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Technology Is Transforming Our Business

Posted by Land Link on Jun 6, 2019 4:03:59 PM

The transportation and logistics industry are currently going through some major transformations. The current metamorphosis is creating opportunities as well as challenges. Successful shippers are looking for ways to adjust to the challenges and take advantage of the opportunities. The economy, labor, and I believe, most dramatic, is the technology component which will be the game changer. Astonishingly what seemed like an unrealistic idea ten years ago, today, is now plausible because of technology. From robotics to radio frequency identification technology to block chain applications, the possibilities are intriguing to say the least. The challenge for supply chain professionals is how to stay current on these applications and how they can give your business the competitive edge that often makes the difference between black and red on the financial statements. Here are a few key areas in which every supply chain professional should have a firm understanding.

Economic Forecasts

Everyone is enjoying a robust economic environment at home even with the Trump administrations tariff threats. The domestic manufacturing economic forecast is a practical place to start in planning your logistics budget both operationally and financially. It's not all about the dollars.  Shippers need to assure themselves of available assets to deliver and receive goods.  The driver shortage is real, there are no significant players entering the asset-based transportation industry so capacity issues will be a common challenge. Existing carriers can only add as much capacity as drivers available to operate the equipment. Online retail spending is estimated to increase up to 20-30% over the next 3-4 years. These growth estimates will impact future freight distributions and patterns by creating additional density for retailer’s networks. Crowd sourced delivery options, much like Uber, will become a significant pool of delivery drivers.  Automated trucks will become more increasingly in demand as soon as the technology can be trusted.

The Labor Outlook

Driver positions are not the only area in logistics that are suffering shortages. Qualified warehouse personnel are also in demand. Particularly, as warehouse and distribution centers evolve into a more complex and technology driven environment. There are many reasons why labor is a problem, but two hurdles stand out. First, trucking has historically paid less than other business’ competing for the same potential employee. Second, the nature of the job requires drivers to be away from home in some cases for weeks at a time. As freight volume continues to grow labor will become an even bigger issue. To attract more recruits, some experts have proposed establishing more enticing industry standards such as a higher base pay and a flex time policy. Neither idea has yet to gain much traction. The simple fact is that truck driving as a career does not appeal to today's young people. On the operations side colleges and universities have historically offered somewhat limited programs in logistics as a science. I would expect the training options should improve as demand for these services increases.

Technology and Big Data

There is little doubt that data and the technology which allows us to interpret and leverage that data will be the future of supply chain management. It is well known that many transportation and logistics companies are late adapters of technology. Some are starting to be shut out of contracts if they cannot provide the data and technology required by customers, especially cyber security. Larger customers are adding minimum levels of cyber security to their contracts; this requirement will eventually become SOP.

Many carriers are even more behind in using analytics to make smart operational decisions. They do not understand the competitive edge analytics can give them even the simplest terms like route maximization. Successful shippers are thriving by seeking the guidance of logistics professionals who are trained in and equipped with the latest technology that mitigates risk to their supply chain and brand value. We are in the middle of a paradigm shift in the way transportation and logistics is executed. Adapt accordingly or die.

Count on the logistics professionals at Land Link Traffic Systems to navigate your company through what is certain to be some challenging supply chain waters in 2019 and beyond.

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Topics: Transportation News, Shipping News, Logistics News, Industry Trends, Technology

Walmart Matches Amazon Announcing Free One-Day Shipping on Many Items

Posted by Land Link on May 22, 2019 10:00:00 AM

In a bid to keep pace with their number one competitor, Walmart announced yesterday that they will offer free one day shipping on many items. Starting May 14, Walmart customers in Phoenix and Las Vegas who buy more than $35 worth of goods enjoyed free one-day shipping. The offer, which Walmart had hinted was in the works and will be applied to as many as 220,000 items, will extend to Southern California in the coming days and will reach about three-quarters of the United States by the end of the year. The $35 minimum was set with the expectation that the average Walmart at that price point would include several items thereby reducing individual unit shipping cost by sending the entire order in one box. Walmart's e-commerce business has not been profitable. In fact, management expects to lose more this year than they did in 2019. Amazon expects to spend $800 million this quarter to cut their shipping costs. Walmart's same day shipping is available to all customers without any membership fees. Amazon's service, on the other hand, is available only to Prime members at an annual cost of $119.

Walmart's Strategy

One thing is clear. The big package companies don't have enough capacity to handle the expected volume of same day deliveries from the big retailers. They may not even want the business. You can expect Target to be adding to the volume as well as other retailers.  Same day delivery from UPS or Fedex would be cost prohibitive. You'll find a range of about $27 to $55 at FedEx and about $30 to $63 at UPS which is clearly not a viable option. So what is Walmart's strategy for this same day service? Walmart is using a surprising strategy on free, next-day shipping that doesn't involve any of its 4,700 US stores. Instead, orders will be filled and shipped from 6 fulfillment centers across the U.S. Walmart plans to further drive down the costs of next-day shipping by making "aggressive investments" in automation and boxing technology. Fulfillment centers are better equipped for those kind of investments according to Walmart CEO, Marc Lore. Walmart will be utilizing its stores for same day order pickup. 

Who Is Gonna Make All These Same Day Deliveries   

The big retailers will have to utilize additional resources to UPS and FedEx. Dozens of start up companies are already in business offering same day delivery. The boom in        e-commerce sales has lead to a surge in package volume and shippers don't have the capacity or network to quickly deliver parcels. This has created a new market and presented a significant opportunity for last mile delivery startups to emerge.

Capital investment and labor are the deterrent to most companies entering the parcel market. For that reason, Deliv.com, Rodie and many others have opened up across the country with limited capital investment. They depend on private van and car owners to make the deliveries as contract workers which is very much like the Uber platform. With the driver unrest Uber has been recently experiencing, these start ups may find some new, willing drivers. The companies won't last if the drivers are not making an adequate wage and one also can't help but wonder when everyone became in such a hurry? To keep informed on this and other industry news, subscribe to our blog.

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Topics: Transportation News, Shipping News, Logistics News, Industry Trends

Leveraging Digital Applications To Open New Markets

Posted by Land Link on May 15, 2019 11:12:14 AM

Digitize Your Communication

In this era of rapid digital transformation, new technologies have opened up opportunities and created challenges, fundamentally transforming customer experiences, operating models and the work environment. Today's transportation providers need to explore their value added viability features to attract new customers and instill confidence in shippers. It has never been more important to provide real time tracking and tracing options for domestic and international shipments.  Shippers basically expect it in this market. Doing it at digital speed is the key. Digitalization is about leveraging technology to create, enable or transform a business process. The basic advantage of digital applications is data compression to improve the speed of transactions. Speed is king in today's logistics world in all facets of execution. Data automation also provides enhanced communication between shipper, consignee and any other interested party. All technologies aside, there is still a strong personal aspect to our business in terms of negotiating contracts, customer service and the commitment of everyone in the organization to be mistake free.

Cloud Technology

Cloud computing is really the internet as we know it today on a commercial scale. Cloud technologies help mitigate the need for physical IT infrastructure, and on-premise support personnel to manage computing capabilities, by running operations across server farms or data centers. Using cloud-based services providers, businesses can leverage IT assets as programmable resources, which are global and scalable on demand. This allows a business to access or lease computing resources and storage power far greater than what it may have been able to access on local infrastructure, while still being able to scale up or down in a cost-efficient manner. Simplicity, affordability and ease of expansion are all enhanced with cloud computing. Enterprise IT is among the fastest growing segment of computing easily set to replace on site systems.

Be Sure Of Your Needs

Everyone wants to utilize the latest technology to remain competitive. The race is on to define the industry’s future. With an estimated US$4.6 trillion of revenues at stake, companies can’t afford to sit back and watch; they need to adapt to changing markets proactively. Before rushing in, consult an industry export to provide the direction and pace of technology applications to stay on point and within budget. Like most other industries, transportation and logistics is currently confronting immense change; and like all change, this brings both risk and opportunity. New technology, new market entrants, new customer expectations, and new business models. There are many ways the sector could develop to meet these challenges, some evolutionary, others more revolutionary. These are indeed interesting times. And its in these times that the council of an expert is vital. For a consultation regarding your current supply chain protocols, please contact us today. To keep informed on these emerging topics and more subscribe to our weekly blog on our site.

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Topics: Logistics Business, Logistics News, Industry Trends, Technology

Kroger Introduces Automated Grocery Delivery In Houston

Posted by Land Link on Apr 24, 2019 4:25:05 PM

The grocery home delivery market is ultra competitive. The big grocery players like Giant, Shop Rite and Wegmans all offer home delivery via manned delivery vehicles. Kroger appears to be first in the autonomous grocery delivery service race. After successful testing last year in Scottsdale Arizona, Kroger, the nation’s largest grocer, has launched a self-driving grocery delivery service in Houston, the latest salvo in a massive grocery market that has supermarket chains investing heavily in new technology to win over online shoppers. Company officials this week showcased the first of dozens of autonomous delivery vehicles planned for Houston: Toyota Priuses outfitted with cameras, sensors and self-driving computer software. In today's competitive grocery market, companies are turning to autonomous vehicles, automation, robotics and artificial intelligence to stand out. Kroger is competing with Amazon, Walmart and other businesses to capture consumers who want fast deliveries without hassles. 

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Topics: Transportation News, Logistics News, Technology

Transportation Management Trends For 2019

Posted by Land Link on Mar 28, 2019 11:20:28 AM

From expedited transportation services to shipping technology integration, 2019 is shaping up to be a year in which shippers evolve to meet the growing demands of both B2B and B2C sales. To help transportation managers cope with the changing appetites of a growing demographic we'll take a look at some developing supply chain trends in 2019.

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Topics: Transportation News, Logistics News, Industry Trends

Warehouses Are Experiencing a Metamorphosis In Operational Procedures

Posted by Land Link on Mar 20, 2019 9:30:00 AM

Warehouses and distribution centers around the world are coping with massive change and investment to stay competitive. Challenged by the demands of e-commerce and omni-channel fulfillment, smaller orders, ever-shrinking delivery timeframes, and a persistent labor shortage, operations are in perpetual need of tools that can help them tackle these and other ongoing productivity issues. Technology is the driving force in the warehouse and DC transformation. With automation, robotics, artificial intelligence and other advanced technologies making their way into the world’s distribution facilities, the warehouse management system has become a vital component to manage the increased amount of information. And because it collects valuable information along the way, WMS also provides actionable data analytics that companies can use for good decision-making.

Let's take a look at some industry trends for 2019.

Software and Equipment Vendors Offer Creative Financing

In an effort to convince warehouse and DC managers to take the next leap in automation implementation, equipment suppliers are coming up with creative finance plans to make it easier to upgrade. One approach that more companies are adopting is that assets can be rented versus purchased or leased. In other instances, the WMS vendors which sell the systems that run the automated equipment are now working more closely with their end users to help make it more affordable for a wider swath of customers.

A Focus On a more User Friendly WMS Interface

Perhaps the biggest turn off to any computer program is a complicated user interface.  Logistics managers don’t have the time to sift through reams of data to find what they’re looking for. Pertinent data needs to be a mouse click away. WMS vendors are focusing on their user interfaces and coming up with ways to present data in a more logical format to users. The focus is on making systems more engaging and easier to use, and particularly in a same-day-shipping environment, where a field service technician or retail clerk can use the system with little or no training.

More Improved Inventory Return System

In the online ordering world returns are a major line item in the profit and loss statement. Managing those returns more accurately will mitigate the return allowance figure in the financial statements. Returns management systems have made a sizable impact on the distribution environment, and are pushing technology vendors to add better precision management capabilities into their systems. Companies have to be able to manage precision, while more economically managing individual items. While WMS systems certainly help companies pick, pack, and stage, they are also inventory systems. As items get returned, shippers need to be able to return those goods to either inventory, vendor, wholesale or scrap to accurately determine their value.

These are just a few trends to watch for in 2019. Form more information on how technology can benefit your organization contact us today.

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Topics: Logistics Business, Logistics News, Industry Trends

Using Data to Establish Accurate Pricing and Operational Efficiencies

Posted by Land Link on Mar 13, 2019 10:48:55 AM

The right pricing strategy is a critical component that companies can’t afford to overlook and is one of the most important aspects of maintaining profitability. In the manufacturer-distributor-customer value chain, one of the manufacturers most pressing challenges is being able to mark up prices in a way that helps maintain profitability while not pricing that customer out of the market. This balance is getting harder to achieve in the current B2B business environment, where the next competitor, price comparison or huge online retailer is literally one mouse click or screen tap away. 

Focused on serving their customers while maintaining healthy profit margins, manufacturers have to effectively balance the cost of manufacturing with the company's profit goals.  Goals that are hard to attain if the company isn’t using solid pricing strategies.

Integrating Data Your Pricing Strategy

As data continues to proliferate right along with the number of technology tools to help harness that data, companies are learning how to leverage that information across multiple departments for maximum success. Accurate data can more precisely reflect the cost of manufacturing by considering critical issues such as seasonal raw materials fluctuations, capital equipment depreciation and labor concerns.  Manufacturers should be generating these cost equations on a monthly basis to forecast cost fluctuations and react in plenty of time to adjust pricing. 

Gain an Edge on the Competition

Even those manufacturers that think they have the pricing game under control will surely face a new competitor, get hit with a new market trend or face another economic challenge in the near future. Look what Uber did to the taxi business.  Manufacturers of the future will also understand that effectively engaging customers requires true innovation in executing the value chain. Traditional approaches to inventory, logistics, pricing and rebates will be reimagined through the application of advanced analytics and technology innovations.  Given the importance of data, analytics and technology to both engaging customers and executing the value chain manufacturers will also need to leverage IT to truly energize, not just enable, their business. 

Data management is central to keeping track of your costs throughout the manufacturing process. If data is properly recorded and accessible to every link in the chain, managers can touch base with their product at every stage, helping maximize efficiency, address problems quickly, and improve customer satisfaction.

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Topics: Supply Chain Management, Logistics News, Industry Trends, Technology, Big Data

Additive Manufacturing Is Emerging From Prototypes

Posted by Land Link on Mar 8, 2019 12:20:19 PM

Additive manufacturing is a process of making three dimensional solid objects from a digital file. Unlike printing a flat picture for example on a piece of paper, a 3D printer actually builds something in 3 dimensions. So to call it printing is a bit misleading. The device builds upward and outward with each progressive layer of material. The creation of a 3D printed object is achieved using additive processes. In an additive process, an object is created by laying down successive layers of material until the object is created in three dimensions. Each of these layers can be seen as a thinly sliced horizontal cross-section of the eventual object. 3D printing enables you to produce complex, functional, shapes using less material than traditional manufacturing methods. The number of production-ready additive manufacturing platforms that ship each year will increase more than 10 times by 2030, as the technology’s use in structural and mission-critical commercial applications comes to fruition.

According to a new report published by ABI Research, a market-foresight advisory firm, these systems will produce more than $360 billion worth of parts and end products each year and nearly $2 trillion in sum by the end of the next decade.

Markets For Additive Manufacturing

There is so much fascinating technology around us today. Everyone wants to believe the next one will be a game changer. The major interest in this particular technology is the potential of additive manufacturing to do much of a company's own manufacturing rather than engaging in trade to buy products from other sources. 3D printers capable of creating just about anything in color and multiple materials already exist and will continue to improve to a point where functional products will be able to be created. The automotive industry represents the largest opportunity globally with $148 billion in additive manufacturing product value forecast for 2030, but it is closely followed by the machinery markets, and these figures differ from country to country. The United States currently leads the world in terms of AM product value but will be passed by China in 2029 under present conditions. Additive manufacturing brings production closer to the places where products are sold and used. For suppliers, this means the ability to better dictate the priority, timeliness, and process that best fits their manufacturing needs. 3D printing has the potential to change the manufacturing world as we know it.

Additive Manufacturing Will Likely Affect The Global Supply Chain

This technology has the potential of transforming our global supply chain in a very profound way. How profoundly, at this point, is very unclear. Any supply chain begins with a manufacturing point. Then warehousing, inventory management and, of course, transportation arrangements. Now AM technology allows us to reduce manufacturing lead times, as well as transportation costs, and also reduce the carbon footprint associated with production and distribution. AM shouldn’t be thought of purely for manufacturing since it could have much broader supply chain implications. The original applications were originally used for printing small numbers of simple objects made of one or two materials but that's rapidly changing. Its most promising initial contribution may come in a couple of basic areas.

Manufacturing Customization

Though mass customization, creating products that fit perfectly with the desires of one customer, is a very hot topic and trend, all of these elements represent a cost and quite an effort. This means you need to make sure it is right for your application and industry, and that the added value for your customer matches your effort. Manufacturing lead times and transportation cost savings can be erased quickly with inaccurate customer data requirements. Simple examples of this mass customization may be common consumer products like earphone buds, cell phone cases or sunglasses.

Spare Or Replacement Parts Market

Another significant advantage to 3-D printing is the replacement or spare parts industry. When the Maytag man, or whomever, shows up to repair your home appliance there is no need for inventory in his truck. Just a 3-D printer and some software. The same argument can be made for just about any similar service type industry.

What's Ahead

AM technology still has some obstacles to deal with. There are implications for the digital supply chain to go along with the physical one since the intellectual property resides in the file from which the object is printed rather than the product itself. Therefore security will be an issue in handling and shipping these types of assets.

This means that in the future, we’ll need to really examine this data chain to ensure that the information it contains is securely transported and managed. This is where technology like blockchain would likely be useful. This is a great growth opportunity for the global logistics supply chain industry. This is also where the digital supply chain technology comes in. To stay current on these technologies and more, subscribe to our blog www.Land-Link.com.

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Topics: Logistics News, Industry Trends

The Big Retailers Relying On Technology

Posted by Land Link on Feb 20, 2019 8:19:14 AM

A new generation of shopping options through e-Commerce and m-Commerce (mobile commerce) has made supply chain management a vital area of concern for many businesses. It is particularly critical for manufacturing companies, which are heavily dependent on the supply chain partners to deliver their products. With an increasing emphasis on technological advancements, as well as the changes in customer expectations, the need for integrated supply management has become increasingly important. In the retail environment particularly, where the margins are thin, technology is the key component between profit and loss. And in this market, the sharks are circling.

Wal-Mart Is Making Hi-Tech Moves

This July, a Walmart supply chain first is coming to Colton, California. A newly built, 340,000-square-foot high-tech consolidation center will be the first in Walmart’s supply chain to receive, sort and ship freight. This automated technology will enable three times more volume to flow throughout the center and helps Walmart deliver the right product to the right store, so customers can find the products they need.

Amazon Started This Fight

Back in 2005, Amazon launched its Amazon Prime service. Customers, paying an annual membership fee, received guaranteed two-day shipping on hundreds of thousands of products. In fact, the introduction of two-day delivery was the game changer and established the dominance of Amazon in the online retail industry. When many other retailers started to catch up with that strategy by offering their own free two-day shipping, Amazon tipped the playing surface by offering a one-hour delivery with its Amazon Prime Now service. The fight now seems who can deliver product faster. The rub, however, is it has to be done at a profit.

The Latest Wal-Mart Approach

A massive Walmart-owned center, which will open in July with 150 full-time associates, can move three times as many cases. It will grow to employ more than 600 associates by 2021. With the combined might of people and world-class logistic technology, this facility will be the most efficient consolidation center in Walmart’s supply chain. Walmart continues to expand its portfolio of high-tech distribution centers. In October, Walmart announced that it had broken ground on a tech-enabled perishable grocery distribution center in Shafter, California.

Amazon Sets The Pace

I have to recuse myself of my opinion to some degree since Philadelphia was in the running for an Amazon Distribution Center Headquarters. Sadly, we didn't make the cut. There is one thing I have to admire about Amazon. Management may have adopted the Bill Bellecheck game plan of logistics protocol. They seem to have designed the playbook of online retail from order to fulfillment to the final mile. When Amazon made its official selection for the locations of its second headquarters, it was hardly a surprise to anyone following the lengthy HQ2 saga. But tucked into the announcement were tidbits we didn’t know, including information on what it took for the two sites to win out over the dozens of other bids.

How To Keep Up With The Competition

Target is lagging a distant third in the giant race for a retail giant of the world. The only strategy for small to mid-size retailers to break into this market is to be lean. Operational efficiencies will be crucial for anyone to be competitive. To keep up with your competition subscribe to our blog, or better yet, join the Land-Link.com client family and let us show you what a lean supply chain looks like.

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Topics: Logistics News, Industry Trends, Technology

Uber Freight May Be On Life Support

Posted by Land Link on Jan 30, 2019 5:19:08 PM

Uber Corp continues to operate at a loss. The company lost $4.5 billion in 2017, up from $2.8 billion the year before. Uber reported a loss of $1.1 billion in the fourth quarter on revenues of $2.2 billion. Uber freight has yet to turn a profit. Their parcel division, Uber Rush, is rumored to close in June. The driverless truck division has suspended testing. According to Eric Meyhofer, Head of Uber Advanced Technologies Group, “We’ve decided to stop development on our self-driving truck program and move forward exclusively with cars." Meanwhile, Uber's head of freight trucking, Lior Ron, who was also working on autonomous-vehicle technology, is leaving the company.

Uber freight is facing the same challenges as established freight brokers; driver availability. Equipment demand is at historic highs. Carriers and owner operators are able to maximize their revenue in this tight market. Responsible shippers are compelled to stay with established carriers and pay higher rates than chance their freight and brand equity riding with an unknown and unproven carrier. The Uber platform is little more than a bidding platform with shipments going to the lowest bidder. Uber freight would be a useful option for carriers shipping low value, durable freight, with little concern about brand equity. There is little history provided to shippers for Uber freight drivers other than insurance and authority. And it's unclear how much vetting is done on the carriers or owner operator. Uber shippers are trading off higher risk for lower freight rates. Most responsible shippers cannot afford to take this level of risk with their products and associated liability.

Uber may be concentrating on its main business; passenger transportation. Uber has decided to redeploy the engineering teams involved in the self-driving truck project to work inside of Uber's autonomous passenger car business. This shouldn't be a shock. Uber is the dominant leader in the on-demand passenger market and not a huge player in the trucking freight market. With Uber planning one of the largest tech IPOs since Facebook, they must have a compelling story to tell investors about how they plan to maintain their position in the passenger vehicle segment and not be lapped by other players with more compelling technology.

Uber's track record in the autonomous passenger segment is not stellar. They have higher incident rates than other companies, measured in Miles per Intervention. Miles per Intervention is a stat published by Pitchbook showing how often autonomous vehicle's computers require a human to take over. Uber ranks far behind Waymo and Cruise. Waymo is best-in-class with 5,600 miles per intervention. Uber is just 13 miles per intervention. GM's Cruise has better stats, with 1,250 miles per intervention, nearly 100x better than Uber.

Without perfecting or at least improving self driving technology Uber's entire market share is at stake.

For the latest Logistics and Transportation technology news, subscribe to our blog http://www.Land-Link.com/blog.

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Topics: Logistics News, Industry Trends, Technology