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Health Crisis: The 4 Challenges Facing the Supply Chain

supply chain

Health Crisis: The 4 Challenges Facing the Supply Chain

The health crisis is putting the logistics chain to the test in particular. Reduced visibility, need for flexibility or even international disruptions… The challenges facing logisticians for this new year are numerous and it will be necessary to be particularly vigilant to meet them properly. Here are our ideas for making 2021 the necessary rebound year.

1 / A lack of visibility that needs to be filled

Since the start of the health crisis, the entire supply chain has faced a lack of visibility. Many activities are slowed down or even stopped, directly or indirectly impacting all players: from the manufacturer to the customer, including distributors. Companies also have to face a regulatory environment that is both blurry and shifting. Result? It is almost impossible to plan medium to long-term actions, especially when it comes to international trade. A situation that is all the more complex as the measurements fluctuate over time and across countries. At present, it is therefore difficult to predict which suppliers or customers will be able to continue their activity and, therefore, to prepare for them.

The first challenge for the actors of logistics management is therefore good to gain visibility on their activity, and not only in the short term. To do this, several avenues are possible:

-strengthen communication, transparency, and collaborative work with the various players in the supply chain;

-work in synergy with companies in the sector in order to have more weight vis-à-vis public authorities and regulatory decisions adopted

-acquire new tools to better anticipate risky situations (reporting, automated alerts, predictive software, etc.).

2 / A need for elasticity and greater flexibility

The current crisis has highlighted one of the main pitfalls of the supply chain: its lack of flexibility and adaptability. For companies unable to quickly adapt their activity to the reality of the situation, the consequences have been serious and varied: stock shortage or increase, shortage of raw materials, volume of labor unsuited to the volume of activity, inability to fulfill orders, longer delivery times, etc. These logistical difficulties have not been without consequences on the financial health of companies. Many have had to deal with a decrease in their cash flow, order cancellations, but also an increase in the cost of storage and transport.

Faced with these constraints, companies have a duty to improve the elasticity of their supply chain. Although the challenge is great, it can be met step by step.

-Adapt the activity: reduction in the number of suppliers (or even single sourcing), reduction of the workforce, limitation of empty transport, local procurement, creation of new services (click and collect, express delivery, etc.) … So many possible avenues for the activity to better respond to current constraints and challenges;

-Develop logistics practices: the supply chain must also become more flexible and, to do this, several avenues can be investigated. Just-in-time work with a view to limiting working capital requirements, cross-docking to reduce stock, cycle counting to facilitate inventories or even optimization of stock management:

-digitization of counting;

-Stock in real-time;

-centralization of data;

-collaborative systems, such as the VMI (Vendor Managed Inventory);

As Isabelle Badoc, Product Marketing Manager for Generix Group’s Supply Chain Execution solutions, points out, some companies have thus chosen to “set up an order preparation organization that is adapted to the flow of ‘greater finesse (more orders with fewer items per line) driven by transport plans ‘;

-Speed ​​up decision-making: as the situation changes rapidly, supply chain players must also be able to act much faster than in the past. The challenge? Adapt all facets of the activity to immediate reality, whether in terms of cash flow, labor or even investments, for example.

3 / A delay in digitization to catch up

The health crisis has considerably accelerated the digitization of practices. With the closure of physical points of sale, restrictions on travel, and fear of interactions, many end customers are turning more to e-commerce. The same goes for B2B buyers, who had already started adopting digital purchasing behavior for a few years. The urgency of digitization is moreover all the more significant as several digital B2B distribution platforms are developing exponentially, like Amazon Business and Alibaba, thus unbalancing the balance of power with distributors ” traditional.”

+ 15% This is the annual growth of B2B e-commerce in France over the past 3 years 1.

Faced with these new behaviors, the players in the supply chain have no other choice but to go digital on a forced march. To achieve this, several projects must also be prioritized.

Develop digital opportunities: in addition to the creation of digital media to meet the expectations of B2B and B2C customers (e-commerce platform, mobile application, etc.), it is also necessary to offer new services, which have become essential at the time of the health crisis (click and collect, knowledge of product availability in real-time, live delivery monitoring, etc.);

Provide “live” management: these different services are only possible if the company is able to manage its stocks and its activity in real-time. This requires in particular the centralization of all information (goods receipts, exits, orders, delivery, etc.) within a dedicated software, directly interfaced with business software, such as aWMS (Warehouse management system) or one TMS (Transport Management System).

-To reinforce customer support: adopting digital practices also requires rethinking its customer relationship. It is indeed necessary to transform the services in contact with customers (sales, after-sales service, etc.) in order to adapt their operation to the current situation while responding to the uncertainties arising from the health crisis. More than ever, the need for education and support must be obvious.

4 / A relocation requirement in Europe

The health crisis has finally shown the limits of ultra-globalization. In fact, current constraints have considerably complicated the exchange of international flows, whether in terms of regulation, supply or transport. It must be said that the health risk is all the greater with long-distance exchanges, the latter involving more players throughout the distribution chain. A situation far from trivial since the logistical risks are stronger than ever: shortage of products, inability to renegotiate contracts, dependence on suppliers, closure of borders, etc. The cost of transport for flows that have shifted to e-commerce has also increased. As Isabelle Badoc reminds us, “ shipments are generally made through couriers or expressions. Reduced to the article, the cost is, therefore, higher than in the case of a full truck charter ”.

To overcome these various constraints, the relocation of the supply chain, in France or at least in Europe, is therefore affirmed as a necessity. Although the site is colossal, different levers can be activated to move towards this ideal:

-determine the positions that can be relocated to France or Europe (suppliers, after-sales service, etc.);

-rely on sector synergies in order to limit the financial impact of relocation;

-request the support of the State in order to be accompanied in the relocation of the distribution chain.

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1 2020 e-commerce key figures – e-commerce and distance selling federation – 2020

This article originally appeared on GenerixGroup.com. Republished with permission.

Manufacturer

10 Integrations Every Manufacturer Needs With Their ERP

As manufacturing markets grow more competitive, the need to operate lean and eliminate inefficiencies has become more important than ever. In the past having a quality ERP system was enough to get the job done.

Today the best ERP systems incorporate all the new Internet
of Things (IoT) technologies currently being developed.
They integrate with these technologies to enable your business to cut costs, work more efficiently, and simplify your entire manufacturing process in ways that were previously only dreams. The ability to integrate with third-party IoT technologies has already become one of the most important criteria for selecting an ERP system – and a powerful competitive advantage.

Our list of the 10 integrations every manufacturer needs with
their ERP includes some that are new and some that have been around a while. If you don’t acquire them soon, expect to be left behind – by your customers and your industry.

Nesting Interface

Operating lean requires reducing setup time and labor as well as material waste. Nesting software handles all three by efficiently arranging part shapes on sheets or plates of stock material to produce the least amount of waste. It eliminates the time required to manually plan which parts to cut on a piece of metal, plastic, wood, etc. and reduces purchasing costs by minimizing unusable leftover materials.

A nesting interface enables your ERP system to share information with the nesting software, including work orders, inventory information, workcenter details, and other data. The nesting software uses this data to optimize material usage and sends cutlist details, material drops, scrap, and estimates for routing and work orders back to the ERP system.

RFID

Whether they’re using barcodes, badges, or biometric scanners, employees typically have multiple processes for entering the building, unlocking doors, and logging into your ERP system. Radio frequency identification (RFID) lets you consolidate all access procedures into your ERP system to eliminate multiple badges, barcoded employee lists, and human error.

In the process, RFID provides faster and more efficient log-ins, more accurate data, lower technology costs, and stronger security of your building and your data. It also facilitates more accurate payroll processing and tracking of job costs. As more manufacturers embrace this technology, RFID can also be used to trace inventory, improve scheduling by tracking idle equipment, locate lost or misplaced tools and equipment, monitor waste and shrinkage, and more. Some manufacturers are even using this technology to track material moving from an outside storehouse into the warehouse and
through production on the shop floor.

EDI

In the manufacturing world, small process improvements performed hundreds of times a day can add up to big savings. Electronic data interchange (EDI) software saves time and money (for you and your customers) by facilitating the computer-to-computer exchange of business data across different platforms. This data can include purchase orders, invoices, inventory levels, shipping notices, and much more.

Using EDI to seamlessly integrate with your customers’ business systems speeds up the order entry process by allowing them to send order data electronically. No phone calls. No faxes. No manual data entry. Just fast, accurate electronic data transmission that eliminates the need for a second entry on the other side of every transaction. The error-free transmission also eliminates the need for time-consuming reconciliations. You can view a list of top EDI
solutions Global Shop Solutions integrates with.

eCommerce/Web

When it comes to saving time and simplifying processes, eCommerce is like EDI on steroids. Imagine if customers could place an order on your website, and your ERP system would automatically launch the sales and work order processes to get the job rolling. Then it would also automatically send an invoice or process payment with a credit card. How much time and effort would that remove from your order entry process?

All it requires is three basic elements:

• A SOAP (Simple Object Access Protocol) software program so that your website can communicate with your ERP system

• An experienced website vendor to build your eCommerce portal

• An ERP vendor willing to support the integration between their product and the eCommerce platform Global Shop Solutions recently assisted one of our correctional institution customers in building an eCommerce website. Read the case study here. Or better yet, visit their website.

CAD Interface

Do your engineers still spend hours every week writing lengthy BOMs and comparing them against the BOMs in your ERP system?
A CAD Interface solution can eliminate this wasteful manual
entry by seamlessly importing the BOM into your ERP system. Your engineers can then use the imported BOM to ensure sufficient materials are on hand to complete the job on time and on budget. With a CAD interface you can:

• Reduce engineering time and costs
• Eliminate manual data entry to update BOMs,
and the human error that goes along with it
• Ensure everyone on the shop floor has the latest
document rev
• Create jobs faster

It used to take one of our packing industry customers four man days to create jobs. Since implementing a CAD Interface solution, it now requires only a couple of clicks to build 100+ routers in a few seconds. Global Shop Solutions offers CAD Interface solutions with SolidWorks®, Solid Edge™, Autodesk Inventor®, and other leading design programs.

Tool Cribs and Vending Machines

To improve the accuracy of tooling costs, more manufacturers are employing tool vending machines.

Workers scan their badge and job number into the machine and press a button for the tool they need. The vending machine dispenses the tool and automatically applies the cost of the tool to the job, thereby increasing accuracy for the overall job costing process.

The key with this integration is seamlessly transporting the costing data to your ERP system. Global Shop Solutions recently wrote a program for one of our aviation design and build customers which passes tool usage and tooling requirements to Global Shop Solutions ERP software.

Employee Efficiency

You can’t afford to have employees standing around wondering what to do next. Integrating Internet-capable TV screens and displays with your ERP system can significantly reduce employee red time.

These screens, strategically placed around the shop floor, can display a variety of real-time data pulled from your ERP system. This includes the status of work orders in progress, work orders scheduled to begin, and hot jobs that need immediate attention.

In addition to keeping employees on the job, this integration eliminates the need for reams of paper work orders and shop floor schedules. It also prevents confusion on the shop floor because employees can always see what needs to be worked on and when – without having to leave their machines or workcenters.

Global Shop Solutions offers this capability via TrueView™. Within 30 days of implementing this integration, one of our precision metal fabricator customers, generated productivity improvements of 20% to 25%, while a manufacturer of washing machines and drying cabinets uses this integration to properly sequence upcoming jobs at each workcenter.

Another example comes from a wood product and component manufacturer. Despite averaging nearly 500 hours a month of indirect time, company management thought they were at full capacity – until they placed 18 TV screens connected to TrueView around their shop floor. TrueView was used to display the names of employees not on a job for more than four minutes and notify their supervisors. Indirect time plummeted to 50 hours per month, and the company now has the capacity to schedule more jobs, increase margins, and pay their employees more.

Payroll

Accounting & payroll are complex, time-consuming processes. Managing all the data in one system makes the entire process quicker and easier while reducing administrative costs. Integrating your payroll system into your general ledger and shop floor data allows you to:

• Eliminate redundant data entry
• Easily distribute payroll accounting by department
• Simplify tax reporting
• Manage your employees better than ever
• Complete end-of-month closing in less time

Global Shop Solutions seamlessly integrates with ADP®, ABRA, Paychex® and other leading payroll solutions.

Taxes

Making efficient use of sales tax data has also taken a big step forward by integrating with ERP software.

Manufacturers can now link sales tax data directly from their ERP software to their state sales and property tax software programs. They can also simplify other tax-related tasks, such as R&D tax credit tracking. For example, one our customers uses this integration to set up tasks on their work orders. This allows the Project Manager to instantly review the percentage of work on a job that can be attributed to R&D for tax credit purposes.

Business Services

Tracking employee expenses – meals, gas, tools, etc. – on installations, repairs and other service calls has long been a thorn in the side of financial personnel. Even with today’s sophisticated software programs, expenses can still get lost. Or they don’t get applied to the job until the employee returns to the office. Either way, it interferes with your ability to track job costs in real time.

Now you can enjoy cost, compliance, and visibility by integrating expense-reporting software with your ERP system. Global Shop Solutions easily integrates (using one of our free, downloadable ARC programs) directly with Concur and other popular expense-tracking programs. Using a smartphone app, your field service teams can tie expenses directly into a work order in Global Shop Solutions ERP software the minute they happen. Job costing has never been so simple or timely.

___________________________________________________________________

As IoT transforms the manufacturing industry at breakneck speed, success increasingly depends on your ability to connect with real time data from anywhere at any time. As a global leader in ERP solutions, we believe it is our responsibility to help you do that. If you’re not taking advantage of the ERP integrations outlined in this whitepaper, call Global Shop Solutions today at 800-364-5958. You’ll be amazed at how a few simple integrations can exponentially increase the power, functionality, and return on investment of your ERP software.

ABOUT THE AUTHOR

Daniel Carranco is the Director for the Continuous Improvement Department for Global Shop Solutions. He leads a department comprised of teams that deal with existing customer projects including consulting and custom development. A Global Shop Solutions team member for more than a decade, Carranco holds a master’s degree in international business, and is a frequent speaker to manufacturing executives and industry groups on maximizing ROI with ERP software.

To learn more about the 10 Integrations Every Manufacturer Needs With Their ERP, call 1.800.364.5958 or visit www.globalshopsolutions.com

industries

5 Industries Worth Investing In

Starting a new business or investing in a start-up is a hot topic. Everyone gives thought to starting their own firm at some point in time. However, not everyone can give a meaningful reality to this idea.

Finding the right industry to invest in isn’t a walk in the park. Many variables are included in this equation, including your interests and the amount you’re willing to invest. But the biggest deciding factor is, of course, the profitability of the industry you’re planning to select.

Selecting the right industry can make or break your success, and could even change the financial conditions for a long period of your life. A well-put investment in an ideal industry can lead to high profits and a stable financial future.

To get you started, here are 5 profitable industries worth investing in in 2021.

Food industry

No COVID-19 outbreak can disrupt the food industry as food is essential for life. The outbreak indeed negatively affected the on-table service of restaurants, but many of them are still operational for takeaway. Moreover, food manufacturing firms like cereals, grains, and beverages are also operational. Furthermore, services associated with food, like food packing, are also still going strong despite the circumstances.

Needless to say, the food industry is one of the safest industries to invest in in the 21st century. As people have gone more health-conscious since the virus outbreak, it’d be a great idea to invest in food products revolving around providing a healthy lifestyle.

Textile industry

Just like food, clothing is a basic essential for human life that can’t be neglected in any circumstance. Fashion trends come and go, but everyone needs some type of clothing to cover themselves up.

The textile industry is huge. Some might say it’s over-saturated, but unlike many other industries which follow the if-it-ain’t-broke-don’t-fix-it rule, the textile industry sees alterations every once in a while due to various trends.

FMCG industry

FMCG (fast-moving consumer goods) industry includes all the daily-use products people need to keep their lives going. A few examples of such products are detergents, soaps, cosmetics, dental care, paper, and batteries. Just like the case with food and textile, human life can’t go on normally without the FMCG industry.

Investing in this industry is a safe bet today. It must be noted that the businesses in this industry fight through very tough competition, that’s why the profit margin is low. However, as these products are consumed in massive amounts regularly, it kind of makes up for the small profit margins.

Technology industry

For more than two decades, computers and IT have shaped the future of the world’s economy and given new meaning to business operations. Today, almost everyone is dependent on some piece of technology for their life activities.

Consumers, as well as businesses, are looking for new and improved technological advancements to be more productive. IT services and computer support are in high demand. If you have a techy background and are aware of the know-how of this sector, the technology industry could be the best industry for you to invest in.

This industry is massive and has tons of options for you to explore. No matter how advanced today’s technology is, there’s always room to improve and expand. Explore the options and look for bright ideas that could be the next innovative solution to a daily problem.

Marijuana industry

Gone are the days when marijuana was only a means of illegal recreational activities. Today, marijuana is creeping out of the shadows to become a major legal pharmaceutical giant. It’s developed into a billion-dollar industry that keeps getting more and more legal authorizations from governments around the globe and is constantly growing.

If you’re eager to learn more about this industry,  getting in touch with a marijuana consulting firm would be your best bet. Moreover, marijuana financing companies provide loans and financial support to new businesses stepping into this industry,

Final word

Researching and choosing the right industry is crucial to make your investment worthwhile. While many smaller industries keep ascending and descending in the priority list for new investors, the above-mentioned industries are arguably the safest options today.

air amazon

Air Passenger Travel is Climbing, so is Capacity Relief on the Way?

A new era of air transportation trends is emerging to create a confusing outlook for shippers.

Air freight has been in nonstop peak-season mode despite pandemic-induced capacity decline, while other disruptions, such as the Suez Canal blockage, drove even more demand to air. This is all happening while the Transportation Security Administration is reporting a 1000%+ increase in passenger travel in April 2021, compared to April 2020, with the vaccine fueling hopes of getting back to a sense of “normalcy.”

Though vaccine distribution is increasing, and we are seeing a spike in passenger travel, capacity relief is not on the horizon. Why not? Most current air travel is domestic, meaning that planes are still not populating major global trade lanes.

In fact, numerous commercial flights are being canceled a few weeks before takeoff because passenger demand is not there. For passenger travel to have an impact on air capacity, business travel will need to return to pre-pandemic levels, That’s not likely to happen anytime soon. Right now, cargo is king and leading routing decisions for most airlines.

With this in mind, there are three tactics that you can bring into your shipping strategy to navigate the current capacity constraints in the air market.

1. Prepare for the permanent changes that will impact the future of air travel

While cargo planes and charters seemed like temporary fixes for shippers in a pinch, they’re quickly becoming necessary for the long term. Even with business travel becoming more viable, it is estimated that business travel will not reach 2019 levels until 2025. Plus, tight budgets and the newfound appreciation for virtual communication may keep many international planes grounded.

Therefore, depending on the slight uptick in commercial travel is not wise. Global shippers will need to look at how cargo planes and charters fit into their shipping strategies long term. Finding the correct partners and resources will be more important than ever as these modes of shipping continue to be needed.

2. Flex your creative muscles

Consider the new level of creativity that these air freight challenges are requiring and how you can do things a new way. For example, to get a timely shipment out for a global customer, we removed the seats from a passenger aircraft to make room for important shipments. Additionally, the plane was routed to a non-traditional cargo hub to avoid the additional delays and congestion found at more popular airports.

That may not be the right muscle to flex in your supply chain, but thinking outside the box is crucial. Depending on your goals, the end strategy will look different.

3. Consider using a mix of modes and ensure you have a partner that can accommodate

A mix of modes doesn’t just mean putting things on a ship when there is no room on aircrafts. Sometimes, it means using a mix of transportation modes for one shipment and being flexible to change on a dime. It all depends on your unique situation, but you must be agile and find the right partner to guide you in the correct direction.

We used this strategy on a recent project with Thomas Scientific, a laboratory equipment provider. We helped them work through the extreme ramp up of demand for COVID-19 related items such as masks, gloves, PPE, and testing supplies.

Prior to the pandemic, most of their business was domestic, requiring only a handful of ocean containers each year to accommodate their international shipping needs. However, they faced a sharp increase in demand in 2020 for COVID-19 test kits and needed to develop an international shipping strategy quickly.

Through our global suite of service offerings and information advantage, we worked with them to create tailored solutions to secure the capacity they needed. We focused on a multimodal distribution strategy based on time and needs. Shipments have since gone directly to customers through less than truckload, truckload, ocean, and air charter.

Once inventory levels are stable and demand shifts as we expect it to, we’ll help them move some COVID-19 test kits to ocean. As warehousing space is tight, making this switch will not only promote cost savings, but also help avoid storage backlogs.

Together, we have implemented strategies that have given Thomas Scientific the ability to quickly change directions as needed.

Despite the challenges that are currently present in the air market, rest assured that there are new ways to get creative and work with your logistics partner to create a long-term plan that navigates capacity constraints.

To stay updated on market trends and how they will impact capacity and pricing, visit our Global Forwarding Insights page.

To dig even deeper, connect with a logistics provider.

warehouse

Faster, Safer: How the Warehouse has Changed Post-Pandemic

Challenges took a new meaning for logistics operations that require more than the traditional approach to developing protocols and workflows. In 2021, the warehouse is not what it was one year ago. The pandemic put a direct spotlight on the importance of keeping workers–and partners–safe. Adhering to implemented protocols are more than a formality in the new normal and can be the very things that keep a business open in the long term. In the short term, warehouse managers have no choice but to stay diligent in securing the safety of their business by putting their employees’ safety first. 

We talked with Edgardo Hamon, managing director with Dachser Mexico, about how the warehouse has changed and how handling these new challenges successfully can sustain employee wellness and ongoing operations post-pandemic. 

“The handling of materials requires interaction between people and maintaining clear rules of social distancing, not only with the collaborators we have on the day-to-day, but also with the carrier that arrives every hour into our warehouses,” Hamon says. “It becomes an additional challenge to keep a strict process to maintain the correct functionality of the warehouse, and of course, avoid any possible risk to our teams. Strict protocols and sticking to them are critical, such as sanitizing our facilities twice a day, consistent washing of the hands and wearing masks.” 

Dachser is no stranger to the work-from-home dynamic, either. Hamon explained that when it is needed, employees stay at home to secure business continuity—and the warehouse keeps running. 

“We implemented the home office process with success, and we believe it is very efficient to continue with this process as it provides a good solution,” he explains. “Whenever it is needed, people remain at home. We do this to make sure the team stays safe and operations are continuously flowing.”  

Technology continues to serve as a key driver for success when securing strict workflows between workers. For Dachser, technology equals transparency and visibility to ensuring protocols are met and partner relations are sustained.

Dachser’s global warehouse management system, Mikado, serves as a major resource for maintaining a seamless day-to-day process while securing opportunities for expansion. Mikado organizes Dachser’s operational team while promoting social distancing and maximizing efficient workflows. 

Hamon cites Mikado as a primary tech resource that ensures safe operations while solving pandemic-induced challenges. This system is a key driver behind Dachser Mexico’s most recent facility expansion that launched in October. Dachser’s bonded warehouse facility in Parque el Marqués at Querétaro will offer 4,000 square meters of warehouse space with an accommodating electrical substation.

Mikado supports operations beyond warehousing, providing solutions for other sectors, including manufacturing. Systems such as Mikado enable companies to move forward amid the pandemic in expanding operations to better serve customers and maintain a competitive advantage. This further emphasizes the importance of reliable, agile technology post-pandemic.

“Dachser believes strongly in the value of technology as it relates to enhanced efficiency and cost reduction,” Hamon says. “With the continuous further development of our IT systems and their worldwide rollout, we have built up a homogeneous IT landscape characterized by stability, integrity as well as adaptability to new challenges in the logistics business. And, of course, the ability to integrate the IT technology into our day-to-day operational platforms. This makes a big difference in remaining competitive.”

What does all this mean for customers? Customer retention post-pandemic has become more of a challenge than ever before. Hamon explains that customers are experiencing a significant financial impact, creating a greater demand for competitive cost-effective options while increasing demand for space. So, not only are warehouse managers working to implement protocols and keep employees safe, but they are also competing to retain customers, drive down costs and meet demand for space at a competitive price. 

“Customers are always looking for more competitive prices in the market,” Hamon notes. “This puts industry players in a difficult situation to compete and provide the best price. At Dachser, we adapt ourselves as much as possible to meet demand and support the customer needs.”

In addition to the most cost-effective options, customers are now demanding agile and quick solutions. If the logistics arena was not high-speed before, it is now. 

Logistics has taken a new form that quickly eliminates paper processes and traditional methods of management. Automation is now a major differentiator as customers vet the fastest and most efficient providers to meet their needs, rather than an option. In the new normal, customers simply cannot afford the risk associated with manual processes and their potential inefficiencies. Dachser recognizes this and cites the power of automation for meeting market demands and providing adaptable solutions. 

“These last few months have made it clear that the supply chain needs to evolve into a stronger, more agile and adaptable system that can respond quickly to challenges and implement solutions,” Hamon says. “This is where we strongly focus nowadays, providing intelligent solutions to our customers. We adapt to their needs, offer flexibility and dive deeply into their processes to identify their needs. This allows us to maintain a competitive advantage over our competitors–globally and regionally. Adapt to the needs of our customers and market situations to provide the best solutions.”

For now, the brunt of COVID-19 has been felt across the supply chain, allowing companies to understand what it takes to continue operating with boots on the ground. However, the team at Dachser predicts additional market shifts are on the horizon, citing the Amazon effect for changing the course of market responses. Hamon explains that logistics players must prepare for a more dynamic delivery flow to meet customer demand in the new normal and beyond. 

“Customers will continue to request faster deliveries and the industry should be prepared. In the future, the industry will see the need for smaller trucks that provide faster deliveries to meet customer demands, and the successful deployment of technology solutions to receive materials faster. If you have reliable technology in place, you can offer these kinds of services to customers, so they receive orders faster. These dynamic solutions will be critical in the near future.” 

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Born in Mexico City, Edgardo Hamon graduated in Business Administration from the Technological University of Mexico. He has worked for the past two decades in the logistics industry, starting as a sales executive working with clients in the pharmaceutical, automotive and technology industries. He joined Dachser as National Key Account Manager Automotive in 2011, and he later became Intra Americas Business Development Manager before being promoted to his current role as Managing Director of Dachser Mexico.

sustainability

An Efficient Supply Chain is by Nature a More Sustainable One

It’s C.H. Robinson’s mission to improve the world’s supply chains. We’ve been doing it for decades now. But in a world ever more conscious of the imperative to reduce carbon emissions, helping customers move their freight more efficiently has taken on new urgency.

Our customers are tackling their carbon footprint from all angles, from their facilities to the source of their electricity. They’re turning to us for help with an even more challenging sustainability goal: reducing greenhouse gases across their supply chains. With nearly 200,000 customers and contract carriers worldwide, we stand to make a significant impact on sustainability across the industry.

New technology and data we’ve launched are proving to be an accelerator of change. Now that companies can get an instant calculation of all their transportation emissions, a huge barrier is removed and the possibilities for reduction are revealed. We helped one of the largest outdoor retailers reduce their carbon output through mode conversion and purchase order aggregation, which eliminated 1,270 metric tons of emissions from their supply chain in one year – the equivalent of 3,000 barrels of oil.

Load and mode optimization, consolidation, and eliminating empty miles are some of the ways we make supply chains more efficient. As Chief Human Resources and E.S.G. Officer for C.H. Robinson, I’m proud to say that those services are also some of our most effective sustainability solutions.

For example, because C.H. Robinson’s technology is built by and for supply chain experts, we can uncover that a customer’s weekly freight from Los Angeles to Chicago is consistently seven different less-than-truckload (LTL) shipments from seven different vendors. To help the customer save money, reduce waste and achieve their sustainability goals, we can consolidate that onto one truck. That’s six cross-country shipments and a lot of emissions eliminated. More efficient. More sustainable.

Our global suite of services also provides more options. For example, if that customer has bigger shipments that are less time-sensitive, one option would be switching from trucks to rail. On average, a ton of freight can move 470 miles by rail on a single gallon of gas. More efficient. More sustainable.

Just think about the carbon reduction that’s possible in a major national retailer’s supply chain. Let’s say the retailer has hundreds of shipments going from Amsterdam to Barcelona every week, with trucks driving back empty to pick up their next load. Those are wasted miles.

Because of our global scope and scale, our supply chain experts can optimize that, too. While even the largest of retailers only has visibility into their own freight, C.H. Robinson has visibility into 19 million shipments annually. It’s an enormous information advantage for our customers. Across our vast network of contract carriers, we can identify hundreds of trucks on similar schedules going from Barcelona to Amsterdam. Pairing up that freight can eliminate those empty miles and the associated carbon emissions. More efficient. More sustainable.

In my E.S.G. role at C.H. Robinson, I have the privilege of seeing how our expertise in solving the most complex supply chain problems is creating a more sustainable future for our customers, our industry and our planet. Let us help you achieve your sustainability goals.

___________________________________________________________________________

Angie Freeman is the Chief Human Resources & ESG Officer at C.H. Robinson

Discover How to Transform Logistics with Emerging Technologies in the Online Event LYT21

On Wednesday, April 21, LYT21 will be held, an online event where companies, all from the logistics and technology sectors, will meet to learn about the most innovative solutions being adopted in the market.

After the success of the first edition held in Spain, LYT20, ChainGO has decided to undertake this second edition in the United States, organizing it hand in hand with major associations such as Virginia Maritime Association, Blockchain in Transport Alliance, Old Dominion University, Global Trade Magazine/CITT (Canadian Institute of Traffic and Transportation), among others. KoiReader, G2 Ops, ChainYard, OARO, WITRAC and Women’s Startup Community have also joined the initiative.

What is LYT21?

The LYT21 event is the meeting point between the highlighted companies of the logistics industry and the new technologies that are already revolutionizing this sector.

“In this second edition of 2021, our mission is to accelerate the digital transformation process in the logistics industry, in a time of crisis where the adoption of the most disruptive technologies to achieve more efficient supply chains, can make the difference between surviving or not in the logistics industry of the future. A future that is already here. “This is how the organization describes it.

To this end, the event will be available to everyone, and free for 3 hours, four panels of experts in which we will see real use cases with direct application of the latest technologies in logistics processes.

The objective of this event is to raise awareness of the opportunities that the most disruptive technologies are offering for supply chains.

Blockchain, IoT, AI and Cybersecurity.

The event is divided into four round tables where the four most disruptive technologies applied to logistics will be discussed: Blockchain, IoT, Artificial Intelligence and Cybersecurity. For this, the LYT21 will have a panel of more than 15 experts among which speakers from large companies, startups, consulting companies and associations will be divided in each table.

Different use cases of the application of the same technology will be presented but from different points of view (explained from a large corporate, a startup, an association, etc.). In addition, once each of the different use cases has been presented, there will be an open panel discussion among the different profiles at the table.

Free registrations.

In the first edition, LYT20, more than 800 companies and 1000+ people attended the event online. For this event, the aim is to push the boundaries even further a reach a more North American-focused audience. To this end, free tickets have been made available to the public.

LYT21 offers its free tickets through this link.

Agile Supply Chain

Supply Chain Methodology: Lean vs. Agile Supply Chain

As for now, the consumer’s behavior and needs change every day under the economic alteration. So, the supply chains depend not only on on-demand and delivery. Shippers have to go on with the consumer’s needs and satisfy them.

The supply chain has to work according to the hesitations on the market. There are two types of customers in the contemporary market: digital and global. It means each potential customer has the access to each product of every company under the hand. Such a situation only exaggerates the competition between the manufacturers. It forces the companies not only to innovate the products but make a faster supply chain. The pace of delivery to the markets designates whose product will be bought.

More than that, the trends quickly pop up and disappear from the market. The companies need to maintain flexibility and adapt products under the demands. In order to cater to the changes, companies have two ways to work under the hesitation of the supply chains. They are well-known as the agile supply chain and lean supply chain.

Which direction is better for your business? How to designate it? Keep an eye on the main differences to find out.

What Is Lean Supply Chain?

The lean supply chain is dedicated to decreasing prices and waste. This system is oriented to fruitful and rational operations. As a rule, cooperation is going between the supplier and the company. The work under one agreement. 

In the lean supply chain, all are accessible, which has values for the customer. The other unnecessity elements are eliminated. Working with the lean supply chain suppliers take into consideration only those steps, which make the values of the products and services a lot higher.

This type works on the predictions of the needful products as well. There are no over-made goods, which customers do not need at all. It works with toilet products, for instance. Now, get into more details about the lean supply chain for your business. 

Manufacturing 

The lean supply chain is the perfect choice to control manufacturing. This type works on the predictions, which help to understand the demand of consumers in the future. As a result, companies make such products, which the buyers need. 

The producer of sports footwear Nike has around 700 factories in 42 countries of the world. This company uses the lean supply chain to decrease the waste of materials, increase the productivity of work and make a better profit. The high productivity of workers leads to the good quality of the goods and well reputation on the world market. 

Stocking

The other advantage of the lean supply chain is the minimizing of stocking space. As a lean supply chain works on the reduction of unnecessary products, it helps companies to decrease the expenses on warehousing. The world popular company H&M uses this strategy. They work only on the needs of potential clients, but without the storage of clothes.

How To Implement The Lean Supply Chain?

Like the other supply chains, lean needs time to show the results. First of all, the adoption of the system by the company plays a big role. Often, companies include all wastes in everyday activity and it’s normal for them. With the lean supply chain, people have to eradicate this strategy and turn out into the other one. 

The results of the lean supply chain will be visible:

-A significant place in the market

-Reducing the expenses on stocking and material

-The increasing capacity

-Better customer service

-Higher productivity

What Is The Agile Supply Chain?

The concept of the agile supply chain was found in early 1995. This strategy is more compatible with the hesitative market, as it is driven by the demand. Speed, Cost, and Efficiency are the basic factors of the agile supply chain. This chain works regarding the real situation and demand on the market, but not on the forecasts. 

There are four main components, which designate the work of this chain.

Virtual Incorporation

The agile supply chain has the target to satisfy the needs of the market and end consumer. To make it, different departments collect the information about the current situation, designate the lack or overwhelming of certain products. Via the virtual incorporation, the agile supply chain gets information about different kinds of problems and finds ways to improve them.

Strong Network Connections

Every single participant of the agile supply chain has an important role to reach success. The duties are equivalent, so everyone should complete the responsibilities. Hence, the success of the agile supply chain does not rely on one participant, but on all of them.

Responsive Market

The agile supply chain works with the current situation on the market. The departments every day collect the information about the situation on the market today because the information about yesterday is the old one.

 This supply chain is relying highly on the desires and thoughts of the clients. The demand of the client today designates what would be on the market tomorrow. Regarding all that, the voice of the consumer drives the agile supply chain. 

Key Features Of The Agile Supply Chain

For your information, the considered strategy is the most popular in the modern market world. The Agile supply chain has the most impressive impact on inventory management. Excess materials and the lack of certain inventory can be overcome using this strategy. 

As for now, companies use modern software to regulate inventory circulation. To operate the agile supply chain successfully, the availability of modern software is a necessity. The old versions and bad quality of technologies can lead to problems with the agile supply chain.

According to the information of the world-known and lead producer McKinsey & Company, around 94% of the companies, which have implemented the agile supply chain, complete the orders on time without keeping the inventory even for 85 days. For comparison, companies, which do not use the agile strategy, keep the inventory for more than 108 days.

What Are The Benefits Of Agile Supply Chain?

All in all, an agile supply chain is not only the type of strategies to keep on supply and demand. It is a new way to solve a lot of problems and confirm success. The agile supply chain is the way to increase operative deliveries in the changing environment. This strategy is behind the competition, as companies can use this kind of supply chain without the help of others. 

Effective agile supply chain brings the company possibility to:

-Streamline inventory

-Decrease expenses

-Create the anticipatable supply chain

-Complete new demand of the customers in a short period of time

-Fast producing

-Increase profit

What Is The Difference Between Lean And Agile Supply Chain?

Under the information above, it is clear what is the difference between the considered supply chains. However, there is one specific feature about the implementation of the lean supply chain in the agile one. 

Lean concepts allow reducing the number of expenses for the companies. For instance, the usage of computers allows making the order in a few minutes, which increases productivity. Despite this, the information, which is given in the result of the lean supply chain does not give predictions about the market’s needs in the future. As a result, this supply chain has problems with visibility, which can lead to overstocking. 

On the other hand, the agile supply chain can fastly get used to the changing environment, economy, individual reasons, tendencies, and other factors. It is easier to overcome the disorders and renew the process.

Hybrid Strategy

In some cases, the lean supply chain is the best, when in others the agile chain will fit very nicely. Besides, more and more companies find the implementation of both supply chains will satisfy their needs fully. A lot of modern powerful companies faced the regarded situation and tried to mix strategies.

To make it excellent, the companies made carefully the plan of how to implement the combined supply chain. It is especially difficult to cooperate with the moving parts.

A Spanish fashion designer Zara uses the mixed supply chain. The company makes all of its own strength. The subcontractors complete only the subsequent functions. As a result, Zara has not only a supply chain with lean characteristics but agile and flexible as well.

As Zara works inside the company, other producers use the hybrid sample, but work more with the subcontractors. They complete different production processes in different locations and parts of the world. However, in this case, the combination of lean and agile supply chains has a nice result.

It seems every company can find a separate way of combining different strategies. In the modern fastly changeable world companies are interested in using both strategies.

How To Choose The Better Supply Chain For The Company?

To take the right way in the system of supply chains, try to answer the next questions:

-What do you produce? Which kind of products do you want to sell?

-Designate the audience of consumers and their conduct.

-How is the demand for the product change? What are the reasons for changing? Build the forecasts for it.

-How fast do your market audience change?

-Which impact has the economy on your product, it’s the cost on the market and consumers?

-Which supply chain do your partners use?

Answering the questions above, it will be easier to decide what is better for a certain company to stay popular and produce demanding products on the market.

Final Thoughts

To sum up, both lean and agile chain supply are perfect choices for the entities. Each of these strategies is new and well-adapted. The benefits are visible and reachable in case you choose what is better for your manufacturers. The main difference is in the flexibility of reactions to the market changes.

The lean strategy is designed on cutting costs on producing a big amount of products with bad changeability. At the same time, the agile system offers to react to the changes with the small and configurable deliveries of goods. Keep in mind that a lean supply chain is more profitable and predictable, but the agile one is more adaptable and flexible.

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Egbert Feron is a freelance content writer and blogger, currently working at csgo-bets.org. He learns his entire life with curiosity and shares his knowledge with others in a simple and understandable way. Topics Egbert covers include technology, marketing, business, and lifestyle.

supply chain

How High Is Your Supply Chain IQ?

If ever the critical nature of the supply chain process was exposed in an obvious way, it was last year. Grocery store shelves were emptied of meat, produce, canned goods, and, yes, toilet paper and paper towels. The general public learned what supply chain professionals have long known: a supply chain break disrupts the ability of those at the receiving end of goods and materials, whether a household or a business, to function normally – or at all.

In succeeding months, supplies have returned to near-previous levels, albeit with some continuing variations. While many factors aided in that recovery, no doubt thousands of individuals made a significant contribution to diagnosing and treating problems. We call their collective wisdom supply chain IQ. It’s an important element of supply chain operations, and one that’s often overlooked by organizations, to their peril.

First, the supply chain itself

In this case, we’re discussing the part of the supply chain that an organization owns and controls. It begins the moment a company receives materials and ends when products reach customers. The supply chain is the ability of the organization to move goods around with the right level of visibility and efficiency.

The five strategic pillars of the supply chain are:

1. Network footprint – assets that make up the supply chain and their location.

2. Information systems and how they’re integrated.

3. Processes and delivery models.

4. Organization – the structure of the company’s supply chain management system.

5. Customers – interaction with them and how the organization uses that information to optimize the first four pillars.

If an organization’s supply chain is failing, it needs to examine the five pillars and find the gaps that are causing problems. It’s often not what an organization initially thinks or assumes. For example, dairy producers had to dump quantities of milk this spring. They were challenged with understanding whether this was due to overproduction, a market issue or a delivery issue.

Determining the real problem helps an organization figure out how to fix it. And this is where supply chain IQ comes into play.

Supply chain IQ defined

Supply chain IQ is the sum of all the capabilities of the stakeholders in the supply chain process and the value created from those capabilities. It’s a subset of organizational intelligence, or the overall capacity of an organization to create and use knowledge strategically. It’s not the supply chain itself, but rather the ability to use it, analyze it, correct its failings and improve it.

The more additive and complementary capabilities you have, the higher your supply chain IQ. And like an individual’s IQ, which evidence shows can be changed somewhat with different interventions, supply chain IQ can always be increased, either through learning or by hiring people who bring new capabilities and knowledge with them.

Understanding an organization’s supply chain IQ is important because it determines whether the supply chain team and resources can handle the challenges that the business faces, or is likely to face, in the near future. No individual can make a supply chain operate smoothly; many people using their knowledge and capabilities together can.

Evaluating your organization’s supply chain IQ

The more “yes” answers to the following questions, the higher your organization’s supply chain IQ:

Supply chain visibility. Does one function know what the next one needs, and vice versa? Do you have the necessary data to make decisions and adjustments as needed?

For good supply chain visibility, an organization needs to eliminate functional silos so all those involved are sharing information and communicating regularly. To make sure you understand the external factors that might impact your supply chain, you need tools or systems to visualize information that’s coming in from either end of the chain – suppliers at the beginning and customers at the end. Regular review of data and information from suppliers, including awareness of circumstances that could substantially change your supply chain processes, is also important.

Sales and operations processes. Are sales and operations aligned? Are operations consulted early in the product development/sales process to assess supply chain impacts that come with new products or sales?

Successful alignment between these two groups includes establishing a sales and operations planning process and resource and capacity planning that consistently matches your sales dynamics. And eliminating silos applies to these two entities in particular; for good communication and decision making, they should develop simple and effective interaction points between functions to help close the sales and operations planning loop.

Performance to strategic targets. Does everyone know what the targets are? Are you meeting them?

Establishing a regular routine to set targets and cascading them in a way that ties the whole organization to them is key. Regular assessment of supply chain capabilities and systems against strategy is also crucial; it means you’ll be able to take corrective action in a timely manner. As a matter of fact, forecasting and reforecasting needs to become part of company culture to make sure the organization is responsive to change. And when it comes to results, you need to take the long view – 3 to 5 years of consistently meeting strategic targets means your supply chain is performing successfully.

Integration of new business and operations. Can you successfully integrate new business, which can be a major disruptor, into your supply chain?

This means establishing dedicated teams for supply chain and systems integrations to ensure that acquisitions are folded into the organization within the first year of purchase. Effective integration also includes implementing capabilities that have been acquired over the past 3 to 5 years into key supply chain areas to ensure success.

Seniority. Do employees have the necessary experience? Are your supply chain practices firmly entrenched in your organization?

You need to have the right resources with adequate experience to enable your supply chain strategy. Capabilities that you see as critical to meet challenges should be in-house. Those capabilities should include strong cross-functional experience among critical team members. Finally, managers need to work with HR to establish processes for ensuring the continued presence of required skill sets.

There is no doubt that the technology used in supply chain management is critical to efficient, effective operations. But even with enterprise resource planning, Internet of Things (IoT) data and automated processes, it’s the people within each organization that are key to making a supply chain successful. They are the source of supply chain IQ and the final, crucial piece of the supply chain puzzle.

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Melvin Bosso is a principal with Myrtle Consulting Group, now a part of Accenture. Myrtle is a firm that drives operational transformation within global manufacturing, processing and distribution organizations. Accomplished and versatile, he has a proven track record in cost management discipline, network optimization, root cause analysis methodology and excellence programs. He is also an expert in developing processes and management systems that favor cooperation and focus on strategic company objectives. Melvin studied Engineering Geology at the University of Technology of Delft in the Netherlands. He joined Myrtle after leading plant operations at CHEP Canada for three years. While at CHEP, he led the company in a complete transformation of the network. Costs went down by 10 percent, production output grew 60 percent, and safety incidents went down by 80 percent while he was in this role. Prior to leading CHEP’s operations, Melvin spent nearly eight years with Labatt in diverse leadership roles. He played a key part in the transformation of Labatt to ABI’s new operating model and contributed his expertise to many corporate and representative initiatives. Melvin has been highly successful in unlocking the potential of individuals and organizations through coaching and support.

cross-border

CROSS-BORDER CARGO TRANSPORTATION CHALLENGES AND SOLUTIONS

Managing a streamlined supply chain for cross-border cargo transportation entails much more than identifying the fastest, most efficient method of getting cargo from point A to point B. Current market challenges have been amplified due to the pandemic and now go beyond ensuring cargo arrives at the final destination on time. The safety of transportation workers as a result of internal processes is now at the forefront of cross-border transportation. After all, if the truck driver is not healthy enough to deliver the products, the products do not move. In the new normal, worker safety is more important than ever.

“Some of the challenges out there are found more so in the area of the trucks that are crossing and the drivers,” says Michael Ford, vice president of Government and Industry Affairs at BDP. “If I was a trucking company, how do I ensure my driver’s safety? When that driver gets in the cab every day, do I know they are healthy?”

Ford continues, “Setting up those types of protocols internally, ensuring that I’m putting a safe driver on the road and that they’re able to perform those tasks as if there’s any type of cross border is critical, especially now. Coordinating, communicating, setting that up, and ensuring that everything is in play really becomes important.”

When driver safety has been established, coordination efforts are challenged once again depending on the region the cargo is crossing. Each region presents a unique set of roadblocks from customs to short and long-haul planning times. Cross-border transport from the U.S. to Canada is a much different process than what U.S. to Mexico transport requires for success.

Although these challenges are not new, they include more variables that require streamlined coordination from the very beginning. Trade lanes are now more open and traveler impact has shifted, presenting opportunities along with the challenges.

“In the past, we have seen much more congestion than we do currently,” Ford notes. “It has always been there between the U.S. and Mexico. But now, while there is less cargo and less traffic running back and forth, it has improved processing time. So, less cargo, less travel. If anything, it has improved and allows U.S. and Mexico customs to do what they need to do–which is all about security and ensuring the right cargo is coming through.”

Technology continues to play a critical role in ensuring worker safety and the efficient transport of cargo. The pandemic created an environment where technology is no longer simply an option but a requirement for the continuation of operations as it provides alternatives to paper-processes and close-contact for workers and customs agents.

“Previously when trucks cross, the driver pulls over, gets out of the cab, and hands paperwork over,” Ford says. “So, the question now is how do we achieve that full paperless experience on both sides in the U.S., Canada, and Mexico? When the driver pulls off, I need to know I have the driver, the driver’s ID, etc. and technology supports the keeping up with this information. It also keeps the driver in the cab and allows whatever information needed to be accessed.

“Advanced data has allowed a lot of that to take place. Being able to share and obtain better inter-agency  cooperation goes a long way to helping the flow of cargo across the borders.”

Technology is a part of the bigger picture. Without technology, the constant exchange of information and obtaining updated data is slowed down. Without inter-agency communications along with customs collaborations, cross-border operations are at risk for further delay. Collaborations between customs agents are the key to making operations for cross-border providers more simplified and accelerated. This incorporates security and accuracy while verifying the right cargo continues to its final destination.

“U.S. Customs has been working with Mexico and vice versa to establish points inside of the other’s country and allowing personnel to set up there,” Ford says. “In the case of letting Mexican Customs come into U.S. territory and process the clearance, it allows that truck to go all the way through, eliminating the need for stopping at the border area. This makes a world of a difference and it speeds everything up. It requires the need for cooperation of the companies that want to improve their business flow. Changing to a brand-new environment for cross borders is big.”

Beyond reducing interactions, the overall reduction of paper processes and redundancies continues to be at the top of mind for companies engaging in cross-border operations. Along with its other supply chain disruptions, COVID-19 has pushed logistics players toward paperless and contactless operations, adding more pressure to the already complex market. For some, utilizing the technology toolbox (such as blockchain) could be the very thing that overcomes the hurdles presented by the pandemic.

“We hear a lot about blockchain, and there are applications inside of this cross-border sector where blockchain can be used as a piece of technology,” Ford says. “Instead of paper, using a blockchain technology to prove that your goods qualify under the USMCA agreement should be in play, for example.”

Regardless of whether the world is battling a pandemic, streamlined collaboration will ultimately pave the way for successful cross-border trade. This requires the latest data for every participant, thorough internal and external communications, and solid business relationships with a common goal to ensure products are received safely and accurately.

“Everybody needs to be involved,” Ford maintains. “It is everybody working together: the carrier, the custom-house broker, the government, and all others. It is also about forming that type of relationship where information is being shared and collected, and as much in advance as possible is part of the success that needs to happen.”

He concludes: “Things can’t just stay the way they have been. But on the other side of things, we need cargo security and the customs officers from the U.S. and Mexico need to be safe. We talk about COVID-19 and workers, but we are also asking those officers to be on the front lines. Keeping that in play becomes a big challenge.”

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Michael Ford is a career professional with more than 40 years of experience in international transportation, specializing in import/export documentation and regulatory compliance. Among his other affiliations, Mr. Ford is the co-chair for Trade on the Export Committee in the development of the new Customs ACE system and has served with Customs as a member of COAC (Commercial Operations Advisory Council), chair of the Mid-Atlantic District Export Council and the partner sector with the American Chemistry Council, Responsible Care Committee. He can be reached at michael.ford@bdpint.com

This article was originally published in December 2020