30.06.2020 | Branchenyt
No need for stretch wrap in the future
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As in many other areas of the world, students in the northern Upper Palatinate in Bavaria, Germany, demonstrate every Friday as part of the Fridays for Future Movement. Helmut Prieschenk, CEO of WITRON, has not walked with them yet, but he takes the concerns of the young people seriously.
“Whether you judge them as good or bad I think that such events are important signs. They are symptoms that make us, and especially our elected officials, aware of problems that have not yet been solved. Unfortunately, we talk too much about the school strikes and about the role of the teachers. Thus, we often forget why young people are actually striking and the actual focus – Sustainability – often takes the back seat. I think it’s a pity that the movement is getting simply too big and everyone is just talking about what Greta Thunberg had for breakfast. Instead, we should be talking about our planet, and discuss the core problems.”
Helmut Prieschenk has many customers in the food retail industry. These customers are keeping a close eye on the younger generation and their needs. They recognize that the consumers of the future have different needs and new demands for the food industry.
“We have to face the actual topic and not the big event around it. We have to talk about sustainability, how to avoid waste, and ask everyone in the supply chain, how we can achieve our goals in the future. Today, the customer wants to know where the milk comes from, from which farmer, from which cow. This tractability is becoming extremely important, it is what the modern consumers want to know today. These are the answers we must give.
The industry is often seen as the bogeyman for the young generation, do you feel misunderstood?
In the end, it’s all about transparency. Volume is not as important anymore. Instead, we need to talk about where the goods come from, where they are stored, how they are stored, and whom do we have to answer to? An approach would be to ask ourselves if we can use an intelligent logistics system to move less goods through the warehouse, to avoid extra tours for trailers, to avoid excess production, and therefore reduce waste and perishable goods in the store.
Once again the question: So you do not feel misunderstood?
No, but one other thing to keep in mind are the people, which are also a part of this EcoSystem, and they are part of the discussion about sustainability. Here, ergonomics is the keyword: Can we manage to build systems that can avoid people lifting 12 tons of cases a day, that produce fewer pallets and need fewer trailers?
These are the topics for Prieschenk and his colleagues at WITRON.
The industry has been discussing sustainability for years. Ten years ago, it was still called Green Logistics - but not much has happened.
But what exactly have we done? Today, we are reducing the amount of trailers that have to go to the stores by 10 percent.
Is this because the technology is available or because the pressure is too high?
Both. People only react through suffering or the threat thereof. When did people buckle up in their cars? When it could cost them money through traffic tickets. People learn, but humankind does not. However, the pressure is useless if there are no technological solutions to light it. Now, we have machines and data. Data Lakes didn’t exist 20 years ago. Now we can tell the customer which cow produced their milk. Now, we have the data, the computers, and the algorithms. Whether you need to know is up to you.
Here is practical real life example.
Stretch wrap is part of every supply chain. It is used for securing products on pallets or roll containers and until a few months ago, it was hard to imagine the storage and transport processes of food retailers without stretch wrap. But the companies are rethinking their approach. Many customers are demanding better climate protection and more sustainability in the supply chains. “If a supermarket retailer reduces its plastic packaging and communicates it through advertisements, the stretch wrap should not be piled up in the backyard of the store.”
In the Spar central warehouse in Wels, Austria, the food retailer and WITRON engineers are working on a solution for more sustainability within the packaging processes. Until today, the pallets leaving our warehouses are stretch-wrapped on the roll container to ensure stability during transportation on the trailer. Now, our customer is testing solutions such as fixed curtains on the roll containers.
WITRON is working on these solutions together with the customer.
We work as partners and are lucky not to be in a classic supplier relationship. We sit down with the customer and think about contributions from both sides. Then, creativity is required - not only from the system supplier, but also from the customer and their suppliers. New questions arise: Does each cucumber have to be wrapped in stretch wrap; can I handle the cucumber without wrapping it, can I use a camera to see where the barcode is? Then the customer have their trailers, which shape the transportation system. The focus is not on providing a sustainable solution for no money, but rather we are talking about an interaction, an integration into an EcoSystem. There is no point in one person optimizing and delivering something great at the expense of others in the system. Customers are prepared to talk to everyone in the chain. That used to be different, but it’s happening more and more in the past four or five years, and it’s similar in Europe and in North America.
Keyword packaging - there is still a lot of flexibility. Prieschenk groans.
The topic of packaging has many aspects and tends to be complex. One person might want to optimize packaging for logistical reasons, the other person wants it to look nice for the consumer, and the store usually wants it to be shelf-ready, to be opened with a quick zip. We have these conflicts everywhere. Other people want no more plastic on the tray. We certainly don’t know today what the packaging of the future will look like. Is it a tote, a pallet, or a completely new transport unit? This is something we are currently working on.
Currently, we are thinking in black and white - “I either have a pallet or a tote” – we are trying to get away from that and interpret the problem differently. Our idea is an integrated transport unit that allows us to flexibly deliver the goods according to the requirements of the store or shelf. There are situations today were we deliver the same SKU to the store in a case, in an overpack, or as a single unit in a tote with other items. Who says that this can’t be done in a more flexible manner? Which system stops us? An ERP, SAP continues via merchandising and the store that orders. It can make sense to integrate more flexibility at this point. But if I do that, I also have to be able to keep up physically. The warehouse and the transportation process must be able to cope with this flexibility. It also has to be efficient, because I can’t end up making 50 extra pallets. I really have to avoid that. That’s what we are working on - intelligent solutions – it not all cut and dried yet through.”
Beyond that, Prieschenk has concerns about a different topic.
If you want to seriously talk about sustainability, you have to discuss business models that might make no sense economically and ecologically – paying $ 1.99 for Ketchup in the store and then the same price for home delivery doesn’t make sense economically. That is we can call exploitation of the earth. During the discussion, Prieschenk refers to aggressive e-commerce strategies that will never pay off economically and ecologically. He is convinced:
“Gravity will fix it. The time will come when the billing is done. We experience flows that swing through and the pendulum must swing back eventually. It’s the same with the automotive industry and the many recalls we see today. The companies want to launch new models more rapidly and save on quality at the same time. Another question: do we actually need to build airplanes for 1,000 passengers? Everything is always driven to the limit, swung over until you realize: wait a minute, it could be a problem and that is when we cut back to normal again. It’s the same with logistics. We have hyped in a direction that is practically impossible to represent - or only for a few, who then hold out at the expense of others. In the end, that has nothing to do with rational competition.”
Prieschenk sees himself and the company as a respectable merchant - is this no longer appreciated?
No, we feel this through our many customers. They appreciate partners who don’t make business at the expense of others. If companies want to make profits at the expense of their own employees, the company won’t succeed. The same applies to suppliers, for example, drivers. Or if a company wants to gain money at the expense of the environment.
And then comes Fridays for Future?
Exactly! Because common sense is not enough to fix it. Then we get signs like Fridays for Future, which are literally the fire alarm. But we also have to look at the actual fire to see if anything changes. Einstein once said: A new type of thinking is essential if humankind is to survive. This goes back quite a way but it still applies today. Many didn’t understand it. We can’t wait for the system to collapse. With Ketchup for $ 1.99 we can wait until we earn money. We frankly can’t do that with the earth.
Specialists of the future
The customers of the Greta Thunberg generation are very critical, make new demands on the companies and also in turn change the logistics processes. The industry can indeed achieve sustainability. Today, we save 10% on trailer transportation and can trace the canned milk back to the cow on the pasture. But only a few people know that.
But the consumers of tomorrow are also pushing Prieschenk for another reason. Companies that are greenwashing no longer have a chance as employers.
Are foosball tables and fruit baskets the solutions for the more than 4,000 WITRON employees worldwide? “No, fruit baskets are not enough, and foosball tables and colorful furniture do not suit us as a company. Our employees know that together with their team they provide 40 percent of Finland’s population with food. Or during the Corona crisis, we kept up the basic supply for people in many countries. We are ensuring fast replenishment to the stores and people in the logistics center no longer have to lift 12 tons a day. That is the purpose of our work.” “We at WITRON have to work on this again and again. The purpose of our work is important for us. Family-run companies can often convey this better than large publicly traded corporations can. That is our big advantage. More so, we are no quarterly thinkers, but think and act in the long-term - focused on total sustainability.
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