy than in previous generations. Even with all of this advanced technology, in large sorting hubs there may still be more than 1,000 employees who spend their time loading and unloading trucks, handling parcel containers, and manually sorting odd-sized items. There is also the need for supporting staff required to maintain these complicated systems. One thing is certain; the cost and time savings generated by these automation applications means the technology is here to stay. 

Automation on the Road

Industry experts are defining what it will take to make autonomous vehicles a practical and safety reality.

Autonomous trucking technology companies have popped up everywhere in the past 12 months, each with similar technology that is focused on clearing two very important hurdles: getting the truck on and off the highway.  

An anticipated increase in fuel prices are likely to increase shipping costs for U.S. manufacturers in 2017 in the form of higher fuel surcharges. 

The autonomous vehicle revolution is quickly on its way to reality...perhaps too quickly. There are several AV's currently in testing for transportation of cargo, as well as humans. The pioneer in AV technology is clearly Uber. With its acquisition of Otto, the leader in commercial truck automation, it plans to be the first at the table with AV technology for cargo hauling. It is also testing its own self driving vehicles in many U.S. cities. 

Both the drone industry and federal regulators are years away from actual legal drone deliveries in the United States, but that’s not stopping companies from testing possibilities. UPS successfully completed its first drone delivery from a delivery truck. The drone is designed to be stationed on the roof of the truck and to be launched from and return to the roof based launch pad.

Monday’s test, performed in Lithia, Fl, with Workhorse Group, an Ohio-based electric truck and drone developer, sent the drone first on an autonomous package delivery and then back to the truck, while the truck was out making a separate delivery.The drone docks on the roof of the delivery truck. A cage suspended beneath the drone, extends through a hatch into the truck.

A UPS driver inside loads a package into the cage and presses a button on a touch screen, sending the drone on a preset autonomous route to an address. The battery-powered HorseFly drone recharges while it’s docked. It has a 30-minute flight time and can carry a package weighing up to 10 pounds.

This test has specific delivery implications for some UPS customers. It has implications for future deliveries, especially in rural locations, where our package cars often have to travel miles to make a single delivery,” said Mark Wallace, UPS senior vice president of global engineering and sustainability. Rural delivery routes are the most expensive to serve, due to the time and vehicle expenses required to complete each delivery.

While the drone is making its delivery, the driver would continue to the next stop, make another delivery by hand, and the drone would then rendezvous and recharge on top of the UPS package car. The drone is fully autonomous. It doesn’t require a pilot. So, the delivery driver is free to make other deliveries while the drone is away.

UPS has been a leader in efficiency improvements in its operation. Years ago, they programmed their delivery routes to maximize right turns taking advantage of right turn on red opportunities, rather than sit at a red light to go left. They continue to maximize delivery efficiency with this drone application.

Last year, the U.S. Federal Aviation Administration (FAA) issued small unmanned aircraft systems rules that allow for some commercial use of drones and paved the way for future expanded applications. UPS was one of 35 selected from a cross section of key stakeholders to serve on the FAA’s drone advisory committee. The committee will provide the FAA recommendations on key drone integration issues that will ultimately allow for safe and secure operations of drones within the National Air Space System.

Mike Pence, just days ahead of being sworn in as the country’s new Vice President, assured hundreds gathered for the U.S. Conference of Mayors’ annual meeting that Donald Trump will follow through with an infrastructure plan. The infrastructure issue is a big deal in the North East portion of the county; the further East- the older the original construction. Adding to the age and history, the daily pounding the roads and bridges endure in the Northeast from 80,000 pound commercial vehicles, it is no wonder the turnpike bridge linking New Jersey to Pennsylvania was shut down recently for major structural repair.