“There’s an app for that”. This is a commonly used term these days but, we don’t yet live in a virtual world. The physical element still exists and, as long as it does, we need to find ways for the physical world to keep up to the development of the virtual world but, how do we do that? What’s the link between physical and virtual worlds and by what means do we link the two? The simple answer is, “The Internet of Things” (IoT). Sensor technology is the catalyst for the IoT to link the physical with the virtual realm while allowing human intervention to control processes for improvement in physical function. This is the underlying tenet of the Cargo Carousel System (CCS). Find an industry that’s as old as civilization itself, as inefficient and unsustainable as anything man had ever created and as fundamental to human need as anything on earth. Then, combine the IoT with an end-to-end, innovative physical solution to transform that industry far beyond mere improvement while minimizing disruption to its functionality and infrastructure, all within a window of opportunity that is unprecedented in the history of mankind. What creation could be so fundamental to mankind’s survival for so long that its development throughout history would forego concern for efficiency or sustainability? The simple answer to this question is, “The supply chain”. With a global efficacy currently estimated to be below 10%, it’s a prime example of inefficiency run amuck in a vertical so important that it still offers profitability in spite of itself. Empty back hauls (the return trip after delivery), partial loads and excessive packaging have us actually shipping more air than merchandise! There has not been a game-changing innovation introduced to the supply chain since the intermodal container back in the 1950’s.
AN INTRODUCTION TO THE CARGO CAROUSEL SYSTEM (CCS)
Creating A Mobile Warehouse
Before reading this document please view this 60-second video of the system’s functionality
As risks in the supply chain continue to occur and customer demand continues to be less tolerant of disruptions, more companies are recognizing the importance of creating and managing a visible supply chain. Although different interpretations and definitions abound, one way to think of supply chain visibility is: The right information, in actionable detail, on events, orders, inventory, and shipments, up and down, and end to end, updated and presented in real time. This definition – ambitious by intention – sets the goal of having visibility through every tier of the supply base, with every supply chain partner, in real time. This means continuous real-time automated presentation of information about such things as a real-time consolidated view of inventories across the supply chain, real-time stock and materials in transit, event management with real-time alerting and a continuous projection of future inventory levels from demand, inventory, and fulfillment data. The Cargo Carousel System achieves these goals.
The CCS is a framework developed to slide inside an existing ISO intermodal container or truck trailer. The framework can be built to fit the size of any container, trailer or truck box. Each “module” within the framework replaces a wooden pallet and is a cubic design which can also be built to fit any application desired increasing the efficiency, flexibility, scalability and sustainability of the supply chain.
What would not be apparent at the first glance of this system are the wireless capabilities that can be designed into each of the CCS’s modules. Utilizing their cubic design can allow Radio Frequency Identification (RFID) readers or Microsoft Kinect technology combined with Augmented Reality to sense whatever is within the cubic space of each individual module whether it is in a container, in transit, in a warehouse or in a retail store and, whether items have been loaded or unloaded anywhere or at any time, it will always know exactly what is within its cubic space. With a password protected, cloud-based portal the contents of each module can be traced anywhere in the world at any time to determine the detailed contents of each module at any given point in time. Simply mouse over the container diagram on your screen and a list of each module’s contents will appear with details from available standardized data synchronization initiatives like the ECCnet Registry and the Global Data Synchronization Network (GDSN) from the GS1/EPCglobal Network. Sensors for weight, light, temperature, humidity, barometric pressure, shock and movement are also included.
With a separate antenna for each module transmitting to the onboard Reader/Central Processing Unit the container’s own external antenna can transmit a continuous, real-time simplex satellite feed for the portal allowing almost limitless reporting potential depending on the size, power and sophistication of the Reader/CPU chosen. To overcome the problems of poor satellite transmission penetration through buildings and containers each module on the container transmits to the onboard Reader/CPU within the container which can then transmit to a DAS (Distributed Antenna System) or other in-house routing system when indoors. From there, transmission is unlimited. The Cargo Carousel System has an offline back-up battery with transformer capabilities to insure power is always available from either a tractor while in transit, a 120 volt outlet at the DC/retail store or from the off-line back-up battery when left alone out in the yard.
An open architecture and an integration engine for sharing content and data between businesses and their applications with full programme and Web API in a secure Cloud-based portal will allow any program to access, cross-reference and integrate this data with their ERP or legacy systems while eliminating antiquated Electronic Data Interchange (EDI) methodologies. Trading partner collaboration will be increased through the CCS’s secure, seamless integration but, more importantly, over time, collaboration to re-design not only the processes and functionality of assets but of entire supply chains will increase efficiency and cut monetary and environmental costs beyond any other efforts available.
Even without the RFID package, when you consider that individual modules can actually be designed as floor display fixtures for a retail setting then the re-design goes all the way back to the manufacturing floor. Product can be packaged in the retail floor display fixture and shipped directly to the retail store with all products tagged and ready for sale. Entire fixtures can then be swapped out as necessary. This would work exceptionally well in the produce sector where trays of produce could be shipped within each module with limited need for additional packaging or in the garment industry for hanging clothes. To further these lines of thinking consider developing the individual modules as other carousels within the modules of the CCS creating an oversized vending machine. Now you can have individual items line up to secure openings in the front or back of the container. A customer who orders and pre-pays online simply goes to the container location with the same pre-pay card or a reference number to enter and picks up their item(s) or can have a courier do it for them for immediate delivery. Pre-stock Carousels can be quickly exchanged for empty ones. This is an excellent delivery system for the ever-growing, global problems of urbanization and would win the war between retailers for speed and efficiency in last-mile delivery. The same will hold true for robotic automation in the warehouse. Replace your existing racking with a geostationary Cargo Carousel System and the exact location of any item can be identified with a simple GPS or RTLS (Real Time Location System) system built right into any forklift or AGV (Auto Guided Vehicle) with a very simple Graphical User Interface that any employee can utilize for cross-docking, pick and pack, etc. and it can all be initiated through telematics without even leaving their office. Each of these technologies are already available and in use today.
Entire warehouses can be retrofitted (no need to build new) to handle the loading and unloading of entire containers, not just their contents (no need for drivers to wait). If properly planned, the CCS can replace racking in any location (production, DC, store, etc.) and be stacked in a stationary position, side-by-side, end-to-end and two or three high gaining twice the space utilization of racking, with electrical plug-ins and a fully automated, satellite fed system that is completely robotic, totally hands-free and functional 24/7. “Lights-out” warehousing is no longer a dream. New warehousing plans might be eliminated in favor of secure “outdoor” yards holding nothing but Cargo Carousel’s stacked as high as necessary. Since the CCS requires no docks, the same can be done in the parking lot of any retail store, replacing existing back-room storage with more retail space while utilizing multiple Cargo Carousel’s either in the parking lot or backed up to bay doors.
The design of the individual modules is what will make each CCS unique in its own way and there are countless ways to design the individual modules. They can all be the same or mixed in any combination desired and one of the best features of the CCS will be the ease of transition from existing systems. The Cargo Carousel can completely eliminate pallets or continue to use pallets while the transition is implemented even without the track & trace elements in place which can be added at any time. The same holds true for production, transport, racking, warehouse, DC and retail space utilization. It can be utilized immediately with only minor changes to planning and processes and then be more fully integrated over time without interruption to current operations.
No other system adds more immediate flexibility to the supply chain while also offering unequalled scalability over time. Need more space? Add another CCS. Even start-ups can have their own warehouse parked in their backyard. Seasonal volume changes can now be easily absorbed without the need for new warehousing that is underutilized during regular seasons.
The Cruise/Shipping industry could utilize pre-ordered, pre-stocked refrigerated units that are exchanged for empty units when the ship comes into port. Naval or other marine/military fleets could replenish munitions and supplies in a much more efficient manner. Recycling and reverse logistics are natural extensions of the CCS’s capabilities. Exchange the modules that you just delivered with a pick-up of store returns or recyclables in the same visit without ever leaving the dock while eliminating the need for dock plates, dock levelers or even docks themselves.
The 48” x 40” or the 1200 mm x 1000 mm cubic module would become the world standard and intermodal containers would be designed to handle them with the CCS in place. The 48” X 40” cube is already used to a large degree in the supply chain. The row height of most racking is set at 48” and the uprights are 40” deep to accommodate the safety overhang of 48” deep pallets. The air freight industry already has standardized 48” x 40” cubes integrated into the storage capacity for much of the fleet. The 48” x 40” cubic design is stable, human workable, and fits where it needs to with little change to infrastructure. The billable charge per unit of transport will become a much simpler dimension-based packaging model with a variable for weight utilizing the cubic model and could be combined with a Distributed Multi-Segment Intermodal Transport System (see Dr. Benoit Montreuil’s the Physical Internet) for end-to-end efficiency gains.
Technology components of the CCS include:
• connectivity: real time business-to-business network;
• data repository;
• supplier and/or other portals;
• alerting/event management capability (sensors);
• display/presentation: views, dashboards, often role based, updated in real time;
• business process customization;
• mobile capability;
• wireless technology;
• social capabilities;
• configurable analytics; and
• role-based security.
Changing from wooden pallets to the modules of the Cargo Carousel System may be the most difficult hurdle to overcome in bringing this product to market. A disruptive technology such as this will require a paradigm shift in supply chain thinking. This may burden initial marketing efforts so, a more focused approach towards a single application to limit costs with the quickest returns may be required. Automated customer or courier pick-up at a single location or automated storage and retrieval systems (AS/RS) in a warehouse setting may be the best strategies to start with. By utilizing more of the existing aisle space in a warehouse and reducing the labor component of the value chain the CCS will offer immediate and measurable returns. This will be the initial selling feature of this system as it is an obvious pain point in the industry with no real economical solutions. The CCS solution speaks to the financial side of the equation and the cost/benefit is easily justified. Once the CCS secures a foothold in the AS/RS market then mobile applications can be introduced and further researched with industry input and support.
By focusing on the AS/RS vertical, the sensors and communications can be brought into development as well. This will be necessary to identify the exact location of merchandise within the warehouse and to automate both the CCS and the AGV coordination. Development of these systems will be paramount to the development of mobile applications and represent the best opportunity to grow into new verticals as the system matures. Acceptance of the CCS in warehouse settings opens the door for greater acceptance in mobile and other future applications. Maintaining a strong customer base through new offerings helps to secure a longer term horizon with which to work while supporting the organic growth of the company and identifies the CCS team as innovative leaders in the industry.
In 2016 and beyond, expect to see more supply chain vendors responding to end users’ needs for more robust visibility capabilities in every aspect of their supply chains. While visibility deep into the supplier base has been a particular challenge, end users are increasingly looking for visibility across every stage of their supply chain, from better demand signals, and supplier audits to track-and-trace capabilities, to logistics tracking. Bringing the Cargo Carousel System into the greater supply chain planning process offers tremendous strategic and performance potential. By leveraging the Cargo Carousel System as a callable capability and incorporating it into downstream transportation and upstream supply chain workflows, companies can improve asset utilization, use fewer trucks, drive fewer miles, have fewer empty backhauls/partial loads, reduce fuel costs, enhance distribution/retailing operations and increase recycling around the world by an order of magnitude.
Consider the research currently undertaken by MIT / GS1: http://autoidlabs.org/page.html and the reader will quickly realize that this is the right product at the right time for global supply chains and will prove to be one of the best hardware components to support the Internet of Things for years to come.
“Develop a complete solution, that is easily installed, and modular by nature, so customers can quickly adopt, see immediate benefits and ROIs, and add to their systems as their needs increase. That's the way to sell technology”.
Contact: Glen Munholland, P: 403-280-4406, C: 403-606-6647, email@example.com See a video of the Cargo Carousel System here
Cargo Carousel System’s Applications – Flexibility, Scalability, Sustainability and Efficiency
1. PROBLEM: Current supply chains lack the visibility to truly identify the quantity, condition and location of inventory throughout the value chain and software alone cannot solve this problem completely (even though some developers profess otherwise).
SOLUTION: Radio Frequency Identification (RFID) with GPS are added to each Carousel to identify anything on any module anywhere in the world at any time offering true end-to-end “Control Tower” visibility in the supply chain to help minimize overstocks or stock-outs and can have sensors for location, temperature, light exposure, humidity, barometric pressure, shock, movement, etc. to alert owners of any problems in real-time.
2. PROBLEM: Trucks have to be completely unloaded before being re-loaded and require sophisticated routing programs just to lay out the most efficient route but routing alone cannot eliminate empty back hauls (the return trip after a truck has delivered its load and is empty) or partial loads that are common to every route.
SOLUTION: Modules loaded with recyclables or distressed inventory (store returns, shelf pulls, overstocks, perishables, etc.) can replace positions on the Carousel as they become empty and at the same time while the truck is still at the dock. Delivery and/or pickups can be done continuously on the same trip eliminating empty backhauls, partial loads and sophisticated route planning software.
3. PROBLEM: More than 50% of the space in a warehouse is set aside for aisles to allow fork trucks to maneuver in.
SOLUTION: Stacking Container Carousel Systems side-by-side and end-to-end in a warehouse creates automated deep storage and retrieval that offers twice the space utilization of regular racking or shelving as it minimizes the need for the aisles that are required between regular racking for forklifts to maneuver which more than doubles the warehouse cubic space utilization.
4. PROBLEM: Labour is one of the most expensive components of any warehousing operation.
SOLUTION: Unmanned Automated Vehicles (forklifts) can load or unload containers at the dock or in deep storage without human intervention by combining RFID with GPS for exact location identification because the modules in the Cargo Carousel System stop at the exact same GPS position each time the Carousel rotates offering true “Lights-out” warehousing.
5. PROBLEM: Shippers are not willing to collaborate to consolidate their loads with third-party logistics companies for fear of losing control of their supply chain and the prying eyes of possible competitors knowing their shipping schedules. This creates the additional concerns of finding the right partners to collaborate with, ensuring timely shipment and delivery, equitable cost-sharing, problems associated with trust, planning concerns, and effective communication between partners.
SOLUTION: Opaque, closed, lockable and sealable modules from different shippers can be loaded onto the same truck without worrying about competitors prying eyes allowing collaborative or consolidated transport for smaller shipments in both the supply and reverse chains. This has proven to save 35% or more in shipping costs and reduces GHG emissions dramatically.
6. PROBLEM: Additional short-term warehouse space is expensive and long-term space is underutilized in the off season.
SOLUTION: Additional storage can be easily added to a store or warehouse (for seasonal or peak periods) and since the Cargo Carousel System requires no docks they can be stacked outside for even more storage and easy access.
7. PROBLEM: Most merchandise cannot be double stacked to fill a trailer because products on the bottom will be crushed resulting in partially filled trucks which only adds to inefficiency and GHG emissions.
SOLUTION: “Crushable” products can now be easily double-stacked without crushing the products on the bottom to insure trucks are always full. Eliminating partially-filled trucks dramatically reduces greenhouse gas (GHG) emissions.
8. PROBLEM: Wooden pallets are heavy and they use more of the annual hardwood harvest than all other uses combined. Tracking and recycling wooden pallets has spawned an industry unto itself and significantly adds to shipping costs.
SOLUTION: The Cargo Carousel System will eliminate wooden pallets saving trees and reducing weight. A blue “CHEP” pallet weighs about 75 pounds and a 53’ container has room for 26 pallets on the floor but, the Cargo Carousel allows double stacking so the equivalent weight of that many pallets would be 75 X 26 X 2 = 3,900 pounds. The Cargo Carousel can weigh half this much depending upon the application or design, reduces deforestation and eliminates the recycling process.
9. PROBLEM: Retailers are seeking better ways to fulfill the “Buy Online, Pickup in Store” shopping favored by many customers.
SOLUTION: Adding a digital keypad creates automated customer or courier pick-up like a giant vending machine anywhere the Cargo Carousel System is positioned like in a parking lot or even facing “inside” a store, high-rise or mall and empty Carousels can be exchanged with full ones for quick replenishment and reduced labour and handling time.
10. PROBLEM: Cruise ships and other marine vessels have extremely limited time to unload, clean and re-load before there next voyage but it takes hours to replenish a ship and time is money.
SOLUTION: Marine vessels (Military, Cruise Ship, Freighters) can be designed to carry entire Cargo Carousels that can be quickly “exchanged” when they’re emptied with Cargo Carousels that are pre-stocked with supplies or munitions for quick replenishment (including refrigerated units for perishable goods). The Cargo Carousel can also eliminate the global marine debris problem by using them to recycle the packaging of the replenished products.
11. PROBLEM: Every time merchandise is handled it costs more money and the packaging is excessive and expensive.
SOLUTION: Modules in the Cargo Carousel can be built as actual retail display fixtures with merchandise already in the fixture to “swap” out with empty fixtures in the store to minimize handling and packaging.
12. PROBLEM: Fashion clothing needs to be unpacked, unfolded, pressed and displayed creating a labour intensive process.
SOLUTION: Clothes can be hung from a cross-bar as a retail display fixture within an enclosed module of the Cargo Carousel System which adds security and empty modules or fixtures can be exchanged for full ones to minimize touch points and reduce time in both the supply and reverse chains.
13. PROBLEM: Perishable items lose half their shelf life while in transit and storage.
SOLUTION: Trays of fruits or vegetables can be layered on trays in racks in a module. Refrigerated containers can be brought directly out to the field and loaded immediately since no dock is required for loading, maximizing shelf life while minimizing touch points in the supply and reverse chains allowing perishables to also be recycled for bio-fuels.
14. PROBLEM: Postal services are suffering due to the Internet and their only remaining profitable service is parcel delivery.
SOLUTION: Courier or postal services could do a delivery and a “return” pick-up from the same location with the Cargo Carousel System. A focus on parcel “returns” could breathe new life into the ailing international postal service because they’re already “in the neighbourhood” anyway and returns are growing in volume due to online shopping.
15. PROBLEM: Fulfillment centres take years to design and build and are permanent once they’re built.
SOLUTION: The Cargo Carousel System could eliminate complete fulfillment centers in exchange for moveable, stackable, weatherproof, temperature-controllable containers in smaller multiple, secure, fenced yards inside or outside of the city for omni-channel fulfillment and “last-mile” delivery as docks, dock plates and dock levelers are no longer needed which allows repositioning closer to targeted customer as demographics and circumstances change.
Reduction of GHG Emissions in the Supply Chain
1 gallon of diesel burned = 11.91 Kg1 of CO2
The US class 8 fleet drove 99,200,000,0002 miles in 2010.
If we use a conservative estimate that only 10% of those miles3 represent tractor/trailers driving empty then: 99,200,000,000 x 10% = 992,000,000 miles of truck/trailers travelling empty
Even if we allow 10 miles per gallon4 efficiency for those tractors/trailers which is “extremely” efficient then: (992,000,000 /10) x 11.91 = 1,181,472,000 Kg of CO2 per year
If 1Kg = 2.20462 Lbs. then 1,181,472,000 Kg = 1,302,350 tons of CO2 per year
If our system could decrease empty back hauls in those trailers by just 50%5 then: 1,302,350 x 50% = 651,175 “tons” of CO2 per year could be eliminated in the US alone
If we use the same conservative estimate that only 10%3 of those miles represent tractor/trailers driving empty then: 99,200,000,000 x 10% = 9,920,000,000 miles of truck/trailers travelling empty
Even if we allow 10 miles per gallon4 efficiency for those tractors/trailers which is “extremely” efficient and we use the average price for a gallon of diesel at $2.9326 then: (9,920,000,000/10) x $2.932 = $2,908,544,000 in fuel savings per year
If our system could decrease empty back hauls in those trailers by just 50%5 then: $2,908,544,000 x 50% = $1,454,272,000 worth of fuel per year could be saved in the US alone
Cost Reductions at the Distribution Centre
Cost to lease a warehouse for one year: $4 to $7 per square foot
Operational (utilities, insurance, taxes, etc.) expenses: $2 to $3 per square foot annually
Fork truck leasing, per truck: $750 to $1,000 per month, per truck. Unmanned, automated fork trucks may cost twice as much when systems software/hardware components are included
Cost per hour per worker: range of $30-$40 (includes admin & management costs, benefits, commissions, etc.)
Percentage of aisle space for fork trucks to maneuver in a DC is easily 50%
Static expenses: At the “low” end for a 500,000 square foot building, ($4 lease costs, $2 operational per square foot), the warehouse could cost $3,000,000 a year before labor, equipment rentals, etc. Split that amongst the total pallets stored and you are starting to see the total cost picture. Add in labor, forklift rentals, etc. and the picture starts to solidify.
Active expenses: Add number of operators x “low” end of estimated labor (say, 50 workers, 8 hours a day at $30/hr.): $12,000 per day of operations. That’s $3,120,000/year for a 260-day per year work schedule.
So, if we add static expenses plus active expenses, this warehouse would run its operator $6,120,000 to run per year. If the facility can store 100,000 pallets, they would cost roughly $61.20 a year per pallet or $5.10 per month. This is a very low estimate, assuming the lowest cost per pallet position. The point is, you can find a number that’s in the neighborhood of cost per position for any particular geographic area. This obviously varies based on where you are, what you’re storing, and the size of your warehouse.
When stacked side-by-side and end-to-end the Cargo Carousel System can reduce warehouse aisles by 75% or more. Unmanned, automated fork trucks can reduce labor costs by 50% or more. Using this same scenario, we could cut aisles space by 500,000 x 50% x 75% = 187,500 square feet or 187,500 x $6 = $1,125,000 a year and labor by $3,120,000 x 50% = $1,560,000. That lowers total costs by $2,685,000 down to only $3,435,000 from $6,120,000. For that same 100,000 pallet capacity the cost per pallet position drops from $61.20 a year to $34.35 a year or from $5.10 per month to $2.86 per month.
These numbers provide a rough baseline to estimate warehouse costs. They are obviously variable between locations and facility types. Unmanned, automated fork trucks and other specialized equipment that are used in operations need to be factored in as well.
These are not difficult numbers to calculate and their sources come from readily available numbers on the Internet and uses standard figures (i.e. 1 gallon of diesel burned = 11.91 Kg of CO2). This is simply a new concept that has never been considered before and it doesn’t take into account the recycling, supply chain visibility or other attributes that our system offers. A 60-second video of the Cargo Carousel System can be viewed at: https://youtu.be/lOkzpGCJapA
1 Source: www.fleetnews.co.uk/ (under Fleet Tools/Carbon Footprint Calculator)
2 Source: The American Trucking (ATA) http://www.trucking.org/News_and_Information_Reports_Industry_Data.aspx
3 This figure is used to express conservatism in the numbers. The actual percentage of empty miles travelled is estimated to be higher than 25%
4 The actual efficiency of class 8 vehicles is between 4 and 7.5 miles per gallon
5 We believe that, over time, our system could decrease empty back hauls in those trailers by more than 95%
6 The average price for a gallon of diesel on Dec. 15, 2014 was $3.419 and on Nov. 15, 2015 it was $2.445 (3.419 + 2.445)/2 = $2.932