Delivering the whole package

Parcel deliveries are on the increase across Europe and putting pressure on logistics organisations. Agnes Gaillard, Head of Supply Chain at Panasonic Business Connect Europe, looks at how technology is helping address these issues.

Who doesn’t like a parcel delivery? As a child, I remember the excited anticipation of receiving a parcel delivered to my door. It was rare but oh so special. Mine were usually associated with a birthday or Christmas and enthusiastically ripping open the packaging was almost as exciting as discovering what was inside! Today, we receive parcel deliveries almost every day and the increase to consumers and across the business-to-business world has been incredible.

The European parcels market exceeded €80bn in 2020, having grown briskly as economic performance across the continent improved and the growth of home shopping exploded. All of the leading countries have seen compound annual growth of more than 5%, according to the European Parcel Market Report 2021 from Apex Insight.

Internet retail sales are mainly driving this growth in Europe. They reached €525bn in 2020, having grown at 17.6% per year since 2015, with double-digit growth across the continent. The highest level of internet retail is in the UK, where the average spend per head was approximately €2,600 in 2020. France and Germany are also large markets: combined they are similar in size to the UK and the three countries represent two-thirds of the European total.

Building pressures

Alongside normalising the receipt of deliveries at home, this explosive growth has also placed extreme pressure on the postal services and 3rd party logistics companies. Expectations have never been higher. Whether a business or consumer, as soon as we have placed an order, we want to know exactly when our shipment will arrive and we want it fast.

As a result, many organisations are turning to technology to see how they can manage the receipt and distribution of parcels more effectively. Solving the problem is not as easy as it might sound. Shipments can be cumbersome things. They can be all shapes and sizes – from pallets full of goods to individual small parcels – and all be labelled in different ways. That’s why, at Panasonic, we combine consulting services and our Visual Sort Assist technology to help organisations tailor a solution ideal for their needs.

Working with the business

Our Gemba Process Innovation team first works alongside the customer to analyse the exact process and systems involved in the arrival or distribution of parcels. Gemba is a Japanese word meaning the “actual place” where work is done. We look to see how best to optimise these processes, using the latest technology to improve efficiencies and productivity for the business.

Visual Sort Assist (VSA) can revolutionise on-site parcel sorting. It reads the bar code on each parcel, using high-performance cameras, as it travels on a conveyor. A projector, linked to 3D sensors, then beams a coloured symbol onto the parcel for easy sorting. In addition, other information such as “urgent” can also be projected onto the parcel, for efficient handling.

VSA in action

The VSA solution is already in use across many organisations helping to relieve the pressure and improve productivity in businesses across Europe. At the global manufacturer Continental Automotive, VSA has transformed the receipt of goods at its warehouse facilities with each system processing 300 parcels in 20 minutes. Search times to identify the right parcels of components coming into the manufacturing facility have already been cut by 40% — and will be reduced to 90% following the next update of its Warehouse Management Software.

VSA can also help postal services to improve the efficiency of parcel distribution in a phase of massive growth. France distributed and exported 1.5 billion items last year with annual growth of over 12%. With the number of letters shrinking, many spaces at the back of post offices are being converted to areas for handling the growing number of parcels.

A European logistics handler for a global sports clothing brand is also using VSA to ensure its items reach retailers and consumers on time. Using the system, as soon as parcels are removed from the container, they are quickly processed and dispatched to the stores. The organisation has seen a Return on Investment (ROI) by limiting preparation errors and improving the throughput, resulting in a 40% saving on operating costs.

VSA is also incredibly useful at recurring peak periods, such as Christmas and Black Friday, when staff and resources are at maximum pressure. In the near future, we may see short term rental or deployment of VSA solutions become the norm for third-party logistics operations at peak operating times.

Suited to supply chain

Having worked across many industries from transport to manufacturing, retail and logistics, it seemed a natural progression for me to move to address the challenges faced by European businesses in the supply chain. I love working in this area. My customers are frank, practical and operationally minded. They face pressure challenges and as a result, are open to new approaches and technologies.

One example of new innovations is the Automatic Volume Measurement solution that we are trialling with one customer. Being able to accurately measure the size and shape of a parcel or a pallet load of parcels can be a costly challenge for logistics companies. Issues often occur. For example, packages can weigh more or be a larger size than described. The impact for the logistics company can be expensive with shipments not being efficiently loaded onto the aircraft or truck, wasting money.

So we have a solution on trial where people can accurately measure the volume of a shipment using a rugged mobile device with a camera and software application connected to the warehouse management or enterprise resource system of the business. By accurately measuring each package, storage is optimised in terms of space and invoicing and loading can be automated and efficiently planned – ensuring every journey is as cost-effective as possible with a simpler and less time-consuming process.

No doubt, the pressures on logistics companies will continue to rise as parcel deliveries across Europe grow but the practical application of innovative new technology solutions will allow these organisations to cope with demand and prosper. I look forward to playing a role in these innovations.

Delivering the whole package

Building pressures

Working with the business

VSA in action

Suited to supply chain

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