Kerry Logistics has been using IoT (Internet of Things) in its warehouse and distribution business unit since 2005, which started with fitting pallets with RFID tags to track their movement around its premises.
This year, the Hong Kong-based third-party logistics provider has expanded the application of IoT to international freight forwarding business with the launch of sensor-based smart tags that monitor cargoes while in transit across air, land and sea.
“We are a typical freight forwarder who is not involved in the physical operation at airports, ocean terminals and ground stations. When we hand shipments to carriers, we lose control of the products during that segment of the transport chain,” said Wilson Lee, group director of IT, Kerry Logistics.
“We want to be able to track the goods from origin to destination,” he said.
Hunting for a suitable solution
IoT, together with blockchain and warehouse 4.0, is a major technology focus of Kerry Logistics for the last five years.
According to Lee, the depth and sophistication of IoT applications being used in the company’s integrated logistics division – in which warehouse and distribution is a part – have grown significantly.
And the IT team at Kerry Logistics plumbed this IoT knowledge and expertise to build a smart sensor solution that will deliver total visibility to the supply chain of its international freight forwarding business.
It took two years to develop the solution, according to Grace Zhong, assistant manager-IT services at Kerry Logistics.
“The first two months was spent selecting the device,” she said. “We found many products that are not mature, so we need to take time to test these products to see whether they are up to our standards. We tested the devices for over half the year,” she said.
The team chose a sensor device that is the size of a standard smartphone.
“Imagine a mobile phone with all the sensors and a SIM card. It is essentially an RFID tag,” Lee said.
The sensor device is designed not only to track location but also to continuously capture environmental parameters such as temperature, humidity, tilt and shock among others, and then transmit these data to the cloud.
“I think the most time consuming part is testing,” Lee said. “We have different products. We need to test the physical behavior of these tags and how efficient and accurate they transmit information via the 3G or 4G network back to the cloud, and how easy we can retrieve the information to our database.”
He added: “That was a whole year that we kept on testing in 2018.”
The next phase in the development cycle was the integration with the device’s cloud provider - primarily how to extract the information, followed by the internal integration with Kerry Logistics’ supply chain portal.
“When we retrieve the information from the cloud, we need to put the data onto our KerrierVISION visibility portal where customers can access them,” Lee said.
Zhong recalled: “The second part is easy because we control everything. We can do whatever we want.”
At this stage of the development cycle, internal testing again was the crucial element.
“We had to wait for the appropriate shipment to do the testing. We do not want to jeopardize normal operations, so we picked specific shipment for testing,” Lee said.
“Basically, we extract whatever data the sensor can provide,” he said. “We do not what kind of environmental factors the customers want to track – so whatever the device can capture, we put it into our portal.”
Besides tracking the movement of the shipment in close to real time, the sensor device also serves as an electronic security device that seals the container itself or a specific shipment inside the container, according to Zhong.
“The sensor can detect light. This will help customers to know if there is any abnormal behavior when the container is in the ship and if it is opened abnormally. And this will serve as an alert to customers, letting them know what happened during the whole trip,” she said.
Furthermore, Zhong said the smart sensor can be enabled to trigger alerts when certain conditions happened during journey and an email will be sent to the customer, so that he does not have to log into the KerrierVISION portal.
Value-added service for premium goods
Kerry Logistics launched its smart sensor solution for its international freight forwarding business last December. The device is recognized in more than 190 countries, and several customers are currently pilot testing the solution.
“We are not offering them for free. This is a value-added service,” Lee said. “We target premium goods such high-end electronic products as well as sensitive shipments such as medicine and other pharmaceutical products.”
He added that the smart sensor gives customers more control over their shipment while in transit.
“With the adaptive smart sensor solution, our customers can make immediate decisions at any stage across the supply chain based on actionable intelligence, which enables them to minimize loss and enhance efficiency.”
According to Lee, the main challenge right now is educating its sales people about the smart sensors in order to identify the right match of customers.
“We anticipate this sensor-based logistics solution becoming an indispensable part of the supply chain with the increasing adoption of IoT in the global logistic practices,” Lee said.
Already, Kerry Logistics is thinking about adding richer features into the smart sensors,
“In the future, I like to see the device – whether it is attached to the container or to the carton – to be able to talk the individual piece of product within, capture the information in the respective RFID tag attached to each item, and then consolidate all the information and transmit them to the cloud. The RFID on individual product does not have transmission capability and the smart sensor can act as a bridge to collect item-level information and transmit them into the cloud,” Lee said.