The aggressive progression to everything mobile has been obvious. The Smart Phone opened an opportunistic Pandora's Box that will never close again. Today, mobility is king. "Several key trends are driving mobility investments that support supply chain operations, and more specifically, in-field fleet/transportation,” says David Krebs, VDC Research’s executive vice president of enterprise mobility and connected devices. “These include the ELD mandate that came into effect in December 2017 (with a final deadline is December 16, 2019) and the transition by many operators from the legacy Windows-powered mobile device to Android.”

President Trump's strategy regarding the Chinese tariffs has been to right a long time wrong. Again, this was a significant aspect of his presidential campaign. The position, which arguably has merit, may come at a substantial cost to the U.S. economy. The theft and mistreatment of intellectual property, a potential monopoly around 5G cellular technology, and the knock-off market of some very high-end consumer goods have had a major impact. It's a difficult pill to swallow, but until now no political official has been willing to tackle the issue. What remains to be seen is how far Trump will take this battle and how much collateral damage will result. The initial collateral damage is in the lane imbalance of exports vs. imports. In an ideal world, transportation providers would like to see a balance of full containers going and coming to whichever port to reposition assets to meet demand. The trade war is expected to have a detrimental effect on this sensitive balance, specifically regarding U.S. exports. The imbalance of shipping containers is but a symptom of misaligned supply and demand caused by the ongoing trade skirmishes. But it is also an indicator of real impact on the supply chain.

Cargo theft is the primary concern of shippers and logistics professionals over any national holiday weekend. Holiday weekends pose a higher threat because truckers will park their trucks, and warehouses will be shut for an extended period of time. Millions of dollars are lost, production schedules disrupted, and customers disappointed over the long holiday stretch.

Before it was referred to as "Logistics", it was simply trucking. Rail, air and specialty transportation was a rarity. It was operationally simple and customers expectations were basic in terms of service. The world got itself in a great big hurry over the last 30 years. I suppose it was all started by the auto manufacturers when they introduced the "Just in Time" inventory system in the 90's. Manufacturers saved on inventory costs by using trucks as rolling warehouses. Thus was born the concept of time critical transportation. The idea eventually caught on with other manufacturing segments and it seems today everyone is in a rush for everything. Let's take a look at what we can expect the logistics business to look like in the next decade.

Data Engineering

Data engineering will be at the forefront of everything that goes on in supply chains. Data engineering, according to Dr. Michael Watson of Northwestern University, is "the art and science of blending data from multiple sources, automatically cleaning and filtering the data, and transforming the data to be useful for analysis." You may have heard the term "Big Data", referring to the volumes of pertinent data accumulated from various sources along the supply chain. This "Big Data" will be the source of information in the data engineering process. Another term you've likely heard is IoT or The Internet of Things. The IoT is the network of physical devices, vehicles, home appliances and other items embedded with advanced electronics capable of exchanging data with a central computer over the internet.

"Big Data" and logistics are made for each other. Companies are often sitting on masses of under-utilized data that could aid them in a number of ways.

Some of the current applications of Data Science by data-driven businesses within the industry include:

• Reducing freight costs through delivery path optimization
• Dynamic price matching of supply to demand
• Warehouse optimization
• Forecasting demand
• Estimating total delivery times
• Extending the life of assets through finding patterns in usage data — identifying the need for maintenance

The Truck of the Future

In business, a trend can refer to a business model, a process or a technology. However, a trend will only be of more than passing interest if it could directly impact your business and people. We'll look at 4 emerging trends.

There is a rumbling of a possible recession in the logistics industry lately. The red-hot freight market is slowing and that has some economists concerned. The freight industry is an accurate measurement of national manufacturing strength. Generally speaking, if something is manufactured it needs to be shipped somewhere. A slowdown in freight transportation may suggest a reduction in manufacturing which is a key component of GNP. Truck, rail and air freight volumes fell 5.3% in June from the same period a year ago, the seventh straight annual decline, according to the closely watched Cass Freight Index. That followed a 6% drop in May.  

Any conversation regarding the labor shortage in the trucking industry tends to gravitate towards the driver shortage. In conversations with owners and operations managers, the need for skilled labor is much more involved. Along with the less than glamorous truck driving career is the supporting rolls of diesel mechanic and miscellaneous support staff functions such as forklift maintenance and facilities management. For those who have never spent much time in a warehouse or dock area, it’s a dirty environment wreaking of propane. If the lure of the currently handsome salary of a trucking career won't attract young talent, the opportunity of support staff is a greater challenge.

So, here is yet another challenge for the facilities management staff. Keeping the assets in safe and operational readiness. The U.S. Bureau of Labor Statistics (BLS) says fewer workers are entering vocational education programs as Baby Boomers age and retire. When it comes to diesel service technicians and mechanics, the Bureau reports, the field is projected to grow by 12 percent from 2014 to 2024, faster than the average for all occupations. The BLS also said 67,000 technicians will be needed to replace retired workers, and 75,000 new mechanics must be added to meet additional demand by 2022. For many years, there’s been a societal push that stresses "without a college degree, you won’t have a career." Jennifer Maher, CEO at TechForce Foundation, an organization that raises youth awareness around technician careers, agreed that it’s an issue even for students who are interested in the trades.

Next-Gen Truck Maintenance

The industry shortage of diesel mechanics and nearly dry bowl of prospective recruits begs the obvious question. Who will service the existing fleet of commercial trucks not to mention the next- gen commercial vehicles? The transition should be interesting to say the least. There is no interest in the old technology but maybe some saving grace in the new. Still, the idea of young men and women getting their hands dirty for a living doesn't seem appealing to today's young career seekers. The maintenance of the fleet of these vehicles has morphed from turning a wrench on a single vehicle to tuning fleets online.

Technology Will Not Slow Down

"As the mechanics and technicians for the trucking industry, we can’t either,” explained Tom Wiers, chief executive officer of Wiers Fleet Partners. “We are up to the challenge and know the trucking industry will be forever evolving and our mechanics, technicians and drivers will always have a role in developing the entire trucking world. The advanced technology will also require specialized services and technicians who will be required to have an advanced knowledge revolving around autonomous tech.”

Moreover, there will continue to be a need for maintenance and service from teams like Wiers Fleet Partners as this technology advances. Items like tire blowouts, oil changes, drivetrain issues and more will still need to be addressed routinely. Additionally, these teams will have to embrace the change in technology and acquire new knowledge as autonomous truck fleets become a reality

Align Yourself With Asset Providers Who Have Done the Proper Vetting

The shackles of doing business in the trucking business in today's environment are challenging. Indeed, only the strong will survive in the coming years. The trucking industry is an intensively capital-intensive market in which to compete. Aligning your company with some established industry professionals ins a critical strategy in times of tight capacity and fluctuating pricing. It's times like these to look for the counsel of the logistic professionals from Land Link Traffic Services. We'd love to meet with you.

Though field testing for automated vehicles has been relatively successful, some hurdles to full implementation remain. Namely, consumer acceptance and comfort in riding in these vehicles. Also, alarming is the idea of an 80,000 lb commercial tractor-trailer rolling down the interstate on autopilot. Additional concerns include who will be servicing these vehicles and the threat of domestic terrorism by system hacking.

Consumer Concerns

Over the past two years, consumer awareness of driver-less vehicles has increased substantially. But a majority of people still want to have the option to drive themselves, according to a new report from Cox Automotive. The report finds that 84% of consumers want to be able to drive themselves, even in a self-driving car, compared to 16% who would feel comfortable letting an autonomous vehicle drive them without the option to take control.

Despite the promise that autonomous vehicles will make roads safer because it will eliminate human error, respondents’ attitudes to this has changed, decreasing by 18 percentage points in the last two years. Generally, self-driving cars are seen as less safe by consumers compared to two years ago. Nearly half of consumers responded they would never buy a Level 5 vehicle, up from just 30% saying they wouldn’t buy an L5 vehicle two years ago.

Much of the reason for the change may reside in the recent high-profile accidents that have involved autonomous vehicles, including the death of a pedestrian due to an Uber car in March of last year. Interestingly, those unaware of this incident are just as likely as others to believe roadways would be safer if all vehicles were operated by people as opposed to self-driving cars. Despite this, consumers do want and expect semi-autonomous features in future cars because they agree that collision warning alert systems and collision avoidance systems help make people better drivers.

What Will the Automated Vehicle Technician Look Like?

The greatest need for new knowledge is in body shops, where crash repairs are increasingly more complex than even the most experienced service technicians can handle. What service executives say dealership technicians will have to know to work on automated vehicles: 

• Technology of advanced safety and driver assistance systems
• Repair and replacement of sensors
• Electrical theory
• Information technology 

Sensor-based, blind-zone, and cross-traffic alerts get knocked around in crashes. Advanced driver assistance systems are proliferating in lower-priced vehicles. Electronic stability control is federally mandated. All new light vehicles will have to have backup cameras by 2019. Furthermore, the industry has agreed to make automatic braking and forward collision warning systems standard by 2022. The collision repair diagnostic person is going to be the one who determines what might be damaged. Replacing a sensor torn off a car's front end and swept up at a crash site can require a body shop diagnostic technician to go far beyond looking up a vehicle identification number to see what advanced driver assistance systems technology original equipment was. Such fact-finding requires the ability to follow an automaker's flow charts, make sure the replacement sensor is reinstalled accurately, and perform static and dynamic calibration.

There are so many controllers on a vehicle that has to work with each other; the technician will have to be able to follow increasingly sophisticated diagnostic protocols for what to clean, adjust, repair or replace. Fulfilling that vision will require a significant transformation of vocational training programs.

Car Cues

As future technicians are trained to work with automated vehicles, they'll have an advantage. The vehicles will predict when failures of key components are imminent. As autonomous and electric vehicles and mobility converge, service will be even more critical. Automated vehicles, especially those owned by fleets rather than individuals, will operate more hours of the day and accumulate twice as many miles as today's cars and trucks before they are replaced.

Hacking Fears and Other Gray Areas of Autonomous Vehicles

Today's Logistics managers have been dealing with the most challenging freight landscape in recent memory. Innovation, technology applications and improved carrier relations have helped ease the turbulence in a market of rising prices and tightening capacity. There is little evidence to suggest this trend will end anytime soon. 2018 was among the most challenging of years for shippers. 2019 has seen similar challenges. Tight capacity led to significant, and in some cases, multiple rate increases in order to continue to secure capacity. Shippers struggled to manage their logistics spend.  Looking ahead it would benefit shippers to make every attempt to guarantee their capacity for the near future, particularly their busy seasons.  

Retail vendor compliance is becoming increasingly complicated and costly for consumer goods companies and their distributors as they seek to meet the ever-changing demands of retailers. If requirements for electronic notification, delivery time and location, packaging and labeling, and numerous other details are not met perfectly, the vendor can receive a short payment on a shipment invoice, commonly called a chargeback. Chargebacks can erode your bottom line quickly. Charge back avoidance planning should be a primary concern if your doing business with large retailers like Walmart, Kmart, and Target. Walmart’s On-Time In-Full (OTIF) policy has set a precedent that will actually fine shippers and suppliers if goods don’t arrive when they are supposed to, whether that be early or late. This means that shippers and carriers need to work closely together to hit the designated delivery window. Must Arrive By Date (MABD) and OTIF are crucial for the changing client expectations. Given that Walmart is such a substantial customer for many suppliers in the United States, making deliveries on time and in full is the difference between making a tidy profit, or losing out on a major customer. There is no uniform plan that will work for all retailers so a plan needs to be tailored for each customer. What’s compliant for one retailer is not necessarily acceptable for another, and there’s a wide range of possible violations. Some are based on one-off problems such as delivery made outside of the approved time window, which could cost the vendor up to 3% of the cost-of-goods sold. Others may be applied due to multiple repeated violations or an inability to reach the required percentage of acceptable, on-time deliveries. Chargebacks are a key component in vendor assessments. Excessive fines could leave you out of next year's RFQ opportunities.

Compliance Planning Design

Strict vendor compliance programs, scorecards, and chargebacks are strategies to dissuade vendors from disrupting a retailer’s finely-tuned, multifaceted, omnichannel supply chain. Given the high stakes involved, setting penalties high enough to be considered punitive ensures that retail vendors pay attention and make compliance a priority. Today, retailers are employing sophisticated supply chain management software powered by artificial intelligence and automated systems, including robotics, to manage these extended supply chains cost effectively, and their financial health depends upon it. Compliance planning is critical if vendors are going to keep pace with the supply chain of the future and do it profitably. There are several step which can be implemented to establish your vendor compliance program for all of your customers. Again, this is a custom designed plan to fit both vendor and customer supply chain systems. So the first step is to evaluate your current supply chain protocols and existing vendor compliance plan in order to identify areas of improvement. Such an evaluation is part of the many services offered at Land Link Traffic Systems.

While chargebacks can cause tension in the relationship between retailers and their vendors and distributors, all of it can be avoided. Vendors can avoid chargebacks by prioritizing compliance within their organizations, employing the right technology, and choosing logistics providers with experience and a history of success with retailers. Supply chain compliance is a complex process that requires the management of numerous moving parts, designed and managed by experienced logistics professionals. Vendors that make the effort to work themselves seamlessly into a retailer’s supply chain don’t only avoid costly, chargebacks but become a preferred vendor. By becoming preferred vendors, these businesses position their products to be available wherever and whenever a consumer is ready to buy them. So, the claim can be made that retail compliance drives profitability. Protect your profit margin with a well-designed Retail Vendor Compliance Plan from Land Link.