NSW freight plan launched

A new plan that “will deliver safer, faster, more efficient and sustainable freight movement to boost a growing NSW economy” has been launched b y the NSW Government.
The NSW Freight and Ports Plan 2018-2023 is said to guide more than $5 billion to be invested across the sector to support the growing freight task while managing growth and congestion across road and rail.
Minister for Roads, Maritime and Freight Melinda Pavey said more than three million households and businesses across the state tap in to the freight network every day, relying on the timely and efficient movement of good to markets nationally and globally.
“The amount of freight moved through NSW is set to grow by 28 per cent to more than 618 million tonnes by 2036. To support this, the NSW Freight and Ports Plan 2018-2023 provides more than 70 initiatives for increasing capacity on the existing network, including building new infrastructure,” Mrs Pavey said.
“From big businesses to farmers, retailers to consumers – we all rely on our goods getting to us in a safe and efficient manner. For this reason the NSW Government has set firm targets to achieve faster, more efficient and higher capacity networks to remain competitive, support jobs and deliver economic growth across NSW.
“With freight and logistics contributing more than $180 million to the NSW economy every day, an increasing population and consumer preferences changing, the freight network will face increased future demand.
“This, compounded by a desire to have same day delivery for online goods, requires government and industry to have the freight network capable of working at full throttle.
“The NSW Freight and Ports Plan 2018-2023 highlights the government and industry plans for road, rail, air, shipping and pipelines and builds on investment from the 2013 NSW Freight and Ports Strategy,” Mrs Pavey said.
The plan is said to bring together policy makers, producers, operators, regulators and government allowing for more coordinated and better freight planning.
 

Toll opens automated DC

The Toll Group has opened a new distribution centre (DC). The highly automated DC has been established to meet increasing demands for efficient e-commerce and omnichannel order fulfillment, and was fitted out by Dematic.
The DC features several Dematic systems integrated with new technologies. Dematic Multishuttles store, buffer and sequence 80,000 SKU. Workers pick orders at 24 ergonomic goods-to-person workstations. Ten AGV handle repetitive transportation tasks safely and automatically. In addition, the Toll Group worked closely with Dematic to define and implement support systems from other vendors to ensure complete integration.
As a 3PL, the Toll Group had some stringent requirements for automation. General manager of speciality retail at the Toll Group Robert Charles said: “We look at the occupation, health and safety requirements. We look at order accuracy to prevent returns coming back to the facility.
“We also look at customer service to make sure customers get their product in an efficient manner. Because it’s all about the speed to market today.”
 
 
 

Cities report recommends elevating freight in planning

Will the North West Rail link carry freight? Photo courtesy of Transport for NSW.

The Australian Logistics Council (ALC) says the report of the inquiry into the Australian Government’s role in the development of cities is an endorsement of its continuing efforts to have freight movement prioritised in the nation’s planning regimes.
“ALC particularly welcomes the inquiry’s recommendation that planning at all levels include freight access as a matter of priority,” said ALC chairman Philip Davies.
“Making sure that our planning regimes properly account for freight movement has been a long-standing policy objective for ALC.
“This includes ensuring a nationally consistent approach to corridor protection, and promoting land use planning that allows freight infrastructure to have the 24/7 operational flexibility it needs to meet a growing freight task.
“Many of the recommendations contained in the inquiry report can help to achieve these objectives, and promote safer and more efficient movement of freight through our supply chains.
“ALC also welcomes the inquiry’s recognition of the need for a national plan of settlement, so that our growing population is managed in a way that ensures our major cities remain functional and desirable places for Australians to live and work.
“Such an approach will be essential to address issues that are already having an effect on the safety and efficiency of our supply chains, particularly road congestion.
“We are pleased that the inquiry’s report has noted so many of the issues around planning and freight movement that were reflected in ALC’s own submission to the Inquiry, especially around the benefits of separating freight and passenger transport infrastructure.
“The release of this report is timely, coming as the Commonwealth Government continues working with other jurisdictions on the development of a National Freight and Supply Chain Strategy.
“ALC encourages governments at all levels to give freight movement the priority it deserves in planning by incorporating these recommendations into their planning regimes.”
 

The next Airbus may be made of woven spider silk

A company claiming to be the world’s first industrial supplier of synthetic silk biopolymers, AMSilk, has formed a partnership with Airbus. The two companies have entered into a joint cooperation agreement “to develop the new era of composites for use in the aerospace industry”.
In recent years, the aerospace industry has shifted from metal and steel fuselage and wings to carbon fibre composite materials, primarily in an effort to decrease the plane’s weight and save fuel over time. Airbus claims it is the first in the industry to experiment with this new material. It intends to explore how AMSilk’s Biosteel fibre can allow them to approach the design and construction of its planes in an entirely new way.
The new composite material will be built using AMSilk’s Biosteel fibre technology, which enables lightweight construction with multiple shock resistance and flexibility. As demand for air travel continues to increase, the need for larger, more flexible planes that spend less time in the workshop and more time in the sky will continue to grow.
Biosteel fibre is made from a biopolymer based on natural spider silk, a material known for its strength, flexibility and toughness. AMSilk produces Biosteel fibre through a closed-loop biotechnological process that renders the product highly sustainable, with no petroleum inputs.
AMSilk and Airbus are aiming to launch a prototype composite material in 2019.
 

CSIRO Blockchain to help your purchasing

CSIRO’s Data61 has formed a consortium with law firm Herbert Smith Freehills and IBM to build Australia’s first cross-industry, large-scale, digital platform to enable Australian businesses to collaborate using blockchain-based smart legal contracts.
Known as the Australian National Blockchain (ANB), the new platform has the potential to represent a significant new piece of infrastructure in Australia’s digital economy, enabling companies nationwide to join the network to use digitised contracts, exchange data and confirm the authenticity and status of legal contracts.
Once completed, the ANB will enable organisations to digitally manage the lifecycle of a contract, not just from negotiation to signing, but also continuing over the term of the agreement, with transparency and permissioned-based access among parties in the network. The service will provide organisations the ability to use blockchain-based smart contracts to trigger business processes and events.
ANB will provide smart legal contracts (SLC) that contain smart clauses with the ability to record external data sources such as Internet of Things (IoT) device data, enabling these clauses to self-execute if specified contract conditions are met.
For example, construction site sensors could record the time and date of a delivery of a load on the blockchain and trigger a smart contract between the construction company and the bank that would automatically notify the bank that terms have been met to provide payment on that load delivery.
ANB will be the first large-scale, publicly available blockchain solution available to businesses of all kinds across Australia, and designed for Australian legal compliance.
Blockchain is a distributed ledger technology that enables permissioned sharing of an immutable record among parties to create consensus and trust. It empowers multiple trading partners to collaborate and establish a single shared view of a contract without compromising details, privacy or confidentiality. Blockchain-enabled smart contracts also hold the potential to be used with AI and advanced analytics to help ensure regulatory compliance or to provide new business insights.
“Technologies like blockchain are set to transform the legal industry and the wider business landscape as we know it,” Natasha Blycha, Blockchain and smart legal contract lead from Herbert Smith Freehills said.
“This presents a huge opportunity for agile and forward-thinking firms and has potential to deliver significant benefits to our clients and the business community as a whole. Our clients are enthusiastic about process automation, and how it can support a move away from paper-based systems, simplify supply chains and quickly and securely share information with customers and regulators.”
Consortium partners Herbert Smith Freehills, Data61 and IBM will first test the concept as a pilot project, using IBM Blockchain. The consortium is already working with another Australian law firm to bring the ANB to market. Going forward, regulators, banks, law firms and other Australian businesses will be invited to participate in the pilot which is expected to start before the end of the year.
“IBM Blockchain and the IBM Cloud provide the highest level of security to support even highly regulated industries such as healthcare and government, and IBM has extensive experience building blockchain networks and convening large consortia focused around solving important business problems,” said vice president and partner, cognitive process transformation at IBM Global Business Services Paul Hutchison.
“Blockchain will be to transactions what the internet was to communication – what starts as a tool for sharing information becomes transformational once adoption is widespread. The ANB could be that inflection point for commercial blockchain, spurring innovation and economic development throughout Australia.”
In 2017, Data61 delivered two comprehensive reports for Treasury on how blockchain technology could be adopted across government and industry in Australia.
“Our reports identified distributed ledger technology as a significant opportunity for Australia to create productivity benefits and drive local innovation,” said senior research scientist at CSIRO’s Data61 Dr Mark Staples.
“Data61’s independence and world-leading expertise will help to catalyse the creation of digital infrastructure for Australian businesses to transition to a digitally-enabled future. For complex enterprise contracts, there are huge opportunities to benefit from our research into blockchain architecture and into computational law. Smart contracts have many applications, and as the ANB progresses we look forward to exploring other business use cases to roll out.”
Should the Australian pilot be successful, the consortium intends to roll out the technology to other markets beyond Australia.
 

Gen Z wants perfect CX and wants it now

Online shipping technology company Neopost Shipping has published a survey report that highlights the need for shipping to contribute to ‘customer experience’ (CX), with 98% of young consumers abandoning their carts online due to shipping-related friction.
The report Great Expectations: Shipping, CX & Gen Z underlines the influence that shipping has on e-commerce conversion and retention. It features survey data from retailers and online consumers in four countries: United States, United Kingdom, France and Australia.
“Gen Z is changing the e-commerce playbook by challenging retailers to elevate the customer experience. Shipping is a key element of online shopping, so retailers who are adept at working through its complexity to leverage it as a revenue-driving CX tool will reap great returns,” said senior vice president Americas at Neopost Shipping Matthew Mullen.
Key findings of the report include:

  • Cart abandonment strongly influenced by the lack of shipping options: 98% of Gen Z consumers have stated that they will abandon cart if a preferred shipping option is unavailable to them at checkout, with 44% opting to then buy from a competing online brand, 33% attempting to visit the brick and mortar store of the same brand, and 21% planning to visit a mall to buy the items.
  • Retailers are not keeping up with Gen Z shipping demands: Compared to the previous year, Gen Z’s willingness to pay for new types of shipping services such as hyperlocal (1-3 hours), same-day and weekend or after-hours delivery has increased. Additionally, Gen Z’s demand for these consumer-centric shipping services is significantly higher compared to the average consumer, yet only up to a fifth of retailers offer them.
  • Strong appetite by Gen Z for speed-based delivery services: Gen Z is more committed compared to the average consumer to shop online if retailers can have their orders shipped faster. 71% of Gen Z versus 56% of average consumers will increase their basket size to meet the spend threshold for free hyperlocal delivery (1-3 hours), while 44% of Gen Z versus 25% of average consumers will shop more online if next-day delivery was available.

“Gen Z is instant gratification personified,” said Mr Mullen, “In a market where the likes of Amazon are pushing the boundaries on what a great shipping experience looks like, retailers rarely get a second chance with young and savvy consumers who won’t think twice about abandoning brands that cannot provide the shipping choice and convenience they desire.
“It’s a known fact that shipping and fulfillment can be operationally challenging for many retailers. Instead of taking on the burden of building everything from the ground up, (retailers should) leverage the supply chain innovations that are in the market – such as updating your technology stack with a shipping software platform, trialling smart parcel lockers, and accelerating the process of getting online orders out the door with automated packing machines,” Mullen said.
The Great Expectations report includes new insights on how shipping can motivate or detract Gen Z from online shopping, why shipping can drive Gen Z to abandon cart and buy from a competing retailer, what retailers can do to convert and retain Gen Z through shipping, and how marketplaces like Amazon are winning Gen Z over with their approach to shipping.

Digital Link to connect brands and consumers online

Global supply chain standards organisation GS1 has announced a new global web standard to help industry optimise online shopping for the consumer.
In an age where the shopping activity can happen anytime, anywhere – and product data and transparency are in demand – this new GS1 standard will empower consumers and businesses alike to move seamlessly through the world of physical and digital commerce, bringing mobile phone scanning into the 21st century.
Head of customer relations and standards office at GS1 Australia Sue Schmid said: “The GS1 Digital Link is a new generation GS1 global standard that is the foundational bridge between physical products and their digital twins.”
Developed by a group of retailers, brand owners, software providers and technology experts, together with GS1, the GS1 Digital Link standard will complement the traditional, ubiquitous GS1 barcode, which is expected to remain the universal standard for product identification for many years to come. It opens the door, however, for a potential opportunity to migrate to a single web-enabled barcode in the future.
Resembling a Uniform Resource Locator (URL) or web address, the GS1 Digital Link can enable connections to all types of business-to-business (B2B) and business-to-consumer (B2C) information.
Retailers and brands deploying GS1 Digital Link will benefit from the simplification of product packaging and the ability to connect with their customers. By linking the physical world of commerce with its digital counterpart, customers will be able to be alerted on discounts and price matching while they are still inside the physical store.
“As businesses begin to develop systems using the new GS1 Digital Link standard, consumers will be able to access a variety of brand-authorised product information by simply scanning a web-enabled barcode. The product information available will be everything from dimensions and images to expiration dates, nutritional data, warranty registration, troubleshooting instructions, discount offers and even social media links,” added Ms Schmid.
GS1 senior vice president solutions & innovation Robert Beideman said: “The GS1 Digital Link standard will ensure that product data, information about inventory and digital assets for a particular product are linked to each other through a common identity that also links to the actual physical product, which is essential to serving the needs of consumers today.”
Pilot projects are now underway in several countries and some solution providers and brands are already cooperating to upgrade their platforms to support this new GS1 Digital Link standard. Other GS1 standards will also continue to improve the efficiency, safety and visibility of supply chains across physical and digital channels.
The GS1 Digital Link was developed through the Global Standards Management Process (GSMP), the community-based forum, facilitated by GS1, where businesses facing common problems work together and develop standards-based solutions.
For more information about the GS1 Digital Link contact the GS1 Customer Support team or call 1300 22 263.

Giving way to the wealthy – and will freight fit in?

Autonomous vehicles could see privileged road access for those prepared to pay a premium, said Monash University ethicists Professor Robert Sparrow and Dr Mark Howard.
Online auctions could determine who gets through an intersection first and faster routes reserved for higher-paying customers, Professor Sparrow said.
Autonomous vehicles offer an opportunity to apply free market principles and create a ‘market in mobility’ by pricing road access for more efficient use of an increasingly scarce resource.
But increased efficiency could come at significant social, ethical and political cost, he warned.
An equal place where all users have the same rights and subject to the same laws – no matter what type of car they drive –  could become a place where the wealthy can buy their right of way.
“The logic of the free market, when unleashed on urban transport, points firmly to pricing journey times — and therefore access to space on the roads — in accordance with the ability to pay,” Prof Sparrow said.
“The cars of those who paid lower prices could be made to slow down and move aside in order to allow the cars of those who had paid higher prices to pass them, making the mobility privileges purchased by the wealthy all-too-obvious to the poor.”
In feudal times ‘commoners’ were often expected, or forced by law, to make way for the nobility on roads.
In the future, algorithms will replace expectations of ‘giving way to the wealthy’ with technology determining traffic flows that provide a daily reminder of someone’s place in society.
The prospect of a ‘market in mobility’ would also lead to roads being private, rather than public space, effectively controlled by a small number of companies operating fleets of vehicles.
“It would also result in private corporations controlling access to a good — mobility — that is itself essential to social and political participation, entrenching the divide between rich and poor.
“It’s something governments and policymakers need to carefully consider in their quest for more efficient road networks.”
 

Australia Post pays $593m in taxes

An Australia Post electric tricycle.

Australia Post has announced a full-year profit after tax of $134 million, up 41 per cent on FY17. This result was largely driven by substantial growth in parcel revenues and a continued focus on efficiency gains, the company said.
This result was underpinned by strong parcel volume growth, both domestically (B2C up 10 per cent) and internationally (up 19 per cent), and a range of efficiency measures across operational and support functions. Together this helped offset the impact of an 11 per cent volume decline in the important domestic letter business.
Once again, this year Australia Post said it has either met or exceeded all of the prescribed performance standards that underpin the community service obligations. Importantly, the organisation maintained broad community access to the network via 4,356 post offices (in excess of target of 4,000), and delivered 98.5 per cent of letters on time or early (ahead of target of 94 per cent).
Australia Post’s Group chief executive officer and managing director Christine Holgate said: “While this result was pleasing, it demonstrates the business has a significant challenge ahead as it continues to transform. Although we continue to optimise our delivery network, we require $2 of parcel revenue to mitigate the impact of every $1 decline in letters.
“In parallel with letter volume decline, many of us are paying our bills online and large organisations are withdrawing from regional towns. This puts further pressure on our local post offices to serve these communities with important services, including financial transactions. These growing services require investment and increased funding to ensure we can meet communities’ needs.
“As Australia’s most trusted delivery partner, facilitating 82 per cent of the nation’s e-commerce, we are uniquely placed to take advantage of a number of growth opportunities. This includes serving our business & government customers better, rejuvenating the role of the post office in the community, focussing on the significant international opportunities, and creating and simplifying our products that people value and trust.
“To build world-class service we are investing in capacity and efficiency in major parcel processing facilities and across our delivery network, with over $300 million of investment in FY18 and $500 million forecast in FY19.
“We are proud that Australia Post plays such an important role in our country, contributing over $6 billion to the economy. For every role we employ, we secure another in Australia including two in regional and rural areas. Our trusted brand and posties are loved by Australians. Around 91 per cent of Australians have visited a post office in the last six months, on an average of 10 times, with 85 per cent of Australians saying it was very important their local post office remains.
“To help keep all our people safe, including our posties, we will invest an additional $30 million in skills, tools and capabilities. We will reduce the number of motorcycles on delivery routes where other transport is safer, such as three-wheeled electric delivery vehicles and electric bicycles.”
Australia Post also made a significant contribution to the community by paying $593 million to the federal and state governments, through dividends ($79 million) and taxes ($514 million), while remaining entirely self-funding. Furthermore, the fully funded cost incurred by Australia Post in meeting its community service obligations during the year was $404 million.
Australia Post has forecast there will be greater pressure on profitability in the 2018/19 financial year due to the continued decline in letters and caution around domestic and cross-border retail conditions.
The 2018 Remuneration Report for key management personnel has also been released today. This report is available at www.auspost.com.au/2018remunerationreport. This year the report also includes forecast remuneration payments for FY19.
At a glance

  • FY18 profit after tax of $134m, up 41% on previous year.
  • Excluding property, pre-tax profit up 280% from $19 million to $72m.
  • Parcel revenue $3.5bn – volumes up 11%. Letter revenue $2.4bn – volumes down 10%.
  • Other businesses contributed $1bn – consistent year-on-year with significant mix changes.
  • Significant contribution to government. Tax payments up 22% to $514m and tax collected up 6% to $1.2bn. Dividends up 57% to $79m.
  • 18th consecutive year all community obligations exceeded.

Fuel prices hit four-year high as retailers boost margins

Average petrol prices increased by seven per cent in the past three months, hitting a four-year high in real terms of around 145 cents per litre (cpl) in Australia’s largest cities (Sydney, Melbourne, Brisbane, Adelaide and Perth), according to the ACCC’s latest petrol monitoring report.
Annual average prices in the five largest cities in real terms steadily fell between the 2013-14 and 2016-17 financial years. However, in 2017-18 the average price of petrol increased overall by nearly 10 per cent compared with the previous year.
“The major factors driving higher prices were an increase in international crude oil and refined petrol prices, and a lower AUD-USD exchange rate,” ACCC chairman Rod Sims said.
“The OPEC cartel in particular continues to have a damaging effect on Australian petrol prices. In late-2016 OPEC, and some other crude oil producing countries, agreed to cut production. This restricted supply into the market, which has clearly started to bite through steadily increasing petrol prices in the past financial year.
“A weaker Aussie dollar has also increased costs for wholesalers buying petrol for the Australian market, which flows through to consumers who pay for this at the pump,” Mr Sims said.
While higher global oil prices are the major factor, the ACCC report also shows that the gross margins Australian petrol retailers are obtaining for every litre sold are also adding to the price pressure motorists experience. Average gross retail margins hit a record high in 2017-18. Annual average gross indicative retail differences (GIRDs), a broad indicator of gross retail margins, in the five largest cities in 2017-18 were 12.4 cpl. This is 4.3 cpl higher than the average in real terms over the last 16 years.
“Current gross retail margins in the five largest cities are now over 50 per cent above the 16 year average since the ACCC began tracking this data,” Mr Sims said.
Brisbane motorists continue to pay the highest price for petrol of the five major cities. This continues a trend that has seen Brisbane prices being the highest of the five major cities for 18 of the past 24 months.
Regional petrol prices
The average differential between prices in the regional locations the ACCC monitors and the five largest cities fell by 1.0 cpl in 2017-18, compared with 2016-17. However, motorists in these regional locations were still paying an average of 4.4 cpl more for their petrol in 2017-18.
The ACCC has undertaken four regional petrol market studies in Darwin, Launceston, Armidale and Cairns and continues to monitor prices and margins in these locations.
“In all these locations, gross retail margins and prices continue to remain high. However it’s worth noting that prices in Cairns, while still high, are getting more competitive. This correlates with more vigorous competition following independent retailer United increasing its presence in the Cairns area,” Mr Sims said.
“This example demonstrates the value for consumers of having competition in petrol markets.”
Background
The ACCC collects retail petrol prices for all capital cities and over 190 regional locations across Australia.
On 20 December 2017, the Treasurer issued a new direction to the ACCC to monitor the prices, costs and profits relating to the supply of petroleum products and related services in the petroleum industry in Australia.
Under the new direction, the ACCC produces quarterly petrol monitoring reports focusing on price movements in the capital cities and over 190 regional locations across Australia. It also produces industry reports that focus on particular aspects of consumer interest in the fuel market in relation to prices, costs and profits. Today’s report was the fourth issued under the direction.
Gross retail margins are the difference between average retail prices and average wholesale prices. As they do not include costs, gross retail margins should not be confused with actual retail profits. These margins are averages across the five largest cities over time. The level of prices, costs and profits vary significantly between retail operations and not all petrol retailing sites will be achieving these margins. Some will be achieving higher margins, others lower.

Annual average GIRDs in the five largest cities in real terms: 2002-03 to 2017-18. The analysis about savings from price cycles was not undertaken for Perth because it has regular weekly price cycles.

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