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Transparency and efficiency in goods receipt – through automated identification and sorting according to individual requirements

IoT Use Case - SICK AG
7 minutes Reading time
7 minutes Reading time

Within the supply chain, a company’s goods receipt is often a bottleneck where delays frequently occur – which have a direct impact on subsequent process steps. Efficient and clear parcel handling helps to save seconds, which can be crucial in the logistics chain to enable timely forwarding. SICK AG is addressing this challenge with an internal start-up called Horizontal Supply Chain Collaboration (HSCC). Using SICK’s own sensors and a customized data platform, the start-up team provides a solution for goods receipt to create transparency in the receiving process and beyond, saving time and resources. In order to additionally automate the process, the system was supplemented with individually designed conveyor technology from next intralogistics GmbH.

The challenge: Personnel-intensive processes and lack of transparency in the handover process from the parcel service provider to the goods receipt

Those who are expecting a package expect the delivery to be complete and on time and look forward to receiving the shipment. This does not always succeed smoothly in a professional context, even if the package has been delivered on the announced date. The greater the volume of parcels, the more confusing the situation is often in the goods receipt. This can always lead to displeasure if, for example, packages cannot be found and, in the worst case, even cause costs if important components are missing and hold up the production process or if incorrect deliveries cannot be verified. There is a lack of transparency and time to identify and check the packages actually delivered and to compare them with the data of the parcel service providers. Identifying and sorting out important goods such as express shipments for fast further processing can only be realized with a very high manual effort. Classic goods receipt is very personnel-intensive and individually adapted to a company’s own processes. Each package must be received and sorted by hand. The recording of the goods receipt often takes place only with the execution of the goods receipt inspection after the opening of the packages. This creates an information gap of several hours to days in goods receipt.

In the daily process of receiving, booking and distributing shipments, many companies lack a comprehensive overview. Information on the exact characteristics of the packages such as consignment number, package service provider and category (e.g. duty unpaid goods) or process-related data such as date, time and exact location of the consignment handover are helpful for this. Lack of transparency combined with high personnel costs gave HSCC the impetus to initially improve the situation internally for SICK and later to offer the developed solution to other companies. As a provider of solutions for industrial automation, SICK already has the corresponding hardware in its product range. The internal start-up HSCC developed the digital platform for collecting, processing and providing the data relevant to the process. Thus, SICK is able to offer a complete solution for the automation of incoming goods.

The solution: Automated goods receipt saves time and records all important data even before the package comes off the conveyor belt

The first important information, such as the assignment of the parcel service provider or the recognition of express shipments, can already be read from the shipment number. The data obtained forms the basis for automated sorting according to individual criteria. At SICK, there is a separate conveyor line for express shipments or those that are registered by the recipient as urgently awaited goods based on the shipment number. Others are set up for duty unpaid shipments or the separation of returns and repairs. In this way, employees work through the pre-selected goods receipts according to priority and find individual shipments much faster. Personnel planning can also be more flexible, as the delivery and further processing of shipments can be carried out separately in terms of time.

The goods receipt system collects additional master data with the help of a DWS Dynamic system. 2D LiDAR sensors measure the dimensions of the packages, which can serve as the basis for volume calculation. A scale determines the exact shipment weight. Both pieces of information are important for an accurate overview of the shipments received and can be useful in the event that clarification is needed with suppliers regarding traceability. For example, ordered goods weighing one kilo can not be included in a package with a measured weight of 500g.

The solution is integrated into SICK’s own IT landscape. This makes it possible to offer functions such as advance notice of customs shipments or e-mail notification. The startup sees the future in integrating with existing customer systems to offer value-added services. The specific data used depends on the individual process in goods receipt. A comparison with orders stored in the ERP system and an automated goods receipt posting based on this are conceivable.

With a daily package volume of 150-300, it was worthwhile for SICK to automate the receiving process. Complementing this, manual capture with handheld scanners also provides key information for the dashboard and may be the best solution for bulky goods or a lower volume of parcels.

The result: Valid information on all shipments optimizes all processes in goods receipt and creates a reliable basis for negotiations.

Automation simplifies processes. The package deliverer does not have to rely on personnel being ready to accept packages, but loads all packages onto a conveyor belt – this can be done at any time. Thanks to sorting, employees process incoming shipments more efficiently and in a targeted manner. This enables more flexible deployment planning.

However, the newly acquired and extensive database generates even more benefits that go far beyond the immediate goods receipt situation. Volume and weight are at least as decisive as the number of parcels for contract negotiations with parcel service providers. Last but not least, the verified and detailed shipment information shortens the reconciliation with the data of the parcel service provider in case of occurring discrepancies such as incomplete shipments. With the addition of captured images at the time of takeover, time-consuming claims settlements can be greatly simplified. The solution developed at SICK is a first step based on (existing) data to generate information that ultimately creates transparency and increases efficiency in logistics. The startup is only at the beginning of its journey: additional value-added services have been identified and are already in development.

Introduction HSCC

Digitization of the value chain is high on the agenda at SICK’s own plants. However, the opportunities for the technology group do not lie solely in production. For use along the entire supply chain, a new understanding of data is needed, from logistics to procurement to warehousing to production to distribution logistics. SICK AG, headquartered in Waldkirch, is not alone in this: for many logistics service providers, digitization is an integral part of their business strategy. Investments are being made primarily in digital solutions.

Among other things, SICK is relying here on an agile strategy for the future with its internal start-up “Horizontal Supply Chain Collaboration” (HSCC) in order to be able to master the growing requirements from the point of view of constantly rising costs. The goal: visionary start-up management and networking with existing divisions to create synergies and ensure a good exchange of information.

The focus is primarily on projects with vertical integration concepts (from sensor to data processing to information provision) to enable transparency along the horizontal supply chain. In the first step, the start-up had put the solution into operation in its in-house logistics center. This allowed them to gain experience and best practices. The requirement: the solution should work internally in exactly the same way as it can work for a customer. The solutions thus include in-house know-how from the logistics center. They are tested in practice and completely functional. The sensor manufacturer is thus deeply involved in its own logistics processes and is strengthening its profile as a logistics expert. With this approach, SICK was able to convince the first logistics service providers as well as producing companies. The first pilot projects for automated goods receipt are already being implemented.

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