One day workers were fumbling with tape measures; the next they were watching wide eyed as incoming cartons whizzed through high-tech scanners. How cubing equipment changed life at Ditan Distribution.
John Johnson joined the DC Velocity team in March 2004. A veteran business journalist, John has over a dozen years of experience covering the supply chain field, including time as chief editor of Warehousing Management. In addition, he has covered the venture capital community and previously was a sports reporter covering professional and collegiate sports in the Boston area. John served as senior editor and chief editor of DC Velocity until April 2008.
Matt Scanlan's operation has an image to uphold, and, frankly, there's no room for rulers and yardsticks in the picture. Scanlan is chief operating officer at Ditan Distribution, a third-party logistics provider that specializes in distributing time-sensitive products like videogames to retail stores. It's not some penny-ante regional outfit. With six distribution centers in North America, Sayreville, N.J.-based Ditan ships just over one-third of the nation's videogames to mega-retailers like Wal-Mart and Target each year.
In the past, when he conducted site tours for prospective customers, Scanlan would show off the facility's sophisticated in-line weighing systems and talk a lot about its failsafe quality control procedures. What he didn't show them was the back room where associates were busily gathering product dimensions with a tape measure and manually entering the data into a computer. "Our customers expect us to have sophisticated processes in place," says Scanlan. "We provide a world-class service and they expect us to have integrity in our processes. You can't bring in a Fortune 500 company and tell them we're measuring their boxes with a ruler."
Today that's no longer a problem. Scanlan now can proudly show off Ditan's state-of-the-art dimensioning technology to visitors. Early this year, the company installed cubing equipment at three of its DCs. The same equipment will be up and running at the other three centers sometime next spring.
What is cubing equipment? Also known as dimensioning equipment, cubing machines use sophisticated sensors to collect dimension data electronically.
Available both as stand-alone models or as devices installed in a conveyor system, cubing systems instantly calculate the length, width, height and weight of items ranging from books and eyebrow pencils to the largest pallets and crates. The data then can be transferred to a real-time host system or a warehouse management system (WMS) that manages the flow of goods within the distribution center.
Rapid receipt
Cubing systems do much more than solve their customers' image problems, however. They save a lot of money as well. By eliminating both the miscalculations that inevitably result from manual measurements and keystroke errors, they cut the risk of costly compliance charge-backs and even lost business. The equipment also saves users money on shipping costs and cardboard, since cartons are packed more efficiently.
Then there are the time savings. Almost to a one, users report that collecting dimensions electronically speeds up processing time on the receiving end. That's been a big plus for Ditan Distribution, which often has only three or four hours to break down an inbound shipment of, say, Grand Theft Auto into as many as 10,000 separate outbound orders. Scanlan estimates that installation of cubing equipment (in this case, Cubiscan units from Quantronix) has sped up Ditan's receiving process by 40 percent.
The availability of complete and accurate cube and weight information for each incoming product also takes storage decisions out of the realm of trial and error. Using the dimension information, a WMS can automatically decide where to put away items in the facility, explains Randy Neilson, director of sales and marketing for Quantronix, which markets several cubing products under the Cubiscan brand. "In order to determine optimal storage locations and to move items into storage and then out of the distribution center, the WMS uses cube information to make more efficient use of the real estate in the facility."
Weighty matters
Though it might not be the first thing you think of, cubing equipment can also bring quality control benefits. Since it installed the cubing equipment, Ditan, for example, has already found that fewer quality checks are needed on the outbound side. Today, exact product weights are captured when items first enter the DC. As the products move past an inline weigh station, they are kicked off only when a weight variation is detected. "Our quality control process is better because our weights going in are much more accurate—thus [the percentage of] boxes getting diverted on our QC line because of weight imbalances has dropped significantly," Scanlan reports. "It saves us an incredible amount of time in our QC process because far fewer boxes are diverted."
Not only that, but the cubing system functions as a sort of double-check mechanism as well. The inline quality scale isn't infallible; a carton of 500 videogames that's short by one unit, for example, would most likely pass through the scale undetected. But the new cubing equipment has enabled Ditan to track picking errors that go unnoticed in the normal quality process. Because the systems are integrated, associates can now cross check the expected weight versus the actual weight, and track down the carton affected by the mispick.
"That's a benefit that we didn't anticipate when we started out with this," says Scanlan. "If our inline scale fails to catch a picking error for some reason, we can identify the carton number in our system, go directly to the pallet and find the box and locate the picking error. We sure weren't able to do that before."
So what's holding him back? The unique nature of the products he's shipping. Obtaining cubing information for stackable products like picnic baskets and berry baskets is tricky business. "It can be very difficult to find a solution when you nest products during shipping," says Bob Babel, vice president of engineering at Forte, a consulting/systems integration firm specializing in DC layout design and equipment integration. "When you ship a waste basket, not only can you stack two or three inside each other, but you can also fit something else inside that space as well, and use only one box. It's a difficult issue to solve, and I'm not sure if there is a perfect solution."
For a company like Longaberger, Babel says, the challenge will be to decide just how many algorithms are enough. Because a big order containing a large number of items (especially stackable items) could result in an almost infinite number of packaging configurations, the company will need to limit the number of calculations performed. "You need to decide if it makes sense to run through three iterations and maybe get to 60 percent [efficiency], or run it through 10 times to get an even higher [level of efficiency]," he says. "You need to consider what kind of processing time it takes to do that versus what you gain."
But Beebe hasn't given up hope. Despite the obstacles, he remains optimistic that he'll soon be able to capitalize on cubing technology to boost customer service. If other online retailers' experiences are any indication, he's probably right. Cubing equipment's success in reducing the number of half-full cartons—or multiple cartons shipped to a single address—has been well documented.
Cubing equipment also holds great potential for damage control. Online retailers are notorious for shipping, say, expensive wine glasses in the same box as a heavy casserole dish, leaving the unhappy recipient holding a box of shards. "That's one place where you can gain some real advantages," says Babel. "The software would actually control that process and prohibit that from happening. When you pay order pickers based on how much they push through the system, [they have little incentive to use] the care you would want somebody to exhibit in that situation. So from a quality standpoint, you can probably see an improvement in the type of cartons packed out, how the product is mixed."
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The U.S. manufacturing sector has become an engine of new job creation over the past four years, thanks to a combination of federal incentives and mega-trends like nearshoring and the clean energy boom, according to the industrial real estate firm Savills.
While those manufacturing announcements have softened slightly from their 2022 high point, they remain historically elevated. And the sector’s growth outlook remains strong, regardless of the results of the November U.S. presidential election, the company said in its September “Savills Manufacturing Report.”
From 2021 to 2024, over 995,000 new U.S. manufacturing jobs were announced, with two thirds in advanced sectors like electric vehicles (EVs) and batteries, semiconductors, clean energy, and biomanufacturing. After peaking at 350,000 news jobs in 2022, the growth pace has slowed, with 2024 expected to see just over half that number.
But the ingredients are in place to sustain the hot temperature of American manufacturing expansion in 2025 and beyond, the company said. According to Savills, that’s because the U.S. manufacturing revival is fueled by $910 billion in federal incentives—including the Inflation Reduction Act, CHIPS and Science Act, and Infrastructure Investment and Jobs Act—much of which has not yet been spent. Domestic production is also expected to be boosted by new tariffs, including a planned rise in semiconductor tariffs to 50% in 2025 and an increase in tariffs on Chinese EVs from 25% to 100%.
Certain geographical regions will see greater manufacturing growth than others, since just eight states account for 47% of new manufacturing jobs and over 6.3 billion square feet of industrial space, with 197 million more square feet under development. They are: Arizona, Georgia, Michigan, Ohio, North Carolina, South Carolina, Texas, and Tennessee.
Across the border, Mexico’s manufacturing sector has also seen “revolutionary” growth driven by nearshoring strategies targeting U.S. markets and offering lower-cost labor, with a workforce that is now even cheaper than in China. Over the past four years, that country has launched 27 new plants, each creating over 500 jobs. Unlike the U.S. focus on tech manufacturing, Mexico focuses on traditional sectors such as automative parts, appliances, and consumer goods.
Looking at the future, the U.S. manufacturing sector’s growth outlook remains strong, regardless of the results of November’s presidential election, Savills said. That’s because both candidates favor protectionist trade policies, and since significant change to federal incentives would require a single party to control both the legislative and executive branches. Rather than relying on changes in political leadership, future growth of U.S. manufacturing now hinges on finding affordable, reliable power amid increasing competition between manufacturing sites and data centers, Savills said.
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.