Pgbarranca's Blog

May 26, 2010

Free Trade Zones (FTZ)

Filed under: Uncategorized — by pgbarranca @ 10:05 pm


A free trade zone (FTZ) or export processing zone (EPZ) is an area of a country where some normal trade barriers such as tariffs and quotas are eliminated and bureaucratic requirements are lowered in hopes of attracting new business and foreign investments. It is a region where a group of countries has agreed to reduce or eliminate trade barriers. Free trade zones can be defined as labor intensive manufacturing centers that involve the import of raw materials or components and the export of factory products.

Most FTZs are located in developing countries: Brazil, Indonesia, El Salvador , China, the Philippines, Malaysia, Pakistan, Mexico, Costa Rica, Honduras, Guatemala, Kenya, and Madagascar have EPZ programs. In 1997, 93 countries had set up export processing zones (EPZs) employing 22.5 million people, and five years later, in 2003, EPZs in 116 countries employed 43 million people.

Corporations setting up in a zone may be given tax breaks as an incentive. Usually, these zones are set up in underdeveloped parts of the host country; the rationale is that the zones will attract employers and thus reduce poverty and unemployment, and stimulate the area’s economy. These zones are often used by multinational corporations to set up factories to produce goods (such as clothing or shoes).

I found a video about Lekki FTZ (Nigeria)

FTZ sources

Purpose of International Free Trade Zones

The main idea behind creation of free trade zones is to facilitate cross-border trade by removing obstacles imposed by customs regulations. Free trade zones ensure faster turnaround of planes and ships by lowering custom related formalities. FTZs prove to be beneficial both for the importers and exporters, as these zones are designed to reduce labor cost and tax related expenditures. Free trade zones help the traders to utilize the available business opportunities in the best possible way. FTZs promote export-oriented industries. These zones also help to increase foreign exchange earnings. Employment opportunities created by free trade zones help to reduce unemployment problem in the less developed economies.




Filed under: Uncategorized — by pgbarranca @ 9:42 pm

In my job (architect), I very often see pallets in building works, this is something I´m curious about. That´s why I looked for some information about it.


A pallet is a flat transport structure that supports goods in a stable fashion while being lifted by a forklift, pallet jack, front loader or other jacking device. A pallet is the structural foundation of a unit load which allows handling and storage efficiencies. Goods or shipping containers are often placed on a pallet secured with strapping, stretch wrap or shrink wrap and shipped.

While most pallets are wooden, pallets also are made of plastic, metal, and paper.


Containerization for transport has spurred the use of pallets because the shipping containers have the clean, level surfaces needed for easy pallet movement. Most pallets can easily carry a load of 1,000 kg (about 2,000 lb). Today, over half a billion pallets are made each year and about two billion pallets are in use across the United States alone.

Skids and pallets were slowly introduced throughout the early 20th Century.

Pallet development

The pallet was developed in stages. Spacers were used between loads to allow fork entry, progressing to the placement of boards atop stringers to make skids. Eventually boards were fastened to the bottom to create the pallet. The addition of bottom boards on the skid, which appeared by 1925, resulted in the modern form of the pallet. With the bottom deck, several problems common to the single faced skid were addressed.

Effect on rail transport

Pallets and forklifts also provided much quicker turnaround of rail cars and ships. In 1931, it took three days to unload a boxcar containing 13,000 cases of unpalletized canned goods. When the same amount of goods was loaded into the railway trucks on pallets or skids, the task took only four hours.

Standardization and regulation


In a pallet measurement the first number is the stringer length and the second is the deckboard length. Square or nearly-square pallets help a load resist tipping.

– Two-way pallets are designed to be lifted by the deckboards.

– Four-way pallets, or pallets for heavy loads, or general-purpose systems that might have heavy loads are best lifted by their more rigid stringers.

Pallet users want pallets to easily pass through buildings, stack and fit in racks, forklifts, pallet jacks and automated warehouses. To avoid shipping air, pallets should also pack tightly inside intermodal containers and vans.

No universally accepted standards for pallet dimensions exist. Companies and organizations utilize hundreds of different pallet sizes around the globe. While no single dimensional standard governs pallet production, a few different sizes are widely used. There are:

– ISO pallets

– North American pallets

– European pallets

– Australian Standard pallets

Types of pallets

Stringer pallet

Stringer pallets use a frame of three parallel pieces of timber (called stringers). The top deckboards are then affixed to the stringers to create the pallet structure. Stringer pallets are also known as “two-way” pallets, since a pallet-jack may only lift it from two directions instead of four. Forklifts can lift a stringer pallet from all four directions, though lifting by the stringers is more secure.

Block pallet

Block pallets (also referred to as Manoj pallets) are typically stronger than stringer pallets. Block pallets utilize both parallel and perpendicular stringers to better facilitate efficient handling. A block pallet is also known as a “four-way” pallet, since a pallet-jack may be used from any side to move it.

Perimeter base pallet

All stringer and some block pallets have “unidirectional bases,” i.e. bottom boards oriented in one direction. While automated handling equipment can be designed for this, often it can operate faster and more effectively if the bottom edges of a pallet have bottom boards oriented in both directions. For example, it may not need to turn a pallet to rack it, and operation is less sensitive to pallet orientation.

Pallets can be made of many materials

Pallet Sources

May 24, 2010

Dry ports and Inland Ports

Filed under: Uncategorized — by pgbarranca @ 10:16 pm

Dry ports


A dry port (sometimes inland port) is an inland intermodal terminal directly connected by road or rail to a seaport and operating as a centre for the transshipment (shipment of goods or container to an intermediate destination, and then from there to yet another destination) of sea cargo to inland destinations.

In addition to their role in cargo transshipment, dry ports may also include facilities for storage and consolidation of goods, maintenance for road or rail cargo carriers and customs clearance services. The location of these facilities at a dry port relieves competition for storage and customs space at the seaport itself.

How they make import and export easier, and increase trade

– Better customs checking/clearance/easier collection of taxes/revenue

– Better transport links/easier transport to the associated sea port/cheaper transport to associated sea port

– Container facilities

– Better management

– Storage in sheds and open areas

– Refrigeration available

– Quicker processing/less time lost/avoid delays at associated sea port

– Less congestion at associated sea port/eases pressure at associated sea port

Dry ports sources

Inland ports


“An Inland Port is a physical site located away from traditional land, air and coastal borders with the vision to facilitate and process international trade through strategic investment in multi-modal transportation assets and by promoting value-added services as goods move through the supply chain”. — Center for Transportation Research, University of Texas.

The term inland port is used in two different but related ways to mean either a port on an inland waterway or an inland site carrying out some functions of a seaport.

As a port on an inland waterway

An inland port in the wide sense, as used in common speech, is simply a port on an inland waterway such as a river, lake or canal.

As an inland site with seaport function

An Inland Port is just such an inland site linked to a seaport. This kind of inland port does not require a waterway. It is often written with initial capitals to indicate a difference to the common usage. Key features of an Inland Port are the transfer of containers between different modes of transportation (intermodal transfer) and the processing of international trade. This differentiates an inland port from a container depot or transport hub.

Advantages of inland location

The idea is to move the time-consuming sorting and processing of containers inland, away from congested seaports.

An inland port could also speed the flow of cargo between ships and major land transportation networks, which would carry goods to the rest of the country.

Benefits to customer by such distribution

–        Tailored offerings from Dell in terms of add-on products and services

–        Very customizable systems at an affordable rate, since Dell manufacturing builds specifically for each customer

An example: Winnipeg Inland Port Manitoba

Manitoba is becoming one of the North America´s most important trading centres. The Government of Manitoba and Canada will invest over $460M into Winipeg´s CentrePort Canada and related projects. This incluyes the development of a high-speed transportation corridor for the Inland Port.

The Government of Manitoba is building an “inland port” around Winnipeg´s International Airport, intending to take advantage of the city´s proximity to the geographic  center of North America. It´s the result of a dynamic partnership between governments and the private sector.

These improvements will emphasize highway and rail linkages, which would facilitate the shipping of goods flown into Winnipeg on massive cargo planes.

Inland Ports sources

Inland Port Manitoba

May 23, 2010

DELL business model and distribution network

Filed under: Uncategorized — by pgbarranca @ 3:28 pm

DELL business model and distribution network

In the following video we can see Dell´s global network.


–        Dell was founded in Texas by Michael Dell in 1984

–        Revenue of $52.9 billion in 2009

–        Net operating income of $ 2.1 billion in 2009

–        Had 96.000 employees in 2009

–        Operates in 34 countries

–        Slogan: “Uniquely You”

–        Products: desktops, servers, notebooks, netbooks, peripherals, printers, televisions, scanners, storage, smart phones


–        Dell grew through the 1980s and 1990s to become at one stage the largest seller of PCs and servers

–        In 1992 Dell entered into the Fotune 500 list

–        In 1996 Dell began selling computers via its weg site

–        In 1999 Dell overtook Compaq to become the largest seller of personal computers in US

–        In 2006  Dell was 25th in Fortune 500 list

–        It currently holds the second spot in the hardware computer industry behind HP

Traditional business model

Dell sold its product to End user customer or corporate customers using direct sales model via Internet and Telephone network


From its early beginnings, Dell operated as a pioneer in the “configure to order” approach to manufacturing — delivering individual PCs configured to customer specifications. In contrast, most PC manufacturers in those times delivered large orders to intermediaries on a quarterly basis.

To minimize the delay between purchase and delivery, Dell has a general policy of manufacturing its products close to its customers. This also allows for implementing a just-in-time (JIT) manufacturing approach, which minimizes inventory costs. Low inventory is another signature of the Dell business model — a critical consideration in an industry where components depreciate very rapidly.

Dell’s manufacturing process covers assembly, software installation, functional testing (including “burn-in”), and quality control. Throughout most of the company’s history, Dell manufactured desktop machines in-house and contracted out manufacturing of base notebooks for configuration in-house. However, the company’s approach has changed. The 2006 Annual Report states “we are continuing to expand our use of original design manufacturing partnerships and manufacturing outsourcing relationships.” The Wall Street Journal reported in September, 2008 that “Dell has approached contract computer manufacturers with offers to sell” their plants.

Dell on line

–        Dell online started in 1996 in its website

–        Dell online is a high success story – industry analyst

–        Millions of people visit the website each week and generate millions of dollars revenue

–        Dell´s business model is to let the customer configure the product on the web and fulfill within 36 hours.

–        Customers can check the order status and also get the technical help online

Component supplier

–        The high-tech components, such as microprocessors and software are provided by firms as Intel and Microsoft, they rely on big players.

–        The low-tech components are provided by small multiple players who compete on prices and availability

Original Equipment Manufacturer (OEM)

The OEMs traditionally would receive all the parts from their suppliers, assemble the computers in their production lines and ship them over to their distributors, or Corporate resellers.

For example, Company “XYZ” receives parts from Intel (processor), Microsoft (software), then this company assemble the computer to Santech computer


–        They generally supply to corporate resellers and other distributors

–        They carry large quantities of different products to increase their leverage when dealing with their customers

–        They also provide specific software, peripherals, furniture, etc, as well as service

–        For example: Ingram Micro, Tech Data, Computer 2000, and Santech.

Corporate resellers / System integrators

–        The corporate resellers or system integrators buy systems directly from manufacturers and install these systems at their corporate clients

–        These are firms whose main purpose is to provide customization to their clients

Dell´s model looks surprisingly simple, but behind this simple model it is the complex and hard to imitate core capabilities developed over 15 years.

Benefits to company by such distribution

–        Cash: Dell maintains a negative cash conversion cycle, that means the payment receive for the product before it has to pay for the material

–        Cost: Dell´s direct sales and build-to-order model has achieved superior performance in the PC industry in terms of inventory turnover, reduced overhead, cash conversion, and return on ivestment. Bypassing the reseller channel that causes further cost reduction to the company

–        CRM: Direct customer relationship is the key to Dell´s business model, and provides distinct advantages over the indirect sales model

–        Demand forecast: Dell has additional advantages over PC vendors who must try to forecast demand and ship products based on those forecasts

Benefits to customer by such distribution

–        Tailored offerings from Dell in terms of add-on products and services

–        Very customizable systems at an affordable rate, since Dell manufacturing builds specifically for each customer

Executive summary:

What is corporate responsibility at Dell? It’s about being a trustworthy partner for our stakeholders, our customers, our employees and the world at large. We’re focusing on three key areas — environmental responsibility, corporate accountability and social responsibility. The World Business Council for Sustainable Development calls this the “triple bottom line.“

Those three key areas, combined with our overall commitment to employees, are our FY09 Corporate Responsibility priorities and are shown here:

Dell´s Corporate responsibility priorities in 2009:

* Aspiring to be the Greenest Technology Company on the Planet

* Making a Meaningful Difference Today – Inspiring a Better, Connected Tomorrow

* Acting with integrity, Inspiring trust


Dell webpage

Dell slide share


May 14, 2010

Warehousing and logistics centers

Filed under: Uncategorized — by pgbarranca @ 10:32 am

LIDL Picks Orders With Schaefer Case Picking System

The food trade company is the first German discounter who opted for the innovative order-picking system by SSI Schaefer

The food trade company LIDL expands its logistics center in Kirchheim/Teck by an automated order-picking warehouse. SSI Schaefer Noell of Giebelstadt was awarded the contract for the logistics components. The intralogistics specialist will establish an amply dimensioned high bay warehouse with five aisles and approximately 15,000 pallet storage positions as well as equip it with the respective pallet conveyor technology. Next to it, a tray-warehouse (STS) with approximately 16,000 storage positions on five levels will be built. It serves to buffer the items by layer after the pallets passed through automatic de-palletizing in goods receiving.

The Schaefer Case Picking (SCP) with its order-related picking of individual packages in parallel multi-access mode provides for efficient order-picking processes. In view of transport as well as replenishment in the stores, the system guarantees ideally packed pallets. Up to 70,000 packages a day are processed that way. Despite the high order picking performance, the system ensures gentle handling of all items.
Civil works have already started and are to be completed in just under two years.

lidl picking system


Improved throughout, operating efficiencies and stock management, together with significant cost savings, are some of the benefits from a new automated warehouse, opened recently by Coca-Cola Enterprises and designed, manufactures and installed by FKI Logistex.

The facility provides on-site storage for the first time at CCE’s Edmonton production unit, eliminating double-handling operations when shipping stock off-site to local warehouses. The unit, which has 25,224 pallet locations, is designed to accommodate future expansion of the factory to meet sales growth forecasts.

The warehouse is linked to five bottling production lines, handling primarily 500-ml and 2-litre plastic bottles of soft drinks for customers throughout London and the south of England and can receive 200 pallets and despatch 300 pallets every hour. Interfaced to the CCE host WMS, the Logistex Warehouse System handles every movement from receipt to despatch.

Following CCE’s philosophy of never stopping production, FKI Logistex employed its handling technologies, plus testing and simulation, to meet targets of 98.5 per cent to 100 per cent full system availability and 65 per cent throughput even when “down”. The resilient overall design avoids risk of single failure points.

coca cola sources


This is an automated retrieval system which gives solutions to high density storage. It has a sofisticated degree of automation, with a high number of simultaneous movements, in vertical and horizontal axis at the same time.



BonnySA is a company dedicated to exportation of tomatoes, which has introduced an automated warehouse for pallets.

Since they have implemented the system they have increased the product control.

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