Category Archives: Supply Chain

How Retailers Can Stay OFF The Closing List

MultiChannelMerchant

In April, Swiss brokerage firm Credit Suisse released a report that sent shock waves through the retail universe. It predicted that more than 8600 brick and mortar stores could shutter before the end of 2017. That would make it the worst year on record for store closures. It’s the stuff of nightmares for retailers.

Whether or not you believe the Credit Suisse analysts are right, you can avoid being one of those stores — all it really takes is providing the experiences that today’s consumers demand. Movie theaters in the 1980s faced a similar environment when home video hit big. The industry feared that once people could rent and watch videos at home, nobody would pay to go to a theater and they would all go out of business.

In April, Swiss brokerage firm Credit Suisse released a report that sent shock waves through the retail universe. It predicted that more than 8600 brick and mortar stores could shutter before the end of 2017. That would make it the worst year on record for store closures. It’s the stuff of nightmares for retailers.

Whether or not you believe the Credit Suisse analysts are right, you can avoid being one of those stores — all it really takes is providing the experiences that today’s consumers demand. Movie theaters in the 1980s faced a similar environment when home video hit big. The industry feared that once people could rent and watch videos at home, nobody would pay to go to a theater and they would all go out of business.

Integrate Ecommerce and POS inventory
Omnichannel shoppers see no difference between your ecommerce and POS offerings and neither should you. Make every store’s inventory visible to online shoppers so that you can take advantage of the “buy online, pick-up in store” model. Integrated ecommerce and POS inventory management systems show real-time availability so consumers do not face unexpected out-of-stocks at brick and mortar locations. If an item is not available at the customer’s selected store, provide fast and free transfer from another store.

Use brick and mortar stores as fulfillment centers
Every physical store should also double as a fulfillment center for web orders. This opens up every item in inventory to sales from any channel and reduces time in transit for ecommerce orders. Orders that are automatically routed to locations closest to customers can reach front doors faster than from a central warehouse, often overnight or within two days without incurring express shipping charges.

Go mobile
It’s official — mobile internet usage has surpassed desktop traffic. If your website does not display properly on mobile devices, you’re missing out on a huge number of consumers. But just displaying properly is no longer enough. Navigation, inventory visibility and checkout must all be optimized for mobile users. This has massive benefits for brick and mortar as well when customers on the go can locate items in your stores; they may even make purchases from inside a competitor’s location.

Automate ordering with vendors
The long-time promise of just in time inventory management finally eliminated worries about out-of-stocks. Set minimum and maximum thresholds for SKUs and let your retail management platform automatically order the right amount of inventory from suppliers at the exact right moment. When you know every product you sell will be automatically replenished before it sells through, you do not have to keep as much inventory on hand and can open up shelf space for additional offerings likely to attract customers. You also don’t have to worry anymore about selling out on popular items and sending frustrated customers home empty handed.

Empower every employee as a checkout
One of the worst things that can happen in a store is when customers with intent to purchase leave upon seeing long checkout lines, or can’t find anyone to take their money. The in-store experience must be as smooth and easy as it is online — consumers are no longer willing to wait. Arm every employee with a tablet loaded with mobile POS software so they can complete transactions, look up inventory, and place customer orders from anywhere in the store.

Personalize direct marketing to customers
Target individual customer segments with the offers most likely to appeal to them through marketing automation. Integrate online and POS customer data to segment personas effectively and send promotions that are personalized to known preferences and likely to bring customers into stores. Specific behaviors should trigger customized messages, and look for opportunities to leverage ecommerce and in-store offerings. For example, an abandoned shopping cart may trigger a reminder message that could also include a note like, “this item is also available at your nearest store, would you like us to hold it for you?”

Expand inventory exponentially with drop shipping
Drop shipping today does not resemble what it looked like 15 years ago. Many vendors offer drop shipping that can use your branding and fulfill lightning fast. Offering items for sale that you do not have hold in inventory opens up your website to endless opportunities and it can also be integrated into “buy online, pick up in store.” Give customers the option of having the item sent to their homes or to their nearest store with no shipping charges. If they select a store, simply have the vendor pack the item along with your next regular order.

The next time you see a headline about a retailer closing stores, refer back to this list. It will become clear that one of the major reasons the merchant is in trouble is because it is not responding quickly enough to the changing demands of modern consumers. Provide the experiences today’s empowered shoppers expect and you will have much less to fear from predictions of impending doom.

Zim ship first to pass under raised bridge at NY-NJ port

The arrival of the Zim Antwerp, heading under the bridge for Maher Terminals, will open a new era at the East Coast’s largest port.

Larger ships than expected traversing new Panama Canal
The long-anticipated sea change in trans-Pacific shipping networks is well underway a year after the Panama Canal opened its expanded lock system.

REA Express

In 1966 REA Express was operating a system primarily engaged in the expeditious transportation of express packages, less-than-carlot, and carlot shipments requiring special handling. REA Express also provided a world-wide shipping service through contracts with air carriers, acted as an ocean freight forwarder to many countries of the world, and provided local truck express service in some large cities of the United States. A subsidiary company of REA Express leased truck trailers to railroads, forwarders, and shippers for the use in trailer-on-flat car service. Such miscellaneous services as pick-up-and-delivery services for railroads, custom brokerage on import traffic, sale of traveler’s checks and money orders, and collection of C. O. D. charges were also performed. REA Express conducted its business through 8,200 offices and used in its operations 137,000 miles of railroad, 132,000 miles of air lines, 79,000 miles of motor carrier lines, and 6,600 of water lines. The company employed 30,000 persons and operated a fleet of 12,000 trucks. The company handled some 66,000,000 shipment annually. (Association of American Railroads)

-with all those assets and experience, even though rail shipping was in decline, REA dominated the private package business. It was already into trucks, had name recognition, a customer base etc. -why did it finally fail? Why didn’t it follow the trends and morph into something successful like UPS and FED EX?

We have a lot of information on the Railway Express Agency, later known as REA Express and also have significant background information available that will help you understand why REA Express failed.

Find more great short stories
https://penneyandkc.wordpress.com/chicago-rail-capital/

Real Welfare Cadillacs Have 18 Wheels

Truck freight movement gets a subsidy of between $57 and $128 billion annually in the form of uncompensated social costs, over and above what trucks pay in taxes, according to the Congressional Budget Office.

If trucking companies paid the full costs associated with moving truck freight, we’d have less road damage and congestion, fewer crashes, and more funding to pay for the transportation system.

What with all the speculation about a possible trillion dollar spending package for infrastructure, we’ve been hearing a lot about about crumbling bridges, structurally deficient roads, and the need for more highway capacity.

It’s clear that our transportation finance system is broken. To make up the deficit, politicians frequently call for increased user fees – through increased taxes on gasoline, vehicle miles traveled, or even bikes. All the while, one of the biggest users of the transportation network – the trucking industry – has been rolling down the highway fueled by billions in federal subsidies.

A 2015 report from the Congressional Budget Office estimates that truck freight causes more than $58 to $129 billion annually in damages and social costs in the form of wear and tear on the roads, crashes, congestion and pollution – an amount well above and beyond what trucking companies currently pay in taxes.

CBO doesn’t report that headline number, instead computing that the external social costs of truck freight on a “cents per ton mile basis” range between 2.62 and 5.86 cents per ton mile. For the average heavy truck, they estimate that the cost works out to about 21 to 46 cents per mile travelled.

Unfortunately, trucking companies don’t pay these costs. They are passed along to the rest of us in the form of damaged roads, crash costs, increased congestion and air pollution. Because they don’t pay the costs of these negative externalities, the firms that send goods by truck don’t have to consider them when deciding how and where to ship goods. This translates into a huge subsidy for the trucking industry of of between 21 and 46 cents per mile.

For comparison, CBO looked at the social costs associated with moving freight by rail. Railroads have much lower social costs, for two reasons: first, rail transport is much more energy efficient and less polluting per ton mile of travel; second, because railroads are built and maintained by their private owners, most of the cost of wear and tear is borne by private users, not the public. Railroad freight does produce social costs associated with pollution and crashes, but the social costs of moving freight by rail are about one-seventh that for truck movements: about 0.5 to 0.8 cents per ton mile, compared to 2.52 to 5.86 per ton mile for trucks.

There’s a clear lesson here: It may seem like we have a shortage of infrastructure, or lack the funding to pay for the transportation system, but the fact that truck freight is so heavily subsidized means that there’s a lot more demand (and congestion) on the the roads that there would be if trucks actually paid their way. On top of that, there’d be a lot more money to cover the cost of the system we already have.

So the next time someone laments the sad state of the road system, or wonders why we can’t afford more investment, you might want to point out some 18-wheelers who are now getting a one heck of a free ride, at everyone’s expense.

View the full report: “Pricing Freight Transport to Account for External Costs: Working Paper 2015-03“

Looking Forward To 2017?

This time of year, you might be of two minds. You’re excited about the upcoming year and the possibilities of new projects, job opportunities, and maybe an upcoming vacation to someplace warm. But you’ve also read articles aplenty about automation affecting supply chain jobs, some segments of the economy are still struggling, we’re always a black swan event away from disaster and, oh yeah, there’s a new president on the way with some very different ideas. Welcome to the new normal!

Don’t despair, for there are many positives ahead. The Internet of Things (IoT), Big Data, cloud technology, and robotics have all made their way along Gartner’s Hype Cycle curve and are now in operation. 3D printing is growing and machine learning/AI is picking up steam, as are driverless vehicles, drones, and VR. Even the political front has bright possibilities, with Trump’s infrastructure plan, tax reductions, and possible repatriation of foreign profits having the potential to light a fire under the economy. Things are looking up, right? Well, yes and no.

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The Network of Networks: You Mean THE CLOUD

Today I spent on a project from 2013: Supply Chain Control Towers

Far greater minds than mine have defined Supply Chain Control Towers? There are many definitions but Capgemini offers a good, broad definition that many would agree with: “A supply chain control tower is a central hub with the required technology, organization, and processes to capture and use supply chain data to provide enhanced visibility for short and long term decision making that is aligned with strategic objectives.”

Yes, I wrote about Supply Chain Control Towers and Transportation Control Towers

First thing today I get a message from India. Company wants to know more about Supply Chain Control Towers. Then I read mail (uuuggghhh). Get a blog from Lora Cecere, The Supply Chain Shaman.. She knows more about Supply Chains than I ever will. But she is allied with ALL the vendors in the industry. I trust them as far as I can throw them.

scmcontroltower2

But she has a great idea: A Netword of Networks

I simplify that to “THE CLOUD”

Back the Control Towers. She and I agree on a lot. Difference simply is I want EDI to be the main communications tool (other than voice-to-voice). She wants to also introduce many existing communications tools from her great vendor community. I feel EDI is proven and can communicate ANYTHING. She wants to introduce things like HADOOP, SPARK, BLOCK CHAIN to the process. ADOBE may be her great friend. All I know about them is their opening remark if I contact them. “What is your credit card number?” Still confident in the international banking system to think BLOCKCHAIN is a lot of B..S We use BNP Paribas and know it’s capabilities.

scmcontroltower3

I am sure Lora and I will work out our differences. So confident that I have signed up for her Webinar in January.

This is a guest blog from my boss, Ken Kinlock. He is “The Man” about Control Towers

The Cloud Supply Chain Data Network

Quality data is the fuel for any business software. In international trade and logistics, where critical data comes from partners scattered across the globe, the challenge of obtaining quality data is even greater.

The traditional approach for connecting to a myriad of partners to receive and send data is costly, time consuming and error-prone. It is the primary reason companies don’t have global view, or a control tower for managing the full end-to-end global supply chain.

Fortunately, there is a new model for delivering data to your solutions that makes what used to be impossible possible, while decreasing costs at the same time.

Modern cloud-based information platforms designed specifically for global supply chains take advantage of powerful network effects that lower costs by spreading them across a large community of users.

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Have You Connected The Dots Yet?

Let’s have some fun with math. What EDI translator does your company use? For that matter, what ERP, 3PL, or other service is on your short list? Next, how many trading partners do you have? And finally, what EDI, ERP, and other electronic systems do they use? It doesn’t really matter whether you have the answers to these questions. What you would get even if you use the smallest estimates available is a very large number of permutations. How is it possible then to maintain compatibility and also keep up with the accelerated pace of today’s supply chain?

Fortunately translating one trading partner’s EDI transactions into the formats your company uses is controllable. That’s not to say it’s simple and doesn’t require constant attention, but the tools have been honed to the point that daily operations move ahead without too much problem. But the processes still need handholding and manual intervention to assure every document processes correctly.

Get the “5 Best Practices for Integration Planning” Whitepaper for free

Read more: http://ec-bp.com/index.php/articles/editors-blog/11799-have-you-connected-the-dots-yet#ixzz4QKzGlGoh

Supply Chain Mayhem – Avoid It

It’s hard to believe that the Holiday season is near – or that for those participating in retail, the season is already well underway. Is it too late to think about making this season better? If you haven’t already made the infrastructure and system changes you’ve been contemplating this year then the answer is likely to be Yes! But there may still be a few things you can do at this late date.

Be Mobile Ready

Get Your Visibility Nailed

Get Ready To Be The Best

Read more: http://ec-bp.com/index.php/articles/editors-blog/11789-supply-chain-mayhem-avoid-it#ixzz4PnQvO3X2