Why is logistics so important to manufacturing?

Louise Smyth

When a business is global, it’s essential to optimise logistics to ensure that products are delivered efficiently and on time. We have talked to Bernhard Zwickler and James Proctor, respectively local director and purchasing manager at automation parts supplier EU Automation, to understand how to improve logistics in the maintenance sector to keep downtime to a minimum and guarantee customers’ satisfaction. 

Manufacturing is an increasingly international field where equipment components are often sourced through a mix of national, international and even intercontinental suppliers. When it comes to finding, stocking and delivering components for manufacturing plants, logistics must be as organised as possible so that customers can have their plants up and running in no time. But what are the most important things to consider when dealing with logistics for the manufacturing sector? 

Why does geography matter in logistics?

Technology-based communication has allowed us to reduce distance challenges, but geography still plays a role when it comes to logistics. A distribution hub located in a strategic area where manufacturing is flourishing might help in several ways. For example, sourcing equipment might be easier, as would be finding qualified personnel. Other advantages are access to good infrastructures, and frequent opportunities to interact and network with local and international enterprises. 

How can you spot these strategic locations? According to the latest World Robot Statistics, the highest robot density in the world is in Asia. South Korea is in the lead, followed by Singapore. Third on the list is Germany, the most automated country in Europe. In the US, most robots are used in the Midwest and upper South regions, with the highest density being around Lake Michigan. 

Monitoring the development of the automation market is essential to understand where having a physical presence could make the difference. It’s important to look at statistics from recognised trade bodies such as the IIIE Robotics and Automation Society and to keep updated on where the next trade shows will take place.  

In the case of a company with multiple distribution hubs, it’s also critical that these have a clear hierarchical or functional structure. For example, EU Automation has four hubs, the main one in the UK, others in Chicago and Singapore that act as supporting facilities, and a new hub in Frankfurt, Germany, with the aim of venturing into the rapidly growing German market. 

Research, monitor, adjust

Research is paramount not only to select strategic locations, but also to stay up to date with the most innovative packaging and delivering techniques. For example, a successful logistics department cannot ignore the movement towards more eco-friendly packaging techniques and should act accordingly. The effort to privilege ‘greener’ packaging will be appreciated by the client, who will also be facilitated when disposing of the packaging material. 

Another essential aspect to consider is how to populate your stock. It’s important to keep accurate track of historic data on which items have been more in demand in a certain area. The goal is to have those items stocked and ready to ship, so that the sourcing phase can be skipped completely. 

A thorough and updated database is a great resource. “At EU Automation the database of our most popular parts is determined on both the amount of times we sold a part, and how many enquires we’ve had for it,” commented James Proctor. “This information is then split into geographical areas, filtered, and used to determine what location is best suited for certain parts to be sourced. This helps us spot trends, which is useful to decide what we need to purchase in the future.”

Keep updated

A database organised around historic data might not be enough to predict how things are going to change in the future. To do that, you need to keep constantly updated on your sector. For example, since EU Automation specialises in obsolete parts, its research department constantly monitors which production lines are going to be made obsolete by their original equipment manufacturer and stocks their components accordingly.

These regular updates need to be shared among members of different teams to be productive. Internal departmental communication must be a priority, so that employees don’t waste time in researching information that their colleagues might already have. 

It’s also important to keep updated on innovations that might help speed up your delivery process. “Sometimes shaving off thirty seconds on one process can make a huge difference in a supply chain, especially if that process is repeated often,” explained Bernhard Zwickler. “With our new packing technology, we can pack any part from ten to 160 kg in less than two minutes. We are also implementing an automated camera which will take up to 15 pictures from the part’s delivery up to its dispatch.”