Real-Time Cargo Monitoring helps reduce food wastage.
Four thousand tonnes is the weight of around 1,400 Range Rovers or 3,000 VW Golfs. It is also the amount of food that goes to waste year after year in the UK long before it ever reaches the large supermarket chains’ warehouses, let alone consumers’ refrigerators. There is no need for all that food to go to waste though, as real-time cargo monitoring is a solution that could help food producers, logistics firms and freight forwarders keep an eye on their supply chain from beginning to end.
In the transportation business, machine-to-machine (M2M) technology not only improves routes and reduces fuel costs by up to 20 percent, it also helps to optimise distribution logistics and reduce food wastage.
With real-time cargo monitoring solutions, a dispatcher with an international tropical fruit producer can switch his computer on at 8 am on a Monday morning to see right away exactly where his pineapple containers are en route between Bangkok and Newcastle. He can also see whether his fruit has been constantly transported at the recommended temperature, whether containers have been opened in transit without authorisation and whether they were subjected to strong jolts or vibrations during their loading in Thailand. A walk-through real-time cargo monitoring solution enables him to do all of this as it enables customers to see at any time where their container is and the condition of the goods in shipment.
Strong growth of container shipping
The following figures show how important solutions of this kind are nowadays, not only for suppliers of exotic fruit but also for producers of meat, fish or pharmaceuticals and other perishables, if they are to remain ahead in the fiercely competitive world market. In 2011 alone, around 91 million tonnes of perishable goods was shipped in containers—about 36.5 million tonnes more than in 2000. That corresponds to an average annual world growth rate of 3.9 per cent. In addition to the constant increase in world population, analysts and academics have identified the rising purchasing power of the middle class in threshold countries as the reason for this rapid growth. In the medium term, Seabury consultants even expect the volume of perishables shipped—produce such as fruit, vegetables, fish, meat, pharmaceuticals and even flowers —to increase further by around 4.5 per cent per annum.
Nearly 90 per cent of world trade is currently shipped by sea, not least because that is still the least expensive option and because goods can be shipped in much higher volumes by ship than, say, by air or truck. So, it is hardly surprising that container shipping has increased more than fivefold in the past 20 years and analysts expect this trend to continue. Machina Research analysts, for example, forecast that the world total number of M2M connections in transportation and logistics alone will increase from 15 million now to 80 million in 2022.
Customers want to be able to monitor quality standards
This trend makes one point clear. Solutions that provide real-time monitoring of entire freight shipments are set to gain increasingly in importance or, to be more precise, they will have to do so. It is otherwise almost impossible to keep an eye on international container shipments or to ensure compliance with industry standards or official requirements. Take food hygiene, for example. The EU Regulation 852/2004 specifies that the cold chain must not be interrupted, or only for an extremely brief period of time, during shipment of perishable foodstuffs. Containers that can be temperature-controlled end-to-end in transit are therefore essential and this is where modern monitoring systems come into play. They are important for logistics companies, especially where their customers are concerned. Today more than ever, customers want to monitor whether the cold chain is maintained in transit and the service levels agreed with the forwarder are maintained. Real-time tracking solutions that also provide detailed incident reports help companies to keep a better eye on their shipments and maintain the cold chain.
Transmission systems must be robust
Scientists see enormous growth potential for the use of modern transmission systems such as radio frequency identification, or RFID. This technology enables automatic identification of objects and is used today in, inter alia, merchandise and inventory management, and to identify machines, vehicles and containers. The main advantage of RFID, along with speed of reading and service life, is its high resistance to interference. Furthermore, and unlike with barcodes for example, visual contact is not required to read data on a label that shows the packaging date of a meat shipment.
M2M helps prevent total write-offs
Because containers that transport perishable goods are, in some cases, in transit for days by truck or for weeks by ship, monitoring systems must fulfill even more stringent requirements, especially for delivery and cold chain management of perishables. Producers of these goods must, for example, be able to rely on their chosen transportation service provider to ship them from A to B with the care and attention required. The slightest deviation from previously agreed parameters can lead to the goods perishing faster. If, for instance, pork is stored and shipped at 4°C instead of the prescribed 2°C, its shelf life is reduced by 48 hours. RFID-assisted monitoring systems can alert customers at an early stage to any temperature increases and thereby prevent sales losses or even a total write-off.
One-stop shop providers have an advantage
Customers that opt for real-time cargo monitoring solutions have an advantage: they do not need to contact and invite offers from a module manufacturer, a mobile network operator and a customer service provider first as the trend is toward a one-stop shop provider. In other words, the customer receives the entire real-time container monitoring solution from a single source. The solution consists of a tracking device and Web-based monitoring software with which customers can monitor their cargoes. Customers can also request at any time an e-mail report on the current shipping status or on any disruptions.
Focus on battery performance
How does it all work? Above all, refrigerated containers that transport perishable goods must be sealed absolutely airtight. That applies as much to roses shipped from Ethiopia to Rotterdam as it does to beef shipped from Argentina to Hamburg or mangoes shipped from Thailand to Europe. The slightest fluctuations in temperature or incidence of light can lead to goods perishing prematurely. To combat this, real-time cargo monitoring solutions such as Deutsche Telekom’s consist of two hardware components. One unit, fitted out with antennas is attached to the outside of the container by a magnet. The other unit, equipped with sensors, is placed inside the container and the two units share information with each other by short-distance radio.
In addition, the tracking device is equipped with a Telekom M2M SIM card and a GPS module determines the container’s position—to within 30 meters if need be. A crucial advantage, however, is the solution’s service life. The battery that keeps it up and running lasts for three months. What is more, every customer specifies in advance which events he wants to be notified of, such as whether his container has been opened in transit, whether the humidity has increased significantly at a given time or whether the goods were shaken badly at any stage of their journey, which would indicate that the forwarder did not handle the container with sufficient care during loading.
Cargo monitoring must be inexpensive
A factor that dictates the success or failure of a monitoring system is the cost. To stay with the transportation of foodstuffs, it may be logistically complex but the goods must also remain affordable for the average consumer even though the mango, for instance, is shipped thousands of kilometers before it reaches a UK supermarket shelf. As a consequence, tracking systems must not cost the food industry a fortune. Because M2M cargo monitoring systems have developed continuously in recent years, acquisition and running costs have fallen significantly. That has made M2M affordable not only for large enterprises but also, and above all, for small and midrange food producers, and flexible business models have a contribution to make. In the case of Deutsche Telekom’s real-time cargo monitoring, customers have the option of booking the entire solution at a fixed price per freight shipment. Major investment in, say, hardware is not required.
Ensuring a competitive edge
The advantages of cargo monitoring for customers are self-evident. They can keep an eye on their goods even when they cannot be on-site, such as when their containers are on the high seas. But what about the shipping service providers themselves? Their focus should be less on seeing cargo monitoring systems as instruments that enable them to control and evaluate their work down to the smallest detail. M2M solutions offer them an opportunity to acquire new clients for whom real-time monitoring of their goods matters. That makes M2M cargo monitoring not only an efficient control system but also a system that offers logistics specialists around the world a crucial competitive edge.
Jürgen Hase is Vice President M2M Competence Center at Deutsche Telekom AG.
He is a graduate in communications engineering and joined Deutsche Telekom AG in 2011 to head the M2M Competence Center. Within Deutsche Telekom he is responsible for the international M2M business.
Jürgen Hase has worked for more than 20 years in the telecommunications industry and in the M2M sector. He also previously sat on the management board of MC Technologies GmbH, was a Sales Director Western Europe at Keymile GmbH and Head of Product Management at Alcatel.
He is also Chairman of the M2M Alliance.