SEEING THE FUTURE OF INVENTORY – STOCKTRIM’S SUPPLY CHAIN LESSONS FOR 2021

BY MICHAEL BOTUR

INVENTORY FORECASTING software StockTrim is finishing 2020 having proven itself effective in a year which tested supply chain resilience.

It was a year in which total US business inventory-to-sales ratio hit its lowest point since 2014, according to US Census Bureau figures reported in August.

The dour year was reflected in the Emerging Out of the Pandemic Supply Chain report from Reuters and CalAmp. Published in July during the peak of Covid-19 lockdowns, the report called demand forecasting software “critical,” noted that Just In Time lean inventories came at the cost of robust supply chain management, and found costly consequences and supply chain bottlenecks were occurring where businesses failed to match siloed data between sales, operations and inventory.

“If the pandemic has shown us one thing, it is that those unwilling to embrace digital technologies must rapidly change their outlook, before it is too late,” reported author Jeff Newman found.

Any wholesaler using inventory forecasting software would have found 2020 a lot easier.

By the time Covid hit, StockTrim had been available for over three years and had already achieved integration with stock management software partners Cin7, Shopify, Unleashed, TradeGecko, Vend, MYOB and Xero.

The inventory optimisation software-as-a-service, which looks at past stock behaviour and future demand to help wholesalers save money, was designed by NZ software engineer Paul Simpson and launched in 2017.

Simpson, who had worked for corporate IT companies such as Datacom, realised there was a market opportunity for a SaaS which would plug into inventory management systems and meet lean manufacturing needs and solve the problem of poor stock-buying decisions.

“Where I worked, inventory planning was a manual process – people were painstakingly bringing up sales reports or doing guesswork,” Simpson says. “I thought it would be really good if a system could use a machine learning algorithm to read through the data, make sense and tell you what to do.”

The algorithm Simpson developed automatically compares predicted demand with actual demand. “Over time it learns the best factors that predict demand for every individual business,” Simpson says.

Users simply connect their inventory data, then StockTrim provides analytics to save money and eliminate human error. The result: Trial customers in a range of countries are reporting savings of up to 40 percent of working capital.

This is because customers told Simpson from the get-go exactly how much stocking mistakes were costing them. A survey of trial customers found NZD750,000 p/a average over-stocking for each business (working capital which could otherwise be saved) and NZD350,000 p/a average under-stocking (risk in missed sales – sum of margin for each item).

Looking at the numbers, Dom Sutton was convinced inventory forecasting SaaS had a bright future and joined Simpson as co-founder in October 2018.

California wholesaler Mega Distribution knew it needed to get smart stock control software due to replenishment planning challenges. Mega Distribution formerly relied heavily on guesswork and had inefficiencies with back orders, introducing new products and too much stock sitting around. After a free trial in 2018, Mega Distribution’s investment in StockTrim quickly paid for itself, with Mega Distribution able to predict demand, reduce stock-outs, reduce over-ordering and see which products need promoting, moving or were due to expire.

Australian organic energy drinks manufacturer Shine Drink chose StockTrim the same year to manage sourcing the different ingredients for its drink products. Using one- click integration with Cin7, the end result for

Shine Drink has been fewer delays in manufacturing, fewer stock-outs and minimising expiry date complications.

New Zealand business Hand Rail Fittings, which provides brass and stainless steel componentry, was one of the first to trial StockTrim. Like most businesses, which save 75 percent in purchase on average, Handrail Fittings got its inventory check times reduced from five hours to one hour.

Sutton talked to venture capitalists in San Francisco, felt SaaS such as StockTrim had a promising future, and when combined with his personal experience, Sutton was sold.

Sutton had formerly owned an importing and wholesaling business and learned first-hand how much Slow and Obsolete inventory (SLOB Stock) can cost.

“I lost NZD1.2m by not using a NZD4-a-day inventory planning software,” Sutton says. “I bought a struggling toy business that, on the surface, looked like it had a lot of potential. But only two years later, I was forced to sell it at a fraction of what I invested. There was stock sitting in the warehouse that had zero chance of selling. I had to use the business’s cash flow to pay for the junk stock and I was forced to keep reordering products because we always had to have new toys on the shelves.”

Sutton urges any business sitting on stock in 2021 to put their numbers on a CSV file and run it through inventory forecasting software. “If only I had StockTrim, I would have seen how much stock was sitting around in the warehouse and how long it had been there, wasting space and working capital.”

Simpson and Sutton are 50/50 partners. With sales increasing in the US, UK and Australia, StockTrim spent 2020 completing a capital raise and heads into 2021 with plans to scale up, saving thousands for businesses worldwide.

“Inventory planning isn’t new,” Sutton says, “But having it in the cloud, easily understood by your average business person and as an affordable subscription – that is reasonably new.”

SUN TORY COFFEE RECENTLY COMPLETED THE BUILD OF NEW ZEALAND’ S LARGEST FRESH COFFEE ROASTING OPERATION AND SELECTED AKA ES ER AIR CENTER ALL-IN-ONE COMPRESSED AIR STATION, COMPLETE WITH FILTRATION AND AD H S 4.0 AIR-MAINS CHARGING SYSTEM, TO MEET THE FACILITIES REQUIREMENT FORA RELIABLE AND DEPENDABLE SUPPLY OF FOOD GRADE COMPRESSED AIR.

FROM A long black to a flat white and everything in between, whatever your coffee preference may be, the majority of us will enjoy a coffee or two every day. Suntory Coffee has been roasting, blending and grinding coffee since 1952. The creators of the first wave of espresso in New Zealand, and the pioneers of the 1990’s cafe culture, Suntory Coffee is home to some of New Zealand’s most loved, most consumed and most well-known coffee brands such as Robert Harris, Orb Espresso & Bruno Rossi Coffee.

At the head office in Auckland, Suntory Coffee recently completed the build of New Zealand’s newest and largest fresh coffee roasting operation. This purpose-built coffee roasting and warehousing operation is where many of the Suntory Coffee brands are processed ready for despatch to cafes, restaurants and supermarkets across New Zealand.

SOURCING HIGH QUALITY & RELIABLE EQUIPMENT

When Cameron Russell, Project Engineer at Suntory Coffee began planning the new purpose-built facility, the selection of equipment – including the compressed air system – was an important detail in developing a plant that would be durable and reliable. From coffee bean roasting, to powering control valves that select the required coffee bean silo, right through to grinding, blending, processing and packaging – compressed air is an essential utility that would be required for many purposes within the new facility.

After considering a number of options, Suntory Coffee opted for an all-in-one Kaeser Aircenter SK25 compressed air station along with filtration and a DHS 4.0 air-mains charging system to meet these requirements.

Remaining proudly manufactured in Germany, the user-friendly Aircenter from Kaeser Compressors is a complete turnkey system which incorporates a Kaeser rotary screw compressor – complete with the highly efficient Sigma Profile screw compressor block – an energy efficient refrigeration dryer and an air receiver all in one space-saving compact package.

At the heart of the Aircenter’s rotary screw compressor lies a premium quality screw compressor block featuring the Kaeser Sigma profile rotors. Superior efficiency is assured with these flow-optimised rotors that are able to achieve power savings of up to 15 percent compared with conventional screw compressor block rotor profiles. In addition, maximum energy savings and outstanding system performance are assured thanks to the inclusion of a premium efficiency IE3 motor which complies with and exceeds prevailing New Zealand EECA regulations for three-phase electric motors.

The Aircenter is user and maintenance-friendly. With the internal Sigma Control 2 controller, compressor performance can be easily controlled and monitored for optimum efficiency. In addition, all maintenance and service points are easy to access. This significantly reduces the downtime associated with service and maintenance tasks and helps to increase compressed air availability and minimise operating costs.

FOOD GRADE STANDARD COMPRESSED AIR

As the coffee can come into contact with the compressed air at certain stages of production, it was essential that the compressed air system produced food grade standard compressed air. To meet the air purity level required for food manufacture, the Aircenter at Suntory Coffee therefore operates with a food grade lubricant and filtration. In addition, a

Kaeser DHS 4.0 air-main charging system was installed.

The DHS 4.0 series electronic air-main charging system not only provides protection for the compressed air treatment components, but it also helps ensure reliable compressed air quality – even following a complete shutdown of the compressed air supply system, for example at weekends.

Such a surge can lead to filter element damage and to a raised pressure dew point in the refrigeration dryer. As a result, contaminants such as oil, particulate matter and humidity are introduced into the pipe distribution network and the process air. The DHS 4.0 eliminates these risks by guaranteeing necessary minimum pressure, which consequently ensures smooth network start-up and safe operation of the compressed air station.

During system operation, it also helps to ensure consistently high compressed air quality. If a fault were to occur with a dryer or a filter, for example, the DHS 4.0 is able to shut down and isolate the affected treatment line. This not only assures consistent air quality, but also safeguards the pipe distribution network and the air consumers in the production facility. By minimising the burden on compressed air treatment components, air receivers and pipe networks and preventing surge loads caused by large changes in pressure from occurring, it consequently enables long service life, which in turn leads to considerably reduced costs.

CONCLUSION

The new facility has now been in operation for over 18 months. “From the coffee roasting right through to the processing facility – the selection of equipment for this project was really important in developing a plant with a high degree of reliability and performance,” said Russell. “Our selection of equipment has worked out to be a very good decision. And, when it comes to the Kaeser compressed air equipment – it is absolutely meeting our requirements backed up with very good customer service.”

The all-in-one Aircenter compressed air systems from Kaeser Compressors are available with drive powers of 2.2 to 15 kW, and produce flow rates from 0.26 to 2.55 m3/min, designed for pressures up to 15 bar.

DETAILS, PH: 0800 447 820; NZ.KAESER.COM.

IN ADDITION to its traditional focus on meat, IFFA will open up to alternative proteins from 2022. With the new sub-title, ‘Technology for Meat and Alternative Proteins’, the world’s leading trade fair for the sector will spotlight the rapid growth of meat alternatives and the manufacturing processes behind and thus offer the global food industry a platform for innovation and networking.

The coming edition of IFFA, the world’s leading trade fair for the global meat industry, will expand its product nomenclature to include technologies and solutions for plant-based products and alternative proteins, with this broader base, reflecting a future- oriented international trend. IFFA – Technology for Meat and Alternative Proteins – will bring together all players from the sector in Frankfurt am Main from 14 to 19 May 2022.

Wolfgang Marzin, President and Chief Executive Officer of Messe Frankfurt, stated that the market for meat alternatives is one of the world’s booming sectors at present and the association aims to depict this development at the next IFFA.

“The core area of expertise of our exhibitors and visitors has revolved around the processing, packaging and sale of meat and meat products since time immemorial. Therefore, we are looking forward to expanding this focus, presenting exciting new products and discussing intelligent applications – a genuine boost to innovation.”

Although plant-based products are still a growing niche market at present, development forecasts for the global market point to rapid growth in the future. Thus, worldwide annual sales of plantbased meat alternatives are expected to climb to more than USD12 billion1 by 2025. This represents annual growth of over 18 percent. In comparison, sales of processed meat are predicted to reach approx. USD319 billion2 in the same year – an annual rate of growth of just 0.2 percent. For manufacturers of food-processing and packaging machines, as well as spices and additives, this development has enormous potential. Many German companies are already active in the sector.

Participants in the coming IFFA will be able to see the expansion of the product nomenclature in the range of processing technology for meat, meat products and alternative proteins, as well as in the ingredients field. This covers not only the production and processing of plant-based products but also products made from cell cultured meat. Additionally, a new key visual will give IFFA a highly modern image reflecting the broader focus and thus open it up to new players and increase its appeal not only to established food manufacturers but also to young start-up companies and representatives of research and investors.

Exhibitors can register for IFFA 2022 from the middle of January 2021. Information about this will be published beforehand at www. iffa.com.

IFFA – Technology for Meat and Alternative Proteins – will be held in Frankfurt am Main from 14 to 19 May 2022.

WITH OVER 60 years of manufacturing in New Zealand, Marley is a household name particularly for rainwater and spouting products. However its origins lie in vinyl floor manufacturing, in Manurewa Auckland, where on the same site, the extensive PVC and pipe fittings plant still operates today.

Marley has always focused on quality, innovation and long-lasting customer relationships and is one of New Zealand’s largest manufacturers in the plastics industry. Involved with extruded and injection moulded products, Marley’s manufacture processes use PVC, Polyethylene and Polybutylene, following Best Environmental Practice ( BEP), and Marley continually strive to minimise how their operations negatively affect the environment.

PVC is an environmentally smart choice because it takes a small amount of energy to make, lasts a long time and at end of life can be 100 percent recycled. With high Quality Control procedures, during processing any ‘seconds’ are removed from the line, shredded and re processed again – the lack of wastage being economic and environmentally friendly.

However when stringent QC checks mean a percentage of extruded pipe is rejected, the pipes are shredded so they can be re-melted and formed again, resulting in minimum wastage. The recycling is a good example of the environmental policies in operation however the re processing causes dust issues.

Neil Bell, Site Services and Project Engineer at the Manurewa plant says, “We had an issue with a dust collector that was supplied as OEM equipment. The filters blocked frequently and required replacing. The filters could only be sourced from overseas and changing them was a dirty, difficult job.

NZDuct+Flex came up with a solution that was sized correctly and since installed in mid 2020 the filter has been doing a good job for us, reducing down time and saving the cost of replacement filter bags. Our fitters are particularly happy with this result.”

A traditional 3 modular baghouse filter was installed by one of the two install teams who are permanent employees at NZDuct+Flex. Driven by a JKF35D 11kW fan, the dust is collected in a custom built bin via a 1000mm Rotary valve also from Danish based JKF Industri.

Geoff Ebdon from NZDuct+Flex says, “As all the components i.e. the fan, filter, filter bags and ducting all come from JKF, compatibility and performance of the whole system is assured. The filter units, made of Swedish finely galvanised steel, can be enlarged by removing the end panel, adding another module and bolting the ends on again. Servicing these units is minimal and consists of oiling the fan shaft occasionally.

“The secret to long lasting dust removal, with minimal maintenance, is sizing up the filter, fan and the needs of the customer’s machinery correctly, and it is the filter area, not only the fan power, that is key,” says Geoff Ebdon.

“If you ask too small a filter unit to handle too much air and dust, instead of the dust cake forming gently on the surface of the filter material, it gets driven deep into the pile of the material and starts to clog. Once this happens it’s a downhill slope of poor filtration and constant filter replacement is costly, leaves dust in the work area and creates dangerous issues, (potential fire risk) in the ductwork. When it comes to filters (commonly called bag houses) a good ‘big’ one will always beat a good ‘little’ one’ for longer life and less problems,” says Geoff.

Modular Bag Houses may be one of the older filter methods, but they are still often a very cost efective solution for high air volumes and heavy dust loads in not only the wood working industry but others also. NZDuct+Flex offers a range of filters from 1000 m³/h to well over 100,000m³/h if it’s required.

Neil Bell confirms the company are very pleased with the solution provided: “The installation was carried out in a safe and efficient manner in the time stated. We are currently looking at another application with NZDuct+Flex where fumes and dust are our concern.”

For more information for a dust extraction solution visit www.nzduct.co.nz or call 0508 69 38 28