Security Management: Packaging Protects What You Produce

Security is all about perceived threat, or reacting to misfor-tune that has befallen someone else. To safeguard what has been produced, manufacturers can rely on transport packaging as the first line of defense against terrorists' activities and theft. Those safeguards range from the obvious—specially designed impenetrable containers and locks, to the not so obvious like special services provided by third parties, changing supply-chain philosophies and invisible ink.

Earlier this year, representatives from the Government Accounting Office (GAO) testified to the Senate that container and cargo security programs continue to leave containers vulnerable to terrorist attacks. The GAO estimates that 35% of U.S.-bound shipments were not targeted by the Container Security Initiative—a U.S. Customs program that inspects U.S.-bound containers before they leave foreign ports—nor were they inspected prior to shipment to the U.S.

In addition, a study by ChainLink Research (Cambridge, Mass.) estimates $50 billion in financial losses from damaged freight or other forms of "shrinkage" for ocean containers and shipping yard activities. According to the study, RFID For Maritime Report, radio frequency identification (RFID) is increasingly being used to track containers as they move across oceans and provide real-time location in maritime yards. RFID also helps with the flow of containers through customs, thus improving the throughput of constrained ports. Many executives view security as a byproduct of using RFID for other purposes.

"Above and beyond homeland security concerns," says Ann Grackin, the main author of this study, "the executives we surveyed rated supply chain objectives like trace and track, and supply chain effectiveness as more important motivators for use of RFID than container security."

Bolting the door
Mitsui U.S.A. Inc. (New York), is a global importer and exporter. Recently it completed tests of RFID intrusion detection tags and electronic bolt seals for its transoceanic shipping containers. These active RFID devices automatically detect cargo door intrusions and security breaches while communicating their location and the condition of the container.

The over-the-ocean container field trials evaluated 50 ST-676 container security tags from Savi (Sunnyvale, Calif.). Tested alongside the Savi tags were 15 E.J. Brooks (Livingston, N.J.) E-Seals— single-use RFID-enabled electronic bolt seals— clearing the way for their commercial availability in November.

The ST-676 is a new generation of security tag that leverages a door sensor and light sensor to detect security breaches. It monitors other sensors for temperature, humidity and shock to capture information on the environmental conditions inside the container. Both the Savi and E.J. Brooks tags are based on ISO 18000-7 standards that operate on the 433.92 MHz radio frequency. Conformity with this international standard enables both products to interoperate within an ISO 18000-based information network with support from countries worldwide for intermodal supply chain usage.

During the field trials, all of the tags were electronically secured and affixed to the containers at a consolidation point in Southern California and then trucked to the Port of Los Angeles. From there, the containers were shipped by ocean vessel to the Port of Hong Kong. At the port, containers were discharged and trucked to a deconsolidation point, where they were physically and electronically unsealed.

Mitsui determined all 65 tags proved effective. There were no "false tamper" incidents and the tags automatically communicated with an RFID reader network throughout their end-to-end supply chain journey between Los Angeles and Hong Kong.

As part of the trials, six containers were intentionally breached at the final destination. Each of the ST-676 tags properly alerted that a door intrusion event had occurred. The containers were also monitored via Savi's Transportation Security Solution software, which was updated when the tagged containers passed by fixed readers or were read by handheld readers.

"The field trials demonstrated that active RFID tags perform flawlessly," says Masahiko Tsumoto, senior vice president, transportation and logistics, Mitsui U.S.A. "This is a significant cornerstone to commercialize such technology into a real business scenario." Tsumoto adds that since these RFID devices are based on international ISO standards, and have passed rigorous field performance tests, he's confident that they will provide the kind of container management and security solution wanted by international shippers.

Shortening the supply chain
A shorter supply chain means fewer opportunities for theft or terrorist activities. UPS (Atlanta) has a program to do just that. UPS's Trade Direct program combines cross-border movement of freight and packages, thus eliminating the need for ware-housing and load consolidation. The program integrates multi-modal services to accelerate and simplify freight shipments from international factories, through customs and on to multiple retail stores or end consumers' doorsteps.

"Trade Direct speeds transit times, even as supply chains get longer and more complex," says Kurt Kuehn, UPS's senior vice president for worldwide sales and marketing. "We're simplifying the information management challenges that can arise with increased global trade."

Crown Premiums (Bonita Springs, Fla.), a manufacturer of high-quality miniatures and collectibles, relies on sup-pliers in China. It worked with UPS to consolidate its supply chain process and eliminate multiple providers.

"We had previously worked with another company and things would get dropped along the way," says Noreen Gedmin, vice president of operations for Crown Premiums. "There was a lot of added paperwork."

With seamless deliveries to customers in Canada, for example, Crown can concentrate on other aspects of its business. "We palletize our Canada-bound LTL [less-than-truckload] product and ship it out all at once," says Gedmin. "UPS clears it through customs and the individual deliveries go directly into the UPS system in Canada."

Brand theft and packaging
Brand theft, a growing concern as more manufacturing moves offshore, is another security area that can be addressed with new forms of transport packaging. Brand theft not only causes a company revenue losses, it can result in liability clams when bogus merchandise goes bad.

Westvaco Brand Security (Stamford, Conn.) a subsidiary of Westvaco Company, has a program called Brand Theft Solutions. The program starts at the beginning of a company's supply chain and steps through the entire packaging process, looking for potential problems and recommending solutions that will deter theft.

Richard Weatherly, vice president, Westvaco Brand Security, says, because the company has no vested interest in any particular technology, it's able to seek out what works best for a particular client.

Among the things Westvaco Brand Security uses are reactive invisible inks and friction-activated inks. Special fibers embedded in the package's material structure, and coated with these inks, can be incorporated into the board material or substrate used to create the package. These inks, combined with tamper-evident tape, present a formidable defense against tampering and theft.

Machine-readable inks are another area gaining favor as a security marker on packages. The characteristics of this ink are customized for each application and authentication is made with a special detector, enabling automated verification of variable data. The ink can be black or colored and has various levels of complexity.

Authentication readers produce an instant response when they come into proximity with a security marker. Compact, handheld devices, readers can be integrated into existing machines used for bar code scanning or automatic gate controls.

Transport packaging has always been a way of defending the product against physical intrusion. Now, when it comes to safeguarding what has been produced, transport packaging again offers the best line of defense against terrorists' activities and theft—a strong offense.