Supply Chain and Security

17 November 2009

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Security Challenges – Supply Chain• 9/11 heightened fear of terrorist attacks – cargo containers

likely delivery vehicle• Intercept suspicious cargo before it reaches U.S. shores –

100% scanning by 2012• Regulation abounds

– Implementing the 9/11 Commission Recommendations Act of 2007 (9/11 Act)

– Customer-Trade Partnership Against Terrorism– Container Security Initiative/Secure Freight Initiative– SAFE Port Act

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Addressing a Global Problem• 11 million containers enter the US annually• Container security market is expected to grow from

$70M in 2008 to over $4B by 2015• Theft in the global supply chain accounts for loss of

billions per year• Customers are interested in solutions that provides

physical security, breach notification and global tracking capability

• Defense companies are leaders with security solutions

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The Dilemma

• Dilemma – increase security but don’t impact legitimate trade

• Many stand-alone products exist but very few integrated solutions– Many focused on security are door-centric– Sensing technology not standardized

• Many players in the supply chain– Shippers– Ports– Trucking & Rail– Customs

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Opportunities?• The container security market is growing. • Industry trends toward reduction in theft, counterfeit,

spoilage and mishandling• Potential customer base is mature but fractured• No integrated, environmentally and technologically

interoperable container security solutions exist

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Transshipments• Fastest growing segment of the container port market

– Examples: Dubai, Hamburg, Trinidad & Tobago

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Transshipment (cont)• Commonly used by smugglers and terrorists seeking to

disguise the point of origin of their goods from Customs officials

• Keys to maintaining strong security:– Good Tracking

• Currently available: RFID, GPS, Satellite, WiFi, Cellular

– Accessible Real-Time Data• Customs 10+2 requirement

• Sensor data; entry logs

– Solid Chain of Custody

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Cubic Security Services, Inc. (CSi)

Enhance safety and security within the public transit and maritime markets for people, cargo

and equipment

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Technology Integration• Cubic identifies technologies of interest and potential

sources of applied research– Sensor technologies, with focus on CBRNE and imaging– Processing technologies to analyze and associate data

• Cubic participates in forums where technology firms are presenting and access is facilitated

• Cubic seeks a relationship with identified technology firms that are mutually beneficial and offer competitive advantages

• Cubic works with “partners” to define served markets of interest and formulate strategies

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CSi Innovation & Technology

• Integrated radiation detection with mass transit fare collection systems

• Explosive detection for transit • Sensor technology development• Global Asset Tracking Enterprise System (GATES)

– Increase container security, tracking and improve supply chain visibility

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Container Security Solutions

• Maritime “smart lock” used as a delivery platform– “Tamper proof“– Keyless entry– Electronic log of access– Validation of who has access– Electronic Manifest & Data– History of container movement– Near real-time tracking

• Integrate threat detection technology• Global coverage

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THANK YOU