While companies like Amazon seem to have their logistics models down, what about the logistics of smaller companies in developing nations?

In North America and much of Europe, goods are delivered by parcel, with an ever-increasing number of couriers to support e-fulfillment. Since more consumers are making their purchases online than ever before, one company may use three different courier services in order to ensure packages are delivered as quickly as possible.

In countries like Nigeria, poor road infrastructure is a huge problem, but also a huge driver for e-commerce. Physically shopping in Lagos will often involve waiting in hours of traffic and then having to find vendors amidst the crowds of outdoor markets.

Although the demand for e-commerce is there, challenges also present themselves. Because of the poor road infrastructure and traffic, most of the couriers travel by motorcycle, which limits the amounts and sizes of products they can take. It’s hard to imagine e-commerce coming into more rural areas of the country—package tracking would definitely be a must. In addition, theft prevention is huge—each driver must be vetted—even spouses and other relatives are met to ensure good character. Security at the warehouse is also very important.

These logistical challenges are far greater than those of the US, but the reward could also be much greater, with online retail growing at a 17 percent CAGR. However, retailers in developing markets are still worried about financial and logistical infrastructure.

A recent study from MIT on supply-chain risk revealed that there is no correlation between the total amount a manufacturer spends with a supplier and the profit loss it would incur if that supply were suddenly interrupted. This finding defies what you might usually think.

Professor David Simchi-Levi of MIT’s Department of Civil and Environmental Engineering and Engineering Systems Division applied quantitative analysis to Ford Motor Company’s supply chain and discovered that the suppliers who would cause the most damage to Ford’s profits are those that provide low-cost components.

“This helps explain why risk in a complex supply network often remains hidden,” says Simchi-Levi. “The risk occurs in unexpected locations and components of a manufacturer’s supply network.”

Risks can range from a minor hiatus in work to a major natural disaster. Sources of low-probability, but high-impact risk are difficult to identify.

However, manufacturers often assume their greatest supply-chain risk is linked to suppliers of high expenditure, which Simchi-Levi proved wrong.

Learn more about Simchi-Levi’s findings and how assessing risk can positively impact your supply chain.

Tomorrow is February 14—Valentine’s Day. While most people are thinking of their special someone’s, companies are thinking about logistics, transportation and distribution.

It’s estimated that over 2 billion Americans will be celebrating this year by purchasing flowers, cards, candy and other gifts. While everyone appreciates getting gifts, not everyone appreciates how they arrive.

The transportation and logistics industry plays a huge role in making your Valentine’s Day run smoothly. The trickiest part about shipping goods for Valentine’s Day is that the most popular gifts to give—candy and flowers—are perishable. Temperature-controlled transportation is crucial in order to ensure the goods arrive in good condition.

Did you know:

  • The National Retail Federation’s estimates that consumers will spend $17.3 billion on Valentine’s Day
  • 36 million heart-shaped chocolate boxes are sold for Valentine’s Day each year
  • 110 million roses will be sold and delivered within a three-day time period

With all of these things happening in such a short amount of time, the right transportation, logistics and package tracking are essential for ensuring everything arrives on time and in good condition for Valentine’s Day.

As much as selling goods on eBay or sending a friend a package can be enjoyable, physically going to the post office, UPS or FedEx to mail a package can be a pain. There’s almost always a line, tons of packing options and countless questions about which tier of service you want. Pick the wrong one, and you could be paying double what you expected!

But, what if you could ship goods without visiting a courier? Meet Shyp—a San Francisco based start-up that wants to change the way we ship goods. Shyp customers simply take a picture of what they need to ship and a driver comes to pick it up—that’s it. Essentially, Shyp is the Uber of shipping.

The photograph helps Shyp drivers assess what packaging materials will be necessary and ensures the goods will fit in their vehicle. Once the driver picks up the goods, they are placed into a bag with a QR code on it that helps Shyp keep track of where each item is going.

Weighing, packing, printing and boxing the goods are all handled at Shyps’ warehouse. Once that process is complete, Shyp ensures the packages get to the correct carrier on time.

If you’re thinking a service like this is expensive, then think again. Customers are charged the USPS going rate. Shyp makes a profit by finding the most affordable carrier that meets its requirements and pays lower wholesale rates.

While Shyp was conceived to help consumers send packages, businesses have been very interested in the service. Shyp is still in private beta, but shipments are steadily growing through word-of-mouth. Some customers have even enlisted Shyp’s help to move their belongings across the country! Who needs moving vans?

Companies like Shyp could have a definite impact on the logistics game. It’s an ideal service for small or start-up companies that don’t have their own mailroom management process and don’t want to spend the time or hassle of handling their own shipping.

How do you think companies like Shyp will impact logistics? Share your thoughts by commenting on our Facebook or twitter pages.

Amazon recently filed a patent for an algorithm-based system that could conceivably ship products before an order is even placed. How could this be?

The patent, known as method and system for anticipatory package shipping was filed in 2012 and awarded on Christmas Eve of 2013, describes a method of shipping a package of one or more items “to the destination geographical area without completely specifying the delivery address at time of shipment,” with the final destination defined en route.

Amazon is already extremely efficient, but imagine what they could do if shipping happened before a finalized shopping decision. But, how does Amazon know what you want? According the patent, Amazon would use a forecasting model based upon prior Amazon activity. Factors such as time on the site, duration of views, links clicked and hovered over, shopping cart activity and wish lists would all be taken into consideration. The algorithm would also take real-world information and factors into account.

While Amazon is able to deliver items to Prime customers within two days for no additional shipping charge, they still acknowledge their disadvantage to brick and mortar store—customers want “it” now.

Amazon’s system would involve a two-part process—a computer that identifies the general shipping location, and a second that awaits the delivery address to be finalized. Hypothetically, if residents in Baltimore buy a lot of Ravens gear in September, a local fulfillment center would fill up on a substantial amount of it, but nothing would be shipped until an actual order is received. Once the order is placed, the item would then already be very close to its destination, cutting delivery time drastically.

While Amazon’s anticipatory shipping may not be as out-of-this-world as their delivery drone idea, it seems a lot more feasible and easier to implement.

Could anticipatory shipping change the logistics game? If Amazon starts, will other big-name retailers follow suit? Share your thoughts by commenting below, or on our Facebook or twitter pages.

By using IntelliTrack’s Stratus ISRP, The Diaper Alliance can now work more effectively.

998126_674789652551237_711897193_nIntelliTrack recently had the opportunity to work with Motorola Solutions and Dow Chemical to help The Diaper Alliance, a Michigan-based organization that helps families in poverty living in Midland County with their diaper needs.

Founded in 2011, The Diaper Alliance manages and distributes over 17,000 diapers per month to local organizations such as Head Start and the Salvation Army that distribute diapers to families in need. With plans to increase their service area, The Diaper Alliance needed to make their shipping and receiving processes as simples as possible.

The AutoID Expertise Center at Dow Chemical decided to deploy IntelliTrack’s StratusISRP, an inventory tracking application ideal for small to mid–sized warehouse order fulfillment operations. This web-based software allows The Diaper Alliance easy access and management of their data. Combined with Motorola handheld devices, the StratusISRP solution can easily tackle all of The Diaper Alliances’inventory, shipping and receiving needs.

Dow, Motorola and IntelliTrack worked as a team to configure the application, install equipment, provide training and design labels—they even helped to facilitate The Diaper Alliance in moving locations and setting up their operating facility.

Diapers that are donated come in all different shapes, sizes and packaging from a variety of different suppliers. By enabling the use of handheld devices and inventory software, products can be scanned and tracked, quickly determining the quantity and vendors and facilitating the overall process. All of the materials and services from Dow, Motorola and IntellliTrack were donated to the organization.

“Leveraging our expertise and supplier partnerships enabled us to help improve the quality of life families in the Great Lakes Bay Region,” said Craig Casto, Global Expertise Center leader for Dow.

Read the release and learn more about The Diaper Alliance.

If enterprise businesses want 100% supply chain visibility, they can’t expect to do so if their processes are cloudy.

Legacy processes, such as manual data entry, often lead to error and inconsistency and definitely slow down processes. Even if a company has one tool, the key is getting all of the right tools working together in the right way.

A lot of time is spent ensuring that everything is done the “right” way, rather than ensuring that the right tools are being used. Companies that have been around a long time don’t want to separate from their trusty spreadsheets. And despite knowing that many software options are available, executives often think their processes and needs are special and their supply chain cannot be handled with one solution. While that may or may not be true, most warehouse management systems can be tailored for individual needs.

Even if a company uses some automation, full supply chain visibility can only occur if all of the tools and process are working together. If certain parts of the supply chain are automated, and others are not, this leave gaps—gaps that are often filled with spreadsheets and e-mail. These gaps create “islands” of automation that don’t add up to 100% supply chain visibility.

What this equates to is adding new technology to old business processes. But supply chains need to be re-vammped entirely in order to function at their best. Without all of the proper systems together working together in harmony, it becomes increasingly difficult to manage anything that happens outside of the realm of day-to-day activities. If demand suddenly spikes, a supply chain with some paper-based aspects still in place could crumble.

Watch the video below to learn more about responding to demand and supply chain efficiency.
 

Consumer mobile trends have greatly impacted supply chain logistics in recent years.

If there’s one thing that’s certain about the supply chain software industry, it’s uncertainty. Anticipating new technologies, trends and logistics isn’t easy, but it definitely keeps things interesting. Innovations are constantly being developed to keep up with customer wants and needs, but it’s important to understand the reasons behind why change is needed. Many of these industrial changes are influenced by consumer-based trends that have a trickle-down effect throughout the entire supply chain.

BYOD
With consumer smartphones becoming more and more powerful, some organizations allow employees to use their personal device for business. Rather than having two separate devices, employees enjoy being able to conduct business on a device to which they are accustomed. However, this means a lot of work for IT departments, particularly ensuring data is secure. Even if companies don’t allow employees to use their personal devices, the consumer market has become so influential that many industrial-grade data collection devices have an Andriod OS option.

Unlimited Data
We live in a connected world—we’re able to sync our phones with computers and tablets and access just about anything at any given time. This consumer trend has also been carried over into the business world. Developers are making sure data is accessible across all channels and locations—more and more warehouse management software and other enterprise business tools are moving to the cloud.

Order from Anywhere
Since consumers are so connected and data can be accessed so easily, it’s no surprise that it has changed the order process. Orders can now come in from a variety of different channels, including websites on computers, tablets and mobile phones; phone calls, resellers and shops. Supply chain technology needs to be able to adapt to handle all of the different orders from various sources. What’s even more important is where the orders are going—since consumers can order from just about anywhere in the world, products need to be able to efficiently arrive at their destination. In addition to warehouse management systems, transportation management and package tracking play a key role in ensuring orders get to their expected destination in a timely manner.

The popularity of consumer mobile devices and increased access to data, has resulted in a supply chain that’s responsive, lean and efficient—it has to be to keep up with it’s customers.

What other consumer trends can you think of have affected the supply chain? Share your thoughts on our Facebook or twitter pages.

As we close out 2013, our minds can’t help but wonder what 2014 will bring. When it comes to logistics and supply chain trends, Freightgate recently announced their predictions for five trends that will make their mark on logistics in 2014.

 1) Compliance Will Be a Key Issue in Supply Chain Management
While compliance has always been an issue, as companies continue to internationally expand, supply chain compliance will be vital in logistics and supplier relationships.

2) Transportation Management Systems (TMS)
Transportation Management Systems are predicted to become more integral to logistics, beefing up their sophistication and offering a myriad of analytics. Business planning and predictive analytics will be integrated to help shippers and carriers work more efficiently together, monitoring supply and demand cycles and syncing them with transportation planning and supply chain events. This will lead to a more collaborative approach, and ultimately, fiscal rewards.

3) Big Data Will Improve Global Supply Chain Performance
Big Data, combined with predictive analytics and business intelligence will play a big roll in cost containment, capacity control and risk management in 2014.

4) Centralized Transportation Management
Centralized Transportation Management will be leveraged in 2014 to optimize all aspects of business planning, vendor collaboration, carrier selection and shipment logistics to centralized supply chain collaboration and decision-making. Transportation departments will focus on comprehensive synchronized spend strategy, concentrating on smaller, incremental reductions and performance opportunities across the entire logistics lifecycle.

Trend #5: Cloud-based Embedded Analytics
The increased demand for supply Chain Analysts will drive improvements in efficiency, especially in the shipping process.

What do you think will happen with logistics in 2014? Share your thoughts with us on Facebook or twitter.

 

Thanks to Amazon, drones could deliver packages to your doorstep in 30 minutes or less! 

Imagine a future where you order something online and it appears on your doorstep only 30 minutes later. This future is not far off, thanks to Amazon’s recent announcement.

While Amazon’s CEO Jeff Bezos is confident that the drones will take off in the next 4-5 years, there’s a lot of skepticism in the industry. But for supply chain management specialists, where there’s a will, there’s a way.

Amazon Prime users are a loyal group, but they want their products now, not two or more days from now… even if shipping is free. Amazon is pushing conventional logistics in order to satisfy their customers and get goods delivered as quickly as possible—how a lean supply chain should be.

An essential aspect of having success with a drone-based delivery system in 30 minutes will be to reduce lead time. Lead time is adversely effected by transportation—traffic, turns, stop signs, and lights all have a significant impact on lead time. But with drones, most traffic-related lead time can be eliminated.

One big change in the logistics behind drone delivery will be batch picking. Now, most warehouses will batch products for a group of customer orders together, but with the addition of drones, order picking would make more sense—especially if the goal is to get the product to the customer within 30 minutes.

Will drones soon be the future of logistics? Share your thoughts with us on Facebook or twitter.