Ensuring Compliance with Logistics Labelling Regulations
Companies are under increasing pressure to deliver products at the speed and convenience that consumers expect. Meeting these expectations requires businesses to meet strict regulations, including complying with GS1 supply chain standards and international export controls, and providing safety data sheets based on country of origin and destination.
Consequently, when a shipment leaves the dock, its labels must correctly match what the customer needs – as well as the requirements of international regulations. In other words, they need to comply with two sets of strict rules governing appearance, composition, and content.
Some product categories are going to have more difficulties than others, of course. A box of plastic widgets will have an easier journey than a shipment containing food, medicine, or electronics.
Like electronics, the labelling of combustible items is subject to strict compliance regimes. Every unit must be labelled, and each label must comply with regulatory requirements. Mistakes have ramifications. For example, what if the number of packages in the shipment doesn’t agree with the number specified on the label? Best-case scenario, this means reprinting labels and relabelling packages. It could mean the package gets shipped with an incorrect label, potentially resulting in fines and shipping delays.
Shipping the product
Once the cargo is shipped, there are multiple challenges to surmount. It must arrive at its destination in a timely manner, and undamaged.
The company shipping the cargo can do little to aid its progress, other than add information so that workers in loading docks and customs facilities know how to handle the cargo safely. This may mean adding multiple labels for redundancy and printing labels in multiple languages. Once again, errors result in halted or delayed shipments.
Combustibles, food and beverage products, and medicines must also all comply with strict regulations once they reach their destination country. In addition, there’s GHS to consider – the Global Harmonised System of Classification and Labelling of Chemicals. Many countries have amended their worker protection laws to match the strictures of the GHS. In addition, GHS has a detailed supplier labelling component. Supplier labels must include the name of the product, manufacturer and importer, a red pictogram, and several hazard statements.
What is enterprise labelling?
Given these challenges, global companies today are taking a different, “enterprise-centric” approach to labelling. These leaders see the value of standardising and integrating labelling with business processes. Enterprise Labelling gives the power to master labelling variations by automating and applying advanced logic to all labelling processes. In highly regulated marketplaces, organisations must keep pace with evolving regulations. Enterprise labelling allows firms to comply by making label changes to formats, barcodes, logos, languages, and content including quickly adding industry-specific warnings, and product information to meet global and regional requirements and avoid financial penalties.
Integrating labelling with enterprise applications lets organisations leverage business processes and ‘sources of truth’ for label data. Certified integration lets companies automate labelling so they can improve efficiency, accuracy and avoid costly mislabelling.
Master labelling variability
When it comes to meeting increased regulatory and customer expectations with regard to shipping time and transparency, companies must provide reams of information. This provides handling instructions to the workers that transport their cargo, reassures customs officials, and helps the cargo conform to the law.
No matter what kind of product a company is shipping, they must automate the labelling process for labelling to keep pace with production. Enterprise labelling helps them comply by making label changes to formats, barcodes, logos, languages, and content to meet global and regional requirements.
A logical solution
Creating shipping labels should be easy. Although the world of safe handling practices and international shipping compliance is complicated, it’s not infinite. Given a set of input parameters, a comprehensive labelling solution can generate a shipping label that complies with multiple international jurisdictions and contains enough information to help move products safely.
Based on simple inputs, an enterprise labelling platform can generate complete, information-rich labels that comply with international law. It would create warnings statements in multiple languages, based on the country of origin and destination; supply barcodes that let companies track and trace their products, and dynamically place images and pictograms on the label. It would even bring up adjunct materials and material safety data sheets as applicable.
Automating the process of generating a shipping label also reduces the chance for human error.. It doesn’t matter what the product is, enterprise labelling lets companies match complex mission-critical requirements while streamlining the tangled environment of international commerce.
Keeping up with a global supply chain
The effect of regulations and emerging standards can impact business as supply chains become more global and complex. Labelling is a specific area where constant change is necessary to comply with evolving standards. Adhering to regulations that define how products are developed, marketed, shipped, and disposed of is essential to avoid fines, retain customers, stay competitive and enter new markets.
By standardising on a comprehensive enterprise labelling solution, enterprise organisations can cope with the complex customer and regulatory demands to ensure customer responsiveness and regulatory compliance. It enables them to automate their labelling processes and support increasingly complex scenarios by using flexible business logic that is designed to manage variability in labelling.
A swift solution
The best way to master all of these labelling variations is by automating and applying advanced logic to labelling processes. With dynamic labelling, you can maximise support for countless label combinations with minimum effort. This allows you to leverage the data from your systems of record and configure rules that dynamically change label content based on that data.
Also, by enabling business users, changes and updates can be made by business users in hours or days rather than months so that requirements can swiftly be met and companies can stay one step ahead of the competition.
In this highly regulated global marketplace, an enterprise must consistently keep pace with evolving regulations. Enterprise labelling allows organisations to comply by making label changes to formats, barcodes, logos, languages, and content including quickly adding industry-specific warnings, product information and even colour to meet global and regional requirements.
DHL and UPS: How is 3PL Evolving in 2021?
To optimise their supply chains, many companies have turned to third-party logistics providers—3PLs—to outsource how they manage inventory, stock warehouses, fulfil customer orders, pack pallets, and handle returns. Especially in the midst of the pandemic, corporations have struggled to satisfy their customers, mitigate shipping delays, and react to rapid spikes in demand. In short: if logistics isn’t your core competency, rely on the experts.
To examine the current state of 3PL, we decided to have a quick roundtable with Philippe Gilbert, President of UPS Supply Chain Solutions, and Phil Roe, Chief Customer Officer and Strategy Director at DHL Supply Chain. Here’s what they have to say on the subject:
What are the fundamental benefits of partnering with a third-party logistics provider?
‘Proper supply chain visibility and planning is one of the key challenges facing modern supply chains’, says Phil. ‘Supply chains now cover multiple jurisdictions across significant distances. They’re also omnichannel, meaning that it’s now standard practice for there to be multiple routes to the customer’. Philippe adds that, ‘3PLs can deliver efficiencies and resources across the supply chain that are difficult for most businesses to replicate’.
According to a study from UPS Global Logistics, five major challenges drive companies to outsource:
- Limited Space
- Increased Customer Expectations
- Faster Order Fulfilment
- Reduced Labour Costs
- Multiple Fulfilment Channels
Now, the pandemic has accelerated 3PL adoption. In that same UPS survey, 29% of respondents indicated that they’d switch to outsourcing their logistics as a direct result of the past year. ‘One of the biggest issues impacting our current customers is the timing on inventory levels’, says Philippe. ‘Production delays out of APAC have pushed receipts and built back orders of products’.
How are 3PLs helping businesses cope with broader disruptions, such as Brexit, transport logjams, and driver shortages?
‘We can categorise supply chain disruptions into three broad areas’, explains Phil. ‘Demand-side, supply-side, and environmental. Some of these are easier to control than others, but all benefit from proper oversight and the ability to quickly adapt’. When the Brits finalised Brexit, for example, DHL scaled up areas that needed specialist support, such as customs processing. ‘We can leverage our network and redeploy on demand’, he explains.
As for UPS, the company developed a post-Brexit SCS solution that enabled its clients to keep inventory closer to their UK customers. ‘We can maintain a broad portfolio of carriers and providers to quickly adapt to supply chain disruptions’, Philippe says. ‘This allows customers to avoid service delays, added costs, and administrative burdens associated with customs clearance’.
Next, this conversation would be incomplete if we didn’t talk about how the boom in e-commerce has affected 3PL.
Do you anticipate that e-commerce growth will continue?
‘The growth of the past 18 months shows no sign of slowing down’, Phil says. ‘Consumer habits have altered, in some cases, permanently. Over the last eight months, DHL has seen a 150% increase in its fulfilment division—reflecting the soaring demand’. To keep up, the company has focused on data and automation, as well as deploying robotics solutions alongside its employees. ‘Whether that’s automated pallet systems or pick-and-pack robots’, Phil explains, ‘we’ve coupled technology and data to manage demand, meet customer expectations, and smooth out labour requirements’.
Fundamentally, e-commerce is driving demand for additional labour and space. ‘This presents a unique opportunity for 3PL’, Philippe says. ‘New entrants in retail platforms, though currently small, will look to disrupt the giant retail players. They’ll be closer to their customers in the city. And they’ll try to unify and digitalise SME brick-and-mortar retailers’.
How are shifting customer expectations - such as the next-day “Amazon Effect” - impacting 3PL?
‘We see 3PLs expanding their networks to be closer to consumers and integrating fulfilment with last-mile delivery’, says Philippe. ‘They have to expand their reverse logistics, including investments in warehouse space’. He suggests that data analytics can enhance visibility and help 3PL companies address inefficiencies. ‘With the right technology’, he says, ‘businesses can access accurate, connected data and derive actionable insights’.
Predictive and prescriptive analytics, when coupled with artificial intelligence and machine learning, can help companies understand when, why, and how supply chain disruptions occur. ‘This way’, Philippe adds, ‘they can prepare for them—or better yet, sidestep them completely’.
In addition, customers now expect companies to follow through on their social commitments...
Can 3PLs help organisations deliver on their ESG objectives, such as reducing carbon emissions?
Absolutely. Through UPS’s Eco-Responsible Packaging Programme, for instance, the company evaluates its clients’ packaging processes to determine the best way to protect their products and the planet. In addition, the corporation works with carriers on creative, lower-emissions solutions. ‘By 2025, we plan to source 40% of all ground fuel from sources other than conventional gasoline and diesel’, Philippe explains. ‘That’s nearly double what we used in 2016’. By then, 25% of UPS’s total electricity will come from renewable sources.
As for DHL, the company offers a portfolio of GoGreen solutions, which offers its customers a range of ways to minimise their impact on the environment. ‘This includes everything from carbon reporting and analytics solutions to investments in internationally-recognised climate protection projects’, says Phil. ‘Sustainability provides us an opportunity to collaborate with our customers’.
Yet, it’s often challenging to serve customers in highly regulated industries. How can companies overcome those hurdles?
‘Companies operating in highly regulated industries such as pharmaceuticals and life science face extra pressure on their supply chains’, Phil explains. ‘Dealing with rapidly growing changes then requires depth and breadth, which is something a global business such as DHL can offer’. To overcome regulatory challenges, DHL offers its clients dedicated sector specialists who understand niche industries but still have access to its global network.
At the end of the day, Philippe comments, 3PLs must take responsibility for running compliant programmes and services. ‘Licensed or not’, he says, ‘they’ll need to work with their highly regulated customers to ensure that SOPs (Standard Operating Procedures) and audit processes are in place’.
What do the next 12 months hold for 3PL providers?
‘Providers will focus on mastering omnichannel e-commerce’, says Philippe. ‘You’ll see faster last-mile delivery, more sustainable logistics and packaging, and better forecasting for risk management’. Overall, he notes, 3PL providers will invest in data analytics and new warehouse technologies to provide greater visibility into their supply chains.
For example, UPS is rolling out a new suite of digital engagement tools. According to Philippe, the company introduced a new UPS Forwarding Hub, UPS Customs Brokerage, and CoyoteGo portals to help their supply chain solution clients. In addition, its e-Fulfilment and Ware2Go products help small- and medium-sized businesses outsource with ease. ‘We’ve focused on adopting technologies to improve our operations’, Philippe says.
Finally, UPS’s Advanced Technology Group (ATG) has implemented robotics, drones, artificial intelligence, autonomous vehicles, new software platforms, and sensor technologies to increase its 2021 revenues and cut bottom-line costs. Says Philippe: ‘With these tools, we can meet customer expectations for real-time tracking, end-to-end visibility, and personalised service’.
And there you have it: the future of 3PL.