Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
Radio-frequency identification (RFID) technology has spread through the logistics field in fits and starts.
One of the biggest "starts" came in 2003, when retailing giant Wal-Mart Stores Inc. mandated that its top suppliers prepare to tag shipments of pallets and cases with the tiny electronic chips. Although many suppliers rushed to comply, the dream of achieving inventory accuracy and labor savings soon ran into the harsh reality of high equipment costs and unreliable technology.
A decade later, RFID began to gain new proponents, as fashion industry and electronics retailers started to tag high-value items. By that time, many of the technology's kinks had been worked out, and tag prices had dropped to the point where RFID had become a viable solution to tracking costly inventory and discouraging shoplifters.
Now, RFID is gaining traction in another new sector, as an increasing number of businesses in the healthcare supply chain embrace the technology. They see RFID as a potential solution to a wide range of challenges, from tracking expensive devices to reducing unnecessary inventory stockpiles.
Most consumer goods retailers find that RFID tags—and the readers and networks that collect their data—are still too expensive to be used for tracking individual items like a jug of milk or a stapler. But the sheer size of the healthcare industry and the high value of items such as pharmaceuticals and medical devices have convinced many medical users that they'll likely see a quick return on any investment in the technology.
The sector could also use RFID to keep up with rapidly changing market conditions such as increased demand for services triggered by aging baby boomers, downward price pressure exerted by the Affordable Care Act, and track and trace capabilities mandated by the 2013 Drug Supply Chain Security Act.
RFID tags can help practitioners meet these market demands and save money, delivering a return on investment (ROI) by eliminating waste, increasing visibility, improving inventory tracking, and boosting regulatory compliance.
TAKING AIM AT WASTE
Many hospitals keep excess equipment in their stockrooms in order to ensure they can instantly provide any medical supply that a patient might need. Even with overnight delivery, there is no time to order a missing item when medical emergencies strike. That means waste reduction is a prime target for saving money.
"Today, we are faced with a healthcare supply chain with an unsustainable amount of waste," says Jean-Claude Saghbini, chief technology officer and vice president of inventory management solutions at Cardinal Health Inc. in Dublin, Ohio. Hospitals and medical device manufacturers throw one in five products in the garbage because the inventory has expired or is mismatched with patients' needs, he says.
"The root cause is the lack of visibility; the data is not there and it is not shared," Saghbini says. "By the time you scan a can of soup at the grocery register, everyone's doing analytics on the purchase: the manufacturer, the retailer, the consumer products producer. But there is much less data collected when you implant a $20,000 pacemaker."
"SMART SHELVES" BOOST VISIBILITY
One answer to the visibility problem may come in the form of RFID-enabled "smart shelves" that use embedded RFID scanners to automatically track high-value inventory like implantable stents, knees, heart valves, and pacemakers.
Each smart shelf has a power cord and an Internet connection, so it scans the items dozens of times per day, then sends that information to an inventory management platform that can be accessed by hospitals, manufacturers, and distributors. Most systems also run these scans every time an item is stocked or removed, recording details such as the lot number, serial number, universal product number (UPN), purchase order, expiration date, the time it arrived, and how long it's been sitting in inventory.
Compared with existing stock-keeping methods like handheld bar-code scanners or manual paper checklists, RFID scans collect more data and share it more broadly with other systems. The approach allows data to quickly flow between separate software platforms such as a device maker's manufacturing execution system, a healthcare network's materials management system, a hospital's electronic medical records platform, and a supplier's warehouse management system (WMS), Saghbini says.
NO DRUG LEFT BEHIND?
Another way that RFID can pay off in healthcare applications is by helping businesses adhere to strict product safety and security protocols, says Josh Cannon, director of global healthcare strategy at Atlanta-based UPS Inc.
For example, to comply with provisions of the Drug Supply Chain Security Act aimed at maintaining product integrity, discouraging theft, and preventing counterfeiting, logistics professionals in the pharma supply chain must implement rigorous systems for tracking and tracing their shipments. The precision of RFID tracking can help them meet the Food and Drug Administration (FDA) requirement that they be able to pinpoint the location of any drug throughout the supply chain and drill down to the individual package level.
The benefits of ensuring the safe, swift delivery of medical products to hospitals go beyond the savings achieved through streamlining the supply chain, however. It also helps improve patients' experiences.
"Leveraging this technology to streamline processes such as order placement for orthopedic-device surgeries and having visibility over inventory in distribution centers close to hospitals makes the supply chain an important component to patient care," Cannon says.
The use of RFID could make the supply chain more efficient by allowing suppliers to track pharmaceuticals and medical devices, fill orders quickly, support cost-savings initiatives, improve inventory control, and reduce errors, he says.
"Effective inventory management is critical within the healthcare supply chain, and RFID technology is a powerful tool for tracking, gaining visibility over inventory, and overall building out a more optimized, integrated warehousing and distribution network," Cannon says.
THE ROAD AHEAD
Despite the benefits of streamlining the supply chain for high-value healthcare products, the widespread adoption of RFID is still hampered by the technology's cost. RFID providers have made progress on driving down costs in recent years, but the solution is still too expensive to tag everyday items like bandages when you add up the price of the chips, software, hardware, and integration with existing software platforms.
"Within healthcare, RFID has found practical use for protecting high-value products such as implantable medical devices," Cannon says. If improvements in manufacturing and technology continue to make RFID cheaper, the technology could spread much farther throughout the healthcare sector.
One such avenue might arise from the confluence of RFID technology with an unexpected platform—smartphones. An increasing number of smartphones use wireless technology called near field communications (NFC) to transmit payment data when waved near a target or to exchange information when bumped against another phone.
Since NFC uses the same wireless specification as high-frequency RFID tags, that means millions of Americans will soon be enabled with RFID readers in their pockets, Cardinal Health's Saghbini says. This could have sweeping implications for home health care, he adds.
For instance, patients with RFID-scanning smartphones could monitor their own home medical care by recording the pharmaceutical products and medical devices they use each day and sending the data to their physicians. In turn, that could empower senior citizens to live more years in their own homes before moving to assisted-living facilities.
Medical providers in many corners of the healthcare industry are finding that the latest generation of RFID tracking and data-analysis technology can provide a reliable return on investment. From manufacturers to warehouses and from hospitals to homes, RFID adds visibility to the healthcare supply chain and could become an important tool in empowering the sector to meet the demands of practicing modern medicine.
Most of the apparel sold in North America is manufactured in Asia, meaning the finished goods travel long distances to reach end markets, with all the associated greenhouse gas emissions. On top of that, apparel manufacturing itself requires a significant amount of energy, water, and raw materials like cotton. Overall, the production of apparel is responsible for about 2% of the world’s total greenhouse gas emissions, according to a report titled
Taking Stock of Progress Against the Roadmap to Net Zeroby the Apparel Impact Institute. Founded in 2017, the Apparel Impact Institute is an organization dedicated to identifying, funding, and then scaling solutions aimed at reducing the carbon emissions and other environmental impacts of the apparel and textile industries.
The author of this annual study is researcher and consultant Michael Sadowski. He wrote the first report in 2021 as well as the latest edition, which was released earlier this year. Sadowski, who is also executive director of the environmental nonprofit
The Circulate Initiative, recently joined DC Velocity Group Editorial Director David Maloney on an episode of the “Logistics Matters” podcast to discuss the key findings of the research, what companies are doing to reduce emissions, and the progress they’ve made since the first report was issued.
A: While companies in the apparel industry can set their own sustainability targets, we realized there was a need to give them a blueprint for actually reducing emissions. And so, we produced the first report back in 2021, where we laid out the emissions from the sector, based on the best estimates [we could make using] data from various sources. It gives companies and the sector a blueprint for what we collectively need to do to drive toward the ambitious reduction [target] of staying within a 1.5 degrees Celsius pathway. That was the first report, and then we committed to refresh the analysis on an annual basis. The second report was published last year, and the third report came out in May of this year.
Q: What were some of the key findings of your research?
A: We found that about half of the emissions in the sector come from Tier Two, which is essentially textile production. That includes the knitting, weaving, dyeing, and finishing of fabric, which together account for over half of the total emissions. That was a really important finding, and it allows us to focus our attention on the interventions that can drive those emissions down.
Raw material production accounts for another quarter of emissions. That includes cotton farming, extracting gas and oil from the ground to make synthetics, and things like that. So we now have a really keen understanding of the source of our industry’s emissions.
Q: Your report mentions that the apparel industry is responsible for about 2% of global emissions. Is that an accurate statistic?
A: That’s our best estimate of the total emissions [generated by] the apparel sector. Some other reports on the industry have apparel at up to 8% of global emissions. And there is a commonly misquoted number in the media that it’s 10%. From my perspective, I think the best estimate is somewhere under 2%.
We know that globally, humankind needs to reduce emissions by roughly half by 2030 and reach net zero by 2050 to hit international goals. [Reaching that target will require the involvement of] every facet of the global economy and every aspect of the apparel sector—transportation, material production, manufacturing, cotton farming. Through our work and that of others, I think the apparel sector understands what has to happen. We have highlighted examples of how companies are taking action to reduce emissions in the roadmap reports.
Q: What are some of those actions the industry can take to reduce emissions?
A: I think one of the positive developments since we wrote the first report is that we’re seeing companies really focus on the most impactful areas. We see companies diving deep on thermal energy, for example. With respect to Tier Two, we [focus] a lot of attention on things like ocean freight versus air. There’s a rule of thumb I’ve heard that indicates air freight is about 10 times the cost [of ocean] and also produces 10 times more greenhouse gas emissions.
There is money available to invest in sustainability efforts. It’s really exciting to see the funding that’s coming through for AI [artificial intelligence] and to see that individual companies, such as H&M and Lululemon, are investing in real solutions in their supply chains. I think a lot of concrete actions are being taken.
And yet we know that reducing emissions by half on an absolute basis by 2030 is a monumental undertaking. So I don’t want to be overly optimistic, because I think we have a lot of work to do. But I do think we’ve got some amazing progress happening.
Q: You mentioned several companies that are starting to address their emissions. Is that a result of their being more aware of the emissions they generate? Have you seen progress made since the first report came out in 2021?
A: Yes. When we published the first roadmap back in 2021, our statistics showed that only about 12 companies had met the criteria [for setting] science-based targets. In 2024, the number of apparel, textile, and footwear companies that have set targets or have commitments to set targets is close to 500. It’s an enormous increase. I think they see the urgency more than other sectors do.
We have companies that have been working at sustainability for quite a long time. I think the apparel sector has developed a keen understanding of the impacts of climate change. You can see the impacts of flooding, drought, heat, and other things happening in places like Bangladesh and Pakistan and India. If you’re a brand or a manufacturer and you have operations and supply chains in these places, I think you understand what the future will look like if we don’t significantly reduce emissions.
Q: There are different categories of emission levels, depending on the role within the supply chain. Scope 1 are “direct” emissions under the reporting company’s control. For apparel, this might be the production of raw materials or the manufacturing of the finished product. Scope 2 covers “indirect” emissions from purchased energy, such as electricity used in these processes. Scope 3 emissions are harder to track, as they include emissions from supply chain partners both upstream and downstream.
Now companies are finding there are legislative efforts around the world that could soon require them to track and report on all these emissions, including emissions produced by their partners’ supply chains. Does this mean that companies now need to be more aware of not only what greenhouse gas emissions they produce, but also what their partners produce?
A: That’s right. Just to put this into context, if you’re a brand like an Adidas or a Gap, you still have to consider the Scope 3 emissions. In particular, there are the so-called “purchased goods and services,” which refers to all of the embedded emissions in your products, from farming cotton to knitting yarn to making fabric. Those “purchased goods and services” generally account for well above 80% of the total emissions associated with a product. It’s by far the most significant portion of your emissions.
Leading companies have begun measuring and taking action on Scope 3 emissions because of regulatory developments in Europe and, to some extent now, in California. I do think this is just a further tailwind for the work that the industry is doing.
I also think it will definitely ratchet up the quality requirements of Scope 3 data, which is not yet where we’d all like it to be. Companies are working to improve that data, but I think the regulatory push will make the quality side increasingly important.
Q: Overall, do you think the work being done by the Apparel Impact Institute will help reduce greenhouse gas emissions within the industry?
A: When we started this back in 2020, we were at a place where companies were setting targets and knew their intended destination, but what they needed was a blueprint for how to get there. And so, the roadmap [provided] this blueprint and identified six key things that the sector needed to do—from using more sustainable materials to deploying renewable electricity in the supply chain.
Decarbonizing any sector, whether it’s transportation, chemicals, or automotive, requires investment. The Apparel Impact Institute is bringing collective investment, which is so critical. I’m really optimistic about what they’re doing. They have taken a data-driven, evidence-based approach, so they know where the emissions are and they know what the needed interventions are. And they’ve got the industry behind them in doing that.
The global air cargo market’s hot summer of double-digit demand growth continued in August with average spot rates showing their largest year-on-year jump with a 24% increase, according to the latest weekly analysis by Xeneta.
Xeneta cited two reasons to explain the increase. First, Global average air cargo spot rates reached $2.68 per kg in August due to continuing supply and demand imbalance. That came as August's global cargo supply grew at its slowest ratio in 2024 to-date at 2% year-on-year, while global cargo demand continued its double-digit growth, rising +11%.
The second reason for higher rates was an ocean-to-air shift in freight volumes due to Red Sea disruptions and e-commerce demand.
Those factors could soon be amplified as e-commerce shows continued strong growth approaching the hotly anticipated winter peak season. E-commerce and low-value goods exports from China in the first seven months of 2024 increased 30% year-on-year, including shipments to Europe and the US rising 38% and 30% growth respectively, Xeneta said.
“Typically, air cargo market performance in August tends to follow the July trend. But another month of double-digit demand growth and the strongest rate growths of the year means there was definitely no summer slack season in 2024,” Niall van de Wouw, Xeneta’s chief airfreight officer, said in a release.
“Rates we saw bottoming out in late July started picking up again in mid-August. This is too short a period to call a season. This has been a busy summer, and now we’re at the threshold of Q4, it will be interesting to see what will happen and if all the anticipation of a red-hot peak season materializes,” van de Wouw said.
“Unrelenting labor shortages and wage inflation, accompanied by increasing consumer demand, are driving rapid market adoption of autonomous technologies in manufacturing, warehousing, and logistics,” Seegrid CEO and President Joe Pajer said in a release. “This is particularly true in the area of palletized material flows; areas that are addressed by Seegrid’s autonomous tow tractors and lift trucks. This segment of the market is just now ‘coming into its own,’ and Seegrid is a clear leader.”
According to Pajer, Seegrid’s strength in the sector is due to several new technologies it has released in the past six months. They include: Sliding Scale Autonomy, which provides both flexibility and predictability in autonomous navigation and manipulation; Enhanced Pallet and Payload Detection, which enables reliable recognition and manipulation of a broad range of payloads; and the planned launch of its CR1 autonomous lift truck model later this year.
Seegrid’s CR1 unit offers a 15-foot lift height, 4,000-pound load capacity, and a top speed of 5 mph. In comparison, its existing autonomous lift truck model, the RS1, supports six-foot lift height, 3,500 pound capacity, and the same top speed.
The “series D” investment round was funded by existing lead investors Giant Eagle Incorporated and G2 Venture Partners, as well as smaller investments from other existing shareholders.
The report cites data showing that there are approximately 1.7 million workers missing from the post-pandemic workforce and that 38% of small firms are unable to fill open positions. At the same time, the “skills gap” in the workforce is accelerating as automation and AI create significant shifts in how work is performed.
That information comes from the “2024 Labor Day Report” released by Littler’s Workplace Policy Institute (WPI), the firm’s government relations and public policy arm.
“We continue to see a labor shortage and an urgent need to upskill the current workforce to adapt to the new world of work,” said Michael Lotito, Littler shareholder and co-chair of WPI. “As corporate executives and business leaders look to the future, they are focused on realizing the many benefits of AI to streamline operations and guide strategic decision-making, while cultivating a talent pipeline that can support this growth.”
But while the need is clear, solutions may be complicated by public policy changes such as the upcoming U.S. general election and the proliferation of employment-related legislation at the state and local levels amid Congressional gridlock.
“We are heading into a contentious election that has already proven to be unpredictable and is poised to create even more uncertainty for employers, no matter the outcome,” Shannon Meade, WPI’s executive director, said in a release. “At the same time, the growing patchwork of state and local requirements across the U.S. is exacerbating compliance challenges for companies. That, coupled with looming changes following several Supreme Court decisions that have the potential to upend rulemaking, gives C-suite executives much to contend with in planning their workforce-related strategies.”
Stax Engineering, the venture-backed startup that provides smokestack emissions reduction services for maritime ships, will service all vessels from Toyota Motor North America Inc. visiting the Toyota Berth at the Port of Long Beach, according to a new five-year deal announced today.
Beginning in 2025 to coincide with new California Air Resources Board (CARB) standards, STAX will become the first and only emissions control provider to service roll-on/roll-off (ro-ros) vessels in the state of California, the company said.
Stax has rapidly grown since its launch in the first quarter of this year, supported in part by a $40 million funding round from investors, announced in July. It now holds exclusive service agreements at California ports including Los Angeles, Long Beach, Hueneme, Benicia, Richmond, and Oakland. The firm has also partnered with individual companies like NYK Line, Hyundai GLOVIS, Equilon Enterprises LLC d/b/a Shell Oil Products US (Shell), and now Toyota.
Stax says it offers an alternative to shore power with land- and barge-based, mobile emissions capture and control technology for shipping terminal and fleet operators without the need for retrofits.
In the case of this latest deal, the Toyota Long Beach Vehicle Distribution Center imports about 200,000 vehicles each year on ro-ro vessels. Stax will keep those ships green with its flexible exhaust capture system, which attaches to all vessel classes without modification to remove 99% of emitted particulate matter (PM) and 95% of emitted oxides of nitrogen (NOx). Over the lifetime of this new agreement with Toyota, Stax estimated the service will account for approximately 3,700 hours and more than 47 tons of emissions controlled.
“We set out to provide an emissions capture and control solution that was reliable, easily accessible, and cost-effective. As we begin to service Toyota, we’re confident that we can meet the needs of the full breadth of the maritime industry, furthering our impact on the local air quality, public health, and environment,” Mike Walker, CEO of Stax, said in a release. “Continuing to establish strong partnerships will help build momentum for and trust in our technology as we expand beyond the state of California.”