FROM MAGAZINE: Africa's emerging logistics tech landscape

The logistics industry has been witnessing exciting times, with development of some stirring technologies. While some of these are being adapted by many African countries, Africa is also pulling some heavy weight in the global race to develop technology solutions that are successfully catering to the natives.

Shreya Bhattacharya

By 2020 there will be more than 700 million smartphone connections in Africa – more than twice the projected number in North America and not far from the total in Europe, according to GSMA, an association of mobile phone operators. The sudden and still rapid penetration of mobile technology and internet in the African continent has instantly connected it with the global economy and shaped a pathway straight into a digital era. Home to one of the world’s fastest-growing middle classes, the sudden shift here has moreover opened opportunities for retailers to now reach new customers in the region. The next obvious move is to strengthen the supply chain that can boost the economies in the continent. In this momentous transition, technology is playing an increasingly essential role and is influencing multiple sectors.

Warehouse Automation
In Africa, 40 percent annual growth in e-commerce activity is predicted over the next decade. This has spurred the demand for more warehousing facilities in the continent than ever before. What is more noteworthy is Africa’s willingness for acquiring new technologies towards automation and robotics in this sector.

South African start-up DroneScan envisages the dream of intelligent drones zooming up and down the aisles of the warehouses, reaching the harder-to-get shelves, updating the inventory and give their human colleagues some relaxation. The company makes clever device which can be attached to drones to scan barcodes. Every time it scans a barcode, it automatically updates the central log with the exact location of that product. The device makes use of lasers and details of the warehouse’s dimensions to navigate the drone. It tracks its position by measuring its distance from the ground and walls. The company says the technology will save large companies millions of dollars every month by cutting man hours during stock-takes. The DroneScan complete system, which includes the drone, the DroneScan Scanning Payload, software, database, training and file integration is priced at $35 000.

Not only local entrepreneurs, but the continent has abruptly become a vital destination for multinational companies to functionalize their operation, who are trying and testing new technologies frequently. Recently, technology group Wärtsilä and logistics major, DHL entered into an agreement to deploy mobile robots from Fetch Robotics to streamline warehouse operations. After a successful pilot in the Netherlands, DHL is now keen to pilot the solution to streamline warehouse operations in South Africa.

According to a report by Mordor Intelligence, the Middle East and Africa warehouse robotics market is projected to reach $ 1.02 billion by the end of 2020 growing at a CAGR of 10.33 percent during the forecast period 2015-2020.

Africa’s own unique tech solutions to serve Africans
Globally, the logistics sector has been witnessing exciting times, with stirring technologies such as self-driving vehicles, eHighway system, 3D printing, blockchain and artificial intelligence into operations, not to forget Elon Musk’s rockets and hyperloops. While some of these are being adapted by many African countries, Africa is also pulling some weight in the global race to develop technology solutions that are successfully catering to the natives.

For instance,the entire concept of e-commerce gets upturned if retailers do not know where exactly to deliver the ordered article of trade. As a matter of fact, half the world’s people have no formal physical address. However, these people are not all poor. Millions of them are potential customers i.e, they have purchasing capacity, internet access and they wish to buy products online. But as an address, they can only mention ‘on ABC road, in front of the bus stand’. So, identifying where to leave the box is a problem.

Sensing the trouble area, Kenyan startup OkHi developed the next generation address system, which is serving the country and beyond. Any delivery person whom the user approves receives from OkHi the user’s mapped coordinates and a picture of the front of their house.
Nigeria based online retailer Jumia, which started in 2012 quickly went ahead in a race with Amazon, by delivering to OkHi locations, taking advantage of Amazon’s long shipping times and the not so good user experience. The app reduces delivery time by 50 percent according to OkHi’s founders. As more and more people embrace e-commerce, its impact is likely to grow over time. Today, Jumia is in nine countries and valued at $550 million.

Apart from this, disruption in the African supply chain has already entered the market through freight and logistics companies like Linebooker, a subsidiary of CCS Logistics. The South Africa based company has launched an online-bidding platform that connects transport customers and trucking companies to offer transparent pricing, as well as end-to-end delivery facilitation services.

Ports and Railways
Nevertheless, one cannot overlook the vitality of other traditional transport and logistics infrastructures, like the ports and railways. The port industry is highly sensitive to the economical and even political ups and downs. It is therefore imperative that ports are flexible enough to cope with such situations and adapt skilfully to the changing needs of customers, port authorities and terminal operators. Driven by the need to simultaneously seek efficiencies and increase operational safety and security standards, ports are using technology to reinvent themselves and thrive in today’s digital world.

According to industry experts, efficient information technology system ensures cargo tracking efficiencies and timely deliveries to the cargo owner. Implementing Electronic data interchange messages between maritime stakeholders ensures timely information updates, adequate planning and reduced transaction costs amongst stakeholders.  Deploying technology to accurately locate units in container terminals translates to lower truck turn-around time, reduced transaction time for clearing container units and better trade throughput for businesses and importers.

Most Southern African import and export commodities are handled through the South Africa’s seven logistics ports, Durban, Richards Bay, Saldanha, Cape Town, Port Elizabeth, East London and Port of Ngqura, where the operations are being handled by the Transnet Port Terminals (TPT).

TPT reveals that there are a number of technologies that have been introduced over the past few years to bring real value to the business, stakeholders and their customers. Some of them being Transnet Port Terminals App, General Cargo Operational System 3 (GCOS 3), NAVIS, COMMTRAC, SPOTLIGHT APP and Transnet 4.0 – INTELLIPORT.

While Transnet Port Terminals App allows users to track their cargo, gain instant information on live berth plans and important terminal updates across its network of terminals countrywide, the GCOS is a comprehensive system that facilitates the terminals’ administrative and operational processes. GCOS 3 is the new web-based version of the cargo operations system that is in use at TPT’s automotive and break bulk terminals. The benefits of GCOS 3 are an improved, simpler user interface, greater efficiency, enhanced security, greater data integrity and better governance.

Another terminal software called the Commtrac, which is currently being used in Richards Bay Dry Bulk Terminal, collates and processes information from other systems and automates manual processes where feasible. The software supplements and supports TPT’s business processes by providing real time accurate reporting, inventory tonnage position, real time overview of loading and discharge progress and real time overview of delays and variances among many other important functions and insights.

The app called SpotLight, developed internally allows for better planning and awareness of weather conditions that may affect TPT terminals by providing updates on the weather and wind speeds in all major cities. Push notifications have been built into the app to also further assist users with any relevant announcements – such as congestion or delays that are loaded and received instantly via the application.

“TPT is moving to integrate the business to create an intelligent port terminal, fit for the future. Still in its infancy, the IntelliPort Project is an enabler of Transnet 4.0, which will align to the broader Transnet digital transformation and integration strategy; One Transnet, One Vision. IntelliPort will leverage people, process and technology into a seamless, intelligent platform to optimise business performance. The solution will integrate technology, data, people and equipment to create a Central Heterogeneous Artificial Port Intelligence (C.H.A.P-I). This artificial intelligence will support real-time, dynamic decision making and predictive analytics, while identifying and capitalising on opportunities to add value in other areas of the global supply chain,” says TPT in a statement.

The terminal operator has also shown greater confidence in NAVIS, and successfully upgraded from version 2.3 to 2.6 throughout its terminals in 2016.

APM Terminals is another major port terminal, which is particularly well-represented in West Africa, with ten facilities in eight countries, including APM Terminals Apapa, the busiest container terminal in West Africa. The operator also swears by the NAVIS technology to ensure full efficiency in its terminals. “APM Terminals have deployed the Navis N4 Terminal Operating System, which is a suite of digital solutions for the ports, to enhance operations efficiency and productivity. We have improved visibility of operations’ performance real-time, man and machine alike, eliminate manual processes, improved vessel load /discharge and it has helped APM Terminals to standardize operations across multiple sites.  This solution also enables self-services for cargo owners reducing travel time, cost and increasing efficiency,” says Augustine Fischer, general manager, Government Relations & Communication, APM Terminals- Apapa Port.

“Another important advancement of technology in the shipping sector in Africa is the option of alternate and environmentally friendly source of power. The use of solar/hydro sources of power reduces the carbon imprint that the diesel generators will have on the environment hence increasing longevity of the earth,” adds Fischer.

Meanwhile, coming on to railway technologies, while there is clear indication that there is an urgent need to standardise and adequately capacitate, the region’s rail networks, Africa is certainly experiencing a rail renaissance on the technology front. According to a GE report, South Africa and the region are already benefiting from efficiencies and cost savings brought by new rail locomotive technology, and further advances are possible if more goods are transported by rail instead of by road.

Thomas Konditi, President and CEO of GE Transportation in Africa, notes that Southern African countries upgrading their rail transport systems are getting some of the most advanced technologies in the world.

“The emissions technology in our locomotives has changed dramatically over the past 25 years,” says Konditi. “A locomotive we produce today has about 1 percent of the emissions compared to a locomotive from 25 years ago. The latest batch we are manufacturing for Transnet will have some of the lowest emissions in the world.”

GE’s new RailConnect 360 technology creates a digital connection between trains, dispatchers and destinations which can increase the fuel efficiency of rail operations.

“Fuel consumption increases with speed. If, for example, you know that your offload point will not be ready for an hour, you can slow the locomotive down to conserve fuel, save cost and arrive at just the right time to offload the freight,” explains Konditi.

Konditi further says Africa would benefit significantly if more goods were moved by rail, particularly on long distance routes where road transport is less efficient and more expensive. Road and rail should complement each other, with road being used mainly for the final point of distribution.

South Africa, Angola and Mozambique are among the African countries investing heavily in improving railway infrastructure, and particularly new locomotives, says the GE report.

On contacting South Africa’s Transnet Freight Rail (TFR), the rail company said that it has been involved in a number of developments for the past few years to deliver freight safely and reliably to its customers like, “In terms of the wagons, upgradation of container wagons from 48 tonnes carrying capacity to 60 tonnes. We are busy with the conversion of old BA fleet from 54 tonnes carrying capacity to 60 tonnes as well as the fitment of ECP brake system to the coal wagon fleet.”

“We are upgrading our Locomotives of old 6E1 fleet to 18E. Increase of tractive effort from 170Kn to 200 Kn, also the installation of new modernised control systems.  We are also busy with the upgrade of 34 GM, 34 GE and 37GM diesel fleets with modernised control systems. Fitment of cameras and on board computers to our locomotives as well as the Fitment of Data loggers (Blackbox) to locomotives,” TFR further added.

There is thus a clear understanding that Africa has huge potential to develop into one of the world’s most important economic destination for trade and business, especially given its mineral wealth and potential manufacturing capability. However, in order to continue the pace of progress, technology must be brought centre stage to unlock the continent’s entrepreneurial potential.

Photo Caption: Future image of APM’s transshipment terminal in Tangier with an annual capacity of five million TEUs, scheduled to open in 2019