I really love this saying: Even if a man’s life is quite long, key moments in life are short. It not only applies to people, but also to a company’s or a country’s evolution. There are moments when we face tests and trials, when we make decisions, and when we look back, we realize we were unconscious of the importance of the choices we made and we cannot figure out if we’re disappointed or happy.
To what it concerns the industry of logistics equipment in China, it is hard to say whether 2018 was of a year of great importance, but we can definitely say that we celebrated 40 years of reform and opening up this year, we started a trade war, we witnessed the emergence of intelligent manufacturing and so on. In 2018, logistics industry had to deal with new challenges and new trends and every company in the field had to figure out how to cope with the new situation. During the CeMAT ASIA exhibition in 2018, our reporter interviewed Mrs. Cai Yongzhen, general manager of Damon Industry once again, about the development ideas she has for Damon Industry under new circumstances, and I believe she is a source of inspiration for our readers and for everyone working in the field.
Marching towards a service-oriented intelligent manufacturing
Reporter：In recent years, China has been advocating the upgrading and development of manufacturing industry and it has been supporting the program “Intelligent manufacturing 2025” by any means, “A service-oriented manufacturing” being an important part of the project. We think that your company made a progress in this sense, as it was selected as one of Zhejiang Provincial Service-oriented Manufacturing Pilot Companies. Please tell us something about it.
Cai Yongzhen：In accordance with State Council's Guidance Opinions on Deepening Integration of Manufacturing Industry and Internet (No. 28, 2016) and Article 21, "Deepening Integration of Manufacturing Industry and Internet – Pilot Demonstration" of the Ministry of Industry and Information Technology’s working points 2018, Zhejiang Credit Commission carried out the evaluation of "Pilot Companies for Deepening Integration of Manufacturing Industry and Internet", selecting Damon Industry as a pilot company. This is a confirmation of the fact that Damon Industry is oriented towards intelligent manufacturing and service-oriented manufacturing.
1. Customer Service
A: Technical Services (Product Selection and Product Details Inquiry)
This service adds value to the business by helping clients to inquire about “conveyor rollers”, “electric rollers” and “belt rollers”. Our clients need to open the APP on their mobile phones or to access the website from their computers, to click on “Product Selection Support” and the system will quickly find the series and the model of the most suitable products and also, will automatically recommend the most suitable type of roller, according to the client’s needs. After confirmation, the system generates a code, which is unique and contains details of the product and of the order. Also, clients can download the drawings of the products.
B: Customer Service in Supply Chain Logistics: Order Tracking
This service adds value to the business by helping clients to inquire about order tracking information. Our clients need to open the APP on their mobile phones or to access the website from their computers, to click on “Order Tracking” and enter the purchase order number or the number of the contract with Damon Industry. After that, they can inquire about production status or shipment, invoice issuance and details about the invoice, information about packaging and the roller’s product inspection form. Also, clients can find logistics information online and compared to calling or sending e-mails, it is time saving and more efficient.
2. Supplier service
Damon Industry included all the suppliers on the centralized management synchronization platform, which is linked to the company’s ERP system. Via data synchronization, when confirming the purchase, suppliers immediately receive all the information, including the drawings. Also, the supplier deliveries sync to the company’s material inspection, warehousing information sync to invoice issuance and payment and so on. The platform improved supplier’s efficiency and reliability and it was highly praised by the procurement units, especially the galvanizing outsourcing units.
3. Operation service
The choices of our clients can reach production directly, due to the information system, which also generates the production order. Operational improvements brought by the information system are the following:
A: In a closed ERP system, besides sales contracts, there is no manual input, which greatly improved accuracy of the data flow.
B: The MAS-based production allowed every stage of production to be synchronized and controlled, ensuring on time delivery. In 2018, on-time delivery rate reached 91%.
C: Paperless drawings, technical data and inspection data are all displayed, processing accuracy rate reached 96%, customer complaints reached a low level of 0.67%.
As for operation services, it ultimately helped customers to save time and effort. As long as the initial order is accurate, the possibility for any other problem to occur is very low.
As a conclusion, we think that a service oriented manufacturing plays an important role for the future. By combining production manufacturing and customer service, we improved efficiency in production and created customer value through a product-service system. At Damon Industry, competitiveness reflects in both product quality and customer service.
Three big challenges in the near future and how to deal with them
Reporter： We have been discussing with many transportation and sorting manufacturers, so to reach the conclusion that starting from last year, there are new opportunities and new challenges in the field. On the one hand, the demand for automated logistics equipment, such as express industry in 2018, has increased dramatically; on the other hand, customers' requirements for product quality, delivery speed and cost performance have also increased. How is Damon Industry coping with these new challenging demands?
Damon Industry works with clients from many industrial fields and some of the industries development very fast indeed. For example, the express delivery industry developed even faster than we expected. From this perspective, we are very confident about the future development of logistics equipment market. On the other hand, as you said, customers' demands are higher and higher. We have noticed three main trends in customers' demands:
1. The need for a more efficient transportation and sorting system. A high-speed transportation and sorting system requires higher quality of the transportation and sorting related products and core components.
2. The need for a shorter project delivery time.
3. Customers have become more and more cost-sensitive and require a lower price-performance ratio.
It is a challenge to be able to satisfy all of the 3 above mentioned demands. We are continuously improving ourselves in matters of production, products and services.
Firstly, when it comes to product quality, Damon Industry hasn’t reached its full potential yet. Clients’ demands regarding a more efficient transporting and sorting system reflect the needs for a system that works at a higher-speed and for better quality transporting and sorting components. Let’s take as an example Damon Industry’s main products, rollers; originally, they may work perfectly well when used as components for a low speed transportation system, but they might become a problem when used for a high-speed transportation system. If we are to improve every roller’s quality level, we need to improve processing and control too. In this regard, Damon Industry has been making tremendous efforts and investments. For example, in the production sector, we have completely replaced manual labor with automated equipment, thus ensuring the stability of the product quality. Also, Damon Industry is making solid investments in upgrading its technology. On August 18th of 2018, Damon Industry paid 3 mill RMB for a multi-sawing and deburring machine from Germany and the results are amazing. This machine is operated through an intelligent control system to do loading, cutting and bevelling operations of pipes and shafts, along with other automatic operations. It can automatically identify and cut the ends of material, it can automatically sort the heads from the tails without a secondary manual handling; at the same time, it can automatically establish if the material is available or not, it can do counting, it stops automatically and it reminds the user to change the saw blades. The production efficiency of this intelligent sawing machine is 4-5 times higher than that of the common feeding machine. It also changes speeds really fast, its processing efficiency is really high and its controllable processing accuracy is of +/-0.1m. This processing machine replaced manual and semi-automated operation modes and helped Damon Industry with improving production efficiency and product quality, with reducing time delivery and costs and with delivering more reliable and stable rollers to its clients.
However, continuous innovation in products is a necessary condition for satisfying clients’ requirements. Even if conveyor rollers are basic components of the logistics system, as clients’ demands change, Damon Industry must keep up with the trends. Out of this reason, at the last CeMAT exhibition, Damon Industry introduced three new products: the light duty conveyor roller, the high-torque electric roller and the belt conveyor pulley.
1. The smooth glide of a light duty conveyor roller.
In order to solve the problem of light objects smooth conveying at a small angle, Damon Industry came up with a brand new design idea: it customized the shape of the light duty conveyor rollers, so that the rotational force of a 1500 grams roller only needs 12 grams, which meets customers’ requirements in matters of conveying light goods. By proving to be reliable products, they have won customers’ trust and now more than 3 million Damon Industry light duty conveyor rollers serve Amazon, DHL and other distribution centers all over the world.
2、The infinite force of a high-torque electric roller.
Along with the wide use of rollers came the clients who asked for products with a higher load capacity. Damon Industry & Japan Concorde DC 24V provide now more stable rollers for transporting a heavy-duty load, relying on a powerful torque. This box type electric roller transports up to 500 kg and it incorporates multiple driven rollers, helping customers reduce costs. At present, it has been requested and used by Benz, Volkswagen, BYD, and companies in automotive or new energy industries.
3、The solid belt conveyor pulley.
Traditional circle welding needed extra materials, of a different kind, and oxygen to be added for ensuring protection during welding, while the welding surface was limited to the outer surface of the joint between the axle center and the sealing plate. Damon Industry took the lead in using a new welding method – friction welding. The friction welding process is controlled automatically. At a temperature of 1000℃ and above, the two welded sides merge completely. There is no need for other types of materials to be added during welding, so the original material is kept pure, while the automatic equipment ensures stability to the welded batch and improves welding reliability a lot. The new welding technology and processing of the belt roller has already been patented. The special belt conveyors rollers, that are manufactured by Damon Industry through this unique welding process, greatly improved the safety and reliability of the customers' logistics equipment. Up until now, it was used in projects carried out by Jingdong, Weiyi, Taiping Ge, Beijing Airport, etc.
Regarding our clients’ demands for a cost reduction, our solution involves minimum necessary costs. It is important to provide a high-quality functional product, but we are economical when it comes to the appearance of the product. We are also trying to use process innovation and management improvement so to be able to reduce costs. In this regard, Damon Industry came up with the "new galvanized tube". Originally, all our products were rust-proofed through galvanizing. Unfortunately, galvanizing is not very environmentally-friendly and with the increasing efforts of our country to reduce air pollution, it became difficult for us to keep using this process, so we were forced to reduce the production capacity and to extend delivery time. In serious cases, production had to be stopped, so the products couldn’t be delivered at all! In order to both protect rollers against rust and to meet environmental requirements, but also to be able to deliver products in time, Damon Industry started an intense research in 2013. The company has been trying to develop a galvanized roller tube that meets the standards, so with the help and efforts of our partners, it finally succeeded. The “new galvanized tube” contains a material that already has anti-rust properties so there’s no need for a surface treatment; compared with the existing galvanized tubes, although slightly darker in appearance, it has shown superior efficacy in every aspect. This product not only respects environmental standards set by our country, but also, helped us reduce costs and save time caused by an additional surface treatment process. For these reasons, Damon Industry solved its problems by providing a solution for both rust prevention and environment protection.
Moving forward on a continually changing market
Reporter: In 2018, the market was dynamic and volatile. The trade war brought great challenges to many enterprises. How did Damon Industry deal with the situation?
In the past years, Damon Industry was actively trying to secure its place on the global market. Expansion and development of many markets are in line with our expectations. For example, our factories in Australia and in Europe are running very well.
On the American market, we faced some problems due to the taxes that were imposed as a consequence of the trade war. In the face of challenges, we try not to complain, but to turn pressure into motivation and improve ourselves. I remember that financial crisis of the year 2008 took its toll on us. It was the year in which our company launched information construction. In the long run, the challenges of that year made us stronger, so as far as we know, encountering a crisis is an opportunity to improve ourselves. The impact of taxing our goods on the US market has mainly affected our gravity conveyor roller with low technology market. In light of this event, we would make two adjustments: firstly, we will turn distributors into production partners, aim for local production and try to reduce the trade disputes between us; secondly, we will strive to enter the high-tech market. As you can see, the market forces us to progress.
One step at a time. We will reassess the situation when needed. We haven’t extended so much on the American market. We focus more on the development and geography of the market, let’s take South East Asian market for example, we think it has a great potential so we increase investments in the area. Due to finding trustworthy partners, we overcame the communication barrier with our Indian clients and got stable market demands.
The development of China's economy and society along with the progress of logistics industry cannot be separated from the hard work and efforts deployed by the logistics equipment manufacturers, such as Damon Industry. The cross-current of the sea shows the true character of a hero. At this turning point, in time of challenges and opportunities, I hope all logistics equipment companies can face difficulties and move forward.