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Back to Growth: U.S. Business Leaders Have Rosy Outlook for Economy

economy

Back to Growth: U.S. Business Leaders Have Rosy Outlook for Economy

The COVID-19 pandemic has affected every aspect of our work and life.

Business executives have had to quickly reconfigure operations, and millions have had to unexpectedly work from home or cease work entirely. Videoconferencing has become the killer app, and Zoombombing became a new privacy concern.

Despite the widespread health and business challenges brought on by the coronavirus, two-thirds of U.S. business leaders are optimistic the domestic economy will recover within a year, according to a survey TMF Group recently released.

It’s an encouraging sign that business executives in the U.S. are expressing this type of optimism, particularly based on the unprecedented challenges experienced throughout the economy over the last few months. This group was obviously very confident before the onset of the pandemic, and they now seem eager to not only restart their businesses but help reignite the economy as well.

We conducted the survey in the middle of April to gain insight into how companies plan to navigate these uncertain times. More than 40 percent of the 300 decision-makers who took part in the poll work in companies with more than 5,000 employees. Most of the respondents (85%) said their companies do business outside the United States.

Nearly a quarter of respondents (23%) expect a V-shaped economic recovery, meaning a dramatic bounce to pre-virus activity by the end of 2020 following the sharp collapse. Only a small minority (12%) anticipate the economic impact of the pandemic to the last two years or more.

Looking beyond the U.S., business executives were a little less optimistic but still positive: 56% of respondents said the global economy would recover within a year.

It may be easy for critics to judge the survey takers as stereotypical American optimists, but I believe their confidence is grounded on some key facts. The economic shock has been largely demand-driven, as travel restrictions and government stay-at-home orders shut down wide swaths of the U.S. and global economies. Many of the world’s governments acted quickly to offset the economic damage. In the U.S., the federal government and central bank organized a massive stimulus package and pumped trillions of dollars into financial markets. More than 60% of respondents said the financial support to workers and businesses in the U.S. has had a very positive or somewhat positive effect on their companies.

Now, as states allow more businesses to reopen, consumers are eagerly venturing out despite the ongoing health risks. As consumer and business demand rebound, companies will begin hiring again.

Indeed, business decision-makers are confident their businesses will rebound quickly. More than half say their companies will return to normal operations within six months.

In times of crisis, there’s a premium on bold leadership and decisive action. Resilient leaders continue to mount appropriate responses to the global pandemic while charting paths to recovery.

The survey underscored that the pandemic has forced business to rapidly evolve. Many are moving ahead to reassess, reimagine or reinvent their businesses. Thirty-six percent say they plan to accelerate plans for international expansion, and 32% plan to seize domestic growth opportunities.

It’s a positive sign that the strategic imperative to go global remains strong because COVID-19 has dealt a serious blow to the international system. The World Trade Organization predicted in April that world merchandise trade would plummet between 13% and 32% this year.

But the factors that have driven globalization for several centuries have not disappeared. People have been driven to seek profit internationally since the earliest days of the Silk Road, and this instinct will continue. Furthermore, the spirit of international cooperation has been strong in the response to the pandemic. Companies, government agencies and nongovernmental organizations are working across borders to solve problems at scale, such as developing a vaccine for the coronavirus.

A big motive for international expansion is the diversification of supply chains, cited by 35% of respondents. The coronavirus has interrupted the flow of goods across borders, from raw materials to finished products. The disruption has vividly illustrated that today’s highly interlinked, international supply chains have more potential points of failure and less margin for error for absorbing delays and disruptions.

Reducing dependence on one country or region is a priority. Diversifying your supplier base may increase costs in the short-term but will make your network more flexible and agile and potentially reduce the economic shock of future disruptions.

The outbreak of COVID-19 forced business to reassess every strategic objective and business plan. The health crisis has exposed vulnerabilities and created unforeseen challenges.

As businesses around the world consider how they can return from the economic crisis unleashed by COVID-19, the survey results provide some food for thought. Expanding internationally or domestically in uncertain times, for instance, may seem counterintuitive but could also fuel faster growth. Severe adversity provides real perspective. It is possible to find strength and confidence in the face of real hardship.

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TMG Group is an international professional services firm that provides administrative support services across multiple jurisdictions.

supply chain

New Supply Chain Optimization and Transition to DSN

Supply chains are typically linear, with a straight progression of:

1. Plan

2.  Design

3. Source

4. Deliver

In traditional supply chains, each step depends on the one preceding it, and inefficiencies in one phase can cause a domino effect of similar inefficiencies in the next stages.

Stakeholders also have zero visibility of other processes, which restricts their capacity to react or manipulate their activities.

But today that’s changing. As supply chains are transitioning from a straight sequence into interconnected, dynamic systems capable of evolving into an optimal state with time and can easily incorporate ecosystem partners.

This transition from sequential, linear supply chain operations to a dynamic, interconnected open system will lay the foundation for how businesses will compete in the future.

We term this open interconnected system, a digital supply network (DNS). And brands who cannot optimize their supply chain for the transition to a DNS may lose out in efficiency to those that do.

How does a Digital Supply Network (DNS) Function?

DSNs integrate data from various locations and sources to push the physical task of production and distribution.

Many companies already on the way to creating DSNs are changing their focus from optimizing and managing discrete functions, like manufacturing and procurement.

Rather, they often use digital supply networks to focus more on how the entire supply chain can easily achieve brand objectives while informing portfolio strategies, corporate and business units.

So DSNs allow supply chains to steadily become an integral part of decision making and strategic planning.

Organizations can now create and leverage many DSNs to complement various aspects of their strategy and efficiently target particular needs.

Transitioning from a Traditional Supply Chain to DSN – the Impacts

The purpose of any successful supply chain majors in the movement of finished goods, capitals, materials, and other assets from location to location.

At its core, though, a supply chain comprises numerous transactions: the exchange of money, time, information, or physical goods for any other unit of value.

However, dramatic digital and technological developments such as enhanced computing power and decreased overall costs have affected the traditional supply chain in various ways, such as an increase in production innovation and a decrease in transaction costs.

Reduction in Transaction Costs

The boost in power and technology efficiency has revealed itself in the drastic reduction of transaction costs for company operations both externally and internally.

It doesn’t have to be prohibitively time-intensive or expensive to acquire insight into each segment of operations anymore, or to understand supplier or customer demand patterns in-depth.

Whilst the linear flow of design, creation, and movement of physical goods stays unchanged, all underlying data now moves around and through supply chain nodes, dynamically and in real-time.

These new interconnections between processes and subprocesses transform supply chains into predictive and efficient networks.

When transaction costs fall, the capacity to transact with other partners rises. This allows transitioning to networked supply chains as businesses can connect with different partners when necessary to deliver increased value.

Production Innovation

Production in the physical world is changing because of dramatic improvements in the way matter is manipulated and the computing power that facilitates such processes with the goal of production.

Enhanced capital equipment will lead to less of it being needed to begin production. And with less capital, the minimum efficient scale drops, and production is allowed to locate nearer to demand.

How to Shift from a Traditional Supply Chain to a Digital Supply Chain

Once you’ve decided to transition your supply chain from linear to DSN, you must consider how to configure your supply networks to execute your plan.

To configure and achieve a DSN driven approach you can execute many supply chain transformations.

Here’s a pictorial explanation of 9 strategic transformations brands can make via leveraging DSN and a list of tactics to achieve each transformation.

Take EasyJet, for example, that offers virtual walkthroughs via smart glasses to enable two-way communication between its central engineering team and remote technicians.

With this, technicians can perform complex maintenance jobs and eliminate downtimes. The real-time walk-throughs enable the supply networks to move without hindrance and ensures a smooth transition from linear to digital networks.

Implementing a DSN – the Optimization

For business executives accustomed to traditional linear communications and data, the transition to real-time access to intelligence and data changes the way they do business.

Once your organization chooses to adopt a DSN, consider how to create, connect, and utilize the various industry-driven innovations that power it.

Before you create a DSN, it’ll be helpful to take the pathway of information creation, analysis, and implementation as a loop.

Integrating digital information from various sources and locations drives the physical actions of manufacturing and distribution in a continuous cycle.

Real-time access to intelligence and data is largely driven by the cyclical and continuous flow of data and actions between the real and digital world.

The flow happens via 3 iterative steps called the physical-to-digital-to-physical loop:

Physical-to-digital: This step involves capturing information from the physical world to develop a digital record from the data.

Digital-to-digital: The digital to digital phase involves sharing information to uncover meaningful insights via advanced analytics, artificial intelligence, and scenario analysis.

Digital-to-Physical: This deals with the application of algorithms to translate digital-world strategies to valuable data able to initiate action and change physically.

Conclusion

Traditional supply networks are phasing out due to their limitations and the hitches they cause in the supply chain.

And because of this, many businesses are opting for a new supply chain optimization by transitioning to digital supply networks.

However, the transition is tough and may ruin a supply chain if not done properly.

But by following the tips and ideas in this piece, transitioning and optimizing these new supply networks should be a lot easier.  

If you have any additional ideas or questions regarding the optimization of the new supply chain, please leave a comment below.

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Will Schneider is the founder of InsightQuote, a match-making service for B2B services, and writes informative posts about fulfillment services at Warehousing And Fulfillment. He is passionate about helping businesses find the right solutions to improve their operations. When not working, Will enjoys coaching youth basketball.

cross-docking

What Warehouses Should Keep in Mind When First Implementing Cross-Docking

Warehouses that want to improve labor and space utilization without expanding to a new location or breaking ground may consider cross-docking because of its potential efficiencies. Unfortunately, it can also come with many pitfalls for those trying it for the first time.

Cross-docking requires a detailed understanding of your team, space, partners, and technology. For new warehouses, that means implementing cross-docking should come with significant testing and preparation, especially in terms of your inventory management, scheduling, spatial allocation, and the training you give your team and partners.

Test inventory management tools

Cross-docking prepares companies for just-in-time (JIT) shipping and distribution, making immediate use of inventory as it arrives. Companies that want to start utilizing cross-docking will need a robust inventory management system that can understand and differentiate these inbound shipments.

Your tools must be able to understand inventory utilization. If half of the goods on an inbound shipment are for JIT purposes, then the inventory platform must be able to split received goods and correctly update both inventory levels and the number of products you list for sale. If this action would require ongoing intervention from you or additional inventory counts, it could introduce higher labor costs that negate cross-dock benefits.

Ultimately, cross-docking can help with inventory management and often keep companies from needing to expand physical infrastructure for the products they hold. It might also help you expand operations to support backorders. This takes time, however, and requires tools that help you understand and manage inventory levels without adding burden.

Robust scheduling includes flexibility

Cross-docking is intense choreography. You’re going to need smart people and reliable technology to manage the planning of how people and trucks are moving in and around your site. Cross-docking and JIT operations demand having the people available to handle inbound shipments and process them while helping your team know what inventory is ready to use and what needs to be put away.

Dock availability and the time of truck arrivals and departures must be flexible so that your operations can run normally. Every cross-docking team plans on a smooth day where everything runs on schedule. However, that’s rarely a reality. Paperwork, traffic delays, accidents, or even someone needing to use the bathroom can cause a small delay. Something as simple as an employee driving through the parking lot can force a truck to wait.

If you schedule everything down to the minute and don’t give your team and partners flexibility, it’ll cause greater delays. In most cases, as you’re expanding and learning, arriving trucks will end up waiting because it’s hard to predict the time people need, but you also don’t want docks sitting empty for extended periods. So, ensure that you have people ready when trucks are there and test the time you give teams for inbound and outbound.

Dock door assignments should consider space and traffic

One other caveat that many warehouses don’t consider when they first start cross-docking is the physical space that people, trucks, and inventory required. Cross-docking effectively requires that dock door assignments be efficient and allow incoming and departing trucks enough space to maneuver safely and quickly. Adding extra points to a turn will slow the entire process down, for example.

If your warehouse wasn’t built with cross-docking in mind, test this thoroughly. Often, warehouses need significant reconfiguration of internal elements or will install new doors and adjust the building design to facilitate cross-docking. Multiple teams, doors, trucks, and the equipment everyone is using are going to take up extra space and need to be able to move freely and safely. Start by giving everything and everyone more leeway than you think they need.

Some new inventory and dock management platforms support cross-docking and can make suggestions based on timing, assignments, and other aspects of your operations based on historical and current data. When your tools offer this, try out their analysis and recommendations to see if you can maximize your efforts.

The entire supply chain requires competencies

Cross-docking is an advanced management and utilization technique for any warehouse or distribution center. You’re managing dock door assignments, transshipment, vehicle routing, product allocation, barcode scanning and putaway, new warehouse layouts, and the network and systems required to manage it all.

Your team needs competency in each of those areas and activities. Partners should have their own understanding plus the ability to support you. Inbound expertise is required, across the board, for JIT requirements and scheduling to be effective.

You’ll eventually want to build out appropriate penalties for time windows to keep things running smoothly, but that requires your team not to cause delays. In many instances, cross-docking is complicated mathematics disguised as people and trucks.

Take your time to test and implement it. Work with partners proactively to help understand what they need from you and explain what you need from them. Train your team specifically on the new processes and requirements. Simulate, test, and optimize procedures and layout continually.

Cross-docking can save warehouses significantly on a variety of costs and size requirements. You might reduce material handling and make labor more efficient. Customer satisfaction can be improved, too, as you’re relying less on backorders or older products. Achieving all of those wins is a lengthy process, and it’s important to walk into the situation with patience.

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Jake Rheude is the Director of Marketing for Red Stag Fulfillment, an ecommerce fulfillment warehouse that was born out of ecommerce. He has years of experience in ecommerce and business development. In his free time, Jake enjoys reading about business and sharing his own experience with others.

disruptions

Preparing for Future Supply Chain Disruptions: Insights from the Field

Organizations across all industries—from automotive, consumer goods, and pharmaceuticals to transportation, electronics, and oil and gas—have felt the disruptive effect of the coronavirus pandemic. Turning the global supply chain on its head, COVID-19’s impact has cut across multiple facets of international trade, including manufacturing, import/export, logistics, compliance, and supply chain management. This disruption has been a wake-up call for organizations worldwide, prompting them to assess their readiness to respond reliably, expediently, and effectively to rapidly evolving risk factors going forward.

Disruption Is Inevitable

Whether driven by an unprecedented pandemic or events that are more familiar, like trade wars or frequent duty and tariff changes, future disruptions to the flow of goods are unavoidable and companies must be as prepared as possible. Case in point: on June 29, the amendments to the Export Administration Regulations (EAR) published by the U.S. Department of Commerce, Bureau of Industry and Security (BIS) came into force, impacting U.S. companies that export goods, software, and technology to China, Russia, and Venezuela.

A few days later on July 1, a new free trade agreement entered into force as the United States-Mexico-Canada Agreement (USMCA) replaced the North American Free Trade Agreement (NAFTA). While the USMCA is designed to provide “significant improvements and modernized approaches to rules of origin, agricultural market access, intellectual property, digital trade, financial services, labor, and numerous other sectors,” companies must respond efficiently to changes in import duties, tariffs, and rules of origin verification procedures in order to avoid compliance issues.

The current government’s uncertain trade relations with China, BREXIT’s unfolding impact on U.K. trade, and evolving pandemic predictions are just a handful of factors that may unsettle global supply chains going forward. With disruption an unavoidable consequence of doing business in 2020, successful companies are securing their supply chains by prioritizing operational responsiveness, agility, and adaptability in order to keep goods flowing while avoiding compliance violations and penalties.

Are You Prepared?

Today’s businesses are keenly aware of the importance of keeping a close eye on their sources of raw materials, parts, and finished products to ensure logistics costs do not erode overall profit margins. But COVID-19 caught many companies off guard, throwing their sourcing strategies and revenue flow into crisis.

Descartes’ 2020 Global HTS Classification Benchmark Survey of importers, shippers, logistics and supply chain operators, and customs brokers around the globe analyzed the impact of the supply chain disruption on companies’ operations and ascertained how they are addressing issues for the long-term.

The survey found that 35% of respondents were forced to research alternative suppliers or locations as a result of the pandemic. An additional one-third felt increased pressure to identify ways to reduce duty and tariff costs in order to shore up the shrinking bottom line.

Lessons Learned: Count On Technology

For those survey respondents forced to look for alternative suppliers due to COVID-19, many also looked to advanced technology solutions to address the more demanding workload and support the shift to a distributed workforce and the ‘remote working’ model.

In their leaning towards more advanced technology, approximately three-quarters of respondents were aiming to establish a workflow process for mass classification and to create an audit trail for proof of due diligence; sixty-eight percent were seeking a collaborative online classification process, while 55% sought configurable classification rule sets for different industries and product categories.

The Descartes survey also found that the majority of companies—not just those impacted by COVID-19—are adopting more advanced technology to enhance responsiveness to change and to increase resiliency. Regardless of the number of SKUs classified annually, businesses are recognizing the value of additional layers of protection against the unknown to help ensure their import operations remain viable during turbulent times.

Keep Agility and Responsiveness Top of Mind

Prior to switching to av more automated and integrated research and classification solution, most respondents surveyed were using labor-intensive and error-prone manual methods; a massive 81% were accessing multiple government websites to access classification data and 46% were looking up information in hardcopy books—an unacceptable drain on valuable time and resources and a serious impediment to pivoting swiftly in the face of disruption.

Respondents using advanced global trade intelligence solutions, with up-to-date tariff data accessed from a single system, reportedly accelerated the classification process by 30% to 100%. This increase in speed is a critical piece of the preparedness strategy, as companies aim to focus on agility to keep goods moving during market volatility.

Future-proof Your Organization

New disruptions to the global supply chain may be just around the corner. A proactive global trade intelligence strategy will help organizations continue to drive commerce while ensuring trade compliance in the face of inevitable change:

1. Take advantage of more advanced technologies to maintain compliance efficiency and accuracy as workload demands increase, as well as to better manage a more distributed workforce.

2. Look to technology solutions to increase the resilience and responsiveness of trade compliance programs.

3. Ensure a single point of access to research complex international trade information, including up-to-date HTS codes, duties and tariff treatments, rulings, and explanatory notes.

4. Use a robust solution to effectively exercise and establish a “standard of reasonable care” for product classification.

With the impact of COVID-19 on sanctions and export controls still not fully known, compliance professionals should re-evaluate their global trade compliance strategy, honing it to boost adaptability, agility, and responsiveness to change. By leveraging advanced global trade intelligence technologies, companies can better insulate themselves from the fallout of future supply chain disruptions while minimizing duty spend and achieving higher trade compliance rates in the process. For compliance professionals everywhere, the age-old Boy Scout adage rings true: Be prepared.

An Economic Recovery From COVID-19 in 2021 Is Possible – But Massive Uncertainty Remains

COVID-19 has had a devastating effect on human life. But it has also caused widespread economic upheaval for both advanced and emerging market economies as countries shut down to try to stop the spread of the virus. The U.S. for instance is set to see the most severe economic downturn since GDP was first tracked in the 1940s.

This means deep hardship for many businesses of all sizes and across all industries. Shutdowns caused many firms to entirely cease operations for a time. Now, they are grappling with plummeting demand as a result of rising unemployment and uncertainty, on top of supply chain difficulties and uncertainty as to financing resources.

Bad Timing for a Global Crisis

Although there is no “good” time for a pandemic to strike, business conditions in 2020 were already a little shaky prior to the outbreak. At the beginning of the year, the global economy had just finished its weakest year since the Great Recession, global trade was turning sour, trade finance had become more restricted and continued uncertainty from the U.S.-China trade war weighed on businesses everywhere.

If the outlook was stormy at the beginning of the year, it’s now outright bleak. Atradius economists are now forecasting that global trade will decrease approximately 15 percent in 2020, while global GDP will decline about 5 percent. The U.S. will perform below average, with a 6.1 percent decrease in GDP – largely due to its lag in controlling the virus and subsequent record high in number of COVID-19 cases, in addition to soaring unemployment as well as pressure on incomes, leading to a drop in consumption.

Will Government Intervention Be Enough?

Governments and central banks the world over have enacted measures to counteract the pandemic’s economic devastation. Early in the crisis, for instance, the European Central Bank put in place a Long Term Refinancing Operations III program, while the U.S. Federal Reserve increased quantitative easing.

Countries have also put together aid packages, such as the U.S. CARES Act and a number of packages from individual EU economies and the UK. Similarly, China is providing tax relief, state-backed credit guaranteed, and delayed loan and interest payments. Altogether, global government stimulus measures amount to approximately 9 percent of global GDP, or around $7.8 trillion.

But will this be enough? Atradius economists suggest not – not unless countries also enact vigorous policies to revitalize the economy at every level. The EU Pandemic Fund provides a good example: the $750 billion initiative will bestow loans and grants to the areas and sectors hardest hit by the pandemic, allowing for a more even recovery rate across the entire EU.

Although stimulus measures are necessary, soaring government debt levels are also cause for concern – even before the outbreak, many countries had worryingly high debt levels. The most recent baseline scenario from Atradius economists has the U.S. federal budget deficit, as a proportion of GDP, increasing by more than 10 percentage points this year. The UK will fare even worse, seeing a 13 percentage point increase in deficit growth rate. China and India are the only major economies likely to maintain moderate debt ratios through the pandemic.

All that said, low interest rates will likely stick around through the end of 2021 at least – this should help offset some of the concerns over high government debt levels. Moreover, central banks like the Fed and ECB will continue purchasing government bonds, suppressing any financial market stress.

What’s Next?

While the global economy is under undue strain at the moment, Atradius economists predict a recovery could begin as early as this year, continuing into 2021. Our baseline scenario has global GDP rebounding by 5.7 percent in 2021, with the U.S. coming in just under that, with GDP growth of 4.2 percent.

This scenario, however, is shrouded in uncertainty and hinges on a few key assumptions:

-That researchers are able to develop a successful vaccine in the near-term

-That lockdowns will be limited throughout the remainder of the outbreak

-That oil prices will remain low

-That the U.S.-China trade war will remain at a standstill

-That the rise in financing cost for firms, if any, remains limited

Should these assumptions not play out, the global economic recession could be much worse than anticipated – contraction rates could be twice as damaging as those currently predicted, with global GDP contracting 12.2 percent in 2020 and U.S. GDP seeing a 7.9 percent drop. Recovering from a contraction of this size would be a slow, painful process, although we would expect 2021 to see similar growth rates.

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John Lorié is chief economist with Atradius Economic Research. He is also affiliated with the University of Amsterdam as a researcher. Previously, he was Senior Vice President at ABN AMRO, where he worked for more than 20 years in a variety of roles in commercial and investment banking. He started his career at the Dutch Ministry of Foreign Affairs. John holds a PHD in international economics, master’s degrees in economics and tax economics as well as a bachelor’s degree in marketing. 

Theo Smid is an economist with Atradius Economic Research. His work focuses on business cycle analysis, insolvency predictions, thematic research and country risk analysis for the Commonwealth of Independent States. Before joining Atradius, he worked for five years in the macro-economic research team of Rabobank, focusing on business cycle analysis of the Dutch economy. He holds a master’s degree in economics from Tilburg University.  

agility

4 Strategies Manufacturers Can Adopt to Increase Agility

In turbulent, transformative times like these, the term “business agility” seemingly appears everywhere. And though it’s easy to imagine even the world’s largest tech companies or consulting firms making a sudden pivot, it’s harder to picture a manufacturer with a factory full of heavy equipment doing the same thing.

So what does business agility mean in the context of manufacturing or construction? It’s less about the speed and scope of changes being proposed and more about communicating effectively across large, dispersed organizations. When disruptions break the supply chain or cause demand to plummet, manufacturers must be able to encourage an information flow across all corners of the enterprise. Agility depends on the free flow of information and the ability to guide a team directly.

The good news is that manufacturers are used to disruptions. They regularly deal with supply chain issues, sudden regulatory changes, or shifting market dynamics. Adaptation is in their nature.

The bad news is that COVID-19 puts a unique strain on the industry that makes agility more important yet less accessible. Specifically, factories and construction sites that have had to either scale back or shut down in response to public health requirements can’t exactly pick their work up remotely. Teams are spread out more than ever and cut off from core assets — and that includes everything from machinery to data.

These are circumstances manufacturers don’t have contingency plans for. Meeting the moment will require extensive brainstorming, aligned leadership, and quick and decisive action — but none of those things will be easy with stakeholders scattered to the wind.

Today’s Realities

All of this means manufacturers need a new concept of business agility along with a fresh sense of commitment.

Since the start of the pandemic, we’ve seen heavy-duty industries forced to shut down suddenly and reopen as quickly as possible. While opening, they’ve had to integrate new social distancing requirements into all aspects of operations and vastly expand health and safety measures. In some cases, they’re even learning how to stop sharing pens and clipboards. And those are just the implications for operations.

Unstable economic forces mean that supply and demand could be in flux for the foreseeable future. Granted, some manufacturers are booming right now — but others have seen business crater, and the long-term fallout of this pandemic remains to be seen. Manufacturers must reexamine (and in many cases revise) their plans, strategies, and fundamental business assumptions. Everything is up in the air.

On top of everything, this pandemic is accelerating the shift away from in-person interactions toward digital ones. Relationships with customers, suppliers, employees, and all other stakeholders are evolving because of the need to socially distance. More than that, though, this health crisis has underscored the fact that digital environments are more efficient, convenient, and customizable than the alternatives. This could prove to be a tipping point for digital transformation throughout the manufacturing industry.

It’s hard to overstate the pace of change right now. The degree to which some manufacturers have already responded is impressive; we’ve seen liquor producers start making hand sanitizer and sports equipment manufacturers adapt assembly lines to create face masks. Agility is possible in the face of this crisis, but manufacturers must take the initiative.

“Business as usual” stopped being relevant with the first COVID-19 cases, and there are serious questions about whether we’ll ever return to normal. That means something different for every manufacturer while still placing the same obligation on all of them: Stay agile or get swept under.

Building the Basis of Business Agility

Manufacturers need to grow agile as quickly as possible. Unfortunately, moving fast while staying coordinated is never easy. Apply these strategies to help guide your transformative efforts:

1. Share information in real time. People need answers right now, whether that’s about health and safety measures, new workplace practices, changing strategies, and everything else that’s been uprooted by the pandemic.

The less accessible this information is, the more disorganized things become. Sharing information in real time so everyone has the answers they need on demand keeps communication issues from making a bad situation worse. Strive to be as transparent as possible and to make information highly accessible.

2. Identify information bottlenecks. The pandemic exacerbated the existing information bottlenecks in organizations and created a number of new ones. Analyzing how internal communication works — how information flows through an organization — identifies where these bottlenecks are and suggests how they can be resolved.

Better access to information (of all types and at all levels) helps accelerate and improve decision-making. Before COVID-19, 86% of companies surveyed said frontline workers need more insights at their disposal. That priority is even higher now.

3. Lead from the bottom up. In any fast-changing scenario, insights from the front lines are what matter most. If executives ignore the ideas and perspectives of workers who are actually in the thick of operations, they miss both the red flags that require attention and the innovative ideas necessary to meet this moment. Information needs to flow freely and broadly within an organization, from one-on-one and small group communication all the way up to corporate messaging. Instead of giving lip service to this priority, make sure there’s a direct pipeline.

4. Create new touchpoints. Information from outside the organization — from customers or suppliers — is also immensely valuable right now. It’s vital to business agility because it helps a manufacturer explore how it can pivot without alienating the partners it relies on. Take those outside insights seriously and solicit as many as possible. Convenient digital touchpoints make it easy for others to supply complaints, suggestions, and praise, all of which inform a manufacturer’s next move.

Remember that agility is all about alignment. Any company — manufacturer or otherwise — can evolve on the fly as long as it can move as one. Communication is what cements that connection and helps achieve unity across the board.

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Daniel Sztutwojner is chief customer officer and co-founder of Beekeeper, the single point of contact for your frontline workforce. Beekeeper’s mobile platform brings communications and tools into one place to improve agility, productivity, and safety. Daniel is passionate about helping businesses operate more efficiently. He has a background in applied mathematics and more than eight years of experience in sales and customer success.

manufacturing

How Automation is Shaping the Manufacturing Industry

Without a doubt, technology has been instrumental in revolutionizing most, if not all, industries around the world.

However, even in the face of this undeniable truth, some businesses remain hesitant about integrating certain innovations, such as automation, into their operations. Esteemed economist Christine McDaniel explained how this resistance may be due to the overblown anxiety over the false claim that automation will leave millions of blue- and white-collared professionals jobless for good.

Be that as it may, with the ongoing crisis requiring manufacturers to take certain safety measures, the dynamics between automation and this specific industry has to change in order to keep up with the times. Furthermore, a lot of experts believe that automation could be the very technology that will prepare and allow the manufacturing sector to thrive in a post-pandemic world. To give you a clearer picture, here are some of the ways automation is shaping the manufacturing industry these days:

Raise savings and cut costs

Over 478 billion of the 749 billion working hours spent on manufacturing-related activities worldwide were automatable. The aforementioned 478 billion hours, which is equivalent to $2.7 trillion worth of labor costs, provides a great opportunity for manufacturers to increase savings. In addition, a new generation of robots that are not only flexible and versatile but also relatively cheaper can help cut costs in the long run and increase the scalability of manufacturing businesses.

Enhance resiliency and simplify processes

In the face of an ongoing global health crisis, most manufacturing plants have been left with no choice but to operate below full capacity and strategically schedule workers to limit the number of employees in a specific location at any given time. And with how tedious this task can be, it’s easy to see how some manufacturing managers could easily run into challenges when coordinating the workers and the machines. Fortunately, Verizon Connect details how manufacturing managers can rely on automated software that can make the intricate process of job scheduling and machine coordinating easy and hassle-free.

Increase labor productivity

As with every other industry, automation has the ability to make businesses even more efficient. With machines and robots that can get more tasks done within a given time frame compared to traditional manual options, manufacturers can look forward to a significantly reduced production lead time and a greater total rate of production. Moreover, automation can also help accomplish seemingly impossible manual tasks that often require precision and accuracy to a greater extent. Economics Help also mentions how automation can enable factories to produce a greater range of goods that come in different sizes and designs, as well as being suited to different functions.

Improve workplace safety

Even without the pandemic, safety has always been a significant concern for manufacturers. After all, data from The U.S. Bureau of Labor Statistics found that workplace injuries and accidents, which are more frequent in this field, can cost businesses nearly $62 billion per year. For many years now, on-the-job injuries have been gradually falling, thanks to machines and robots that have been doing all the heavy lifting, taking over repetitive tasks and eliminating the need for employees to work in extremely hazardous environments. In the coming years, manufacturers can continue counting on automation when it comes to making hazardous workplaces safer.

As the world braces itself for a future that’s been completely changed by the current crisis, the manufacturing industry’s reliance on automation will only run deeper, and it’s easy to see why. After all, automation has the ability to raise savings and cut costs, enhance resiliency and simplify processes, increase labor productivity and improve workplace safety.

forklift trucks

How has the Role of Forklift Trucks Evolved in Warehousing Operations Landscape Amid Flourishing E-commerce Presence Worldwide?

The rising global prevalence of technology and connectivity has set off a significant transformation of the industrial landscape, especially in the retail domain. As the world moves to an increasingly digitized platform, e-commerce, or electronic commerce, commonly associated with online shopping, is rapidly establishing itself as a favored retail choice among consumers. In fact, studies have shown that almost 95% of all shopping will be facilitated through e-commerce by 2040.

With such a prolific rise expected in e-commerce adoption over the forthcoming years, the demand for robust warehousing and distribution facilities takes significant precedence. This, in turn, augments the need for efficient material handling systems and components to ensure proper storage, loading, transport activities in the warehouses.

Since product transport is one of the most integral roles in the e-commerce distribution ecosystem, the forklift market is likely to garner tremendous interest as retail and shopping activities continue their transition to the online platform.

What are forklifts?

Forklift trucks, also known as jitneys or lift trucks, refer to a class of vehicles designed for industrial use. These systems comprise a power-operated platform attached to the front, which can be raised or lowered as required to lift or move cargo. The term forklift is derived from these platforms, which are usually in the form of fork-like prongs. Lift trucks are used across myriad industrial sectors for the efficient transport of goods and materials.

The origins of these systems can be traced back to 1887, when the first material handling equipment, known as a two-wheel hand truck, was created using a combination of wheels and iron axles. However, the history of the modern forklift is more commonly associated with the invention of the Tructractor by the Clark Equipment Company, in 1917. The machine, which is often credited as being the first forklift, was essentially a tractor with an attachment for product handling, bearing only a minor resemblance to their modern-day successors.

Since its inception, the forklift industry has undergone several evolutions. The industrial impact of this material handling equipment over the years has been profound, evidenced most prominently during its contribution to boosting efficiency and productivity in workforces during World War I and World War II eras.

Rising prevalence of e-commerce solutions amid turbulent global conditions

While e-commerce itself is on its way to establishing a firm presence in the retail landscape, the ongoing global crisis stemming from the coronavirus outbreak has brought about a significant shift in consumer preferences and behavior. The rise in demand across the globe for essential and daily goods, alongside limitations due to social distancing and quarantine protocols has breathed new life into the e-commerce journey, as more and more people turn towards online portals for safer and quicker shopping experiences.

Fueled by this expansion of e-commerce, logistics systems, including warehouses and distribution facilities have grown tremendously in number, thus accelerating the demand for lift trucks and other warehouse solutions.

E-commerce solutions are most attractive to consumers due to the various benefits and conveniences they offer over conventional shopping experiences, including free and faster delivery of products, hassle-free returns and exchanges, and wider selections, among others. In order to fulfill these benefits, warehouse and distribution operations need to be extremely efficient, in terms of timely movement and transport of products to and from the facility, making the role of forklift trucks a crucial one for the industry.

Many prominent figures in the e-commerce and retail-associated industries have taken heed of this and started to develop innovative warehouse transport technologies to cater to the rapidly surging demand for online products. A notable example of this is global delivery service DHL, which has implemented several technologies including AI, self-driving vehicles and robotic lift trucks, etc., at its North America warehouses, to accommodate evolving product demand.

Technological advancements shaping the forklift industry

The forklift industry has witnessed several advancements over the years. These progressions, which range from mobility solution to automation to power source technology evolution, each assert a considerable impact on the way the modern fork truck functions.

Chief among these advancements is the emergence of environmentally friendly forklift technologies, given the burgeoning costs of fuels and the rising impact of climate change on the global ecological structure. According to some studies, energy-efficient lift trucks can last over 20-30% longer than their internal combustion engine-based counterparts.

In light of this knowledge, several companies have forayed into the development of energy-efficient electric forklifts to cater to the evolving warehousing demand from the retail industry. For instance, GMH (Godrej Material Handling) has recently unveiled the three-wheel Bravo Electric Forklift for the 1.6-2 ton category, equipped with an advanced battery solution for optimum product transport and handling.

Apart from the ecological standpoint, forklift trucks have also undergone a significant transformation in terms of mobility, as was evidenced by the launch of the Sidewinder ATX-3000 forklift by Vetex, which is an omnidirectional lift truck, owing to a series of rollers used in place of traditional solid or pneumatic tires.

Automation has asserted its impact across the industrial spectrum in myriad applications, and fork truck technology is no different. Automated lift trucks are equipped with a host of sophisticated technological systems including guidance systems that help them self-navigate through warehouses and facilitate automatic pick-up and drop of products, with little to no human intervention required.

These systems are reshaping the way forklift trucks function across various industries including warehouse, automotive, manufacturing, and more. The Raymond Corporation has recently introduced an automated lift truck stacker that leverages vision-guidance technology from Seegrid Corporation, to enable autonomous stacking from pick-up to delivery locations.

Source: Global Market Insights

administrative review

Opportunity to Request Administrative Review

On August 4, 2020, Commerce announced in the Federal Register the opportunity to request an annual administrative review for products that are currently subject to antidumping and countervailing duties.

The products and countries that have August anniversary months are the following:

-Seamless Line and Pressure Pipe from Germany

-Sodium Nitrite from Germany and China

-Finished Carbon Steel Flanges from India and Italy

-Brass Sheet & Strip; Tin Mill Products from Japan

-Polyethylene Retail Carrier Bags from Malaysia, Thailand, and China

-Light –Walled Rectangular Pipe and Tube from Mexico, Korea, and China

-Dioctyl Terephthalate; Large Power Transformers; Low Melt Polyester Staple Fiber from Korea

-Small Diameter Carbon and Alloy Seamless Standard Line and Pressure Pipe from Romania

-Ripe Olives from Spain

-Certain Frozen Fish Fillets from Vietnam

-Steel Propane Cylinders from Thailand

-Silicomanganese from Ukraine

-Various Products from China

As part of this annual review process, Commerce intends to select respondents based on an analysis of U.S. Customs and Border Protection (CBP) data for U.S. imports during the period of review, which is released only to legal counsel for interested parties.

Any party wishing to participate in the antidumping and countervailing duty review process or who may be affected by duties on the products identified in the Federal Register notice should file a request for review no later than August 31, 2020.  In order to be eligible to participate in the review, a party must either be an exporter or importer of the specific products and during the specific time periods identified in the Federal Register notice.

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Camron Greer is an Assistant Trade Analyst in Husch Blackwell LLP’s Washington D.C. office.

rural

RURAL EXPORT CENTER SUPPORTS THOSE IN THE AMERICAN BREAD BASKET SEEKING NEW GLOBAL MARKETS

The U.S. Commercial Service in July opened the Rural Export Center (REC) in Fargo, North Dakota, to promote rural America’s exports and equip its companies with the research and resources to compete and win in the global marketplace.

“The Rural Export Center addresses the unique needs of rural American companies by providing in-depth market research and training designed specifically for them,” explained Ian Steff, assistant secretary of Commerce for Global Markets and director general of the United States and Foreign Commercial Service.

“These companies are a crucial part of the continued growth of the American economy,” Steff continued, “and providing them with these essential, customized tools will help bolster their success in both the domestic and international markets and will increase U.S. exports worldwide.”

Companies from anywhere in rural America can request virtual consultations and assistance through the REC and many can apply grants from the Small Business Administration’s State Trade Expansion Program toward REC services. Armed with REC research, the company then collaborates with their local U.S. Commercial Service Trade Specialist to implement plans and strategies informed by REC analysis.

“Together, they leverage the global network of U.S. Commercial Service offices located in U.S. Embassies and Consulates in more than 75 markets around the world,” states a U.S. Commercial Service press release.