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Integrating Risk Management Into Supply Chains: 5 Points to Cover

supply chain risk
Archives, Global Logistics, Global Trade Daily, International Trade

Integrating Risk Management Into Supply Chains: 5 Points to Cover

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Risk management is central to running any business, but it’s especially important for supply chains. Disruptions in the supply chain have far-reaching ripple effects, as the COVID-19 pandemic has made painfully evident. With logistics serving as the backbone of virtually every other operation, risks here are risks everywhere.

Supply chains must identify, document and respond to all potential dangers to maximize efficiency and resiliency. However, while many organizations are aware of this need, fewer understand how to implement proper risk management.

Why Supply Chains Need Better Risk Management

According to a PWC survey, 60% of supply chains pay only marginal attention to risk reduction processes. The study also revealed that most of these companies focus on maximizing profit, minimizing costs or maintaining service levels. Ironically, had they prioritized risk management, they’d be better equipped to meet those goals in the face of disruption.

Widespread supply chain issues amid the COVID-19 pandemic further illustrate the subpar state of risk management. Early in the outbreak, 75% of U.S. companies saw capacity disruptions from the pandemic, and many continued to face similar challenges throughout the year. The world’s supply chains were clearly unprepared to handle these risks.

Understanding the importance of risk management is the first step towards improvement. As supply chain managers start to create a risk management plan, here are five points to cover.

1. Identify and Organize Risks

Risk management in any operation begins with identifying the risks an organization faces. These can be internal, like poor user behavior leading to a data breach, or external, like a natural disaster. This may also take careful analysis, as some risks, such as changes in customer preferences, may not come to mind immediately.

Supply chain managers should break down every node and link to find risks. When recording these, it’s also crucial to determine their potential impact on the company, which is often more substantial than initially evident. For example, worker’s compensation claims can incur ongoing care expenses and disability payments on top of the original cost of care.

After compiling a list of risks and their potential impacts, supply chains should prioritize them. Weigh each hazard according to its likelihood and the size of its consequences. The most likely and most disruptive deserve the most attention in planning to prevent and mitigate them.

2. Create Response Plans for Known Risks

This organized list represents a supply chain’s known risks. These are the things that a company can predict and quantify, and as such, managers can create a response plan for them. Businesses may not be able to create a detailed plan for every item, but they should for at least the most threatening eventualities.

Some hazards don’t require extensive planning and preparation. For example, if a truck battery dies, drivers can start it without jumper cables if need be to take it to a repair shop. Even though the solution here is fairly straightforward, businesses should still write down what to do to ensure quick responses.

Other events need a more detailed and lengthy response plan. A supply shortage from an overseas supplier, for example, may require backup sources, a transition plan and steps to mitigate customer reactions. Creating these plans can take tremendous effort, but emergency responses will be slow and ineffective without them.

3. Ensure Flexibility for Unknown Risks

Of course, supply chain managers can’t predict every possible eventuality. In fact, unknown risks like the COVID-19 pandemic can be the most disruptive because businesses don’t have a specific action plan for them. While supply chains can’t predict the details of these events, they can prepare for them.

The key to preparing for unknown risks is to ensure flexibility. When a supply chain can’t predict a disruption, it must be able to adapt to it in the moment. If the chain is flexible by design, it can adapt more easily, minimizing the effects of unforeseen events.

Segment, stock and plan (SSP) strategies can reduce part shortages by 50 to 90%, helping supply chains become more flexible. Supply chains should also consider distributed sourcing, which mitigates the impact of a disruption in one location. Creating more transparency through internet of things (IoT) technology and data analytics will also help.

4. Build a Risk-Aware Culture

One easily overlookable point of supply chain risk management is cultivating a risk-aware culture. Supply chain managers can’t expect to discover every potential disruption on their own, much less fully understand their impact. Employees throughout the supply chain may have a more personal understanding of these things, making them indispensable assets.

Just as effective cybersecurity involves all employees, so does the rest of risk management. All workers should be able to report risks they notice, requiring easy and open communication tools. Similarly, management must be open to change and ensure employees that bad news is a welcome alert, not something to punish.

Some supply chains may even consider rewarding employees whose insights lead to meaningful risk management improvements. When everyone can report and discuss potential hazards, supply chains can get a more comprehensive picture of their risk environment. This communication will also improve flexibility for unknown risks.

5. Monitor and Review Risks

Finally, supply chains must understand that risk management is an ongoing process. Some experts claim that constant monitoring is the best way to strengthen the supply chain, as it enables quick, effective responses. The first step here is expanding visibility through data collection and reporting.

Regular reports from all supply chain nodes provide an updated picture of a supply chain’s risk environment. Similarly, IoT tracking and data analytics can enable real-time visibility across an organization and help predict incoming changes. When relying on data analytics, supply chains must ensure they’re gathering extensive, high-quality data, as poor or insufficient datasets can be misleading.

Monitoring this data to predict incoming disruptions is only part of the ongoing risk management process. Supply chains must also periodically review their risk management framework as their situation changes. What’s most threatening today may not be tomorrow, so these plans should evolve over time.

Risk Management Is Crucial for Supply Chains Today

The sheer size and complexity of supply chains today make risk management essential. Disruptions can come from anywhere and have far-reaching consequences if these organizations don’t prepare to counteract them.

As supply chain managers tackle their risk management framework, they must be sure to cover these five points. If not, they could fall short when an emergency arises. By contrast, following these steps can help them ensure ongoing efficiency and minimal disruption in the face of adversity.

DTC
Archives, Global Logistics, Global Trade Daily

4 Ways DTC Brands Can Beat Supply Chain Logjams

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With the holidays fast approaching, global supply chain disruptions are threatening to cast a shadow over the peak shopping season for both brands and consumers. COVID-19 related shutdowns, production delays, rising materials costs, labor scarcity, shipping container shortages, and port congestion could all leave retailers short of products to sell, and consumers without gifts to give.

That’s troubling for both digital and traditional retailers who rely on final-quarter sales to drive their revenues. For direct-to-consumer merchants, though, it isn’t all bad news. Despite the challenges, direct-to-consumer merchants have a real opportunity to leverage their brand equity, weather the storm, and come out ahead by capitalizing on supply chain disruptions this holiday season.

That’s partly because DTC sellers have less risk exposure than marketplace merchants or real-world retailers. More than half of Amazon’s sellers, for instance, are now based in China, meaning the marketplace could be especially hard-hit. Besides global shipping issues, China is also facing widespread power shortages that could curtail manufacturing operations and leave Amazon facing tremendous shortfalls in inventory — both for Chinese sellers and for U.S. sellers that import Chinese-made products into Amazon’s FBA network.

Traditional physical retailers face similar challenges. Their geographical footprint requires a multiple-step distribution process, creating greater costs, slowing down delivery times, and heightening the potential impact of logistical logjams and labor shortages. Full-truckload shipping is especially tough, with drivers in such high demand that high schools are now training teenagers to drive 18-wheelers. Inventory shortages are also likely to be more noticeable in brick and mortar stores, where empty shelves will impact customer experience and could dissuade shoppers from entering stores in the first place.

By comparison, DTC dropshippers have a much simpler task. Like any ecommerce operation, DTC brands have significantly lower fixed operating costs than brick-and-mortar retailers. That’s especially significant when inventory runs low: if nobody has products to sell, it’s far better to be on the hook for small, manageable hosting costs than to be stuck paying a sky-high commercial lease.

Better yet, DTC brands don’t just have lower costs and less risk exposure — they also have more control over the customer experience. While marketplace sellers have little option other than to simply remove listings for out-of-stock products, and real-world retailers are left with bare shelves, DTC brands can respond more creatively — updating their websites to guide shoppers to available products, say, or reducing SKU count to create a more focused browsing experience.

This agility, combined with deeper brand equity and a more loyal fanbase, gives DTC brands a path to generating revenue and deepening customer relationships even in the face of product shortages. The best approach will vary from brand to brand, but a few key strategies include:

1. Transparency. 

Be honest with your customers. Many will have read about global supply chain issues, but they may not be aware of how acute they are or how they are impacting your brand. While consumers will get frustrated by marketplace sellers or real-world retailers that don’t have the products they’re seeking, they will tend to be more sympathetic toward DTC brands that communicate about the challenges they’re facing in purposeful and honest ways.

Start by reaching out via your customer email list — an asset most marketplace sellers and real-world retailers lack, or fail to actively maintain — and follow up with a posting on your website. Strike a forthcoming and optimistic tone, and avoid defensiveness, and you’ll find your transparency will increase your credibility with your customers.

2. Assortment 

Because DTC brands often have lower SKU counts than other retailers, the impact of a single product being out of stock can be disproportionately large. To combat this, merchants should leverage their brand equity and promote available product-adjacent and brand-extension items, such as branded merchandise or related products and accessories.

Taken to excess, this could dilute your brand — but executed tastefully and in a way that’s still aligned with your core brand, it can be an effective strategy. Bringing new temporary products to market requires some additional research and investment, but it’s also an opportunity to learn more about your customers, and potentially identify new SKUs to incorporate into your permanent product lineup.

3. Promotions

Given the likelihood of shortages and delays, try to drive engagement by running one or more promotions. Easy options include gift cards and credits, discounts for late delivery, and freebies such as accessories and merchandise. You could also offer free gift-wrapping or small personal touches such as notes of thanks to customers whose gifts arrive later than expected.

The key is to offset late delivery or other inconveniences with an elevated experience — something that marketplace merchants simply can’t offer, but that can be a great option for DTC brands shipping high-value, high-demand items.

4. Pricing 

When supply issues cause order volumes to drop or COGS to rise, the easiest way to make it up is by increasing prices. This is harder to do in marketplaces where competitors’ products are only a click away, or in brick and mortar settings where overhead is higher, but DTC  merchants with strong brand equity are better-placed to command higher prices this holiday season.

If you pursue this strategy, distribute increases across your best-selling items to reduce the effects of price elasticity, and be forthcoming about why prices are going up to preempt sticker shock and underscore your commitment to transparency. Alternatively, consider pursuing a more aggressive bundling and up-selling strategy, including tailored product recommendations and checkout up-selling, to increase AOV without increasing item price.

Control your destiny

Of course, how well these recommendations will work for you depends on your brand and your customer base. The most important thing, though, is to realize that as a direct-to-consumer brand you have far more control over your destiny than pure-play marketplace sellers and traditional retail brands.

If there was ever a time to use the strengths of the direct-to-consumer model to your advantage, it’s now. The global supply chain disruptions will undoubtedly affect sellers of all kinds this holiday season. That makes it all the more important to use every tool in your arsenal to face these challenges head on, and to leverage your brand equity to strengthen customer relationships and drive revenues in the months ahead.

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Remington Tonar is the Chief of Staff at Cart.com, the first end-to-end ecommerce solutions provider delivering a fully integrated and owned suite of software, expert services, and infrastructure to scale businesses online.

e-commerce online
Archives, Global Trade Daily, International Trade

HOW TO GO GLOBAL: WHAT E-COMMERCE SHOPS CAN LEARN FROM THE BEST ENTERPRISES

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Organizations face inherent risks and challenges on the path to globalization, due in part to each country’s regulations, inflation rates, currency and currency exchange rates, language and cultural barriers, foreign politics and policies, and consumer behaviors and preferences.

With almost 200 countries participating in international business, worldwide commerce presents an opportunity for enormous organizational growth if these hurdles can be cleared. Several large enterprises have expanded well internationally (Apple, McDonalds, etc.) by following some key touchpoints.

Surprises at checkout can lead to high cart abandonment.

The last thing an online merchant wants is to have a successful purchase in progress, only for additional fees, unaccepted payment methods, or extra taxes to tempt the consumer to abandon the cart. With online shopping cart abandonment estimated to be around 69.8%, it is the responsibility of the merchants to be aware of foreign regulations and payment challenges that could potentially add costs and corrupt the customer experience.

Equally as important is to be forthcoming about this information. All taxes and fees which may be associated with purchasing internationally should be upfront, and merchants must consistently highlight what the entire cost of the product is going to be, even if this includes additional wording in the checkout. Furthermore, e-commerce merchants need to be clear about the payment methods they accept, as this can vary significantly from country to county.

Merchants need to start paying attention to what consumers want to pay with.

When it comes to localization in e-commerce, customizing payment options is essential. Established enterprises and e-commerce merchants alike should not approach payments with a one-size-fits-all mindset. For example, while Americans prefer to pay with credit and debit cards, Europeans favor bank transfers and digital wallets (such as PayPal), and Asian consumers gravitate to QR codes. Narrowing down the scope even further, demographics within those counties play a role.

Therefore, e-commerce merchants need to tailor their payment methods to what will work for their target consumers.

Data breaches are far too common and are only on the rise.

Recently, international enterprise giants such as Microsoft, Estee Lauder, and MGM Resorts suffered security issues. From accidentally exposing confidential customer data online (such as credit or debit card information, home or office addresses, birth dates, buying history, and more) to malware and hacking incidents, these events significantly harmed consumer trust and brand reputation for these businesses. Even more, cybercrime is a substantial financial liability as the cost of patching, compensating victims, and possible litigation leaves many companies unable to recover fully.

The good news is that there has been much investment from established enterprises to create solutions that cross-border e-commerce merchants entering the market can utilize. For example, innovative technology is allowing faster responses to suspicious activity to ensure that transactions remain secure. As e-commerce merchants now realize that they are at risk if they decide to hold sensitive data in-house, they are discovering new ways to safely store information that is susceptible to threats.

Global merchants must take a lot of things into consideration. 

The established enterprises that have thrived worldwide do so because they understand their target audiences. They know that the key to success overseas is localization starting from a very high level, such as transparency and communication. It then goes down to payment preferences and choices, followed by assuring security and local compliance.

For global e-commerce merchants, this is a roadmap they can follow. For an e-commerce merchant to grow internationally, they need to identify what they want to accomplish, how local they want to be, what resources they have in-house, how to create the best experience and their KPIs.

This is where the right payments infrastructure partner can be of great value. By helping global merchants discover optimal ways of implementing payment methods, defining the best digital experiences based on preferences by the local consumers, and determining conversion metrics, they help merchants connect with more consumers, whether they’re 10 or 10,000 miles away.

Therese Hudak is the Head of Enterprise Account Management at PPRO

supply chain
Archives, Global Logistics, Global Trade Daily, Warehousing

Embracing a New Normal: Why We Should Never Go Back to a Pre-Covid Supply Chain

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For the past decade, global supply chains have been running a seemingly normal path. However, when COVID hit its peak in March 2020, it exposed many of the vulnerabilities that have been affecting these networks. Even a year and a half later, industries across the board are experiencing the impacts of supply chain disruptions. With massive labor shortages and continual shipping delays, there is increasing desperation to return “back to normal.” Instead of quickly returning back to the way things used to be, we should examine the root causes of these issues and create a new model that better aligns with the world we live in today.

Currently, the majority of global supply chains operate on a global warehousing method due to the industry standard of bulk production from a single manufacturer. Typically, bulk orders are routed from one vendor to another distribution center across the globe. While this system can provide some economies of scale, it has also led to wasteful overproduction, increased pollution, inflexible startup costs and major supply chain disruptions.

Industry leaders, brands, and retailers should instead consider incorporating smarter supply chains that uniquely combine technology, data, and manufacturing to automate and optimize the flow of production, procurement, and logistics.

Because consumers can order around the clock, forecasting demand is less predictable, the volume of order sizes lowers, and the number of products offered increases. Coupled with consumer expectations of short delivery times and high customer satisfaction, businesses need to ensure their supply chain requirements can deliver on speed, complexity, and efficiency. A smarter supply chain can meet and even exceed these seemingly impossible expectations.

Smart Supply Chain: On-Demand Manufacturing + Global Production Network

The manufacturing portion of a smart supply chain unites on-demand manufacturing, a process where goods are created only when needed and in the quantities required, with global production, a distributed network that transfers raw materials to production facilities closest to end consumers for final assembly.

On-demand manufacturing and global production are not only more sustainable than traditional manufacturing methods, but they also allow for more flexibility, efficiency, and responsiveness when issues arise such as the current global shortages and delays.

Moving from Global Warehousing to Global Production

Global warehousing, or traditional wholesale manufacturing, relies on storing items until they are ready to be shipped. Many retailers and businesses have historically depended on this method given there were no other reasonable alternatives for decades. Technological advancements have not only paved the way for new more affordable options but have brought to light the many disadvantages of global warehousing including, but not limited to:

-Producing excess inventory

-Inflexible to changing consumer preferences

-Leading to disengaged workforce

-Requiring high start-up cost

The inflexibility and costly nature of global warehousing are two of the major reasons why global supply chains have been struggling to keep up with unprecedented demand.

Use Cases of On-Demand Manufacturing + Global Production

While both on-demand and global production are relatively new processes within the past decade, remnants of each model have been proven across multiple industries.

-The automotive industry embraces a similar just-in-time approach with their parts and assembly. Instead of selling their vehicles at traditional dealerships, Tesla uses stores that are usually found at popular shopping centers. Customers can’t simply drive away with a Tesla either, they can view sample vehicles and then order a customized car online with the help of a sales expert. That level of personalization and detail can only be achieved via an on-demand production model, which Tesla and other European automotive brands successfully utilize.

-Ecommerce businesses that implement a print-on-demand model also only produce items until a customer places an order, eliminating the need for wasteful inventory and costly order minimums. Additionally, this on-demand method helps shrink the supply chain—meaning, the time it takes to produce and ship an item—from 30 and 45 days to between two and three days. Lowering the restock supply chain lead time allows brands to significantly cut down on the initial inventory runs which in turn helps them be more reactive to customer preferences that dictate the winners and the losers within a design, a SKU, a model, or a season.

-Similar to the distributed network in the global production model, Akamai paved the way in the computer network industry by eliminating network hops and putting servers closer to the end-user in order to quickly and more efficiently deliver content. Akamai’s platform has greatly improved Internet latency and exemplifies how a distributed architecture can yield more flexibility and responsiveness. Gooten, a smart supply chain provider, has a parallel approach in the manufacturing space where they utilize a distributed network of global manufacturers to fulfill on-demand orders more efficiently, sustainably, and at a competitive rate. What’s more, Gooten produces 70% of its orders in the U.S. at 23 factories spanning from New Jersey to Oregon.

Embracing a Smarter Supply Chain

With all the benefits that on-demand and global production provide, it’s easy to wonder why more businesses aren’t embracing them. Despite major outlets such as Vogue and Amazon creating buzz around on-demand manufacturing as an answer to many of the supply chain industry’s biggest challenges, it has made headway primarily amongst startups and eCommerce brands. The major impediment for embracing on-demand is primarily due to knowledge gaps and general resistance to change.

Whenever there are revolutionary shifts in any industry, there are always old guards that are comfortable with the existing status quo. One of the more notable examples of this is the film industry shifting from film cinema cameras to digital recording technologies. While the advantages of digital are paramount—from cost savings, ease of use, flexibility, and accessibility—it took over a decade for the industry to fully adopt the method. Hollywood began filming digitally in the 2000s but it wasn’t until 2013 that digitally shot films began the norm amongst the top 100 grossing films.

While they are not mutually exclusive, one can argue that the supply chain disruptions have a far greater impact than the use of digital over film. That’s why it is imperative for companies to embrace the change, even partially, from global warehousing to global production in order to overcome supply chain disruptions and sustain themselves for years to come.

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Mark Kapczynski is the Chief Marketing Officer of Gooten, a globally distributed company that operates a smart supply chain for brands and retailers that are looking to utilize print on-demand manufacturing to transform the way they do business.

safety
Archives, Commentary, Global Trade Daily, Special Reports

Invisible Safety: How What You Can’t See Can Hurt You

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COVID-19 outbreaks in the workplace have revealed the importance of protecting and maintaining the health and wellness of employees. From social distancing to HVAC upgrades, factories have implemented strict protocols to stop the spread of the COV2 virus.  

If you walk into any manufacturing facility in North America, the first thing that you will see are signs related to safety. That’s because factories and assembly plants often have dangerous equipment and machinery, and even a minor lapse can have serious – or even life-threatening – consequences. Employers want to keep their team members safe, and they also know that the legal and financial risks of failing to maintain rigid safety standards can be devastating at a business level. But thanks to the COVID-19 pandemic, one of the biggest threats to safety can’t be seen at all: the air we breathe. Forward-thinking assembly companies need to factor this in when they evaluate their protocols for keeping their employees healthy and safe. And in many cases, existing HVAC systems aren’t up to the task.

There was a lot we didn’t know about the novel coronavirus when it first reached North America in March 2020, but over the last year and a half we have learned a great deal. As it turns out, the risk of disease transmission through surface contact is fairly minimal, as is the likelihood of an outdoor super spreader event – but more than 99% of COVID-19 cases can be traced back to events held in indoor spaces with poor ventilation and filtration. That’s why the Centers for Disease Control (CDC) has issued so many guidelines on how companies can keep their facilities safe. One of their biggest recommendations is for companies to improve ventilation to reduce the risk of people getting sick. 

That’s easier said than done. The best way to improve ventilation is to open windows and circulate fresh air. Unfortunately, many buildings, especially assembly facilities, have self-contained ecosystems to protect the quality of the items that are being put together. After all, letting free-floating particles into a building where microchips or electronic components are being put together is a recipe for disaster. What works during “normal” times to maintain product integrity may actually be harming the workers who are unable to breathe air from the outside. 

Despite some misinformation from the early days of the pandemic, HVAC systems are not responsible for the spread of pathogens. That’s the good news. On the other side of the coin, many of these systems don’t circulate enough air to maximize the safety of people inside the facilities that rely on them to maintain appropriate levels of humidity and temperature. Replacing entire heating and ventilation systems is expensive and time-consuming. So what options do operators of assembly facilities have to maintain employee health without jeopardizing their operations? 

The answer is supplementary air systems, which actually top the list of CDC recommendations for maintaining the safety of indoor spaces where natural ventilation is impossible. These devices come in many sizes, and can be used to filter air in small facilities as well as buildings with several million square feet of floor space. Regardless of how big a facility is, the principle is the same: air needs to be circulated and properly filtered to remove potentially dangerous microbes from the environment. Existing HVAC systems actually do a pretty good job, but they simply don’t move enough air to be effective, especially in an era defined by an airborne virus that has already killed more than half a million Americans. 

Clearly, this is something that needs to be taken seriously by companies in the manufacturing space. But this isn’t just a short term solution. While many people were optimistic that rising vaccination rates and social distancing rules would lead to the end of the coronavirus pandemic this fall, there is still plenty of reason for concern. That’s because in many parts of the country vaccination rates remain very low, and new variants, including Delta, are proving to be much more of a problem than doctors initially anticipated. Despite the many heroic advances in medicine over the last 18 months, the reality seems to be that we will be dealing with the long-tail effect of COVID-19 for years, or even decades, to come. 

It has been a century since the last major viral epidemic caused this much damage, but most health experts agree that the next pandemic will happen long before the year 2120. In fact, there is a high probability of a similar event occurring in the next 25 years. With that in mind, operators of assembly facilities not only need to get through the current pandemic, but also prepare for the next one. Maintaining air quality should be at the top of their list as they plan for an uncertain future. 

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Marshal Sterio is the CEO of Surgically Clean Air Inc., a Toronto-based manufacturer of portable systems that purify air by supplementing existing HVAC systems. The company’s products are market leaders in dental practices, currently protects over 50,000 dental professionals, and are used by Fortune 500 companies, Major League Baseball clubs, the NBA, the NHL and thousands of other organizations. 

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Archives, Commentary, Global Trade Daily

See Line Item in Action with a Live Webinar or Product Demo

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You already know that CPG e-commerce has taken a leap forward during the pandemic—and that business intelligence has become table stakes for success. This is because knowledge is power, and what you don’t know is hurting you. In such a dynamic market, you must monitor changing demand patterns and analyze the risks of CPG e-commerce without business intelligence. We’ve gone beyond analyses and caution, though, to share how the right business intelligence platform can help you sell more on Amazon and Walmart, the giants that control the retail market. And we’ve shared an overview of the good, better, and best tools for e-commerce e-analytics to show how Line Item helps CPG and e-commerce marketers master their market with insights to drive sales growth.

Now to compliment our industry-specific articles, we’re offering live webinars and product demos so you can see Line Item in action.Why watch a live webinar, or tune into an on-demand session? Simply put, a live product tour brings Line Item’s features to life in specific ways for your category or product portfolio. It’s a way for you and your colleagues to understand the power of business intelligence for your business, not just for CPG and e-commerce in general (though of course, that’s important, too).
Here are four reasons to join us for a live Line Item webinar or product demo.#1: Understand value through product attributes.
Line Item’s deep insight into product attributes is what sets it apart from other analytics platforms. With a single tool built specifically for CPG and e-commerce, marketers can improve performance and profitability by understanding exactly what’s driving value. Line Item’s proprietary AI engine can calculate attributes for every item, even across hundreds of items in a category. These include form (like liquid or powder), size, flavor, and packaging (like pouch, box, and more).With a live product demo, you can see how Line Item enables visibility into this granular detail for business intelligence that powers better decision-making. See when competitors are coming out with new items that could threaten your sales. Detect new attributes that drive value. Know what consumers value about your product and your brand.

#2: Learn how to truly optimize your search results.
Search results matter. They can make or break whether your product makes it into customers’ carts, in-store or online. There can be many reasons why your product isn’t getting its share of page one, but if you don’t know them, you can’t address them with a fix. And it’s not enough to look at them as separate. A smart and successful digital strategy is built and optimized across all selling platforms. You need to know if your e-commerce SEO is working across all sites and all search terms.

In a webinar, you can understand the power of Line Item in optimizing SEO strategy across all keywords, retailer websites, and online marketplaces. Line Item provides insight into how your brands and items are ranking and analyzes page share, rank by item, brand, form, and other attributes. You can also ask questions specific to your brand or category on SEO strategy and how Line Item powers it.

#3: Discover how to drive sales with smarter insights.
How do you know if your promotions are performing? Which search terms are working across all retailers and platforms? Which keywords are worth investing in? This level of detail is where the battle for the digital shelf is won, but it’s impossible to access without deep insight. And it’s not actionable without the kind of visibility into your e-analytics that Line Item enables. This is just one example of how smarter insights can drive sales growth in the fiercely competitive e-commerce market.

Here are some others. Are your out-of-stocks hurting revenue? Are they giving competitors the edge if you don’t maintain inventory on Amazon? Optimizing inventory is enough of a challenge without having to second-guess your strategy. Line Item gives you the insights to understand how inventory is affecting your sales and ultimately your profitability. A webinar or live demo can show you how Line Item can be a game-changer for your e-commerce portfolio.

#4: Level up your ability to monitor third-party activity.
Amazon may be the world’s biggest marketplace, but it’s also the world’s most competitive. Keeping tabs on authorized and unauthorized third-party activity is key to success on the platform, but it can be complex even with the right tools. Unless, that is, you’re using Line Item. In a webinar or live product demo, you can see how a deep dive with Line Item can reveal when an unauthorized third-party seller starts selling your product online. With Line Item, you can understand when your items are priced correctly as well as when competitors or third-party sellers are undercutting your price. From pricing to competitor activity, see how Line Item can help you understand more about your market.

Actions speak louder than words. Join us for an upcoming webinar or request a live product demo to see how Line Item can transform your CPG e-commerce. You’ll understand why Line Item is your best option for mastering your market. It’s a single platform with comprehensive capabilities purpose-built for CPG e-commerce. In today’s competitive and uncertain e-commerce market, Line Item is your lifeline to more profitable e-commerce.

cyber
Archives, Global Trade Daily, Software

Security and EDI, the Trojan Horses of Cyber Attackers

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If no one is safe from a cyber-attack, then the multiplication of EDI flow increases the vulnerability of a company. Indeed, EDI flows with less protected subcontractors can be privileged entry points for attackers. The choice of a reliable and certified EDI provider is becoming more and more necessary. 

SMEs, the weakest link in cybersecurity

When it comes to cybersecurity, small businesses are the weakest link and the ones that attackers are targeting, so that they reach larger targets. Faced with this phenomenon, some companies use rating companies to estimate the security level of their suppliers and eventually select them according to their score. This approach is extremely costly and is nevertheless reserved for a few large international companies.

A study conducted by cybersecurity firm BlueVoyant shows that of the 1,500 companies surveyed, 77% of CISOs and CIOs report a complete lack of visibility into their vendors’ security. At the same time, 82% have experienced at least one data breach in the past 12 months. This lack of control over third-party security can be explained by the fact that a company’s cyber resources are obviously focused on securing their own information systems. Some companies send a security questionnaire to their partners to assess their practices, but the average company has about 1000 partners, which limits the company’s ability to control them. Cyber threats and protection systems are constantly evolving, and even systems that may appear to be the most mature, such as EDI (Electronic Data Interchange), are not always the most secure.

EDI, a secure technology, but not safe from attackers

By design, EDI flows are secure: the protocol ensures the integrity and traceability of exchanges. The data itself is encrypted, which guarantees its confidentiality and integrity, but EDI flows can potentially be exploited by hackers to infiltrate the information system of a company or its EDI provider, or to divert data indirectly.

Since the 2010s, EDI network flows initially carried by the specialized X25 network have given way to IP and Internet connections. In the same way, the use of EDI has expanded, especially among SMEs, thanks to the development of Web-EDI type solutions, accessible to all. Any company can communicate EDI data via a simple Web browser and this democratization increases the risk of computer hacking.

The ecosystem, a concept too often underestimated by companies

For example, a supplier who links his computer to a client, so he can obtain a list of addresses, will open a connection between the two platforms. By attacking the supplier, the cyber attacker opens a breach towards the client’s company.

While it is appropriate for the supplier to protect its customers, it is also up to the client to qualify the trust it places in the supplier. Intrusion attempts are polymorphous: if identity theft is the most frequent case, companies must generally limit the flow of sensitive data communicated within their ecosystem.

The support of all EDI formats and protocols on the market is the first criterion for choosing an EDI solution. The platform must support EANCOM, EDIFACT, XML, UBL, HL7, JSON, PDF or X12, but also offer interfaces with ERP and business software packages such as SAP, Microsoft, Oracle or Sage. Finally, the EDI provider must obviously have interoperability capabilities with all the countries with which the company will have to exchange. But nowadays, you must also choose your EDI provider according to its maturity and its investments in cybersecurity.

The role of the EDI provider has evolved; it has become a key player in protecting companies from these attacks and the company itself must ensure the seriousness of the protections put in place by its EDI provider before connecting to its service.

Certifications and standards are a way to ensure the seriousness of its processes. An ISO 27001 certification appears as an essential criterion in the selection of an EDI provider. It is up to the provider to ensure that the data flow is not subject to a “Man in the Middle” attack. It is also the provider who stores the data exchanged between EDI partners. This storage must therefore be encrypted to ensure that, even if an attacker manages to penetrate the defenses in place, he cannot exploit the data exposed to his attack. Asymmetric encryption is the most secure solution to protect data, but some players are now turning to Blockchain technology to further increase the security level of their EDI.

Generix Group North America provides a series of solutions within our Supply Chain Hub product suite to create efficiencies across an entire supply chain. Our solutions are in use around the world and our experience is second-to-none. We invite you to contact us to learn more.

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Archives, Global Trade Daily, News

Global Frozen Fruit Trade Grows Robustly

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IndexBox has just published a new report: ‘World – Frozen Fruits – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

Global frozen fruit imports continue to grow in physical terms, expanding twofold over the past decade. In 2020, global imports rose by +3% y-o-y to 2.7M tonnes. In value terms, imports reached $5.8B last year. The U.S. and Germany remain the largest importers of frozen fruits worldwide, with a combined 34%-share of the global figure. The U.S. featured the highest growth rate of imports in physical terms in 2020. The average global frozen fruit import price amounted to $2,121 per tonne in 2020, increasing by +8.2% y-o-y. 

Global Frozen Fruit Imports by Country

In 2020, global imports of frozen fruits amounted to 2.7M tonnes, increasing by +3% on 2019 figures. In value terms, frozen fruit imports expanded by +11.4% y-o-y to $5.8B (IndexBox estimates) in 2020. Global frozen fruit imports have expanded twofold in the past decade.

In 2020, the U.S. (544K tonnes) and Germany (376K tonnes) constituted the key importers of frozen fruits worldwide, together comprising approx. 34% of total imports. France (186K tonnes) occupied the next position in the ranking, followed by the Netherlands (159K tonnes). All these countries together held approx. 13% share of total imports. The following importers – Poland (115K tonnes), Belgium (113K tonnes), the UK (107K tonnes), Canada (100K tonnes), China (98K tonnes), Russia (95K tonnes), Japan (82K tonnes), Austria (66K tonnes) and Australia (55K tonnes) – together made up 31% of total imports.

In 2020, the most notable growth rate in purchases amongst the leading importing countries was attained by the U.S. (+19.7% y-o-y), while imports for the other global leaders experienced more modest paces of growth.

In value terms, the largest frozen fruit importing markets worldwide were the U.S. ($1.1B), Germany ($675M) and China ($428M), with a combined 39% share of global imports.

The average frozen fruit import price stood at $2,121 per tonne in 2020, growing by +8.2% against the previous year. There were significant differences in the average prices amongst the major importing countries. In 2020, the country with the highest price was China ($4,385 per tonne), while Russia ($1,148 per tonne) was amongst the lowest. In 2020, the most notable rate of growth in terms of prices was attained by Austria, while the other global leaders experienced more modest paces of growth.

World’s Largest Suppliers of Frozen Fruits

In 2020, Poland (335K tonnes), followed by Serbia (205K tonnes), Canada (201K tonnes), Mexico (159K tonnes), China (133K tonnes), the Netherlands (115K tonnes) and Egypt (113K tonnes) represented the major exporters of frozen fruits, together constituting 52% of total exports. Peru (101K tonnes), the U.S. (101K tonnes), Morocco (85K tonnes), Costa Rica (75K tonnes), Belgium (73K tonnes) and Germany (61K tonnes) occupied a relatively small share of total exports.

In value terms, the largest frozen fruit supplying countries worldwide were Poland ($551M), Canada ($436M) and Serbia ($428M), together comprising 28% of global exports. These countries were followed by Mexico, Peru, the U.S., the Netherlands, China, Belgium, Egypt, Germany, Morocco and Costa Rica, which together accounted for a further 38%.

Source: IndexBox Platform

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Archives, Global Trade Daily, News

Top 4 Trends Enhancing Self-Checkout System Market Size through 2027

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The higher acceptance of compact kiosks designed with user-friendly interfaces will significantly augment the self-checkout system market. The escalating labor costs, specifically in Europe have stirred the need for automated systems to limit the involvement of staff and let end-users complete the checkout processes. The growing incursion of AI and machine learning techniques into the self-checkout software for enhanced functionalities and effective transaction handling will additionally influence the industry prospects.

In this regard, as per the recent study by Global Market Insights, Inc., the global self-checkout system market will reach a valuation of over USD 6.5 billion by 2027.

Here is a peek into some factors driving the overall market growth in the coming years:


Space benefits of wall-mounted/countertop systems

Industry share of wall-mounted/countertop systems is expected to grow in the forecasted timeline. This is ascribing to their increasing preference by small restaurant owners and medium-sized retailers as they are ideal for places having space constraints. Considering the surging number of retailers and restaurants looking for automated processes, self-checkout machine manufacturers are coming up with various solutions to offer powerful computational features in compact designs.

For instance, Advanced Kiosks introduced a self-checkout system comprising amplified speakers and a 17-inch touch screen LCD monitor to offer enhanced customer comfort.

Higher presence in the travel sector

Demand for self-service checkout systems in travel applications will grow with the increasing international passenger traffic. This has led transportation authorities to deploy advanced solutions for mitigating the checkout time to offer traveler convenience. The International Air Transport Association has estimated that around 80% of the global passengers will employ a complete self-service system produced under the association standards by 2020.

For instance, leading American travel experience provider, Hudson, in January 2021, deployed Amazon’s Just Walk Out technology, Self-service Bag Drop (SSBD) across a few travel convenience stores to limit traveler check-in times.

The retail industry as a big booster

The retail sector will see higher adoption of self-checkout machines through 2027 driven by rising advancements and the assistance to retailers in keeping the stores open in the absence of a workforce. According to a survey that analyzed the shopping habits of U.S. consumers, over 73% of respondents preferred self-service technologies for improved retail shopping experiences and reduced staff interactions.

The growing preference of consumers for fast checkouts with standalone kiosks has encouraged retailers to operate their stores with minimum employees. In addition, the systems help customers to scan as well as pay for their products by themselves, allowing retailers to provide enhanced customer comfort with busted long queues at the payment counters.

Expanding tourism sector in MEA

The Middle East & African self-checkout system industry will gain traction owing to the higher deployment of advanced digital technologies. The mounting economic development through retail, mainly in Saudi Arabia and the UAE has made way for a higher count of large malls in the region for attracting international tourists. The increasing preference for UAE as a shopping hub has led to higher product penetration to offer improved and hassle-free experiences. The growing number of international tourists and the booming hospitality sector are other factors impacting the regional market growth.

Furthermore, the higher incorporation of digital payment techniques, including mobile wallets and smart cards to limit the requirement for handle cash-based financial transactions, will favor the demand for self-checkout kiosks. There are also improving economic conditions across Latin America and the Asia Pacific. The growing usage of smartphones for timesaving and helping customers scan the items and pay through apps will also anchor the market forecast.

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3pls, Archives, Global Logistics, Global Trade Daily, Ocean Ports, Trucking

6 Emerging Challenges for the Supply Chain and How to Address Them

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The past 18 months have exposed major weaknesses in the global supply chain. For many companies, the pressure from the COVID-19 pandemic stretched logistics to their limits, revealing inefficiencies and areas for improvement.

These existing weaknesses are being compounded by new supply chain challenges and changing market conditions. Here are six of the most important emerging challenges for global logistics — and what businesses can do to address them.

1. Lead Time Expectations

Consumers and business clients both expect increasingly quick turnaround times on new orders. In part due to the rise of ecommerce giants like Amazon, many consumers consider it normal for an item to be delivered a day or two after an order is received.

For the global supply chain, however, this is often unrealistic. International shipment can take weeks or months, depending on the complexity of the item ordered.

These consumer expectations aren’t likely to change any time soon. As a result, more effective demand forecasting and supply planning will be essential for businesses. Flexible supply chains that are capable of expediting orders as needed — for example, taking advantage of backup air freight contracts when land or sea would be too slow — will become an invaluable asset.

Strategies that keep goods close to buyers can also help businesses meet these expectations. Distributing warehouse space, if possible, can make it more likely that items are nearby buyers when ordered, making them quicker to ship.

2. Port Congestion

Port congestion, in part caused by the COVID-19 pandemic, remains a major challenge for logistics. Right now, ports around the world are experiencing record levels of congestion, meaning freight shipped by sea is likely to be delayed significantly.

Businesses are experimenting with different solutions to this problem. In the United States, some major retailers have begun chartering their own ships to import goods ahead of the 2021 holiday season. Chartering these ships allows the retailers to unload at less-congested docks, like those in Portland, Oregon.

Most businesses likely don’t have the resources to charter their own cargo ships. Instead, demand forecasting and carrier choice may help companies keep sea freight moving. Staggering shipment containers across multiple vessels may also help businesses avoid the worst of a port’s congestion while also mitigating risks in other ways.

The diversification of sourcing in a supply chain strategy can also help. If port congestion makes it nearly impossible to obtain a good or raw material from one supplier, there may be other suppliers available via air or land freight.

3. Aging Equipment

As they age, vehicles become less reliable and more prone to failure. Regular replacement of fleet vehicles is essential to keep the supply chain running smoothly, but the high expense of a new truck or tractor-trailer means businesses are continuing to use legacy equipment for longer than they would typically.

Vehicle failures can happen suddenly. Even simple issues can cause massive problems when a part that’s been on the verge of failure begins to break down.

Replacing old vehicles with new ones is one way to minimize downtime due to failures. An upgrade is also an opportunity to investigate alternative fuel vehicles and electric trucks.

For businesses that can’t afford the capital expense of a new fleet, knowledge and careful maintenance can keep vehicles running longer. Preventive maintenance and effective upkeep is the best way to extend the lifespan of a vehicle.

For example, the lifespan of tires that are underinflated by just 20% may decrease by as much as 30%. Proper tire inflation can keep vehicles on the road and decrease maintenance costs over time. Other common semi-truck issues, like brake failures, can also be avoided with the right maintenance practices.

Some businesses may also deal with niche-specific maintenance problems. For instance, transporting crops can put significant strain on the suspension of a vehicle or machine, especially its leaf springs.

Regular inspection and maintenance of these suspension components can help logistics companies avoid costly breakdowns and significant downtime.

4. Aging Infrastructure

A similar, related problem is emerging on the state side of logistics. Dated transportation infrastructure is beginning to show its age. In 2021, the American Society of Civil Engineers (ASCE) gave American infrastructure as a whole a C minus. Roadways fell behind even this low average and were given a D grade.

Bridge closures, roadwork, and infrastructure failures can all create serious difficulties for logistics companies. When essential routes are closed for emergency maintenance, companies may have few options for avoiding delays.

As with port congestion, diversification may be the answer for businesses. Distributing risk by partnering with a larger number of suppliers can help businesses create a more responsive and flexible supply chain network.

5. Digital Transformation and Cyber Vulnerability

Data has become one of the most valuable assets available to logistics companies. With the right customer information, a business can more accurately predict demand, anticipate crises, and mitigate risks.

This same information can also make a company much more vulnerable, however. The value of data stored on business networks makes these networks a more attractive target for hackers.

At the same time, digitalization, the adoption of Industry 4.0 technology and IoT devices, and the pivot to working from home have all increased the number of critical business assets exposed to the internet.

The consequences of a successful breach can be massive. Businesses that suffer a breach may pay multi-million-dollar ransoms, lose critical files, or face a badly damaged reputation. Downtime and fines from government regulators can further increase the cost of a breach.

Effective cybersecurity is the best way to reduce the risk of a breach. Investing in IT, developing best practices, and participating in industry conversations on cybersecurity will help businesses ensure that critical assets and digital infrastructure are kept safe from hackers.

6. Rising Freight Prices

Higher shipping costs are likely here to stay. For logistics providers and vendors, this can be a serious challenge. Already, experts are predicting that businesses will hike prices to offset the growing freight costs. The impact will likely be felt in almost every sector of the economy.

Better technology may help businesses adapt to these higher prices. Transportation management utilities that allow businesses to compare carriers and optimize routes, for example, can help them to both navigate around delays and minimize freight costs.

How Businesses Can Adapt to a Changing Supply Chain

The global supply chain is transforming fast. Businesses that want to develop effective logistics strategies will need to manage both old and new supply chain challenges.

Technology and diversification may both be essential. Partnering with a range of suppliers can help businesses distribute risk and avoid emerging issues like port congestion. New technology can make it easier to optimize routes and identify the most valuable carriers.