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A Picture-Perfect Warehouse

THE PORT NORFOLK COMMODITY Warehouse, Inc., is a full-service third-party logistics company which operates an 18-acre facility at the port city of Norfolk, Virginia. To comply with Customs and Trade Partnership Against Terrorism (C-TPAT) guidelines and to reduce the amount of product theft and damage by employees, the company installed a 53-camera CCTV system and reduced the speed of its forklifts. Together, these changes led to a stunning drop in the amount of stolen and damaged goods.

Jane Mirmelstein, Port Norfolk Commodity Warehouse’s president, explains that her company works with steamship, domestic trucking, train, and other transport lines to bring in, temporarily store, and send out a variety of goods. The site includes 370,000 square feet of warehouse and office space, some of which is leased to tenants.

The facility was originally built in the 1960s, then added to in the 1980s. There are many parts to the site—warehouses, refrigerated coolers, offices. “There’s also a rail siding with the capacity to bring in five cars, as we own our own trunk line and are transport brokers for Norfolk Southern,” she says.

Until several years ago, the facility was protected only by perimeter fencing and a few CCTV cameras that were required as part of a contract with specific customers. This minimal security did not meet the requirements of clients that wanted to gain C-TPAT certification to avert their cargo containers being held in port. “Our customers wanted to comply with the guidelines…[which meant] we were also required to go by the guidelines.”

But compliance wasn’t the only motivation. The need to reduce theft and accidental damage was also a major issue. Among the types of goods in company warehouses are automotive products, building supplies, natural and synthetic rubber, plastics, textiles, and beverages. One common problem was forklift damage to pallets of drinks.

“If a forklift comes around a corner too fast or the driver is not paying attention, he will clip the corner of the pallet and damage the bottom cases. This requires that the whole pallet be disassembled and the cases replaced, which is time consuming labor,” Mirmelstein says.

Stolen or damaged goods are paid for by the company. “We are 100 percent responsible for customers’ product. Whatever we say we have, when it gets ready to load out, if there is any variance, it will be credited to them,” Mirmelstein explains.

“So, we wanted accountability as to how warehouse theft and damage was occurring,” she says.

Accountability is especially important because the company shares space with others it leases to, “and we have no control over their employees, so we needed to ensure that, in those shared spaces, we could monitor our employees, as well as make sure that theft was not occurring by the employees of other companies,” says Mirmelstein.

In late 2006, the company brought in Atlantic Protective Services (APS), a full-service security company based in the Tidewater area of Virginia, to design and install a blanket CCTV system. Mirmelstein and her staff met with APS representatives. “We talked about our needs, where we thought we needed protection and where the coverage would be best to maximize our dollars,” she states. APS then surveyed the property and designed the system, which was installed in two phases during the following year.

Mirmelstein says, “The installation went smoothly. Obviously, with any type of installation in an older facility, wiring could be an issue, but they did a great job.”

APS chose Honeywell’s HCD92534 IR bullet cameras with infrared capabilities to effectively monitor the grounds around the clock. Feed from the cameras is randomly multiplexed to a main console in the company’s office as well as to the desktop computers of Mirmelstein and one other employee.

The system uses digital, color cameras with pan-tilt-zoom capability that can be activated to track action in an incident. Otherwise, the camera feed is recorded and stored in servers at the site for 60 days. A software interface allows authorized users to search by date, time, camera, and other parameters; to burn video clips to disc; to create reports; and other options.

The 53 cameras provide blanket coverage of the facility, inside and out. For example, there are cameras covering the rail siding and the three main gates for cars and trucks to enter the facility. Inside the company’s offices, there are cameras in the computer room, the telephone server room, and other sensitive areas.

Cameras have also been placed on every loading dock. “We installed cameras at all these doors so that it is clear what comes off of every truck and what goes on every truck,” Mirmelstein says.

To further discourage theft, the employee parking lot was moved farther away from the warehouses. Now employees have to walk outside past three cameras to get to their cars, she states. The other change adopted by the company was the placement of governors on all forklifts that reduced their speed by 50 percent. Annual forklift training is required by OSHA, but the company also held retraining after the governors were installed. Since then, says Mirmelstein, “we have reduced damage to .001 percent.”

The CCTV system cost the company about $70,000, Mirmelstein says, but it has already paid for itself in savings. A recent inventory check by one of the company’s largest customers resulted in “a 100 percent perfect inventory,” she says. “Before we installed the CCTV system and the speed governors, that inventory would have showed at least a 10 percent loss that we would have been responsible for.”