Daily Insights, Trends and Solutions for Professionals, Experts, Students and Society
Tag: SCM
SCM is the tag for Supply Chain Management which encompasses all things Supply Chain including Procurement, Logistics, Planning, Business, Operations and more.
Modern transportation and trucking is currently experiencing major changes thanks to transformative transportation technologies. Although we’ve become accustomed to long international flights, jam-packed public transportation and diesel trucks that only get 20 mpg, the future of transportation promises to change all of that and much more — and it’s closer than many people realize.
Let’s take a look at 6 transportation technologies sure to impact the trucking and transportation industries forever.
A new survey from Brightpearl found that 42 percent of U.S. retailers say they have seen an increase in the number of returns and “serial returners” over the last 12 months.
What’s more, 61 percent of the retailers surveyed said they would ban serial returners.
This is an interesting change in an industry that has put so much emphasis on facilitating free returns and exchanges.
E-commerce is defined as the buying and selling of products or services exclusively through electronic channels. If you’ve made an online purchase through eBay, Shopify, Amazon (through Amazon FBA), and other platforms, then you have made your purchase via an e-commerce site. More and more people spend their time browsing on the internet and the more likely they are to buy stuff online.
Admittedly, the e-commerce industry is booming. Retail e-commerce sales in the United States are projected to grow at a fast pace in the coming years, going from 322.17 billion U.S. dollars in 2016 to just over 485 billion US dollars in 2021.
Why You Need Order Fulfillment Services
If you’re looking for a business that will eventually get you out of your 9-5 job, or looking to expand your existing business, having an online presence and web-based store could fulfill this goal. For beginners in the e-commerce trade, what do you need to do to get more sales, with a lot of online businesses competing for customers’ attention?
Customers want products that will give the best bang for their buck with speedy delivery, and good after-sales support. Here’s where the different companies offering order fulfillment services come in.
What is an Order Fulfillment Service?
Order fulfillment is defined as the steps involved in receiving, processing and delivering orders to end customers. A fulfillment service is defined as a third-party company that provides these order fulfillment steps on behalf of another party, such as an online seller.
FBA, or Fulfillment By Amazon is a business model wherein e-commerce sellers on the Amazon Marketplace, big or small, can have their products stored in any of Amazon’s giant warehouses, pack and deliver them to customers, handle customer support, and returns.
FBA Pros
Expertise and Reach
Amazon has one of the most advanced e-commerce fulfillment service in the world, can help you scale-up or grow your business and as of the last measured period, the source estimated 90 million paying Amazon Prime subscribers in the United States, up from 63 million in June during the previous year.
Amazon Prime customers are eligible for 2-Day Shipping, Free Shipping and other benefits. If you sign up your products for Amazon Prime, your products are eligible for free shipping, too.
Customer Service and Returns
FBA handles customer service and returns. Listings are displayed with the Prime logo, so customers know that Amazon handles packing, delivery, customer service, and returns.
They handle the fulfillment services side of the business and saves your time, so you can focus on the other aspects of your business.
Multi-Channel Fulfillment
With Multi-Channel Fulfillment, you can fulfill orders from other sales channels using your inventory stored in Amazon order fulfillment centers. Single-source your inventory to streamline your fulfillment operations, manage your inventory through an online user interface and can direct Amazon to return your inventory in e-commerce fulfillment centers at any time.
Cons of using FBA
Customization
Little to no order customization. Sellers must comply with existing Amazon .processes.
Branding
Items are shipped in Amazon boxes. Sellers can ship in generic boxes which may cost extra.
Warehouse Pricing
Storage fees are generally higher compared to 3PLs and usually rise during holidays.
Higher order handling fees for non-Amazon orders.
Communication
Solutions are based in standard processes which may pose little opportunity for dialogue.
Conflict of interest
The fact that Amazon may actually be a competitor to the seller. Amazon is in the business of selling, they just happen to offer shipping services. For Amazon, it’s free product and market research, and they’re making money off you.
Third Party Logistics (3PL / TPL)
Third–party logistics in logistics and supply chain management is a company’s use of third party businesses to outsource elements of the company’s order fulfillment services.
Pros of Using 3PL
Customization
Boxes/bags and all internal packaging are customized to a specific brand. Processes are adapted to your business’ operation and specification.
Warehouse Costing
Attractive storage costs that is variable. Customer pays storage space on a given month. Some 3PLs even offer free warehouse storage for a limited time.
Communication
Has onboarding processes, frequent communication before and after product launch. Collaborative approach is encouraged.
B2B (Business to Business)
Certain 3PLs can handle both B2B and B2C (Business to Consumer) fulfillment, resulting in one e-commerce fulfillment partner for all sales channels.
Cons of Using 3PL
Finding a Trustworthy 3PL company takes time.
Not all 3PL providers are created equal. It takes time to find a good company to work with from the beginning. Once you find someone you can trust, you can rest assured that your goods are being properly cared for. The initial search could be stressful but it will all be worth it once you find a reliable 3PL company.
Bad Service Reflects on Your Company
An inefficient 3PL provider could make your company look bad. Your customers do not care who is in charge of getting the product to them. All they care about is the end result. It is very important to look for a good distribution center early on to avoid customer-satisfaction issues in the future.
Amazon FBA or 3PL in Conclusion
Order Fulfillment Services are a crucial part of your business and a major factor in determining its success or failure. Whether you entrust your fulfillment services to FBA or a 3PL, there is a greater chance that you will be in good hands – these are fulfillment experts, after all. The key difference is you as the owner, – what do you want for your brand and what kind of customer experience you want to give to your consumers.
If you are happy to use Amazon’s existing system and tap into their wide customer reach, FBA may be a perfect fit for your company. If, however, you would like more control over your order fulfillment services, partnering with a 3PL could be the best solution. Make sure your order fulfillment service provider is experienced with the type of operations you need before you entrust them with your reputation.
Amazon FBA article and permission to publish here provided by Dona Dimaculangan at 3p-logistics.co.uk. Originally written for Supply Chain Game Changer and published on March 8, 2018.
How many times have you looked at your Distribution Centre operation and thought about how you would re-layout and streamline the process flow if you had the chance?
When you are starting with a new, empty facility it is clearly much easier to layout the operations to make the best possible flow of materials and processes. But when you have an existing operation which has evolved over a long period of time, you are likely faced with utilities, equipment, infrastructure, walls, and paradigms all of which have resulted in a rather inefficient flow of materials and people and processes.
This was the situation we had in one of our Distribution Centres. In this particular Distribution Centre the current layout of the operation had been the result of many iterations of adding new customers, new products and new processes over time with the associated fluctuations in demand for everything.
Yet with the launch of our Global Process Excellence project we had unleashed our employees to make the improvements they had imagined could be made for a long time.
We launched the Global Inventory Turnover Breakthrough project on April 1st. It was not a joke. Our challenge was to improve Inventory turnover from 6.3 turns to over 8.6 turns within the year. This was a level of achievement that the company had never before reached, let alone thinking about going from Worst to First.
But we had the Call to Action. Our Inventory turnover was perennially the worst in our industry. Our Inventory levels were consuming an enormous amount of cash as well as creating a lot of expense in carrying charges. And this had the effect of driving our Return on Invested Capital to very low, unattractive levels. Further there were ongoing complaints that even though we had a lot of inventory we never had all of the right material that was needed.
We had the motivation to turn this situation around. What we didn’t know is that we were about to make history and go from Worst to First!
Customer expectations are changing as new sales outlets are being used. With the application of social media, omni-channel and e-commerce customers now have more price options, selections, delivery methods and shopping experiences. The ability of a business to keep the customer satisfied greatly depends on fulfillment capabilities, such as with the use of warehouse robots.
Progressive businesses have realized the critical nature an operations strategy has on designing a working supply chain. Combining distribution and fulfillment operations into a single facility has become the base of the supply chain network, as they allow a single location to stock a vast number of products and service multiple channels.
Growing global complexity in supply chain management has forced organizations to look towards technology as their silver bullet; serving as the missing link between people (supply chain actors) and the ability to collaborate at scale. As such we have Blockchain technology reshaping SCM.
Blockchain technology is one of the most hyped amongst the currently developing technologies, hypothesized to make one of the greatest impacts in supply chain management — especially procurement and logistics — in the coming years. If SCM tech were a summer reading list, Blockchain would be the Twilight trilogy.
There are thousands of supply chain technology vendors in the market today, and many companies claim their system is the best-of-the-best.
How do you truly know which systems are the best, and what can you do to ensure the selected supply chain technology does not become a money pit for your organization?
The answers to these questions lie in understanding the top pitfalls to avoid when selecting systems and new technologies for use in your organization.
At Supply Chain Game Changer we believe in sharing experiences and expertise from people in every industry and from across the globe. As such we have introduced our “Seasoned Leadership in Action™” Interview series at Supply Chain Game Changer. This interview is with Paul Kretz, Head of SCM at Church and Dwight.
I first met Paul at Celestica. He left to purse other interests but our paths crossed again later on. I was at a company that had just implemented a new WMS system in the Distribution Centre. The system cutover was a disaster. And the operation had been run without true Warehouse Management experience as well. As I looked to recruit a new leader I was looking for a someone who could lead change.
I toured my final two candidates through the Distribution Centre, including Paul. Their reactions would help me decide who to select. The other person seemed overwhelmed and lost while looking at the mess in the warehouse. It wasn’t clear what they would do. Paul looked at the disastrous situation like a kid in a candy store. He saw opportunity at every turn. And instead of being intimidated by the situation Paul was motivated and inspired. I found my leader!
Imagine what the future will look like in Supply Chain!
We don’t mean the near future, but the very distant future. There are articles which describe what the future of Supply Chain will be like in 2025, or even 2030.
But is that enough of a far-reaching vision to offer much more than an incremental view of what we see today based on existing technology?
Any view of the near future is more likely to describe incremental changes and incremental advancements based on the current knowledge base. But an extremely distant vision of the future is more likely to offer revolutionary ideas as to what future possibilities are.
China has fast become a key player in the world’s economy. Since 2012, China has been the world’s number one trading country, and it shows no signs of moving from this spot anytime soon.
China is now the leading exporter of many items and Chinese products have become absolutely ubiquitous. In America alone, consumers purchase more than $500 billion worth of Chinese goods per year.
As a boutique recruitment agency, we at Argentus are on the front-lines of the churn in the new jobs market. We speak with potential job candidates every day.
Some of them are passive, interested in moving into new opportunities when we reach out to them. Some of them are active, reaching out to us because they want to make a move.
With the economy experiencing a prolonged growth spurt, and demand for professionals in Supply Chain Management and Procurement – our area of specialty – going up, there’s a lot of activity, especially in short-term contracts where companies are onboarding talent for their change management and business transformation expertise.
We have written many blog posts about Change Leadership and Culture Change. At its core the overall objective is creating a High Performance Organization (HPO). For a truly High Performance Organization is one in which their will be high morale and an innate ability to achieve superior results for all stakeholders in the company.
There are relatively few High Performance Organizations. More importantly there are many, many companies that are actively on the journey to become an HPO.
The Olympics are a tremendous source of inspiration in many respects. Watching the incredibly talented athletes compete is truly amazing. Whether they win or lose, whether they are favourites or underdogs, or whether they are from your home country or another country, their years of training, commitment, skill and expertise are on full display.
Seeing so many of the countries of the world come together in peace is also a remarkable sight. Fans and supporters cheer all of the athletes whether they are winning, struggling, or just giving it their all, and no matter where they are from.
Most of us create, use, present and work with at least one spreadsheet each and every day. Spreadsheets have proven invaluable. And many businesses even observe, and complain, that they are run on spreadsheets.
Yet there was a time not that long ago when most people didn’t even know what a spreadsheet was. In the early 1980s I was given one the first IBM Personal Computers to use, along with the spreadsheet software Visicalc. Spreadsheets forever transformed my productivity and skill set.
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