everyday fast fashion :how zara manages its supply chain

If you’ve ever shopped at Zara, the ubiquitous clothing chain, you may have noticed its trendy offerings are not just up-to-the-minute but up-to-the-instant. zara is a chain of supply chain which is owned by Inditex ,the Spanish retailer with a turnover of over 14A billion turover .with12% net profit over sales . The secret sauce of  how Zara is able to do its because of their famed Supply chain  management, which has become a case study in many business schools since a long time

The supply chain management is the key to Zara’s corporate strategy. and its revenues and profits that swells up every year.Zara is the most profitable European retailer and apparel brand .Zara's success has been the result of focus and  rapid response to the market . Unlike all its competitors it does not outsource all  its production activities .Most of its production capacity is inhouse and outsourced is located in Europe so that it can work  on  shorter lead times

It often relies heavily on sophisticated fabric-sourcing, cutting, and sewing facilities nearer to its design headquarters in Spain .While the wages of  European workers are higher than china or taiwan ents an hour. But its  turnaround time is miraculous: as short as two weeks from an idea in a designer’s head to a garment on a Zara store’s shelf. The bulk of its production and apparel is shipped by air, so that Zara can deliver  it  across  retail stores in very short times ( 72 hours )to the market across all the stores located around  the  world.

Because of its ability to respond quickly . Zara is able to bring products across its retail chains and store shelves quickly ( withing 15 days of product creation )Zara ensures that it has a fresh lines of fashion and apparels with no product in the shelves for more than 4 week
s.
No wonder it positions it selves as " Fresh Fashion everyday . The sheer  and and awesome power of scaling up and ensuring no inventory is stockrd up not more than onr month, It can deliver retailers with the latest line of products within 15 days of its launch across most nations where Zara is present 

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how retigence is helping store owners manage inventor in real time

HOW TO ALIGN INVENTORY TO REAL TIME DEMAND

 One of the most crucial role RETIGENCE predictive analytics has played in delivering  inventory optimization was for a mobile company. Traditionally mobile retailers purchase inventory from distributors  for a credit  period of 21 days.

The disadvantage here is that  the retailer had no idea on  the inventory stock in their books and the amount they have to pay  to the mobile company distributors  during the credit period of 21 days. There was no real time mechanism by which they coudl judge the value of their inventory in the real time. They only managed to  find the data during the end of the financial period

When it comes to merchandise ordering many retailers are restricted by lack of timely and accurate information on their sales, stock turn and customer demand

By quickly and easily delivering required information to mobile store owners including inventory  purchases and other decision makers  we have  insured that each inventory was reduced    so that the chances of overpaying the vendor  is almost nil.

this also ensures taking the guess  out of guess work, with helped retailers to acess real time analytics and insight into daily stocks and store right down to sku levels

,our retigence predictive hana  helps them interpret real time data with accuracy and speed by which retailers  can make their  decision faster , ultimately leading to higher sales, gross profit and faster growth
this saves  businesses from going bust. you dont have to wait for data , because we help access real time  computing data on the fly by theanalytical  power of sap hana

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the 3 golden rules of optimizing network design process:

1)The decision to allocate volumes and markets to plants is an important decision in the overall tactical decision system for the firm. The decision to locate these plants in locations where it has decided to is an important network design decision, which has significant implication on the supply chain performance

1)Firms can use linear programming model to decide an optimal network design and operations Deciding optimal location of services in a model a) where consumers need to walk in everyday involves different considerations as opposed to a model b) where “ its corporate employees are located at one point and with c) where its manufacturing locations are located across the country

2)Network design involves large amount of data , converting large amount of data into meaningful structured data into insights

3)Global firms spreads out their risks by having their manufacturing plant as dispersed across geographically possible and keep their excess capacity in network as a hedge against uncertainty in markets and prices of finished products and raw material

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How target is moving to owning the longer piece of the supply chain pie

At a time when consumers expect rapid fulfillment as they shop online and from mobile devices, Target is writing custom software to improve its supply chain operations.
Target is building new supply chain software to better align inventory availability with consumer demands. To better position the retailer for online and mobile shopping, the retailer’s IT team is writing custom software to quicken the pace with which merchandise gets from its stores to consumers.

 According to Target's CEO Mike McNamara" It was important to get the fundamental's of Supply chain " correct specially during today's uncertain times. Mike believes that as a company the stress and strain we put on our supply chain today is very different to what was the case four or five years ago

 Target last year  had allocated $1 billion for its digital business transformation, is modernizing an outdated supply chain predicated on a linear model in which goods went from the manufacturer to a distribution center and then one of its 1,800 stores for purchase.

 Target's inventory lens has widened to include more products from countries such as China and perishable groceries for which timely arrival is a critical factor. Target is now shipping products directly from fulfillment centers, distribution centers and local stores to consumers' homes to accommodate preferences for online and mobile ordering.

In Target's fourth quarter, one third of its online orders were picked up in store or filled from inventory in stores. These factors have led Target to own a "longer bit of the supply chain," McNamara says. "We're using the whole enterprise inventory to service our guests in a way we never did before." The new apps are designed to better streamline increasingly complex operations.
Target naturally generates a lot of data, so it relies on several open source databases and data management tools, including Cassandra, Kafka, Couchbase, MongoDB and Hadoop

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iceland and frozen food retailer xpo logistics ties up for 5 year supply chain deal

Iceland and XPO logistics  has agreed   for a five-year warehousing and distribution deal , as the frozen food retailer looks to continue growing its store network in the UK.


 The supermarket currently has 850 stores and a burgeoning network of new 'out-of-town' Food Warehouse outlets, and XPO says it has developed a supply chain solution that combines the retailer's dedicated network with the its own shared-user facilities.

 XPO Logistics, Inc. is a US corporation and a provider of supply chain services in 32 countries. The company has annual revenue of approximately $15 billion, with more than 1,450 locations and a workforce of over 84,000 employees

 XPO will manage Iceland's distribution centres in Warrington, Enfield, Livingston and Swindon, with responsibilities including warehousing activities ranging from product receipt to nationwide store distribution, as well as a number of primary collections.
 Iceland's temperature-controlled fleet of 320 tractor units and 450 trailers will also be overseen by XPO in a move that is expected to create further operational efficiencies for the retailer by implementing an integrated inbound supply chain platform.
In 2015 XPO acquired Norbert Dentressangle, a logistics business that had a significant presence in the UK grocery and general merchandise retail sectors.

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Who Checks Out Faster…Men or Women?

Image Source- GroomsAdvice

Men stare at space while women check multiple outfits. Isn’t that a sweeping statement or maybe a cliché? Men have been stereotyped and on the other hand, women are the epitome of having an insatiable desire to shop. Any man’s expressions look like waiting till eternity for her woman to finally make up her mind. The flickering of fluorescent lights in the shopping mall continues to hypnotize the man. So do men hate shopping? Contrary to popular and often cliched  opinion, many men are perfectly happy to hit the stores.

However It is the process of shopping that they hate an not per se " shopping " as an activity. The generalization that men and shops do not gel well together is a cliché. There is a subtle difference that retailers need to understand. Biologically speaking  men buy for their needs while women shop for their wants.

 Women are naturally programmed to be a gatherer whereas; men behave like a hunter since primitive times. And this 21st century is no different. So any man’s job is to target the exact thing rather than wandering aimlessly to look at various options available. Men are far more decisive when it comes to shopping. However, women shop on behalf of their kids, husband, in-laws, friends, professional associates and even for their friend’s kid, to name just a few. It is said that men head to the check out counter after choosing one out of 3 items, while women selects  one out of every 8 items  they see.

Their tendency to constantly evaluate their purchases and the impact it will have on the people they care for is visible to everyone. So it is a must for retailers to understand the gender differences  and how does this impact retail  . By doing so, retailers can overcome the hidden barriers to the sale. Diversity in the shopping behavior of both the genders need to be addressed before forming any notion about them. Nowadays, both the genders are staying single and settle down later in life. So don’t risk your sale by forming stereotypes about them.

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Managing the Stock Out Conundrum

In  a recent  survey data   that covered across more than 71,000 consumers in 29 countries  show ho consumers react to stock-outs problems. When consumers can’t find the precise product they’re looking for, consumers typically do one of five things.

•  They find a substitute of the same brand, they substitute a different brand,
•  they delay their purchase until the item’s back in stock at that particular store, 
• they don’t buy the item at all, or, 
• worst for retailers, they buy the item at another store

Depending on the product category, 7% to 25% of consumers faced with a stock-out will continue shopping but won’t buy a substitute for their desired item at the store; 21% to 43% will actually go to another store to buy the item according to a recent harvard review retailers can lose nearly half of intended purchases when customers encounter stock-outs. Those abandoned purchases translate into sales losses of about 4% for a typical retailer. For a billion-dollar retailer, that could mean $40 million a year in lost sales

A study indicates that approx 600 retail outlets across 29 countries, the retailers themselves are responsible for most stock-outs— However these are at odds with other findings which is showed 72% of stock-outs were due to faulty in-store ordering and replenishing practices—retailers ordering too little or too late, generating inaccurate demand forecasts, or otherwise mismanaging inventory. Just 28% of stock-outs, we found, could be attributed to replenishment and planning problems in the supply chain. These included product droughts created by suppliers; category planners who mismanaged shelf space, promotions, or new product introductions; or supply chain managers who misjudged long-term demand.

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Retail Start Ups now to e-open for 365 days a year

Indian Finance Minister Arun Jaitley today proposed allowing small and medium shops to open all through the week on a voluntary basis as part of the simplification of rules for the sector to create more jobs, a move hailed by retail players. In his Budget 2016-17 speech, Jaitley said the government plans to circulate Model Shops and Establishments Bill which the state governments can adopt on a voluntary basis in order to boost the retail sector, which is the largest service sector employer in the country.

 "Many more jobs can be created in this sector, provided the regulations are simplified. If Shopping Malls are kept open all seven days of the week, why not the small and medium shops? These shops should be given the choice to remain open on all seven days of the week on a voluntary basis," he said. Jaitley, however, said the interest of the workers in terms of mandatory weekly holiday, a number of working hours per day have to be protected. "We propose to circulate a Model Shops and Establishments Bill which can be adopted by the state governments on a voluntary basis," he said. 

 Welcoming the announcement, Retailers Association of India CEO Kumar Rajagopalan said, "Permission for keeping stores open 365 days helps retailers increase sales, generates more employment, creates customer convenience and also increases tax collection for the government thanks to increased sales.

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Comparison of Efficient and Responsive Supply Chain

  EFFICIENT SUPPLY  CHAIN                                            RESPONSIVE SUPPLY CHAIN

PRIMARY GOAL:  supply demand at a lower cost                        respond quickly to demand


PRODUCT DESIGN: maximum performance at minimum cost     creates modularity for product changes                                                                                                                            

PRICING STRATEGY: lower margins as price is a prime            higher  margin, price isn't a driver

MANUFACTURING: lower cost, high utilization                        flexible capacity to buffer unpredictability


INVENTORY ; minimize inventory to lower costs                        maintains buffer inventory
                                                                                         
                                                                                                                                                  

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Dimensions & Activities that affect Offshoring

The list of dimensions that impact the offshoring concept


Performance dimension  Order communication
Activity Impacting Performance  Order Placement
Impact of off sourcing More difficult communication

 Performance dimension: Supply chain visibility
Activity impacting Perform: Scheduling and expedite
 Impact on Offshoring: Poorer visibility

 Performance dimension: : Raw material costs
Activity Impacting Performance: : sourcing of raw material
Impact of Offsourcing Sourcing of raw material could go either way depending on raw material costs

 Performance dimension Unit Cost Production
Activity Impacting Performance: quality and transportation Labor/Fixed cos
the impact of Offsourcing: quality may suffer

Performance Dimension: Freight costs
activity impacting performance: transportation modes and-and quantity
Impacts of offshoring: higher freight costs  could go either way


Performance Dimension: Stockouts
activity impacting performance: Ordering, production transportation with poor visibility
Impacts of offshoring  : Increase"


Performance Dimension: Minimum order quantity
activity impacting performance: Production and transportation
Impacts of offshoring : larger minimum quantity increase inventory


Performance Dimension: working capital
activity impacting performance: Inventories and financial reconciliation
Impacts of offshoring "larger minimum quantity increase inventory

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Is your Supply Chain at risk due to Network Design failure

 Mitigating  your supply chain risk  during network design disruptions: 5 ways to  handle the supply chain risk

 1)INCREASE CAPACITY : Focus on low cost decentralisedGet capacity for predictable demand 

2)GET REDUNDANT SUPPLIERS :Get redundant supplies  for high volume demand and low redundant supply for low volume demand 

 3) INCREASE RESPONSIVE : Give  preference to  cost over responsiveness for a commodity item which has a long life cycle.In contrast   increase responsiveness over cost for shorter life cycle products 

 4)INCREASE INVENTORY: Decentralize inventory of predictable lower valued goods and decentralize unpredictable and higher valued goods or products 

5)INCREASE FLEXIBILITY : Favor cost over flexibility for high volume products. In contrast, favor  flexibility over cost for low volume products

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Performance characteristics of Retail Industry with Consumer Pick Up

The Inventory and cost impact "for  retail consumer pick " Industry

 In  retail consumer site, the inventory is stored with the manufacturer or distributor  warehouses, however, the consumer orders are based on online or the phone orders. In this   case, online consumers give the order online or mobile. The "goods are picked up and are then sent to the designated pick up spots "which are then send to the consumer. This involves
1) Order by phone
2) Orders are delivered to stockists
3) merchandise are then shipped  to pick up points

 In this post, we take a look on how " inventory costs and performance" impact consumer retail pick up industry

Cost factor : Inventory
Performance: Higher  than all other options

Cost factor: Transportation
Performance: lower that other options

Cost Factor : Facilities and handling
Performance: Higher than other  options. The increase in handling site  at the pick site can be significant for online and phone orders

Cost Factor : Information:
Performance: some investment in infrastructure needed  for online and phone orders.

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Supply Chain drivers that impacts Distribution Network Design

At the highest level performance of a distribution network shall be evaluated by following criterias
 1) customer needs that are met
2) Cost of meeting customers; The the firm must consider the impact of customer service and the cost of meeting that service

 Although there are customer values is impacted by various factors we discuss the measures influenced by the structure of the distribution network .Parameters that impact Customer needs are 1)response time for reaching customers
2)Product variety and SKU
3) Product availability
 4) customer experience
5)Time to market
6) order visibility
7) Return ability Firms that are able to target customers who can tolerate long response time are required only a few locations that may eb far from the customer. These companies focus on increasing the capacity of each warehouse ot stores In contrast firms that target customers with shorter tolerance response time needs to have their location close to their facilities

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6 supply chain drivers that impacts distribution network design

6 supply chain drivers that impacts distribution network design are

1) inventories
2)Transportation
3)facilities and handling
4)Response time :The other 2 drivers are 5) sourcing and  6)pricing

INVENTORY AND AFFECT ON SUPPLY CHAIN  a)As the number of facilities in the supply chain increase the costs also increases .To decease the inventory costs ,firms try to consolidate and limit the number of facilities in supply chains c)For example with fewer facilities Amazon  is able to turn its inventory 10 times a year, where as Barnes and nobles , with hundred of facilities is able to turn its inventory 3 times a year.

2) TRANSPORTATION AND SUPPLY CHAIN Transportation : Inbound transportation costs are the cost involved for bringing material into the factory.While outbound supply costs consist of  goods are transported out of the facility Outbound transportation costs per unit tend to be higher than inbound costs because the inbound lot sizes are typically larger

3) FACILITIES  PLANNING  AND SUPPLY CHAIN facility cost decreases as the number of facilities decrease because consolidation of facilities allows firms tro exploit economics of scale 4)Response time : if the firm wants to reduce its response time it might have to increase the number of facilities beyond the point that it minimizes logistics cost.

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Explaining the model of Supply Chain in Online Retail Industry: Infographic

explaining the  model of supply chain in online retail industry:

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Predictions & Forecasts of the Internet Of Things

predicting of forecast of internet of things

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The 5 Biggest Industry Vertical Markets for Predictive Analytics

The Industries with the highest use of Predictive Analytics

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Why Stock Clearance Sale is good for managing Inventory

For a retailer, the best way to ensure you continue to stock latest products and get your items moving  is to ensure you continue to de-clutter your store so only the best merchandise remains.

This is more so especially for  retail stores as  " life cycles for fashion "  are quick and abrupt. It is important  for a retailer to get  some of your investment back before it is totally worthless.

Many merchants are just hesitant to markdowns, and it is unnecessary. Your money is already gone; holding on to it just ties you to the past and all your are left with " stuff that will not sell as time grows by"  and  especially in apparel trade. If  the clothes lying on your shelf has not sold for the last 5 months, chances are it may never get sold in the coming 6 months.

The best way to get rid of them is a "stock clearing sale" as  you don't want to " have excess inventory" when you are just waiting for the latest stocks to  arrive.. knowing that  those will sell well

 But many retailers feel that they must get back whatever they paid for their inventory, no matter how many years ago the merchandise first arrived in their store. This thinking is murder on their cash flow.

Some more  retailers feel there will always be a demand for a part or accessory to a model or product, even if that product is no longer sold. Maybe on Ebay, but not on your display shelves.
inventory being like apple and  milk and  the more they sit there doing nothing ... the more are the chances of them getting spoiled.

 Unlike Humans.. whose power of thinking and rationalizing  gets better with age. Merchandise Doesn’t Get Better With Age. It only stops you from getting better returns
Too many retailers avoid aggressively clearing out old merchandise either because they feel they will lose money when they sell it, or it’s too complicated to know what to clear out. Neither is true. If merchandise is old, you’ve already lost the money. The fact it is sitting on your display shelves doesn’t make that any less true, but it does make your entire store look dated, out-of-touch or just plain old.

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Global Auto Suppliers: Toyota

OEM FOR TOYOTA TACOMA

wind adhesive : Yokohama industries
Pedestrian protection absorber : shape
Oil Cap:miniature precision industries
Power Steering Feed Tunes: Yokohoma industries
Hydraulic Power Steering Pumps:Koyo
Fog Lamp : North American Lighting
Front Suspension  Coil Spring : Nasco
Aluminium Wheel : Superior Industries
Electronic Locking Differential : GKN Driveline
Door Panel Insert: Haartz
Fasterners :PowerTrain and Chassis : Rightway Fasteners
Fuel Tank Straps :Midway products
Leaf Springs: Rassini
stainless steel fasteners : Maclean Fogg
exhaust component : Tennecco
License plate Lamp :Hella
Fuel Tank StrapsMidway products

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Review of Storage and Warehousing Supply Chain Start Ups

View post on imgur.com

Storage and Supply chain today has undergone a evolution. From the time consuming process of loading , tracking and following shipments, many supply chain start ups are " disrupting the existing space by " providing faster service and GPS tracking to their consumers which makes shipping and tracking easy

 LIST OF SUPPLY CHAIN WAREHOUSING AND STORAGE START UPS 

1.)Lockitron A remote controlled lock and mobile app enabling users to store locally instead of using warehouses.
2.)MakeSpace An on-demand storage solution. MakeSpace provides pickup, urban storage, and on-demand retrieval.

3.)Boxbee Much like MakeSpace, BoxBee provides pickup, urban storage, and on-demand retrieval for homes and businesses through an easy web/mobile interface.

4.)ShareMyStorage On sharemystorage.com people are brought together to provide a common sense self-storage solution – using space such as the attic, garage, basement, or spare room in the back-office.

5.)Cubbyhole An app-based service that lets users rent their storage space out to strangers. Renters specify how much space they need and for how long, and snap a photo of the goods they need to store. Prices start at $15, renters pay via credit card directly through the app

6.)Keycafe Store your keys securely at the local cafe and exchange them remotely with your home-rental guests via the app. Keycafe is not classic ‘storage’ but about managing access to your home remotely.

7.)Swapbox: Shop online and ship your packages to a Swapbox located nearby. It’s a modern, always-open postoffice. You get notified via email and/or text message when your packages arrive.

8.)Cargomatic A platform that provides shippers with instant access and real-time visibility to trucks around them via mobile app and cloud-based software.

TruckTrack A cloud app for trucking business management, giving instant insight into business KPIs, fleet and human resources. The app also provides you business optimization recommendations.

source : Johathanwichmann

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Supply Chain Logistics and Transportation Start Ups

Transportation & Logistics Start Ups 

 Matternet is a transportation system made up of Unmanned Aerial Vehicles (UAVs), landing stations and routing software. The system aims to transform the way we move goods locally, starting with the pharmaceutical delivery market in areas inaccessible by traditional infrastructure.

 Freightos A website – and a network of freight forwarders – that provides automated freight quotes and a contract management system for shippers.

 Transporteca: A website giving shippers and consignees a much-needed tool to easily compare shipping and transportation prices from freight forwarders.

iContainers: An end-to-end pricing tool and freight forwarding service offering best available prices for ocean and sea freight as well as international moves. With iContainers you can get a quote online instantly from multiple carriers.

 Shippo" Shippo  is “shipping made easy”. With the Shippo API and apps you can get discounted shipping rates and labels within minutes. Shippo is basically selling discounted labels when connecting shopping cart apps with carriers such as DHL, FedEx and UPS – making things easier and cheaper for those who want to ship.

Retigence : A company specialising in " providing predictive analytics, which will help retail  and businesses to align inventory to the real time demand of the product.By mapping inventory in real time it helps retailers predict ' demand forecasting  better

Freight Filter An easy-to-use service to help you find the best shipping options. It’s divided into three simple steps – get the price, book it, and ship.

Xeneta A service that ads transparency to the shipping industry by enabling companies to benchmark their ocean freight rates. Useful for both importers, exporters and freight forwarders, e.g. for understanding the market and when negotiating prices.

source :jonathanwichmann

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5 Steps in creating a Sales and Operations (SOP) Planning Process

 source :supplychaininsights
The 5 steps in creating a sales and operation Planing are

1) demand planning
2)Supply planning
3)Determine most profitable
4)Conduct If what Analysis
5)Collaborate among cross functional departments

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5 Trends in Big Data and Its Impact on Supply Chain

Supply chain and Big data : top 5 Trends from Retigence Technologies Private Limited

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Auditing Supply Change Delays and Disruption: Top 5 Findings

Global supply chain risk management infographic from Retigence Technologies Private Limited

HOW SUPPLY CHAIN RISKS IMPACT COMPANY BOTTOM LINE

A recent research report on the risks of supply chain shows us some startling statistics. Since most manufacturers outsources a fair amount of work to “ their suppliers and vendors” the chance of “ supply chain disruption, delays or external natural factors is always omnipresent .

 • However just 25% of a typical company’s end to end supply chain is being assessed for risk auditing The risk factor

 • 90% of respondents do not formally quantify risks when sourcing production • In a survey 45% firms indicated a looss of revenue due to supply chain distruption

• 14% of companies revenue loss on account of supply chain distruption exceded one million euros • Supply chain distruption caused shareholder returns to decline by 33-40% over a 3 year period

• Share prices  of companies that  experience delay and disruption in supply chain tended to be more volatile ( on average around 13.5% higher)

 • 58% of firms indicated that a loss of productivity as the main reasons for supply chain disruptions • while 11% firms believed that supply chain risks and delays lead to increase in cost of production

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Reviewing Supply Chain Conflicts: Manufacturer Vs Multi-brand Retail

 manufacturer vs multi-brand retail is one of the classic cases of supply chain conflicts.

Manufacturer vs multi-brand retail conflicts is one of the most classic cases of supply chain conflict, as the manufacturer will want the retailer to work with high service levels as to ensure availability of his product on the shelf. However, a multi-brand retailer across the world or any big departmental store would want to maintain a high product availability at the category level and not on a brand level.
If the cost of substitution of competing brands is not very high, the departmental store does not mind which brand” is available at the store as long as the category product are available. This model is valid for products that do not have a very high level of brand loyalty. For example “ Milk, Yoghurt, Cheese, Butter, jams, sauces “ which are mostly generic products”
In the above cases,  the  multi-brand retail chains would like to work on a lower service level as to keep his “overall cost low This substitution model, which the multi chains believe in, is in direct confrontation with the model the manufacturers believe in.  However for a single sourced item in a business to business environment, we don’t see the kind of conflicts we see in “ product categories that are more or less “commodities “.

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Supply Chain Risk; Suppliers Vs Manufacturers

 SUPPLY CHAIN RISK: SUPPLIERS VS COMPANY

For companies that manufacture products mostly  use suppliers, and over a period of time, they have become extremely dependent on them.  So should the  supply chain depends on the outsourcing suppliers? Most companies have many suppliers as to derisk their investment and ensuring backup if one supplier goofs up

However,  there exist a divided opinion on ultimately who is responsible for " supply chain.  Are the suppliers more accountable for the  supply chain risk, or is it the supply chain teams  of the company more responsible for " ensuring vendors and suppliers" deliver in  the right number and the right time

According to The Ripple Effect, a recent survey conducted by Deloitte Consulting LLP, 63% of executives see external suppliers as one of the biggest sources of today’s supply chain concerns. And when problems do arise, it’s the company—not suppliers—that will likely bear the brunt of the blame. What’s more, even having a diversified portfolio of suppliers is no guarantee when it comes to managing the supply chain.

 For example, when Japan was hit by a tsunami in 2011, most companies thought their supply chains were safe because they had multiple suppliers as backups. As it turned out, many of those suppliers relied on the same secondary suppliers, causing the entire supply pyramid to collapse.

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Top 3 Challenges in Supply Chain for the Food Industry

TOP 3  SUPPLY CHAIN CHALLENGES ACROSS THE FOOD INDUSTRY

Supply chain across Food Industry is a big challenge. The basic problem is in the kind of products across supply chain which is perishable. Unlike other industry the inventory has to be very tightly controlled so that products are fresh and losses minimized

In the past, most food companies dealt with supply chain risk after-the-fact through product recalls—and by switching suppliers once problems were detected. In an increasingly complex marketplace, the traditional approach just isn’t good enough.

 Tracing a food problem back to its source is complicated by multi-tiered supply networks and divergent standards for food quality and safety around the world. For example, various countries that produce rice allow different levels of arsenic (which is used to control pests). This means that rice may be deemed safe and legal to sell in one market but not in others. Regulations and standards are continually evolving and present a challenging risk. In the U.S., for instance, federal lawmakers are expanding the authority of the Food and Drug Administration to include the ability to shut down operations that fail to comply with the law.

 The supplier in the food industry  is a big variable and is a  crucial factor in deciding the success of the supply chain, as the raw  stock of the food  is the most precious and important part of the inventory forecasting. Apart from quality and consistency, adulteration is another risk.The entire ecosystem  Farmers, to the cold storage  to the suppliers  play a big role in ensuring the effectiveness of the supply chain  across the Food Industry.

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The numbers behind the Trucking Industry: Infographic

The numbers and data behind the US trucking Industry: top 5 trends

1. Trucking statistics in the United States The trucking industry employs a total of all most 9 million, out of which 3.5 million are truck drivers 
2.  There are currently 62 million unregistered vehicles in the United states and approx 6.4million unregistered Vehicles Out of which 32% consists of heavy vehicles including construction Vehicles, bulldozers, and heavy machinery vehicles out of which 2 million tractor trailers. 
3.  The US economy is heavily dependent on Trucking industry to deliver 70% of freight transported annually
4.  Approximately 671 billion of manufacturing and retail goods are transported by Trucking industry in one year.Truck Transportation of goods to Canada makes up $295 billion of the truck trade and $195billion with Mexico
5.  1 out of 9 truck drivers are independent, a majority which are owner operators Approx 5.7 % of truck drivers in the United States are the woman.

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Reviewing Less Than Truckload Shipments

Explaining LTL Shipments (Less than Truckload ) Shipments in Logistics and Transportation

A shipment that does not require a full 48- or 53-foot trailer can be shipped via less-than-truckload or LTL. Shippers use this option, which can be cost-effective and environmentally friendly when they only need to ship a small amount of product.

LTL shipments involve shipment of relatively small freight. To put it in simple terms, general freight carriers offer two types of service, Full Truckload (FTL) service or Less-Than-Truckload (LTL).

While the FTL carrier moves full containers or trucks of one product from one customer, the LTL carrier moves goods from many different customers on one truck.

 LTL shipments typically weigh between 151 and 20,000 lb (68 and 9,072 kg). Less than Truckload carriers use "hub and spoke," operations, where small local terminals are the spokes ('end of line') and larger more central terminals, are the hubs (also called Distribution Centers or DC's).

 LTL shipment rates s are determined by class, weight, lane (i.e., pickup and delivery locations), and additional required services, if any. LTL carriers normally offer better rates than parcel carriers for competitive reasons and economies of scale. A separate cost added on top of the line haul, the fuel surcharge is the cost of fuel associated with the lane, specifically the distance between the shipper and the consignee. The fuel surcharge changes weekly due to barrel costs.

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Reviewing Logistics & Transportation Scheduling: Static Scheduling

Once the vehicle route has been scheduled, the frequency of collection and dispatch not only depends upon the demand and supply but also on other constraints.The firm has to keep  in mind  the firm has to choose between 2 strategies  for optimal utilization of the resource.

Take the example of Amul Dairy  and milk marketing cooperative in India. Here schedules are announced in advance  and the local farmers know at what time the vehicle will visit their village for milk collection.In other words,  it works with static schedules which are pre-decided for milk production
Auto companies to work with static schedules for part collection from their vendors.

Companies  like Unilever clusters all dealers into 6 groups and each static group gets served on a working day and even within that day, the route followed by the vehicle is announced well in advance. Static schedules result in, by and large, uniform load on the depot and transport system and helps the dealer in planning the work ahead  because the dealer knows the exact slot  within a week when delivery can be expected.

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Review of Supply Chain: Cross Docking and Best Practices

As we explained Cross Docking here.  In this article we look at  the benefits of cross docking and across which industry and circumstances can it be used. 1) The first benefit is that it allows manufacturers to prevent costs on warehouses as the incoming materials are directly picked up by outbound trucks.
2) This ensures transportation costs are minimized and kept under control.

 However, this concept of cross docking is only possible only if a firm is working in an environment of predictable volumes which lowers transit types. For example, if 3 trucks bring in incoming materials to be loaded onto outgoing 3 trucks, all the 6 trucks must be available at the single point at one destination. if this is not available cross docking cannot take place, otherwise, the firm needs a physical distribution point or a warehouse to take care of the inventories piled up In the absence of cross docking, the manufacturer does not have to tightly control the logistics flow.

 And the material can be directly shipped, however in this model the cost of transportation increases. In cross docking the " need for tightly controlling the logistics as it has to ensure that the entire ecosystem has to be tuned in to ensure both incoming and outgoing trucks are available in real time and a predestined point. Walmart is one company that has been using cross docking extensively which has ensured that its transportation costs are kept low. For this reason, Walmart has been using its own vehicles so that it can have more control over the vehicles.

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