Saccheria Franceschetti: reinventing logistics with AI
Saccheria Franceschetti started producing big bags from old fabrics in 1939. Now, almost 80 years later, it is the third distributor of flexible packaging in Europe. The strength of this company from Provaglio d'Iseo, with almost €20 million in sales revenues and 50 employees, is its ongoing innovation. Market leader in its sector, in 2017 it decided to adopt AI-based solutions by integrating various AI Google tools in its back office and warehouse and in so doing boosted efficiency, reduced costs and increased sales revenues. This experience was then capitalized with the ELI WMS startup, which developed a cloud solution using Google Kubernetes Engine to manage and optimize its warehouses and logistics.
What made you opt for AI?
“Consumers have become more demanding because they can get any product quickly and efficiently, so SMEs working in B2B need to adapt to this paradigm in order to stay competitive. The only path to follow, as we see it, is to introduce AI into all company processes. We started from scratch. In 2017 our warehouse management was old world and not very efficient, as were the offices, with packing slips, invoices and documents still in hard copy format. We decided to opt for Google Cloud Platform and API Google because, in addition to containing operating costs, it offers a “light”, powerful and scalable structure. In the offices, Google Cloud Platform helped us to integrate management software with G Suite applications, especially for emails, video calls, invoices, technical charts. In the warehouse, also thanks to the algorithm developed by our ELI WMS startup, the entire process – from the moment goods come in until they are delivered – is automated and monitored, minimizing the risk of errors”.
How does the technology work?
“The company implemented a warehouse management system that is all based on Google Cloud Platform and API Google. The big bags are moved, catalogued and made available in priority order (using predictive analysis) both on the basis of their position in the warehouse, as well as customer practice. In the first case, a voice in the headset that uses Google Cloud Natural Language API gives the warehouse workers the fastest loading order, in the second, the system classifies the various buyers on the basis of their punctuality and, as a result, the price applied is in proportion to the ability to respect pickup times. All this is done using QR codes and tablets.
Back office procedures were also dematerialized. For example, before this implementation it took at least 10 minutes to process an order, now it takes less than 60 seconds. Cloud management also offers other advantages: no need for maintenance (everything is done remotely), it is easy to use and is low-cost because there are no servers and other physical infrastructures inside the company, last, it means having an integrated system that manages the various applications under a sort of scalable platform that can be adapted to our needs”.
What were the results?
“We now have real-time monitoring of all company processes, from the supply chain to delivery. It is also because of this gain in efficiency that sales revenues have increased from €16 million in 2015 to almost €20 million forecast for 2019 and profit margins have doubled. Even more interesting is the fact that the number of commercial complaints and mistakes with purchases have basically been eliminated, which further increases customer loyalty”.
Would you recommend it to other entrepreneurs?
“AI enables you to eliminate waste and automate operations that have a low added value, and to focus on the really important ones. The result is not only in the company’s balance sheet, but also in the better service we can offer to our customers, making them more aware of the entire process, guaranteeing definite timeframes and transparent costs. Pursuing this goal is vitally important for any company that wants to keep growing on the market. The more businessmen adopt this innovative approach, the sooner the entire ecosystem, both companies and customers, will benefit from it".