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Trade Wars and Warehousing: Repositioning Supply Chains for Success

supply chains

Trade Wars and Warehousing: Repositioning Supply Chains for Success

It’s almost impossible to keep up with trade war news today – whether it’s U.S.-China, UK’s Brexit, EU vs Tech Giants, or anyone of the 101 international trade dispute cases filed with the WTO since 2015. The fact is, the news changes almost daily. What we do know is that the pace of change in tariffs, regulations, and subsidies has enormous impacts on global businesses and their supply chains, dramatically impacting sourcing decisions, market opportunities, competitiveness, and profitability. In the view of many analysts, this state of constant flux has become the new normal. It also means that businesses will need to find a way to cope.

Supply Chains in the Crosshairs

Trade disputes cause havoc with global supply networks, affecting both supply and demand, as well as logistics providers who move the goods. As we know, changes in tariffs and regulations can throw a wrench into even the best of supply chains. By quickly changing market signals, they can completely alter the economics of a business and leave companies struggling with sub-optimal networks and trading partners. It puts enormous pressure on margins and makes companies more vulnerable to disruptions, market fluctuations, and changes the competitive landscape at home and abroad.

Reconfiguring the links in the supply chain can be a monumental task. In fact, in this Wall Street Journal article Jacob Parker, vice president of China Operations for the U.S.-China Business Council, said, “Businesses are making arrangements to diversify their supply chain investments away from the China market and enacting other structural changes to account for that. It could take about three to five years to build up the supply chain elsewhere.”

While that may be true for some, for others changes in supply and manufacturing will occur much faster, and in many cases are already occurring. Whatever the timescale, in the near term these disputes can leave executives paralyzed by uncertainty and their businesses idling, hoping for global trade issues to subside. That may happen, but at this point, it looks just as likely for the uncertainty to continue. For many, waiting is not an option.

Pressures for Warehousing and Distribution

For warehouses and distribution networks, changes in cost signals brought about by tariffs manifest themselves on two timescales.

Near term: For an importing country facing higher tariffs on imported goods, the business response is as obvious as “Sale Ends Sunday” signage. Businesses will stockpile imports from their traditional suppliers to the greatest extent possible in the months and weeks prior to the imposition of tariffs – before prices go up. Ports and warehouses will operate at max capacity, and nimble businesses will look to move materials into their downstream warehouses and distribution network as quickly and efficiently as possible. For the supplier nation, manufacturers and logistics providers will be stretched in their supply chains as well, looking to match this spike in demand.

Longer term: Because of changing economics, importing businesses will ultimately look for new international sourcing options, new manufacturing capacity, overseas warehouse capacity and possibly new logistics providers. Here the advantage will go to those businesses that can adapt to change most quickly and bring new business partners into their supply network most efficiently. They will need to establish a trading collaboration with shared work processes, communication, business rules for exception handling, and master data management – so all parties are working from a single version of the truth in the trading relationship. Even the domestic supply chain structure may need to change in response to shifting entry points, volumes, and lead times.

A Fundamental Shift: Optimizing for Uncertainty

What businesses need to do is plan and prepare for uncertainty and constant change, which will make their business operations and network more resilient. To minimize the existing uncertainty in the supply chain, while increasing its agility, many are looking at their existing infrastructure and are seeking new ways to make them more adaptable to rapidly changing conditions in demand, supply and logistics.

Because most companies run their businesses and global supply chains with many different enterprise systems, they lack end-to-end connectivity and real-time visibility and collaboration capabilities. Traditional systems, such as ERP, MRP, WMS, and TMS, provide vital functionality, but it is primarily enterprise-focused. B2B networks often suffer from a similar problem, as they evolved from acquisitions and the integration of enterprise systems. While giving the illusion of a unified system, at the core they have multiple data models and databases that must be integrated and synchronized.

These systems introduce latency through batch processing to synchronize the various systems; both internal systems and those of trading partners. They contribute a huge amount of friction and uncertainty to the supply chain, increasing the variability and the need for safety stocks. They create rigid, hardwired connections between systems and trading partners, which make it difficult for companies to adapt systems to new partners, business opportunities, and workflows. They are costly to maintain, and an upgrade is virtually a new implementation, with all the cost, time and risk that that entails. The combination of poor visibility and collaboration, rigid architecture, and untrustworthy data makes it difficult to make effective decisions and identify opportunities and threats in a timely manner.

Removing the Guesswork with Real Time Business Networks

Enterprise systems certainly have a role to play, but to effectively manage global supply chains, trading partners need to share data and work together in real-time, to resolve supply chain issues and exploit business opportunities in a rapidly changing trade environment. Multi-party supply chain networks connect all parties to a single network so they can share data in real-time. This provides a cohesive, connected and transparent supply network, that eliminates delays and minimizes uncertainty and variability. With a permissions framework to control who can see what, companies can quickly enable access for various supply chain roles at each trading partner. All relevant parties can have visibility to demand, inventory, orders, shipments, capacity, and constraints. They can plan collaboratively and work together to resolve issues as they arise during execution, eliminating huge amounts of uncertainty while enabling companies to reduce safety stocks and other buffers against variability.

Because all business partners are on the same network, with planning and execution on the same platform, processes like creating documentation for trade compliance can be automated, streamlining many labor-intensive import and export administrative tasks. These processes can also be preconfigured so that intelligent agents can monitor and alert users to missing customs documentation and other issues to ensure compliance.

With unified solutions like inventory management, warehouse management, yard management, and transportation management all running on the same network, businesses are better positioned to understand actual demand and their various supply and logistics options so they can meet the demand at the lowest costs. Companies can also leverage the network to make better decisions about where and when to move inventory. For example, they can choose to move their goods to new markets where demand is higher, rather than incur tariffs on products where demand is low. And if stockpiling is strategically necessary in order to take advantage of market fluctuations or impending changes to tariffs and regulations, companies can leverage the network for storage, distribution and logistics services.

Digital Transformation is Important and Urgent

Lower inventory levels are one of the major benefits of real-time business networks, with companies typically reducing inventory levels by 10 to 30 percent. This relieves pressure on warehouses, where inventory is frequently stockpiled to provide a buffer against variability and uncertainty. Inventory reduction frees up a lot of capital, reduces storage costs, and significantly reduces the risk of product going unsold or obsolete.

Having access to an unlimited number of potential partners is another powerful advantage of a multi-party network. Whether it’s the need to expand in new markets, or withdraw from others, find new suppliers or new logistics partners, a multi-party digital network also means you are already potentially connected to thousands of new customers and partners. Companies who are not already on the network need only onboard once, as connections are then made virtually as opposed to physically with clicks as opposed to point-to-point hardwired connections. This makes for extremely flexible and agile business ecosystems that are controlled by the business analysts charged with managing supply and demand rather than involving scarce IT resources.

Regardless of the changes imposed by political and regulatory agencies, a real-time business network mitigates risk. They are easy to configure, rapid to adapt, extensive and inclusive, rich with alternatives, and infused with intelligence. Although the financial costs can’t be eliminated entirely, much of the administrative overhead can be, and significant savings can be made through a frictionless transaction platform that removes uncertainty, provides transparency, reduces waste and optimizes the utilization of resources.

Most importantly, for businesses facing the uncertainty of ongoing trade wars and other factors that drive volatility, real-time, multi-party networks provide a digital platform for agile business that can respond to risk and quickly exploit new opportunities. They enable companies to leverage new markets, suppliers, logistics services and other trading partners, to respond to changing conditions and to innovate new business models that keep them profitable and competitive whatever the market throws at them.

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Nigel Duckworth is a senior strategist 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 at https://twitter.com/onenetwork.

freight invoicing

How to Tackle the Freight Invoice Management Obstacles

A freight invoice is a detailed bill which includes information regarding the transportation of a company’s goods from one place to the other, along with the inclusion of the amount of charges, its weight, due dates, complete goods’ description, contact information, and names of both the receiver and the shipper, etc.

On the other hand, logistics is defined as the process of planning, implementing, and controlling the storage and movement of services and goods from the point of origin to the point of consumption within a supply chain, explains a top provider of Invoice Processing Services. The companies which deal with these processes become a part of the logistics industry and handle a few or all of the functions of supply chains as per the logistic requirements of the client.

Past Examples of Invoice Issues

-In recent times, an IT company was overbilled throughout 14 days by an amount of $935,578 owing to the incorrect weight applied by a parcel carrier.

-Auditing helped a national level entertainment retailer in saving around $35,000 from a wrong monthly invoice charge

-A worldwide renowned LED manufacturer had to pay $93,147 more due to incorrect billing currency, but the amount was recovered after the fault was discovered during the auditing process.

Top Freight Invoice Management Obstacles

Multiple Challenges

Managing invoices is extremely hard as a lot of challenges like reconciling contract terms with Bill Of Lading (BOL), invoices’ rating for correct rate selection, decisions about the acceptance of differences in charges, getting invoices resubmitted after making the carriers do corrections, etc. have to be dealt with extreme care. When these challenges are not addressed properly, they lead to errors, which further lead to overcharging, eventually adding to the overall Invoice Processing complexity.

Tedious Information Processing

The processing of information for the invoices is really tiring and tedious in nature. This is the reason employees who process the information for billing, weight, ledgers, data entry, and more commit multiple mistakes and make the final outcome inaccurate and hard to understand.

Bill Entry Issues

The very first concern which the logistics industry has to deal with during invoice management is the efficient functionality of the billing entry process which is defined below:

-Shortage of non-standardized processes and control due to operations which are not centralized for billing entry

-Multiple systems integration

-Due to missing BOL information, incomplete billable items are captured

-Multiple formats for BOL 

-Lost information regarding a customer or local-specific procedures for billing

Refund Management Issues

There are a lot of instances where the goods and services do not land safely at the doorstep of the receivers. In such cases, goods and services are returned back to the suppliers, which involves going through all the invoice processing steps again, which is extremely time-consuming for the owners of the logistics company.

Best Practices to Tackle Invoice Management Obstacles

Must-Include Invoice Listings

-Consignee and consignor names

-Shipment date

-Packages number

-Freight description

-Volume, weight, and measurement of freight

-Total outstanding charges

-Each carrier name engaging in transportation and movement route

-Shipment’s transfer point

-Issuer’s business address and remittance address

Freight Management Controls

It is important to incorporate internal controls which are powerful into the management structure of the freight. An authorization system, duty separations, and internal audits on a periodical basis are one of the most important tasks for managing risks like favoritism and fraud, which have the potential to bring down the overall profitability. 

The main objective is to make sure none of the employees have any chance for concealing and committing any illegal or unethical activity. For example, an employee who has been given the responsibility of getting the estimates should never be made the in charge of making the final freight invoice payment or selection.

Proficient Auditing System

According to a report by ReconLOgistics.com, wrong freight bills appear in about 5-6% of the entire invoices, which can raise the expenses of transportation to a great extent. With a proficient auditing system in place, along with a thorough recalculation and review can save you from overpaying due to inaccuracies in the freight bills. 

Apart from this, normal dealing procedures for lost shipment or damaged dealing, and timely claims reconciliation are an imperative part of a cost-saving management program for the freight.

Outsourcing Payment and Freight Audit

When it comes to finding the best solutions for streamlining the freight invoice management process, Outsource Invoice Processing remains a top favorite amongst the businesses due to its cost-cutting feature, along with the following benefits provided by it:

-Paper routing, filing, and handling elimination

-Centralized system for entire processing functions of the freight invoice

-Eliminating multiple systems and non-uniform processes

-Real-time insights into the invoices

-Latest technology use like artificial intelligence and automation

-Invoices’ long-term archival in the electronic form

-Carrier queries

-Increase cash flow to the maximum levels with timely invoice payments

-Receive correct and detailed accrual files and cost allocation straight into your system

-Gain visibility into operational metrics, invoice status, and payment information

Invoice Automation

Most of the industries have already incorporated the use of automation in a majority of their work processes, and have reaped great benefits in the following forms:

-Faster processing of invoices

-Elimination of costly human errors

-Invoice costs reduction by 80%

-Preventing payments duplicity and maximizing initial incentives for payments

-Enabling enhanced cash flow control and visibility

-Achieving 100% accuracy for invoice entry

Freight Software

Businesses who are trying to manage their freight invoices by themselves can ease their management workload with some of the top freight software mentioned below:

The Magaya Cargo System

This user-friendly software helps in eliminating duplicity of data entry, streamlining shipment workflows, generating Bill Of Lading, etc., along with a fully-integrated system for Invoice Accounting.

A1 Tracker

This software meets the unique business demands of the present scenario, make the working of the logistics systems smooth, and bring the required value to your business.

Freightos

The online platform for global trade management and freight booking, along with providing logistics owners with digital sales tools.

Excalibur WMS

This is a software which is fully integrated for warehouse management, accounting system, and third-party logistics (3PL) service billing.

CargoWise One

A central software system platform for worldwide providers giving logistics services.

Managing the freight invoices is definitely challenging owing to the various complexities in the form of inaccuracies and irregularities in the data and work processes, respectively. These complexities can be brought down greatly with the use of automation, outsourcing, audit systems, etc., eventually streamlining the process of freight invoice management at large, along with saving time and money at the same time.

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Gia Glad holds the position of Business Content Writer at Cogneesol – an outsourcing firm offering finance and accounting services along with other value-added services to the small and mid-sized businesses globally.

release

5 Tips for Launching New App Features

Plan the release. 

While you’re still in the planning phase for a new feature, it’s a good idea to also think about how you will release it. This is something often done within the design process.

Things you should incorporate into this include: 

-Who will see this feature first? (Are there internal or external beta groups?)

-What is success for this feature?

-Who will see the feature once it’s in a steady state? (Is this for VIP customers or everyone?)

-Is there important timing tied to this release, such as an event or special time of the calendar year?

Tools that will help you with this include product delivery and tracking tools

Build awareness.

Awareness around a release is important for both internal and external groups. Within your organization, do teams have the support they need to be successful? Think about what your sales, marketing, customer success, or any other team will need in terms of understanding the feature being released, and how to answer any questions they might face. Externally, awareness should be tied back to how you will measure success. 

Tools that will help you accomplish this include go-to-market plans, centralized information repositories, and any other tools that will help your teams (and customers!) stay connected, informed, and collaborative. 

Measure your release.

After the release has happened, how will you know if it was successful? Because you already thought about success metrics in the planning stage, you should be ready to measure whether or not it was successful. 

Tools that will help with this include those that surface sales and ops metrics. Also, it’s important to consider these together—look at performance and monitoring metrics, support requests by volume, and qualitative feedback from customers and prospects.

Celebrate and recognize.

Take time to celebrate your wins. Shipping software is like a muscle, the more frequently you do it, the easier it is to execute. If you ship less frequently, the process begins to atrophy and the action becomes more difficult. Celebration (even for small wins) provides motivation to continue practicing the act of shipping, and results in more stable services and products.

Reflect and iterate. 

Software is never done, and neither is a process for software delivery. After the release has occurred and you’ve paused to enjoy the moment, now it’s time to reflect back on what went well and what didn’t. Reflect on both process and product.

Tie process back to culture—consider the tools that you use for process, what enabled you to do more and what was a hindrance? Use this feedback and apply what you learned from measuring success in the planning phase for the next release. Learn how you can adjust and improve upon what you shipped.

 

Adam Zimman, VP of Product and Platform, LaunchDarkly

Adam has over 20 years of experience working in a variety of roles from software engineering through to technical sales. He has worked in both enterprise and consumer companies such as VMware, EMC and GitHub. Adam is driven by a passion for inclusive leadership and solving problems with technology. One additional objective is to be a part of a diverse and equitable company. Not simply an organization that accepts diversity, but one that actively pursues a more diverse and inclusive team as an imperative for building better products and services. Adam is also an Advisor for a number of startups and nonprofits. His perspective on life has been shaped by a background in physics and visual art, an ongoing adventure as a husband and father and a childhood career as a fire juggler.

6 Ways to Improve Efficiency, Speed, and Accuracy in Your Warehouse

Modern warehouses are already much faster and more efficient than those 20, even ten years ago. But you’re still feeling the budget crunch every quarter. And, if you’re like us, you know that there are always things we can do to make a warehouse a little better.

So, we crunched the numbers, talked to experts, and meditated in the back of the warehouse to come up with these six methods designed to improve your warehouse efficiency, speed, accuracy, and how much we like working in a warehouse.

Improve Your Operational Software

Your first step in improving your warehouse operations is having the right tools in place to measure, track, and understand what you’ve got. A modern warehouse management system (WMS) is your safest bet to start establishing baselines of your efficiency, waste, how quickly you fill orders, and how accurate everything you do is.

We’ve all heard it a thousand times, but it remains true: you can’t improve something you don’t measure. Choose and implement a capable WMS to gain a better understanding and give your team plenty of ways to use their time and your inventory better.

Enhance Your Metrics Choices

Metrics, especially key performance indicators (KPIs), build on that introduction of a smart WMS. They help you tell the story of your business and how it can do better — and sometimes communicating KPIs is just as important as choosing the right ones.

Review the metrics you track and how you define KPIs. Do they measure productivity? Can they respond to changes to your baseline? Do they match up with current targets and accurately track as performance changes?

Don’t get overly complicated.

You want KPIs that are easy to understand and measure. Glancing at your system and dashboards with these metrics should give you an idea of the health of your business. You and your warehouse team can understand five metrics much better than 20. So, find what easily tells the most important story.

Reorganize Your Inventory Locations

Once you know what to track and can start tracking it, it’s time to review your standard day’s orders and the routes people take to pick them. Look for high-volume products and see if they’re in a good or bad location.

Put your most popular products near they critical points in your warehouse that can speed up picking and packing efforts. Usually, this includes aisle ends and exit or transition areas. However, you might also have enough volume to give them their own space that’s closest to your packing areas, with a set team of pickers grabbing only these while others grab the secondary items to complete each order.

You can speed this up further with a WMS that support voice picking and wave or batch pick and pack methods. They’re faster, more accurate, and improve your efficiency for filling orders.

Try Custom Kitting

When you redo your inventory locations and start reviewing route changes, you’re collecting a lot of data along the way. Use it.

Productivity can see significant gains when you implement custom kitting in your warehouse. Kitting can occur with the packages you sell or how you manage your warehouse, both increasing efficiency by reducing pick points. Selling kits means you can control inventory better and generate higher-value orders more often.

However, you can kit within the warehouse simply by grouping products that are typically bought together. Some companies even bag select items together to give pickers an option to grab one thing instead of many. It can help you control your space and keep inventory counts more accurate, giving you a nice boost.

Give Receiving Its Due

The warehouse mantra is often about getting orders out the door as quickly and accurately as possible. Unfortunately, that leads to bottlenecks and procrastination in the receiving department. The faster and more efficient you become, the quicker you need to get your inventory ready for use.

Make every aspect of receiving, from putting away inventory to breaking down boxes and taking out the trash, important. It should be habit, and your systems should reinforce it. The better you do this, the more accurate and reliable your data, making all these other steps more efficient.

Besides, do you really want a bad inventory count because an empty box listed as full?

Talk to Your Team

And the final way we’ll think about running a better warehouse is by asking you to stop thinking about it. All of the steps above require data and activities from your warehouse team, IT, leadership, and more. Every group interacts with each change in a variety of ways, giving them varied perspectives.

Don’t let all that experience go to waste.

Talk to your team in the warehouse, in IT and sales, and leadership. Discuss what’s working, what isn’t, and their suggestions to change things regularly. You’ll get a two-prong benefit:

-People interacting with the systems and changes have excellent vantage points to find breaking points or see additional changes that can boost your performance.

-It helps your teams feel heard, which makes them happier to come into work and more likely to implement the changes you make.

Your company pays a lot to have different experts in and around the warehouse. They’re the most significant resource for maximizing your business. And, we all like feeling respected at work.