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How AI is Enhancing Supply Chain Performance

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How AI is Enhancing Supply Chain Performance

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The COVID-19 pandemic has forced many supply chains throughout the world to collapse. This reminds us that over the years, the world has become extremely interconnected — a global village — and supply chains have grown in complexity almost exponentially.

But as businesses emerge from the devastating effects of the pandemic, one thing is clear, software, digitization, and automation will be the cornerstones of future development, and companies must incorporate these into their business structures to build resilience, weed out inefficiencies, and prepare well for the next disruption.

Intelligent project management software like pmo365 has already begun to automate and digitize the business world, allowing senior executives to monitor company resources and projects effectively. But another area where business software is making giant leaps is in improving supply chain performance via artificial intelligence.

Areas where AI can optimize supply chains

When we think about supply chains, we tend to focus on the physical (and more visible) aspects, such as transportation, transformation, and storage and warehousing of materials. But underlying these physical flows, are certain processes and information flows that are equally important for the integrity and flow of a supply chain.

Because modern supply chains are so complex, information needs to flow back and forth between various people and organizations at an alarming speed to coordinate the activities of the day and ensure the successful running of the chain.

Risks need to be predicted, potential hurdles identified, and decisions must be taken fast. All this depends on effective communication and intelligent software, and this is where AI can enhance supply chains.

In addition to information flows, AI can also power (and improve) the various processes that make up a supply chain. By automating iterative tasks, identifying inefficient processes, and providing supply chain professionals crucial predictive data, AI can shift the focus of the human workforce towards more complex and strategically important tasks.

So let’s take a look at some benefits of AI use in supply chain management.

Benefits of AI in supply chain management

AI prevents stocking of unwanted inventory

Because of AI’s ability to process huge amounts of data, identify trends, and take into account recent world events, companies are now using AI to study consumer habits and the ups and downs of seasonal demand.

This allows companies to prevent stocking unwanted inventory, which is not only a waste of space but also means the customers are not getting what they want, which really translates into a loss of revenue.

Inventory management is an overall complex process, with many aspects like order processing and packing involved. Companies strive for accurate inventory management because it prevents understocking, overstocking, or sudden stock-outs in unpredictable circumstances, all of which could translate into hefty costs.

AI can automate various processes in inventory management, reducing the risk of error, and providing valuable predictive data on supply and demand. This can turn the slow and sluggish animal of inventory management into an intelligent and efficient beast!

AI-backed decisions are better

Given the complexity of modern supply chains, it’s no surprise that supply chain professionals are often faced with difficult decisions. Huge amounts of data to sift through and limited end-to-end visibility makes these decisions even more difficult and risky.

Supply chain optimization software integrated with AI allows machines to analyze large amounts of data and detect patterns that are hard for humans to see. AI can then offer actionable insights to professionals, allowing them to make AI-backed decisions, and make them fast and at the right time. This can have a major impact on the overall efficiency of a supply chain.

AI improves fleet management

Managing large fleets is a difficult task. Fuel costs, labor issues, and unexpected bottlenecks can lead to significant fleet downtime, which negatively impacts delivery times and disrupts the supply chain.

Fleet managers often find themselves struggling to make the correct use of large amounts of data that comes in from a large fleet. With AI, fleet managers can gain a greater insight into their fleet than they ever had before.

With real-time tracking and intelligent use of weather and traffic data, AI can provide fleet managers valuable information about the optimal time, place, and date for a particular delivery to be made. AI can also detect bottlenecks and work its way around them, reducing unplanned fleet downtime and eliminating fuel inefficiencies. All of this translates into an effectively managed fleet, which is crucial for the uninterrupted running of the supply chain.

AI enhances workplace safety

Warehouses are important to supply chains, and it’s crucial for companies to provide a safe working environment for workers in a warehouse.

AI enhances warehouse safety in two ways. First, it improves the overall management and planning in a warehouse, which in turn makes it safer to work in.

Second, AI can record stocking parameters and analyze data related to workplace safety. This analysis can be turned into actionable insights for operators, allowing them to take timely decisions and be proactive about maintenance. Both of these factors play an important role in making warehouses safer!

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Archives, Global Logistics, Global Trade Daily

Rethinking Your Supply Chain: Why Your Company Needs to Find and Invest in its Strengths 

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In today’s increasingly intricate world of supply chain management, what makes your company unique? What sets you apart? What are you good at? What do you want to be good at? Basically, what are the foundational blocks of your company’s one-of-a-kind nervous system?

These might be hard questions to answer, at least initially. Ten years ago, the drive was to be good at everything — to use, build, or provide an end-to-end solution in which your company excelled in all aspects. Back then, these all-in-one, suite-based approaches seemed like the right path, both for vendors and users.

But we’ve stepped into a new world. Supply chain management is now built around layers of integrated solutions and powered by the cloud. More than ever before, charting your company’s strengths and priorities is paramount for shippers, freight forwarders, and suppliers and vendors. Because whether you’re two people in a one-room office using an Excel spreadsheet as your transportation management system or you’re a global 3PL or carrier with 30,000 employees, you can’t be great at everything. Nobody can.

That should be empowering, even liberating. You don’t have to be great at everything. You’re free to find your strengths and invest in them. You can find what makes your company unique and double down.

Making these decisions intentionally and consciously is one of the first steps to rethinking your supply chain. Ask yourself where you want to lead, where you want to follow, and where you want to get out of the way. As you begin building out your nervous system and interconnecting all of the various points of your supply chain management, you can start to understand your own DNA.

This, in turn, helps you talk to your software vendors more effectively. It helps you talk to your customers more effectively and find better alignment. And it helps you see and define your own organization in a deeper, more meaningful way to find better alignment across your ecosystem.

For example, consider a processes map for a third-party logistics provider (3PL). There may be upwards of 50 unique processes that all center around their core task of executing the movement of freight. That includes purchase order management, e-commerce fulfillment, shipment management, carrier booking, billing, CRM — just to name a few. Each of those might have 10 different vendors or systems behind them. So the 50 processes could ultimately turn into 500 solutions. That’s quite an ecosystem and for just one 3PL.

The point is, everyone in that ecosystem needs to understand they’re part of an ecosystem, but not everyone in that ecosystem needs to understand the whole ecosystem, nor can they.

You could make a very similar map for the systems and connectivity inside any shipper or carrier, or anyone else in the industry, for that matter. Like in the example above, they’re likely underpinned by dozens, if not hundreds, of processes and corresponding solutions.

If you don’t have a map like this, you need to make one. Then, start outlining and connecting all the various processes that make up your company’s supply chain.

What parts of that map are most important to you? What’s important to your customers, suppliers, and partners? Again, what do you want to be good at?

Draw a box around the processes that answer those questions. Then, draw a box around what’s not important to you, and shade those out.

Are you a low-cost provider or a white-glove provider? Do you focus deeply on 4PL activities purchase order management? Are you the company that focuses on having a consistent experience across the globe? Do you want to excel at warehousing? Do you want to focus on e-commerce?

Whatever it is, know your own map.

Smaller companies tend to be good at this exercise because they don’t have a choice. They have to know and to say, “This is what I’m good at. This is where my hustle and focus is.” And vice versa — “this is what I’m not good at.”

In bigger organizations, this is harder. Nobody wants to work in the department where you have decided to be a mid-pack player, but the reality is that there’s only so much budget to go around. Being clear and honest at an executive level can remove a lot of this tension. If a VP or director understands that they need to be a mid-pack provider, they can work with their software providers to focus on things like cost savings instead of innovation which can save millions of dollars and years of heartache.

But big or small, your company has a unique DNA, a nervous system that defines it. It is who you are. Knowing who you are and being confident in that will help you be the most effective. It will help you prioritize what’s important and what your company should be investing in. Once you do that for yourself, you can find the right suppliers that align with your organization and your goals and, on the flipside, demonstrate your value to your own customers in those same ways.

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Brain Glick is the founder and CEO of Chain.io. Chain.io is a cloud-based supply chain integration platform that connects the industry’s best-in-class tools and trading partners to create data visibility across systems. Chain.io delivers smarter and faster data integration using a cutting-edge supply chain connectivity platform. The fully managed integration services allow Logistics Service Providers, Shippers, and Technology Firms to work together more efficiently under one umbrella. Specialties include connecting modern APIs to legacy EDIs, as well as complex client integration. For more information, please visit www.chain.io.

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Archives, Global Logistics Planning Guide, Global Trade Daily

GLOBAL TRADE’S ANNUAL LOGISTICS PLANNING GUIDE PUTS YOU IN THE POWER POSITION AGAIN

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2020 was a historic year from politics to a pandemic, but professionals working in logistics, in particular, faced huge challenges and had to dramatically pivot their strategies. As 2021 kicks off, professionals working in logistics, notably 3PLs and 4PLs, will need to remain flexible as some of the changes from 2020 are here to stay.

To prepare you for what lies ahead, here are 10 supply chain and logistics trends to watch for in 2021.

1. Shorter Contract Terms

As we all witnessed, capacity was incredibly tight throughout the year, giving carriers more negotiating power for higher rates, especially leading up to the holiday season. Contract trucking rates are heavily influenced by spot market movements so instead of conducting an RFP in Q3 or Q4 for the year (which is typically RFP season) and locking in a yearly rate, shippers created shorter contract terms, hoping rates will improve in 2021. While this helps shippers to lock in rates in the short term (and helps them budget), it is still a gamble because rates could remain steady or increase. 

This year, I anticipate that this trend will continue. Shippers and carriers want and need more flexibility in this volatile market. Shippers are hoping for lower rates in the future, and carriers want to take advantage of a hot spot market without rejecting previously contracted freight. 

2. Tech Investment for Shippers

Unless new technology investments are truly essential to running the business, many shippers will not be investing heavily into new technology until the pandemic is over. While technology will be a good investment in the long run, it’s often a “want” over a “need,” and it takes a lot of human capital, research, and time to invest in the right technology that will pay off for your business. Right now, every professional working within the supply chain has their hands full running the business, so I anticipate less money and time spent on tech investments in 2021.

While shippers may be hitting the pause button, logistics companies, especially 3PLs, have an opportunity right now to leverage their greatest asset: people. What is most important in our current environment is trusted relationships and human touchpoints. The industry is still scrambling to keep up with the demand for a constantly changing global supply chain, and handholding and relationships will go further than flashy new technology. 3PLs can capitalize on this by spending time discussing with carriers and customers how they can solve their current challenges with best-in-class customer service. If your company is leaning on a new technology or making an investment into this area, this is the year to publicize your innovation widely because there will be less technology noise in the marketplace. Have a technology story that got your company through 2020? Now is the time to tell it. 

3. Consumer Buying Behavior Will Remain A Top Stat for Logistics

3PLs are tracking consumer behavior closer than ever. Due to the pandemic, consumer buying behavior changed dramatically, disrupting the supply chain in ways not previously seen. Because of consumers’ impact on the supply chain and demand of freight, 3PLs, in particular, will continue to follow key consumer buying behavior data. 

Additionally, in 2021 I expect continued steady growth in-home delivery services (from retailers to foodservice) so all eyes will be on final mile demand. This year, we’ll see more online marketplaces and innovation within final mile delivery. With new companies and offerings entering the industry, 3PLs have an opportunity to forge new relationships and add core competencies with these businesses to gain an advantage over their competitors. 

4. Spot Market Will Likely Stay Hot in 2021 

We might call 2021 the Capacity Games–may the odds be ever in your favor. Carriers are entering 2021 with negotiating power. Amidst one of the most volatile marketplaces in recent memory, the growing disparity between driver supply and truckload demand has resulted in increasing tightness. When this is the case, we expect upward pressure on truckload rates, just as we did throughout the back half of 2020. We may have hit the peak of inflated spot rates, but with the pandemic still raging, carriers have the upper hand on rates and may decide to take fewer contracts this year to reap the benefits of the spot market. When some form of normalcy does return, we will see another round of shifting capacity and supply chain volatility; 3PLs that can navigate the chaos and guide their customers through it are going to come out on top with relationships and case studies that will speak volumes. 

If you’re a shipper or a 3PL, this means you have to think about the whole carrier experience beyond just rates. Carriers want to get paid quickly and treated well, so if the facility they are servicing is difficult to navigate or doesn’t offer any driver amenities, your freight is far less desirable compared to previous years. To entice carriers, shippers and brokers need to be creative, reliable and more than anything, flexible. 

5. Carriers Focus On Diversifying Their Book of Business

Prior to the pandemic, most carriers specialized in one or a handful of specific industries. This was a sound strategy because specialization allowed carriers to set themselves apart from the competition by tailoring their vehicles, routes and service to the needs of shippers (who all have different needs, depending on their industry). COVID disrupted this strategy. When the pandemic struck, certain industries completely shut down. From automotive to restaurant services, carriers can no longer focus on one niche industry as the pandemic showed how having all of your eggs in one basket is ripe with risk in these times.

This year, I anticipate more carriers will diversify the industries they support. 3PLs have an opportunity to help and should look for opportunities to offer freight to their trusted carriers who previously may not have considered that type of freight before. By partnering closely with carriers to educate them on the needs of that particular freight and help them enter a new industry, 3PLs will be able to solidify their carrier relationships while also problem-solving for shippers who are desperate for capacity. 

6. Reefer Capacity Will Be Tough To Come By 

People are still working from home. COVID numbers are at an all-time high, and many cities/states are under curfews and restrictions to discourage people from leaving their homes. But people still have to eat. Groceries stores and food delivery will continue to be in high demand, translating to huge demands on reefer capacity. Add to this the reefer capacity needed to effectively distribute the vaccine and the grip on capacity tightens. This isn’t news. This has been the case since March 2020, but it’s only going to continue. 

3PLs have to remain nimble and creative to source reefer capacity and make sure the service they offer those carriers is top-notch to ensure those carriers will continue to partner with them. 3PLs who are able to keep reefer carriers moving and maximize the efficiency of their assets will be the ones who benefit on both sides of the customer/carrier relationship. 

7. Regional Distribution

Because of the supply disruptions in 2020, there was a renewed focus on regional distribution. Amazon led the way during COVID, relying on their regional distribution network when drivers were hesitant to drive long hauls far from home. This will continue to be a go-to strategy for many shippers, and I anticipate we will see many retailers investing more into their regional distribution strategy. This shift will create two demands: final mile and long haul. 3PLs that are able to competitively source and seamlessly provide these two modes to their customers at varying degrees of volume will be the heroes of 2021. 

8. Opportunities for Mid-Size to Small Carriers To Get Access To New Customers

With the COVID vaccine distribution, many large carriers, seasoned in pharmaceutical freight, have been tapped to move this critical freight which means they will not be able to fulfill previous contracts. So, who is going to move that freight? Mid-size to smaller carriers have an opportunity right now to get in with the companies left in a lurch. 

This may not be the strategy for every carrier, but with so much capacity going to the vaccine (as well as all the implementation needed to distribute a vaccine), carriers have an opportunity to service freight previously unavailable to them. 

3PLs, keep this in mind. Follow which large carriers are transporting the vaccine and take advantage of opportunities to follow up with their known customers who may be hurting for capacity. While historically technology, integration, volume commitments, etc. were barriers for mid-size to small fleets in providing service to large shippers, 3PL relationships should be providing access to these large customers as need for capacity widens. 

9. Relationships Continue to Be King

As isolated as many of us have been in 2020, relationships and personal connections mean more than anything. Both individuals and companies want to work with people they know and trust and can rely on to deliver in a time of need. Logistics is truly a people business. No matter what role you play in the supply chain, if you focus on building and deepening your professional relationships, you are investing in your future. 

10. Greater Focus on the Value of Drivers/Carriers

I’m hopeful 2021 will be the year that drivers/carriers will finally get the full respect they deserve. From keeping our grocery stores stocked to distributing the COVID vaccine, carriers/drivers have been on the frontlines of this pandemic. The past few years, the industry has talked about a driver shortage with the narrative focused on a lack of talent entering the industry. But if we take a step back, the problem isn’t people’s interest, it’s because these essential, frontline workers deserve a better wage. 

If we truly want to solve the driver shortage and respect the people who have been front and center in this pandemic, the industry must reward carriers/drivers with better pay, benefits, and support. 

As we continue to progress into 2021, it’s clear that many of the supply chain impacts from 2020 are here to stay. Flexibility and a commitment to relationship building should be a priority for any logistics company looking to navigate the challenges ahead.

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Aaron Galer serves as senior vice president of Strategic Accounts at Arrive Logistics, “a carrier and customer-centric” logistics company that is headquartered in Austin, Texas, and has offices in Chicago and Chattanooga, Tennessee. Aaron is focused on growing and strengthening partnerships with Arrive’s enterprise shippers and carriers as well as tailoring unique solutions specific to their needs, industry and logistics challenges. He also serves as an internal resource to the entire Arrive team.  Prior to joining Arrive, Aaron helped launch the Amazon Freight program and has nearly a decade of logistics experience with Fortune 500 companies including Expeditors and Starbucks. His past responsibilities include building and overseeing transportation teams that manage large transportation spends and developing technology for large shippers. Aaron is active in the supply chain communities in the Greater Grand Rapids and Greater Seattle areas; he holds certifications in Lean Six Sigma and with ASCM and has a degree in Supply Chain Management from Michigan State University.

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Air Cargo, Archives, Global Logistics, Global Trade Daily

The Importance of Packaging Optimization in Supply Chain

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Packing is usually considered as one of the most boring, least impactful aspects of a supply chain. With logistics, transport methods, and keeping track of your freight shipments, why should you bother with packaging optimization in supply chain? Well, as it turns out, it can have some surprising benefits, especially when appropriately tackled. So, with that in mind, let’s take a more in-depth look into the importance of packing in supply chain management.

Packaging optimization in supply chain management- why it matters

Before we go over the importance of packaging optimization, we need to outline what packaging entails clearly. If you are new to supply chain management, you might think it is merely putting items into boxes. But, in actuality, there is much more to packaging once you get into it. There are various materials to consider, be it their cost or sturdiness, not to mention packaging design for branding and eco-friendliness of your packaging procedures. Therefore, even in a couple of sentences, we can give you an idea that packing is a significant issue and how useful it can be to optimize it with due care.

Safety measures

Safety should always be your primary concern. Whether you are dealing with something private or business-oriented, safety is paramount. With this in mind, you’d be hard-pressed not to consider packaging optimization. By handling your packing procedure, and everything that goes with it, you can ensure that your supply chain is safe. People often forget that proper packing requires in-depth knowledge of the whole chain. It is precisely because you know where the shipments are headed that you should do your part in preparing them.

It often happens that people pack and repack shipments during the supply chain. This is primarily because they are only worried about keeping the shipments safe during their segment. Tackling packing like this is not only cost-inefficient but also potentially dangerous. Since people mainly focus on short-term safety measures, they are unlikely always to follow the necessary packing procedure. By dealing with the whole aspect of packing in one go, you can use the right packing supplies and tape, label, and log items as necessary. While doing so might seem minute, it will play a prominent role in how safe your shipments are.

Cost optimization

As we have already mentioned cost optimization, let’s elaborate more on what role packaging optimization has in it. If you allow people who are not interested in cost optimization to pack your belongings, they will do a poor job. Sure, they will ensure the safety of your items. But, they hardly have the incentive to use packing supplies adequately. It results in half-packed boxes, poorly structured shipments, and considerable unused space. These are the main things that you need to avoid. Now, you might think that these things don’t add up as much. But, think again.

By handling all of these aspects with due care, you will optimize your packaging to the utmost cost efficiency. Keep in mind that even a slight increase in optimization can end up saving you a lot of money. All of the aspects that we have mentioned pile up, especially in large supply chains. So, the more of them you take care of, the better off you’ll be. In fact, we wouldn’t be surprised if you end up astonished at how much money you were wasting with improper packing.

Brand recognition

There is hardly a marketing strategist out there that won’t tell you about the importance of brand and brand placement. If you plan on running a decent marketing strategy, you need to develop a brand and use it in every facet of your business, from your online presence to your vehicles, worker uniforms, and even packaging. There is a reason why companies like Amazon invest in their packing supplies. Branding on them ensures that your customers see your logo, even before opening their products. Not to mention all the people that will be handling your boxes during the shipping procedure. So, all in all, know that investing in branded packing supplies is definitely worth the money spent, especially if you ensure that they are of top quality and that your packing is overall stellar.

Eco-friendliness

Having eco-friendly supply chains is becoming more and more necessary. The current situation requires us to do whatever necessary to protect our environment. Luckily, this is another aspect where packaging optimization has a role. True, it won’t have as big of an effect as utilizing carbon capture or using more eco-friendly fuels. But, the impact it does have is nothing to scoff at.

Using eco-friendly supplies will go a long way in protecting the environment and ensuring low waste. After all, the biggest problem with packing is that we use non-degradable materials like plastic and styrofoam and routinely throw vast amounts of it away. This has to change, and modern supply chains do whatever necessary to do so. Modern materials allow for the same safety while being biodegradable. At the same time, eco-conscious packing procedures ensure that we waste as little as possible.

Final thoughts

All things considered, you should have a decent idea of the importance of packaging optimization in supply chain. Without it, you not only risk losing money but also endangering your items and having a substantial carbon footprint. Know that even a small change in your packing procedures can have a long-lasting effect on your finances and the environment. So, invest your time into looking into it. Once you do some research, you will learn that we’ve come a long way from run-of-the-mill cardboard boxes. Modern packaging solutions give you a lot of freedom to explore how to make packaging as optimized as possible. So, do your best to make the most out of them.

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Amanda Anderson has been a relocation coordinator for various moving companies and marketing advisor for Capital City Bins. During her 15 years of service, she has learned a thing or two about shipping and how to prepare for it safely. Now she helps both professionals and amateurs handle shipping with due care.

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Archives, Global Trade Daily, Special Reports

Adapting Your Sales in a Six Feet Apart World

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We talk about it all the time – “when things go back to normal.” But will they? Will sales ever be the same?

2020 forever changed us. Sales processes were turned upside down. In-person meetings – probably not happening for quite some time. Remote presentations – now the norm. Sales engagement software – a must. These changes are not temporary. If you aren’t yet, how do you adapt to the next normal?

Digital first

The pandemic accelerated the rate of change and digital transformation much faster than any of us anticipated. Now, B2B buyers and sellers doing business digitally is the norm. According to Mckinsey, more than three-quarters of buyers and sellers say they now prefer digital self-service and remote human engagement over face-to-face interactions. The path forward is clear: Digital is here to stay.

We might physically have to remain six feet apart, but digitally nothing is slowing down. In a digital selling environment, the speed of sale is increasing in importance. Gone are the days of sending a PDF attached to an email or getting on a plane and waiting days for the next step in the sales process. In our time of immediate gratification, inefficient, time-consuming sales processes will no longer be acceptable.

Digital first also transforms the traditional sales hire. Tech-savviness is now part of the job description. A high-level of familiarity with popular CRMs, sales enablement solutions, and contract automation are now a must-have. As we continue digitally, the technical requirements for sales hires will increase.

Humanize the digital experience 

Today, buyers have more access to information and knowledge than ever before. They’ve read online reviews, seeked advice from peers, and compared features of multiple products before they even speak to you. If you want to remain competitive, you have to go beyond the basics. You must provide value that a buyer can only receive from an expert. By putting your prospect-first, you will stand out from the crowd.

In addition to putting your prospect-first, it’s important to keep the personal touch throughout the digital sales process. Without personal touches, trust issues can arise, and closing the deal becomes harder. You need digital tools to create engagement and human touch with prospects. Adding a personal video when presenting proposals and sending out agreements is an emerging way to humanize the digital experience. Live chat has also emerged as a top channel to create engagement and trust with prospects.

Empathy is key to the digital experience. The need for empathy for your prospects and yourself continues in the next normal. We wake up ready to slay each day, but inevitably something will humanize the day. You want to answer your prospect’s questions and provide a solution that will help them thrive, yet it won’t dominate every conversation. Connect human to human when dogs bark at the mailman or children need help with a virtual school. We’re all in the next normal together.

Technology is a co-worker

Digital first not only transforms the traditional sales hire, it transforms co-workers. With reliance on digital selling, so does the need for sales software solutions that helps sales reps humanize the digital experience and close more deals. It starts with a team of technology co-workers automating the sales process from proposal to eSignature. Combine that with the tools to connect with prospects through video, live-chat and real-time data tracking, your sales team will stand out from the crowd. Now, more than ever, it’s important to have a solid team of technology co-workers.

When it comes down to it, sales will never be the same. Legacy processes can’t keep pace with today’s buyers. Being digital first, humanizing the digital experience and building a team of technology co-workers will have you on your way to succeeding in the next normal.

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Tara Pawlak is the Head of Marketing for Get Accept, the all-in-one sales platform where you design, send, track and market your proposal to get more deals digitally signed. 

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Archives, Global Trade Daily, Global Trader Profile

2021 Starts Off Right for These Global Traders

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Burkhard Eling will become CEO and Executive Board spokesman of logistics provider Dachser. The former leader of Dachser’s Corporate Strategy, Human Resources and Marketing units will succeed Bernhard Simon, who will take over as chairman of the Supervisory Board of the Kempten, Germany-based family-owned company at mid-year.

Tim Thorne announced his retirement as president ArcBest less-than-truckload carrier ABF Freight, effective June 30. Seth Runser, ABF vice president-linehaul operations, will be promoted to the new role of ABF chief operating officer, effective Feb. 1, and he will become ABF president on July 1.

Paul Brady has been named CEO of 3Gtms, LLC, a global provider of cloud-based transportation management software based in Shelton, Connecticut. Brady, who has a long track record of success with start-ups, growth companies, and complex multinational businesses, succeeds Mitch Weseley, who retired to join the 3Gtms Board of Directors.


Brian Drees, who has more than 25 years of management/engineering experience, has joined ODW Logistics as the Columbus, Ohio-based company’s new senior director of Operational Excellence. And we can’t forget to mention that John Haber will now lead the small parcel division of Transportation Insight.

After 18 years as Pfizer’s cold chain and network solutions specialist, Matthew Tomkinson has joined Softbox as a Technical Solutions specialist. Softbox is a leading global innovator and provider of passive temperature-controlled packaging solutions for the pharmaceutical, life science, and cold chain logistics industries.

Jannie Davel has joined Delta Cargo as managing director-Commercial, while Vishal Bhatnagar has been promoted to managing director-Global Cargo Operations. Davel, who will lead the Sales, Alliances and Product Management divisions, hails from DHL Global Forwarding and Emirates SkyCargo. Bhatnagar most recently was Delta Caro’s director of Cargo Operations Performance and Customer Experience.

Geert Aerts will be the new director of Cargo & Logistics at Brussels Airport. He had been active in aviation the previous 17 years at CAE Inc. Aerts succeeds Steven Polmans.

B&H Worldwide, a leading global provider of aerospace time-critical logistics solutions, appointed Michael Haskins as its head of Global Sales. He was most recently at Tala (The Aerospace Logistics Alliance). 

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Archives, Global Logistics, Global Shippers 101, Global Trade Daily

How Will Ocean and Air Market Conditions Affect Your Shipping Decisions?

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Global transportation—like many industries—has faced unparalleled disruptions over the past year. Now, as we head into 2021, there are new and different challenges added to the mix.

Many of our global shipping customers are up against the clock with Chinese New Year (CNY) approaching, while also navigating potential changes from a new U.S. administration. Of course, fast-changing consumer behaviors, port congestion, and continued uncertainty around the impact of COVID-19 continue to bring changes to the market as well.

Today I’m going to focus on how the ocean and air shipping markets have been affected and steps you can take to successfully account for these and other events.

Greater market demand overall

The global logistics market is forecasted to grow over 17% in 2021. And only a month into the year, that growth seems to be on track due to heightened demand across major global trade lanes. Volumes between China and the United States have increased by 30% compared to this time last year. It is likely the demand will continue past CNY, which falls on February 12, this year.

We historically see a spike in demand before CNY, but this year looks different from past years. Many companies are stockpiling and replenishing stock rooms in the wake of COVID-19 disruptions. And with a continued need for PPE and the dramatic uptick in ecommerce shopping, it’s no wonder there’s greater amounts of freight being moved right now.

Demand and disruption in ocean shipping

Ocean shipping capacity and port congestion

You’re most likely to see the most congestion and capacity constraints when shipping via ocean service in early 2021.

Significant increase in demand and equipment shortages in Asia have led to longer dwell times for vessels, which inevitably delays export shipments. In the United States, carriers continue to reduce the amount of exports in order to reposition empties back to Asia. Additionally, the uptick in vessel accidents due to inclement weather has added to the delays. Companies whose freight went overboard are not the only ones impacted, in fact the recent incident with ONE APUS resulted in all remaining freight being unloaded in Japan for further inspection. Inspections and transloading are likely to add considerable delays to a container’s journey.

Historically, ocean carriers announce the percentage of capacity that will be removed from the market during CNY. However, with the continued high demand and equipment shortages likely to continue through March, carriers have announced they will only remove 2-4%. This is down from the average 15-20% that we’ve seen removed in previous years.

Demand and disruption in air shipping

COVID-19 vaccine distribution

Air passenger travel is still down, and capacity for air cargo remains tight. Today, COVID-19 vaccine distribution has had minimal impact on capacity, but we’re closely monitoring the situation as it could and likely will change rapidly.

The majority of COVID-19 vaccines will not require inter-continental airlift, however, when doses do need to be transported via air, many airlines are already prepared to reposition capacity. When this happens, expect heavy demand from both Europe and India. And if/when this capacity is pulled from today’s already tight air market, your global supply chain may need to pivot in response.

With new COVID-19 strains and outbreaks, many countries are now requiring pilots and airline crews to quarantine or limit overnight deliveries. These changes will likely add to the inconsistencies and put pressure on air freight costs.

Successfully overcome shipping challenges

Monitor global events

Shipping across borders inevitably means customs and global compliance will play a vital role in your supply chain. It’s important to keep abreast of the changing global trade climate so your company can remain compliant and avoid customs delays. This is especially true with a new U.S. administration in place and Brexit in full swing.

While President Biden has indicated he does not plan to focus on trade and tariff changes immediately, he has already expressed his intention to approach trade differently than the previous administration.

Additionally, shippers both in and out of the UK will need to stay up to date on changing regulations as Brexit continues to progress, and any change may directly impact many supply chains.

Establish a plan for disruptions

Despite the challenges, it is possible to mitigate delays due to congestion and equipment shortages. We’ve been able to help multiple customers avoid 10+ day delays by routing shipments through a different port or shifting freight across modes.

Instead of trying to keep up to date about market changes from several news sources, you can trust a single information source to help you see how market trends will impact capacity and pricing. C.H. Robinson’s Global Forwarding Insights webpage provides a clear picture of rapid shifts in ocean and air capacity by aggregating current market information, like I shared above, in one easy to view place. With trade lane level detail, these market insights provided by industry experts are presented with an easy to understand summary of past and present market conditions so you can maintain flexibility, adapt to potential disruptions, and prepare for the most complex shipping challenges.

To dig deeper, connect with your logistics provider to develop a disruption action plan which is key to creating an agile, flexible, and well-rounded supply chain.

Cainiao
Archives, Global Trade Daily, Imports/Exports

Cainiao Smart Logistics Announces New Container Booking Service

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Cainiao Smart Logistics announced the launching of a new container booking service this week. Known as an extension of Alibaba Group, Cainiao’s booking service sets the bar higher for a quick turnaround in booking confirmations, maximizing cost savings, and access to a wider global network of ports and participating countries.

“In the face of the current global container shortage and surging shipping prices, Cainiao is committed to leveraging our technology and logistics ecosystem to provide a one-stop port-to-port shipping solution for exporters and importers,” says James Zhao, General Manager of Cainiao Global Supply Chain.

According to the information released, merchants can expect a booking confirmation just two business days following order placement. Considering the usual turnaround for booking can range from a week to a month, this significantly expedites the process for the industry. Both air and sea freight bookings will be available through the service along with competitive compensation in the event of booking delays and/or missing a departure date.

More than 200 ports in 50 countries are connected through the service including China ports in Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Hangzhou, Yiwu, and more. Additionally, those that utilize the new booking service can enjoy a significant price decrease on a cross-border port-to-port shipping fee, as Cainiao’s fee is reported to be up to 40 percent less than market rates, offsetting the market increase in shipping costs due to the container shortage.

According to the China Container Industry Association (CCIA), the increased turnaround time has some waiting up to 100 days versus 60 days for containers due to the capacity cuts in international markets, specifically in the U.S. and Europe. Pair this with the spike in freight costs, there’s no doubt this new booking service will serve as a reliable solution for the industry.

“By working closely with airlines and cargo companies, we aim to safeguard the entire cross border line haul network and instill greater stability into sea and air freight shipping,” Zhao concluded.

freight forwarders
Archives, Global Logistics, Global Trade Daily, Ocean Ports

TOP 10 FREIGHT FORWARDERS OF 2020

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By occupying six slots, including the top three, the Alpine Region of Central Europe dominates Global Trade’s list of the top 10 freight forwarders of 2020.

 1) Kuehne + Nagel

With more than a century specializing in the transportation space, Kuehne + Nagel serves multiple industries, including high tech, industrial products, perishables, pharmaceutical and healthcare industries. Services include: order management, warehousing and storage, supply chain consulting, project management, air, rail and sea cargo and expo and events. Kuehne + Nagel Management AG, Dorfstrasse 50 Schindellegi, 8834 Switzerland, Tel: 41 44 788-9511.

2) DHL

DHL Supply Chain and Global Forwarding Divisions provide freight forwarding services throughout Europe, Russia and the Middle East via rail, air and road. The company’s global reach extends from transportation and warehousing to industry-specific solutions designed to streamline worldwide logistics for its clients. Services include: dedicated freight management, warehousing, customs services, freight security, supply chain management and air, road and sea shipments. DHL Supply Chain and Global Forwarding, Deutsche Post AG Headquarters, Platz der Deutschen Post, 53113 Bonn, Germany, Tel: +49 228-1820.

3) DB Schenker

The logistics division of German rail operator Deutsche Bahn AG provides an array of logistical and supply chain consulting services for clients throughout the automobile, technology, consumer goods, special transport and trade fair logistic industries. Services include: e-commerce solutions, fulfillment logistics, lead logistics services and intermodal transportation. DB Schenker, Richard-Wagner Strausse, Essen, Germany, Tel: +49 (0) 201 8781-4990.

4) (tie) DSV Global

Headquartered just outside of Denmark’s capital of Copenhagen, DSV offers worldwide warehousing and transportation solutions for European and North American companies looking for supply chain solutions across the global stage. Services include: full or less-than-truckloads, warehousing, order fulfillment, intermodal, air, sea and rail shipments and “supply chain innovation.” DSV + Panalpina, Hovedgaden 630, 2640 Hedchusene, Denmark, Tel: +45 43 20 30 40.

4) (tie) Sinotrans Limited

With offices throughout Asia and the Pacific Rim, Sinotrans offers transportation solutions from warehousing to getting goods to their final destinations. Services include: warehouse management, distribution solutions, cross border freight hauling, intermodal transport, project lead and “innovative supply solutions.” SinoTrans Ltd., 6F Suite B Waiyun Building, Building 10 Yard 5 Anding Road, Beijing, China 100020, Tel: 86 10-5229-5600.

6) Expeditors

The Fortune 500 service-based logistics company believes because it does not own the aircraft, ships, or trucks they use every day on six continents, they can be highly flexible when it comes to supply chain management. Services include: supply chain design and optimization, order management, fulfillment, warehousing, customs brokerage and air, sea and ground transportation. Expeditors International, 14301 24th St E, Sumner, WA 98390, Tel: (253) 863-5502.

7) (tie) GEODIS

The French logistics company aims to be a growth partner with its clients through its proven expertise and emphasis on excellence. Services include: supply chain optimization, freight forwarding, contract logistics, distribution & express and ground transport. GEODIS, Espace Seine, 26 Quai Charles Pasqua, 92300 Levallois-Perret, France, Tel: +33 1 56 76 26 00.

7) (tie) Bolloré Logistics

A global leader in international transport & logistics, the French company is committed to delivering reliable, flexible, innovative and value-creating solutions that help clients grow. Services include: transport, trade compliance, contract logistics, global supply chain, e-commerce and customer care. Bolloré Logistics, Tour Bolloré, 31-32 quai de Dion Bouton, 92800 Puteaux, France, Tel: +33 (0)1 46 96 44 33.

9) Nippon Express

First established in 1937, the Japanese company operates in more than 40 countries, with clients throughout Asia, North America and Europe and overseas transit facilities in Thailand, Indonesia and Malaysia, among other locations. Services include: warehousing, distribution, cross border freight hauling, fine arts transport and moving services. Nippon Express, Higashi-shimbashi 1-9-3, Minato-ku, Tokyo, Tel: 81-3-6251-1111.

10) Hellmann Worldwide Logistics

Founded in 1871 by Carl Heinrich Hellmann, who as the lone employee used a horse-drawn cart to deliver parcels in and around the town of Osnabrück in northern Germany, Hellmann today has a worldwide network of 20,500 people in 489 branches in 173 countries. Services include: logistics, insurance, security, technology, e-commerce and road, air, rail, and marine transportation. Hellmann Worldwide Logistics GmbH & Co. KG, Elbestrasse 1, Osnabrück, 49090 Germany, Tel: 49-541-605-6450.

We created our list by considering three other lists that were released this year. In September, Armstrong & Associates, Inc. (A&A), an internationally recognized key information resource for 3PL market research and consulting, put out a list of 2020’s top 50 ocean freight forwarders that is based on 2019 TEUs, logistics gross revenue and air metric tons.

Actually, A&A updated an earlier list because two heavy hitters in the ocean freight industry, DSV and Panalpina, merged in 2019. Then came COVID-19 early in 2020, which necessitated an examination of responses to the global pandemic.

A “key trend we’re watching is the impact COVID-19 is having on various modes of transport,” A&A President Evan Armstrong explained to Logistics Management Executive Editor Patrick Burnson. “Ocean capacity may open up, but rates will escalate. In the meantime, the air cargo sector will become more reliant on expensive freighters, as passenger traffic remains in steep decline in the international marketplace.”

Global Trade also considered 360 Research Reports’ Global Ocean Freight Forwarding Market Size, Status and Forecast 2020-2026 examination that focused on 25 companies and was released pre-pandemic, in January.

Thanks to the A&A and 360 Research reports, there were definitive answers about which companies would occupy most of Global Trade’s top slots. However, we also turned to a third report to settle any differences between the other two: a list of the top 10 3PLs in the world released In July by TradeGecko, which is part of Intuit QuickBooks, an accounting software company.

While freight forwarders on the Global Trade master list serve U.S. markets and have facilities in the States, our collection doesn’t exactly scream “American.” Fortunately, Armstrong also shared some wisdom with Burnson that may have Yanks ranking better in 2021. “We’ll see more shipping and sourcing in North America as shippers reevaluate their options overseas,” the A&A president says. “The ongoing trade tensions with China will also exacerbate this situation.”

The U.S. companies that did not make our top 10 but would have easily made our top 50 include: C.H. Robinson, XPO Logistics, United Parcel Service (UPS), Yusen Logistics, Mallory Alexander, Odyssey Logistics and Technology and Horizons Air Freight.

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Armstrong & Associates, Inc.’s Top 50 Ocean Freight Forwarders of 2020: https://www.3plogistics.com/3pl-market-info-resources/3pl-market-information/aas-top-25-global-freight-forwarders-list/

360 Research Reports’ Global Ocean Freight Forwarding Market, Size, Status and Forecast 2020-2026: https://www.360researchreports.com/global-ocean-freight-forwarding-market-15076500

TradeGecko’s Top 10 3PLs in the World: https://www.tradegecko.com/blog/supply-chain-management/top-10-3pl-companies

consumer
Archives, Global Logistics, Global Trade Daily

Omnichannel is Everything – How the Pandemic has Made Direct-to-consumer a Priority and is Upending the Old Supply Chain Model

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If 2020 taught us anything, it demonstrated that to succeed, maximize resilience, and ensure business continuity, companies need to utilize every available channel – e-commerce, direct-to-consumer, retail stores, distributors, and marketplaces like Amazon. That way if one channel is disrupted, whether by natural or man-made causes, the show will go on. In this environment, enterprise and functional silos, coupled with batch processes, won’t do. Companies will need to rely even more on supply chain networks to consolidate demand across every channel and have a view into every point of supply, to be able to satisfy customer demand efficiently, grow revenues, and minimize costs.

The pandemic highlighted the urgent need for businesses not to rely on a single channel for servicing customers. Many companies that were doing well through brick and mortar, both retailers and manufacturers, suffered a huge blow when the pandemic hit and stores closed. Many of them are now scrambling to catch up and bolster or create their e-commerce channels and just in time. E-commerce has surged with Accenture reporting that “much of this new e-commerce activity has been from new users. COVID-19 will permanently change consumer behavior. Consumers’ attitudes, behaviors, and purchasing habits are changing—and many of these new ways will remain post-pandemic.” It is clear that companies that can exploit this channel, but those who fail to do so will slip behind their competitors.

Meeting the Challenges of Direct-to-Consumer

Organizations today know the value of being customer-centric, focusing on the end-customer, and tailoring the supply chain to serve customer demand as and when it happens. However, this means having products available, keeping customers informed of the progress of their order, and ensuring a timely and smooth delivery experience. In these times, it’s extremely difficult and costly to acquire a customer, and a single bad interaction can lose them.

That becomes a major challenge when customers are everywhere, in stores, physical and virtual, shopping on third-party marketplaces, and researching and reviewing on social. Today, being customer-centric requires a view across all demand channels and the ability to aggregate that demand. It also requires visibility to all available supply so organizations can coordinate that supply to meet demand at the lowest cost. That might be a pick-up in store, ship from store, ship from DC, or from the manufacturer direct to consumer.

To do so efficiently requires the ability to plan, collaborate, and execute across the extended supply chain. What does it take?

A Connected Real-Time Business Network. Companies need to be connected, not just to their immediate trading partners, but to their entire supply network. This means connecting and coordinating with distribution centers, fulfillment partners, retail locations, and parcel carriers, and perhaps with “white glove” installation and service partners.

Processes to Support Order Size of One. Companies of all sizes need to become better at efficiently managing single item orders. However, those new to e-commerce and accustomed to shipping bulk order quantities to distribution centers and stores will need to move to smaller order quantities through to the end customer. The rule upstream has been to enforce minimum order quantities in order to drive efficiencies and lower costs. Today, shippers must process a “little-and-often” approach that is predicated on point-of-origin collaboration and consolidation to move smaller quantities more frequently based on real-time demand updates.

Real-Time Data. It is possible to move to smaller order quantities and actually decrease costs by using the end-to-end network since it can provide real-time data down to the item level. This eliminates information lead times and enables real-time visibility and collaboration. In turn, this reduces variability and the bullwhip effect for all trading partners by providing real-time insight into demand across all tiers. It creates better alignment between departments and partners and coordinated response to demand and makes possible truly demand-driven logistics. From a transportation perspective, mixed loads will become the new normal.

A real-time network also enables visibility to, and the ability to redirect and reallocate supply from all sources, stores, warehouses, suppliers, even product in-transit to match demand. This means more agility and accuracy in deploying inventory and using the most cost-effective source of inventory for customer orders.

Integrated Logistics. For optimal efficiency, organizations also need logistics options across every mode, from international and ocean to domestic and last-mile delivery. Networks enable this because the technology views inbound and outbound orders as two sides of the same coin. What one trading partner considers inbound, another considers outbound. Thus, the only way a last-mile solution can benefit both the consumer as well as the companies providing the goods and services, is to optimize all inbound and outbound across a single network. Providing visibility, control, and math-based or AI-based decision-making at different supply chain touchpoints empowers trading partners to make well-informed decisions about positioning and moving inventory. Telematics and full order visibility enables companies to better anticipate logistics issues, minimize disruptions, predict ETAs and drive customer satisfaction.

Alerts and Analytics. Applying real-time, network-wide data, combined with AI and intelligent autonomous agents, greatly increases visibility to potential problems and expands an organization’s range of options for resolving them. Predictive analytics enable the business to anticipate issues sooner, while prescriptive analytics provide guided resolutions to fix them optimally. In many cases, where the resolution is within predefined “guardrails,” intelligent agents can resolve issues autonomously. This type of AI-assisted and autonomous problem solving is especially important in omnichannel environments, where there are a lot of channels and a high volume of orders and shipments in flux. Applying AI can also help balance complex trade-offs and consider the repercussions of decisions across many variables and at scale, in way that human planners cannot.

The omnichannel challenge of reaching direct to the consumer is winnable. Real-time data, networks, machine learning, and intelligent agents, make it possible for an individual home-based order to trigger a response from the supply network, while also aggregating this demand in real-time across all customers to leverage economies of scale. This allows the supply chain to function as a unified and agile ecosystem to achieve the highest levels of customer service at the lowest possible cost. Yes, even when the orders are home-based for individual items.

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Joe Bellini is COO at One Network Enterprises, provider of an AI-enabled business network platform that enables all trading partners to manage, optimize and automate complex business processes in real-time. To learn more, visit www.onenetwork.com or follow One Network at https://www.linkedin.com/company/one-network-enterprises.