DINESH KUMAR South Africa faces the challenges of lower maturity with regard to business, especially in the sectors of consumer goods, transport and healthcare
Audit, tax and advisory ser- vices firm KPMG rep- orts that although the South African materials handling industry is undergoing sev- eral changes, the rate at which South Africa is advancing – in terms of materials handling processes and its associated costs, technology and skills levels – it is not on par with other countries.
KPMG associate director and head of supply chain and procurement Dr Dinesh Kumar says South Africa faces challenges of a lower maturity with regard to business, especially in the sectors of consumer goods, transport and healthcare.
He notes that a report by the World Bank has stated that, among Brazil, Russia, India, China and South Africa, or Brics nations, South Africa is not the best performing country. He adds, “We are, however, better than Brazil and Russia.”
Kumar explains that other major challenges include a low level of skills and issues with the availability of a suitable workforce. He adds that minimal use of advanced technology such as standalone tools, has impeded development, while the high cost of raw materials such as steel and construction material, has resulted in poor manufacturing capacity.
“Extended customs and port processes have delayed materials handling processes further, resulting in sluggish supply chains and loss of revenue,” he says.
Kumar notes that some recent trends have positively affected the materials handling industry. “The use of high-density racking systems has increased materials handling capacities and efficiencies,” he says, adding that integrated system technologies have further improved business processes.
Further, the standardisation of the use of equipment and technology, as well as the implementation of radio- frequency identification and other scanning technologies, has aided development and growth in the industry.
The slow growth in the materials handling industry is owing to inflated labour costs and long processing times; manual processes, compared with speed-ier automation, is also a factor, Kumar explains.
One of the biggest shortfalls in the materials handling sector involves skills development and training. “The US Department of Labour’s Bureau of Labour Statistics predicts a gap of about 17% between the demand and supply of skills by 2030,” says Kumar, adding that training related to supply chain integration, visibility and optimisation would also be a good area in which to drive growth. “Consolidation and focus on energy saving and environmentally safe practices would drive future sustainable development,” Kumar concludes.