Airfreight industry to soar with IoT and AI

Global information technology firm Unisys predicts that the future growth of the airfreight industry and its ability to capitalise of the e-commerce market will be heavily impacted by the rise of the Internet of Things (IoT) and voice-enabled artificial intelligence (AI) smart devices and systems, warehouse drones and strategic alliances between airlines and distributors.
“As the air cargo industry undergoes growth and transformation, driven by rapidly increasing capacity supply on passenger flights, and the shift to business-to-consumer small parcel shipments as a result of e-commerce, cargo operators will be forced to embrace such innovation to be more efficient, nimble and proactive in an increasingly competitive and price conscious market,” the company said in a statement.
Venkatesh Pazhyanur, Senior Industry Director of Freight Solutions at Unisys, noted that the freight industry as a whole must make an effort to keep up with evolving technologies.
“The cargo industry needs to embrace disruptive technologies from the consumer world, including Internet of Things, digital assistants and drones, to increase efficiency and meet customer expectation for greater transparency throughout the supply chain,” said Pazhyanur.
The company added that the Asia-Pacific air cargo industry is experiencing growth and transformation driven by rapidly increasing capacity supply on passenger flights, and the shift to business-to-consumer small parcel shipments as a result of e-commerce. This growing passenger demand will increase the number of passenger flights and add to cargo capacity supply, it added.
According to the International Air Transport Association (IATA), the number of people travelling by air globally will almost double between 2016 and 2035, with the greatest growth in Asia Pacific. At the same time, the rising popularity of e-commerce is changing the nature of cargo shipments, incrementally increasing the number of small parcels – predicted by management consultancy McKinsey & Company to grow five per cent annually in mature markets and 17 per cent annually in China.
“At Unisys we predict these market pressures will bring innovation in three areas in the cargo supply chain: smart warehouses will become even smarter, drones will finally take off in the cargo supply chain – but inside the warehouse, and new alliances between airlines and global distributors will enable longer term capacity management,” added Pazhyanur. “Much of the underlying technologies are already being used in other sectors – including the consumer world. But now, more than ever, cargo operators will be forced to embrace such innovation to be more efficient, nimble and proactive in an increasingly competitive and price conscious market.”

Amazon to hold online selling summit for Australian retailers

E-commerce retailer Amazon has released details of a summit to be held in Sydney in November to advise Australia’s retailers on setting up and growing online businesses.
The first-ever Amazon Marketplace Seller Summit is being run in partnership with the Australian Retailers Association (ARA) and small business network, the SME Association of Australia (SMEA).
Amazon Marketplace is an online platform that enables third-party retailers to list items for sale on Amazon’s website, elsewhere orders can be fulfilled by the merchant or by Amazon itself, though the company has not released any information confirming whether fulfilment by Amazon will be offered in Australia, or on what timeline.
Amazon has reported that over 500 businesses have already registered to sell their products on the Amazon website when Marketplace goes live.
Rocco Braeuniger, Country Manager, Amazon Australia and Fabio Bertola, Head of Amazon Marketplace in Australia, will speak at the event, along with various other retail experts and entrepreneurs.
“The internet and technology have the power to level the playing field between big and small businesses, empowering Australian companies, large and small, to grow their sales and their business online,” said Braeuniger. “We look forward to enabling local businesses to make their products available to a wide audience, not only in Australia, but also worldwide.”
Russell Zimmerman, Executive Director, ARA, said: “We believe that Amazon’s arrival brings new possibilities to Australian retailers, small and large. We are pleased to work alongside Amazon to bring the Seller Summit to Sydney so that businesses and retailers alike can receive practical advice and guidance on how to make the most of Amazon Marketplace.”
The free, half-day event will take place 13 November at Jones Bay Wharf in Sydney.

Amazon developing own delivery service

Anonymous sources have informed news site Bloomberg that Amazon is planning to launch its own US delivery service, ‘Seller Flex’, which has been designed to ease overcrowding in its warehouses and make more items eligible for two-hour delivery.
Research for the US pilot project reportedly began in India two years ago, with Amazon now in discussions with US sellers ahead of a national rollout in 2018.
The sources said that through the service, Amazon will manage parcel delivery from warehouses of third-party sellers to the customer’s delivery address, a role until now performed by delivery partners such as FedEx and UPS.
Bloomberg’s Spencer Soper noted that the relationship between Amazon and its delivery partners may well continue, though the e-commerce company would gain more control over how a package is sent.
He added that this would give Amazon more flexibility and control over the final mile to customers’ doors – opening up opportunities for volume discounts – and help it streamline its warehouse inventory operations, by having external sellers store their goods in their own facilities.
“Amazon’s final-mile efforts reflect a logical extension of its model as it builds network density,” Benjamin Hartford, a Robert W. Baird analyst, told Bloomberg.

Australian logistics and warehousing market to reach $187 billion by 2021

Australia’s warehousing and logistics industries will be worth $187 billion by 2021, according to a new study from market research firm Ken Research.
The company noted that it has observed an evolution in the logistics industry in recent years, in terms of integration and digitalisation of the supply chain, which has led to better productivity and efficiency creating sustainable modes of transporting goods from one place to another.
Ken Research attributed the Australian logistics market’s impressive growth rate in 2016 to the expanding manufacturing and retail sector, the growing number of foreign companies and the increasing value of exports and imports.
The demand for cold chain logistics has grown with the rising demand for Australia agricultural products from other countries leading to increasing agricultural exports, the company noted. It added that government investment in infrastructure development of road, rail, air and water transport facilities will drive the Australia logistics and warehousing industry in coming years, through investment including $70 billion allocated for transport infrastructure from 2014 to 2021, and $75 billion for funding road and rail infrastructure from 2018 to 2027.
The partnership of the Australian Government with New South Wales, Victoria, Queensland, Western Australia, South Australia, Tasmania, Northern Territory and the Australian Capital Territory in 2014 is expected to assist the various land transport infrastructure projects.
Ken Research said that the freight forwarding industry will continue to account for the larger share of the revenue pie, supported by the growth of third-party logistics (3PL) service providers, as global players enter the Australian market.
Large companies are expected to focus on value-added services, with the power having shifted to the consumer, with internet driving growth, the transformation of supply chain, business-to-consumer (B2C) outgrowing business-to-business (B2B), new technology and home delivery.
“The value added services segment has seen faster growth in the international market than domestic primarily due to growing cross border e-commerce,” the company said. “With the development of artificial intelligence and growth of e-commerce sector, the demand for warehousing is expected to develop with auto and ancillary and chemical and pharmaceutical sectors [emerging as the] largest demand drivers of warehousing space.”

eStore Logistics opens Melbourne warehouse

eStore Logistics has announced the opening of a new 13,000m2 e-commerce warehousing and order fulfilment facility located in Melbourne’s West.
The new facility features 12,500 pallet positions, 18,000 pick bin locations, state-of-the-art security and more than 45 high-resolution video surveillance cameras with 24/7 recording.
This new warehousing facility has been designed specifically for storage, dispatch of goods for e-commerce and omni-channel retail clients.
E-commerce order profiles will be serviced from the facility as well as full case and split case picks for wholesale and direct to store requirements.
The company explained in a statement that the facility had been designed to provide a flexible operation that could be scaled up based on seasonality, business growth and new clients.

New tenant for NSW industrial development, Calibre

Mirvac Group has announced it has signed kitchenware wholesale business Sheldon and Hammond at Calibre, its industrial development at Eastern Creek in New South Wales.
Sheldon and Hammond has signed a ten-year lease for a 31,000m2 facility at Calibre, with construction due to have commenced during September 2017. The building comprises high clearance warehouse space and office space and an outdoor courtyard.
Sheldon and Hammond is an importer and distributor of home and giftware brands.
Mirvac Development Director, Industrial, Fabian Nager, said Sheldon and Hammond was seeking to consolidate its existing facilities in a strategic location, into a new purpose-built facility that reflected the quality of their offering and would support the evolution of the company.
“The high quality and flexible design of this facility will cater to the growth that Sheldon and Hammond’s business is experiencing across Australia.”
Located at the junction of the M4, M7 motorways and the Great Western Highway, Calibre’s location places Sheldon and Hammond at the centre of Australia’s supply network, with access to key freight routes through a multi directional signalised intersection constructed at the entry to the Calibre estate.
Ken Angus, Managing Director, Sheldon and Hammond, said, “We chose Calibre, Eastern Creek not just because of its great location but because of the confidence we have in Mirvac delivering our facility on time and to a very high quality standard, which will be complimentary to our corporate brand.”
“At Calibre, we’re continuing to push the boundaries of standard office and warehouse options, creating facilities that deliver long-term efficiencies for our customers and our portfolio,” said Nager. “As Australia’s supply & logistics, retail and manufacturing sectors adapt to current market changes, we’re delivering assets that help future proof our tenant’s businesses.”
Sheldon and Hammond joins supply chain management company CEVA Logistics who relocated to Building 1 at Calibre earlier this year.

Optimistic outlook for Australia's logistics sector

Australia’s industrial and logistics occupiers are generally optimistic about the future and expect their businesses to be better off financially in the next 12 months, an inaugural survey carried out by commercial real estate services and investment firm CBRE found.
The Australian Industrial and Logistics Occupier Survey was undertaken to gain a better understanding of decision-making drivers, occupier strategies and how changes in technology and automation are impacting real-estate requirements.
Kate Bailey, Senior Research Manager, CBRE, said the results reflected an engaged and optimistic industrial and logistics market, with 66 per cent of respondents expecting their business to be better off financially and 25 per cent expecting things to stay the same over the next 12 months.
The retailing, warehousing and distribution sector were the most positive, with 86 per cent of respondents expecting their business to be better off.
“Surveys of this kind have rarely been undertaken in the Australian industrial and logistics market, meaning there has been limited benchmarking of what drives occupiers’ decision making,” said Bailey.
Manufacturers were found to be the most likely to want a smaller occupancy, with 21 per cent preferring a smaller footprint. This was possibly reflective of the shift towards high-tech manufacturing, which was less floorspace intensive, Bailey said.
CBRE Senior Managing Director, Industrial & Logistics, Matt Haddon, said the survey also highlighted key trends and attitudes in relation to sustainability, e-commerce, new development practices such as multi-storey warehousing, and the drivers behind occupiers’ site selection criteria.
“It is likely that the drive to incorporate sustainable design elements in industrial and logistics assets will continue to be led by the owner-occupier sector, with this group most likely to amortise initial expenses such as solar panels and wind turbines and see the flow on benefits from sustainable demand first hand,” said Haddon.
When it came to e-commerce, one of the more surprising findings was that the impact was yet to be fully realised in the sector, with 42 per cent of respondents indicating that they had seen no change from the growth of e-commerce in the past five years.
In relation to multi-storey warehousing, the survey found that while there was a high level of awareness from respondents (90 per cent) only 25 per cent of respondents would consider this style of asset.
The level of appeal was higher amongst retail/warehousing and wholesaling occupiers (50 per cent appeal, 50 per cent consideration) and lower amongst manufacturers (20 per cent appeal, 17 per cent consideration) – possibly due to the high cost of specialised machinery and equipment.
Turning to site selection, the survey found that access to road networks, key transport infrastructure and skilled employees had the highest level of perceived importance when selecting an industrial or logistics property.

GAC Australia launches logistics service, opens Perth warehouse

GAC Australia has opened a new consolidation warehouse in Perth, marking its first foray into the logistics business, in parallel to its shipping services available at all Australian ports since 2007.
The opening of the new warehouse comes in response to growing demand for storage space and distribution services from a major client with operations in Western Australia. The facility is located in the new Swan Brewery Estate at Canning Vale, about 20km away from Perth International Airport and Fremantle Port, with easy access to transportation links through the major road network.
The 800m² facility features a 5m x 5m warehouse door and an 8.5m truss height, allowing trailing equipment to reverse into the facility for loading and unloading. Arriving goods are consolidated and packed into pallets before being distributed to domestic and international locations.
“Australia has significant quantities of discovered gas resources,” said Scott Henderson, GAC Australia’s Managing Director. “In Western Australia alone, resource projects and infrastructure in the pipeline amount to billions of dollars. It is home to many local and international companies servicing the oil and gas, as well as mining equipment, technology and services (METS) sectors, presenting plenty of opportunities for project logistics and warehousing services providers.
“Having established a strong foothold in the country’s shipping sector, we are now ready to expand our portfolio to provide logistics services, and Western Australia is an ideal launch pad for our logistics operations. The ability to provide integrated shipping and logistics services will allow us to serve our customers better.”

CouriersPlease opens two new depots

Parcel delivery service CouriersPlease has opened two new relocated logistics facilities in major Australian cities, investment in its infrastructure ahead of a forecast growth in parcel deliveries in tandem with the growth in e-commerce.
The two new Perth and Melbourne locations will be key logistics facilities as the company expands its reach in Australia and overseas, as CouriersPlease explained in a media statement.
Located in the new $440 million logistics hub Drystone Industrial Estate, CouriersPlease’s relocated state-of-the-art logistics facility in Truganina, Victoria, replaces the company’s Port Melbourne, Victoria, depot. Along with CouriersPlease’s existing Mulgrave facility, it will provide the business with east-to-west coverage of Melbourne. The site is 29,000m2 in total, with 12,500m2 under the roof, and will accommodate over 160 courier vehicles. Additional bay spaces have also been allocated to accommodate future growth.
Drystone Industrial Estate is home to other distribution centres for major Australian companies, including Kmart, The Reject Shop and Rand.
The second recently opened logistics facility is located in Welshpool, an inner south-eastern suburb of Perth. The new 4,043m2 site will be the delivery hub for Perth and Western Australia. It comprises a 3,443m2 warehouse, with a 600m2 office space, and room to expand a further 2,000m2 in the future.
The logistics facility will provide improves access to the CBD and the north and south of the city and is close to main arterial routes such as Orrong Road, Welshpool Road, Leach Highway and Tonkin Highway.
In September last year, CouriersPlease opened a relocated Brisbane depot in Salisbury, and a new Adelaide depot is set to open in Marleston later this year.
“CouriersPlease has relocated our logistics facilities in major capital cities in order to accommodate the significant growth in the volume of parcels moving throughout our network,” Mark McGinley, CEO, CouriersPlease. “Our commitment in moving to the west of Melbourne has stemmed from it being a massive growth corridor with some of the highest rates of online shopping in the country. Our new Welshpool depot gives us greater coverage of the city and a larger warehouse space for logistics operations, allowing us to bring a better service to our customers. With room for future expansion, we hope to bring more jobs and opportunities to the local community.”

Shortage of large-scale logistics facilities in Melbourne

The industrial leasing market in Melbourne’s north has seen strong tenant demand continue to absorb supply of prime-grade stock, according to real estate group Colliers International, particularly in the food and beverage, logistics and specialised manufacturing industries.
“As leasing space and supply continues to tighten across the northern suburbs, we are also starting to experience a reduction in let-up time and incentives, with one of the key drivers being a shrinking serviced land allotment pipeline,” said Colliers International’s Marco Sandrin.
“With respect to current leasing vacancy for more than 10,000m2, we are currently experiencing the tightest market there has been for many years, with only eight buildings available, totalling just more than 100,000m2.”
Sandrin said two of the most significant transactions that had occurred this year were within the Melbourne Airport precinct.
“Growthpoint has leased 120 Link Road, a 26,517m2 facility to Wesfarmers’ Workwear Group, and 45-55 South Centre Road, a 14,082m2 facility to Direct Couriers, both on 10-year leases,” he said.
In Melbourne’s western suburbs, 50 per cent of leasing deals for more than 3,000m2 have taken place in the inner west, with the main catalyst being easy access to the CBD, Colliers International’s Stephen Ryan explained.
“We are also seeing a high demand for low site coverage cross-dock facilities that is resulting in higher square-metre rates across the buildings, along with quicker let-up times,” he said.
“With shrinking land supply and recent leasing take-up, we are expecting let-up times to continue to reduce and the incentives to compress.”
Ryan profiled a deal negotiated for delivery service BagTrans as an example. The company has signed a lease for 8,333m2 at GM Property Group’s business park at 600 Geelong Road, Brooklyn, from the start of October, following less than three months’ vacancy.
Colliers International recently released a custom publication showcasing large industrial facilities suited to transport and logistics, warehousing or distribution users across Melbourne, Big Sheds Victoria 2017.

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