Aircargopedia Newsblast: July 2021!
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19th July 2021  
 


Dear Air Cargo Professional:

Discover impact of Globalization on supply chains by Pat from SUNTEC.

Know more about the arithmetic behind “One-Piece Flow" in this article by Peter Canellis, Professor of Management, Vaughn College.

In more World Air Cargo news, How many flights does it take Emirates SkyCargo to transport 247 horses from Liege to Tokyo?

Gerry’s dnata becomes first to achieve GDP certification for pharmaceutical cargo in Pakistan. Ethiopian Airlines and Liege Airport extend long standing partnership
  DJ Ghosh

D.J. Ghosh
President & Publisher
AIRCARGOPEDIA
WWW.AIRCARGOPEDIA.COM
”The Complete Encyclopedia for the Air Cargo Professional & Investor”


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Impact of Globalization on Supply Chains

In the recent past, the world has become a lot more compact. The globalized market is characterized by digitization and improved transportation infrastructures. This globalized market provides businesses opportunities to reach new customers and secure a diverse selection of new workers, materials, and products. Though the opportunities associated with globalization are numerous, the risks it poses to your supply chain may be bigger than you expect.

As a logistics manager, or business owner, impacts on your supply chain can be difficult to assess. The truth is that there are pros and cons to globalization, and it could significantly affect your supply chain. The outcome is solely dependent on your management style and nature of business.

Pros of a Globalized Supply Chain
The onset of globalization implies increased complexity in supply chain management and business criticality. As a logistics manager or business owner, befriending globalization lies in your hands.

• Expand growth in new markets – Globalization simplifies communication between business owners, vendors, and customers and therefore makes it easier to reach new markets and stay connected with customers no matter where they are located.
• Increase sourcing opportunities – Globalization makes it possible for businesses to secure a diverse selection of workers, materials, and products from regions of the world that were previously out of reach.
• Broader Inventory – Globalization increases your sourcing opportunities which means it also increases the range of products and services that you can provide for your customer.
• Grow the scope of your business – Globalization makes communication near effortless, which make it easier for markets to expand and diversify, thus providing more opportunities for businesses owners to capitalize.
• Save money, increase profits – More options to source from and to capitalize on means more chances to save on spending and a greater chance of profit.

Cons of a Globalized Supply Chain
The benefits of a globalized supply chain are limitless, but it presents a new set of challenges to managing your supply chain. To reap the benefits of globalization, one must be aware of the cons, and how they can tackle them.

• Greater complexity – Global supply chains have global problems. As companies globalize, they must scale up all aspects of their business, especially their supply chain.
• Increased risk to your supply chain – When your materials, factories, and customers are spread around the globe that means your business is entirely at the mercy of global events, like natural disasters, port and border closures and changes to the geo-political landscape.
• Increased competition – You can bet that if your company broke into a new market that there are several companies just like yours with the have access to the exact same supplies, products, labor pool, and customers as you. To stay in global market supply chains, you need to be as lean and efficient as possible.
• Greater data collection challenges – When different aspects of your supply chain are scattered around the globe, the process data collection and oversight grow in complexity and becomes more difficult.
• More legal issues – Operating across borders means operating in countries with different legal systems, which can get complicated and expensive very quickly.

Conclusion
Globalization is, for better or worse, a boon for your supply chain, and the world at large. Although globalization poses substantial risk to your business, the benefits that globalization will bring to your business far outweigh the risk.

Pat Praveen
SUTEC LLC.
suntecrm.com

For any questions, please contact Pat at pat@suntecrm.com
For more info please visit www.suntecrm.com


Transport Logistics

Inside the Factory: The Arithmetic Behind “One-Piece Flow”

Supply Chain Management discussions typically address broad issues that involve more than one supply chain participant. This contrasts with studies of the factory or assembly environment where process activities are usually called “Operations Management”.

Taking a more inclusive perspective, a factory really has a “micro supply chain” of its own within its “four walls”. When viewed accordingly, flow of components and subassemblies through a factory needs to be synchronized so that outgoing products are produced as efficiently as possible. A key principal applied to realizing this objective is that of “One-Piece Flow”.

One-Piece Flow was developed by Kiichiro Toyoda as an alternative to “batch processing” (whereby parts that comprise an assembly are produced independently of each other without synchronization) in 1934.1 We can begin to investigate its benefits with a simple example.

Consider a Widget that is itself made up of three other widgets. Each of the three elementary widgets as well as the assembled widget have unique Stock Keeping Unit (SKU) numbers.

Supply Chain Management

Each of the SKU’s, 1, 2, and 3, require different times for production and / or preparation prior to being brought together to create Subassembly SKU 4.

To keep the arithmetic simple, let’s assume respective preparation times for the components as follows:

Supply Chain Management


We will further assume that each of the three widgets are being produced by three workers, one at each of the three workstations. With 3,600 seconds available in one hour, production at the end of that one hour would be:

Supply Chain Management

Now, SKU’s 1,2, and 3 must be brought together to create Subassembly SKU 4. Since SKU 4 is the product, only 120 can be created for sale. This leaves unused inventory after one hour as follows:

Supply Chain Management

The table immediately above reveals a problem. If this process were to continue, SKU’s 1 and 2 would continue to build up unused inventory at the rate of 240 and 60 units per hour respectively!
Furthermore, if we assume that each of our 3 workers are paid $10 per hour (again, let’s keep the arithmetic simple) it has cost us $30 to produce 120 saleable units. Accordingly, our production cost per saleable unit is $30 divided by 120 units = $0.25.

Supply Chain Management

What are we going to do about this? We can’t keep piling up unusable inventory.
There must be a better way!
Yes, there is!
Let’s look at a one-piece flow scenario as the alternative. We have now trained our three workers to perform production and preparation functions for all three SKU’s. The three workstations still exist; but now, rather than each worker producing only one SKU, each worker moves from one workstation to the next producing all three SKU’s and then puts them together.

If we include movement and assembly time in our original production time (heroic to be sure, but it won’t change the conceptual outcome!), the resulting difference is extraordinary.

Each Subassembly SKU #4 still takes 60 seconds to produce (10 seconds + 20 seconds + 30 seconds for SKU’s 1, 2, and 3 respectively), so each of our three workers can produce 60 SKU #4’s per hour for a total hourly production of 180. We still pay them $10 per hour, so our hourly cost is $30. With this new operating process, our production cost per saleable unit (i.e., SKU #4) is $30 divided by 180 units = $0.167. Figure 3 below summarizes the difference between the two production alternatives.

Supply Chain Management


We not only achieved a 33% production cost improvement (eroded somewhat when worker movement and assembly time are considered), but also score a huge win by eliminating inventory!

The implications of this basic example are considerable. Benefits that accrue from one-piece flow get larger with increasing production complexity.

But understanding the concept: well, that’s as simple as 1-2-3 (sorry, I couldn’t resist!).

Peter Canellis

Regards,
Peter Canellis
Professor of Management
Vaughn College of Aeronautics and Technology


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How many flights does it take to transport 247 horses from Liege to Tokyo?

Dubai, UAE, 15 July 2021

On Emirates SkyCargo’s modern and efficient Boeing 777 freighter aircraft capable of transporting around 100 tonnes of cargo per flight, it takes only eight flights to move 247 horses in 131 specially designed horse stalls, 59 grooms to look after the horses, 100 tonnes of special equipment and most importantly 20 tonnes of food and drink for the equine champions. Eight more flights will fly the horses back to Liege from Tokyo.

As the eyes of sporting enthusiasts around the world turn to Tokyo, a group of very special champions are making their way to the Japanese capital on special flights operated by Emirates.

Emirates

Emirates SkyCargo, the freight division of Emirates is operating eight charter flights to fly 247 horses from Liege to Tokyo. The first flight with 36 dressage horses has already landed at Haneda airport, Tokyo. Emirates will be operating an additional eight flights for the return journey from Tokyo to Liege. The carrier is working with Peden Bloodstock, a leading international horse transportation specialist for this charter.

During the flights, the horses will be comfortably settled inside specially designed horse stalls. Emirates SkyCargo will be flying 131 horse stalls to transport the 247 horses. In addition, 59 grooms will also be flying with the horses on the eight flights to ensure that the horses are well cared for, fed and watered during the journey from Liege to Haneda via a brief stopover in Dubai. Emirates will be transporting 20 tonnes of inflight food and drink for the horses along with 100 tonnes of special equipment for the onward journey from Liege.

Emirates has decades of experience in transporting horses across six continents for international sporting events. Emirates is also the title sponsor of a number of prestigious global horse racing tournaments and is a sponsor of Godolphin, the world’s leading horse racing team.

Emirates has a fleet of modern Boeing 777 freighter aircraft and a well-trained team to ensure that horses have a comfortable and stress free flight experience. Emirates SkyCargo complies with regulations set out by national and international authorities on live animal transport including IATA Live Animals regulations (LAR).


Air Canada Cargo

Gerry’s dnata becomes first to achieve GDP certification for pharmaceutical cargo in Pakistan

Karachi, Pakistan, 30 June 2021

Gerry’s dnata, the leading ground services provider in Pakistan, has been awarded the Good Distribution Practice (GDP) certification for the safe and reliable pharmaceutical handling services at the company’s state-of-the-art facility in Karachi.

GDP is a program focused on systems for warehouses and distribution centres that store and distribute products that are medicinal or carry active pharmaceutical ingredients. Setting stringent standards, the scheme ensures that consistent quality management systems are in place throughout the entire supply chain.

dnata


Gerry’s dnata, the leading ground services provider in Pakistan, has been awarded the Good Distribution Practice (GDP) certification for the safe and reliable pharmaceutical handling services at the company’s state-of-the-art facility in Karachi.

GDP is a program focused on systems for warehouses and distribution centres that store and distribute products that are medicinal or carry active pharmaceutical ingredients. Setting stringent standards, the scheme ensures that consistent quality management systems are in place throughout the entire supply chain.

Gerry’s dnata handles temperature-sensitive goods in an ultramodern cargo facility at Jinnah International Airport (KHI), facilitating the independent adjustment of the temperature in each holding room to suit the needs of the product. Pharmaceuticals and vaccines are given priority loading and unloading to ensure that they are moved quickly with minimised temperature fluctuation. Gerry’s dnata’s handling team also receives specialised training for the handling of such niche products.

Syed Haris Raza, Vice President of Gerry's dnata, said: "We are proud to become the first handler in Pakistan to achieve the prestigious GDP certification at a time when demand for the rapid and safe transportation of vaccines and pharmaceutical products is on the rise. This accreditation demonstrates our ability to move these products under the strictest international standards, providing world-class safety and quality to our customers and their customers. We continue to invest in infrastructure and equipment to consistently deliver service excellence across our operations, every day."

Gerry’s dnata opened its new, state-of-the-art cargo centre in Karachi in 2019. The 72,000 square foot facility is equipped with the latest technologies, including an Automated Storage and Retrieval System (ASRS) and a Material Handling System (MHS), ensuring safe and efficient handling and storage of all types of cargo, including temperature-sensitive goods. To achieve the highest possible operational efficiency, Gerry’s dnata applies automated and semi-automated equipment in its new centre.

Gerry’s Group and dnata, a global leading air services provider, joined hands in 1993 to provide ground handling services at Karachi Airport. Since then, the joint venture has continually expanded its operations in the country and today serves more than 15 airline customers at seven Pakistani airports. Gerry’s dnata’s dedicated employees handle 150,000 tons of cargo annually.

South African Airways
Ethiopian Airlines and Liege Airport Extend Long Standing Partnership

Addis Ababa, 14 July 2021

Ethiopian Airlines Cargo and Logistics Services and Liege Airport have announced that they have renewed their long standing partnership agreement until 2026. Liege Airport, Belgium’s largest cargo airport and the 6th largest cargo airport in Europe, will continue to be Ethiopian Airlines cargo hub serving as a freighter gateway between Africa and Europe for the next five years. Ethiopian Airlines Cargo and Logistics Services, Africa’s largest cargo network operator, has been working with Liege airport for its freighter operations between Africa and Europe.


Ethiopian Airlines Cargo and Logistics Services Acting Managing Director, Mr. Enquanhone Minyashal said : “We are glad to have renewed our partnership agreement with our long standing partner airport at a time when we are registering tremendous growth in our cargo destinations and capacity. In collaboration with Liege Airport, Ethiopian Cargo and Logistics Services has been providing fast and secure cargo transportation service across Europe and beyond for the last 15 years of successful cooperation. In the next five years, we will work to transform our freighter operation to serve Europe better with our renewed commitment with Liege Airport. As the largest pan African carrier, Ethiopian Airlines will continue to strengthen its partnership with Liege Airport to boost its freighter operations between Africa and Europe”.

Steven Verhasselt, VP Commercial of Liege Airport said : “First of all, Liege Airport would like to congratulate Ethiopian Airlines and all its staff and partners a very happy 75 th birthday. It is with great pride that we are part of the Ethiopian’s success story for almost 15 years and LGG will continue to be Ethiopian Airline’s cargo hub in Europe. Looking back from the start to where we are today, Ethiopian has already operated 15,000 freighter flights into LGG, approaching an incredible 1 Million Tonnes of cargo carried”.

“Still, Steven Verhasselt highlights, this is the past and can be considered as a very impressive start. Today, we celebrate the future. Ethiopian and LGG have renewed their partnership agreement that not only confirms the European Cargo hub in LGG for the next 5 years but also states that Ethiopian will become much more than an airline flying into LGG. In the future a dedicated cargo hub can be established in Liege North, for which Ethiopian was the launch customer to start with. We are very much looking forward to this next step that will help Ethiopian to serve its customers even better. More than ever, LGG will be the hub for Ethiopian and the main freighter gateway between Africa and Europe”

According to the African Airlines Association’s (AFRAA) report, Ethiopian has been ranked first by passenger and cargo traffic in 2020. Ethiopian carried 500 thousand tons of freight and 5.5 million passengers through its main hub, Addis Ababa Bole International Airport.

Ethiopian recently has been honored with gold award for the volume of cargo transported to and from Guangdong Airport in 2020 by Logistics of Guangdong Airport Authority Co. Ltd. during the seminar held in 2021 in Guangzhou. On the same month, Ethiopian Cargo and Logistics Services won the World Air Cargo Customer Care Award 2021 during the virtual Air Cargo Weeks Award program held on 5 May 2021.

Re Ethiopian contribution of saving the world during the pandemic, so far the airline has operated 450+ charter flights of PPE shipment to combat COVID 19 and transported more than 30 million doses of vaccine to more than 24 countries.


Turkish Cargo

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