Saturday, 25 February 2017

Chit Chat: 3PLs in the Supply Chain 2017

There is growth potential for shippers and 3PLs. The growth is achieved through mergers and acquisitions. Outsourcing remains strong as many shippers remain committed to outsourcers and not bringing the operations in house. The most common activities that are outsourced are as follows:

  • EDI – Electronic data exchange
  • Planning and transportation management
  • Order, shipment and inventory visibility
  • Scheduling in transportation management
  • Warehouse management
3PLs are moving into more strategic and IT solutions as well as the transaction based services. The IT-intensive services are being used by 3PLs to separate them from the competition. They are using technology to optimise the supply chains and the shippers are looking for more efficient ways of moving products. The shippers say that the 3PLs are giving them the ability to see the alternatives that are available thanks to their supply of real-time analytics. 3PLs are transforming supply chains and they will continue to enhance logistics and create stronger bonds between themselves and the shippers.

Friday, 24 February 2017

What are the objectives of network management?

 The objectives of network management are to set borders and define the links, set the goals and objectives and execute the order and control the results. Those solving problems in logistics have to avoid barriers and look beyond their own network. They need to know about the entire chain, both upstream and downstream. The general tasks of logistics are as follows.
  • Developing strategies
  • Forecasting and demand planning
  • Designing the structure of the network and the supply chain
  • Scheduling the stock and the orders
  • Control and consult logistics
  • Planning and the implementation of logistics systems
  • Synchronisation of links and interface
The above list is the general task but there are also special tasks. The special tasks vary between companies. When logistics are a core competency, the company need to be organised as a separate corporate unit. The temporary tasks can be delegated to a consultant.

Thursday, 23 February 2017

What are permanent and flexible networks?

Permanent networks are created for an unlimited amount of time to handle a demand that is long lasting. The size of the orders and the longevity of demand is what determines the network.
  1. Permanent or fixed logistic networks that are made of logistic stations placed at fixed locations that are connected by transportation.
  2. Logistic network providers own permanent logistic networks or for retailers with a dedicated logistic centre and warehouses.
  3. The electric industry can satisfy continuous demand using a permanent logistic network
Fixed networks are not very flexible and therefore they don’t work well with seasonal demand or peak demand. This is when a flexible network works best.
  1. A flexible or virtual logistic network has stations that change and different transportation links with partners that change too.
  2. Flexible logistic networks mostly have higher operating costs compared with a permanent network.
  3. Permanent networks can be connected to flexible networks when the demand calls for it.
  4. Global logistic providers use combined logistic networks

Wednesday, 22 February 2017

What is a temporary logistic network?

 Demand isn’t always consistent. In times of temporary demand, temporary logistic networks can be set up and used. Some examples are:
  • Exhibitions
  • Fairs
  • Events
  • Developments
  • Building sites
Temporary logistic networks are managed by project logistics. The project logistics are performed by companies that specialise in major projects with alternating locations. Examples are as follows:
  • Disposal logistics performed by salvage and demolition companies
  • Object logistics of event organisers
  • Plant logistics of engineering companies
When the project is a one-off and won’t reoccur, it makes no sense to organise your own logistic departments. Project logistic providers should be used in these circumstances.

Tuesday, 21 February 2017

The Effects of Logistic Centres

A logistic centre’s logistic costs come from:
  • The transportation costs for centres shipments from their sources
  • Inventory capital interest costs
  • Performance costs that come from the functions of the logistic centres
  • Costs of distribution for deliveries from the centre to their destinations
The amount of the partial costs depends on the inventories, procurement consolidation, distribution and functions. There’s another factor, the amount of logistic centres that are located between the points of delivery and receiving locations. Costs can also be reduced and there is an optimisation rule. This is a rule for a set of restrictions and requirements for an optimal amount of centres. The costs decrease by reducing the amount of logistic centres until the optimal number of logistic centres is reached.

Procurement consolidation is when a large load is made up of lots of small procurement orders in order to reduce the cost for suppliers. The consolidation of smaller shipments from one supplier to multiple customers is the consolidation of inbound flows. This reduces the amount of inbound transports that are needed without changing the frequency of the transport.

Consolidation of stocks is when the same goods from multiple regional warehouses in a central store. The stock level can be reduced but the service level is maintained. Consolidation of distribution can be achieved b y putting many single shipments into big shipments to reduce transportation costs.

Monday, 20 February 2017

About process chains and logistics chains – Part 2

A process chain is a sequence of operations carried out in chronological order in a chain of units and performance stations that result in a service or product of a certain value.  Other terms for process chain are:
  • Performance chain
  • Value creation chain
The performance chain is a logistics chain, order chain or an information chain, which can refer to tangible or intangible objects. 

Logistic Chain
A logistic chain is when material objects pass by different operative stations in order. There are in and outgoing objects that move through the logistics chain, which is called a material flow.

Information Chain
The information chain is similar to a logistic chain but it deals with information, or data, rather than physical objects. Ingoing and outgoing data or information isn’t tangible. The movement through the information chain is data flow or information flow.

Order Chain
The order chain is when orders and then the orders are passed through a sequence of administrative and operative stations. The orders are processed and controlled by the administration stations and the operative stations carry out the service or production orders.

Saturday, 18 February 2017

Chit Chat: Product Marketing Ethics

Marketing can open up problems in ethics. There are situations where the producers or sellers don’t consider the ethics and simply focus on finances, where on purpose or not. It’s important to think about:

·         Due care to customers – Involving design, materials, production, quality control, packaging, warning labels and notifications in the case of product recalls.
·         Attributes of product quality – Is the product reliable and have a clear service life. Is the product safe and can it be maintained.
·         Marketing ethics and the moral principle of marketing.
·         Product marketing ethics such as product counterfeiting, ethics in the marketing place and product liability.
·         Consumer protection, which protects the interests of the consumer. Consumer protection is linked to the consumer protection law, the EU and the Slovak Republic.

Here are the activities in product marketing that require improvement of ethics consciousness.

1.    Perfecting legislation in product quality standardization
2.    Improving legislation in product control mechanisms
3.    Following existing legislation of the sellers, producers and any stockholders of the demand side subjects
4.    Incorporating customer protection topics and the related product marketing topics into the text used in learning environments
5.    Enhancing and activating the consumer association activities
6.    Enhancing the information in the media and advertising products and services

Friday, 17 February 2017

About process chains and logistics chains – Part 1

Complete performance chains are made up of all the performance stations that lie between the source and the sink. It is divided into internal and external logistics. External logistic chains have stations that are outside the company and the transport connections between the shipping locations, destinations, and logistic centres. Internal logistic chains have stations that are inside the company, station or logistic centre.

Internal logistic chains start with the goods receiving area and there are several activities involved including:

·         Unloading the vehicles
·         Receiving the goods
·         Quality control
·         Unpacking and repackaging
·         Building of the storage units

When the goods are not being stored they are sent by direct transport to the dispatch area, known as crossdocking. When the goods are kept in stock the following processes take place:

·         In storing of the storage units
·         Keeping the unit stored
·         Retrieving the storage unit

Then follows commissioning, which is when the single items, mixed loads and sorted load units are required. The activities of commissioning are:

·         Replenishment of reserve units
·         Provision of access units
·         The movement of the order picker
·         Gripping order line quality
·         Deposition of picked products

Thursday, 16 February 2017

What are the tasks and objectives of logistics?

Logistic tasks have set aims and defined aspects. The two most common aspects are macrologistics and micrologistics.

Macrologistics are focused on the efficient supply of goods for consumers and companies and organizing the flow of traffic between the sources and the destinations. Micrologistics is to supply companies and consumers with goods they require based on private orders, contracts and agreements. The main area is company logistics and they use internal and external logistics. Internal logistics connects the receiving docks and sources and the shipping docks that are located on the same site. External logistics connects together the shipping docks at one or more locations with the receiving dock at the other locations.

Procurement logistics are focused on the supply of goods from their source and getting them to the company. Distribution logistics is the delivery of goods from companies to the recipients. They are two aspects that have the same task. The objectives are therefore determined either by the supplier or the customer.  Reverse logistics is the reversal of supply. The tasks involved are collecting, transporting, storing, recycling or disposal, consumer waste, packaging, empties and worn out goods.

Wednesday, 15 February 2017

What are the 10 principles of retail shoppability?

There are 10 principles that retailers can do to improve the shoppability of their stores and increase sales and customer loyalty.
  1. Showing the products – Products are what encourage the customers into the stores.  Retailers show organise their store and presentation of the merchandise to make them clearly visible. The fixtures should be aligned to make the products easy to be seen as consumers walk through the aisle.
  2. Providing navigational aids – Make it easy for customers to know where to go to get the products they want when they enter your store.
  3. Simplifying product presentation – Avoid having lots of products. Pick select products and items and suitable accessories to make it easy for customers to find what they want and need all in one go.
  4. Reducing clutter – Clutter distracts shoppers. Clean up the shop floor and reduce all distractions to improve retail transparency.  Aisles need to be wide enough and there should be enough signs to show people where to find their products, but too many signs can clutter up the space. Find the balance.
  5. Product affordability – Make the benefits and the products visible to your customers.
  6. Showcasing new ideas and products – Entice customers to come back and to come in for the first time with new products.
  7. Making the shopping experience convenient – Consumers are pushed for time. Make it easy for them to get in, buy what they want and get out. Make it easy for them to find what they want as they are more likely to browse when their attention isn’t as focused on their main goal.
  8. An enjoyable shopping experience – Consumers are more likely to spend money where they feel good, according to Walt Disney.  Make your customers feel good by providing an engaging experience and meeting their needs.
  9. Speaking with authority – Build confidence in the consumers by making it clear that you are experts in your field. Speak with authority and ensure all staff are trained and knowledgeable.
  10. Maintain flexibility – Change to meet the expectations and demands of customers, but don’t make changes for no good reason.

Tuesday, 14 February 2017

What is retail shoppability?

Retail shoppability is the ability to turn the consumers’ desire and need to shop into making purchases. This is achieved by using the company’s assets, including the people, the places and the practices so that a rewarding shopping experience can be achieved. Experiences vary from store to store but each shopper gets a great experience and excellent customer service. 
  • This can be achieved in many ways:
  • Personal assistance from store personnel
  • Streamlined shopping trips
  • Expert advice
  • A sense of community
  • Unique stores
There are too many examples here. One thing is essential, being able to engage the shoppers and understanding their individual needs and desires so that these can be used to encourage a purchase. The retailer needs to know their customers well and provide suitable and appealing merchandise for them to buy. The store should also be appealing, using layouts, fixtures and lighting to attract the customer, while building on the retail brand.
Transparency is also essential while balancing the shopper’s interest in either high ticket items, unexpected items or low priced items that are always changing.

Monday, 13 February 2017

What are some risks and pitfall of dropshipping? – Part 3

Before jumping into dropshipping, it’s important to be aware of the risks.  Today, we’re continuing our look at the risks and pitfalls that can come hand in hand with becoming a dropshipper.

Product Description

One common mistake is for dropshippers to copy and paste the product descriptions that are provided directly by the suppliers or manufacturers. Another is to have short descriptions in order to save time and put more products on the website. It’s vital that you remember the search engines when creating a website and that includes your product descriptions. They should be original and unique and long enough to provide your customers with all the information they need to help them make the decision to buy. Hiring copywriters are a great way of saving time and ensuring your product descriptions are original and search engine ready.

Checkout a Dropshipper

Don’t rush into selecting the first dropshipper you find that has the products you want. Research them, ask them questions and seek out independent reviews. Find out how long they’ve been trading and that the products they provide are the real deal and not fakes. Check that the company has a physical address and read the contracts, including all fine print to look for any hidden fees you might not have been made aware of. Order some test products before you sign any contracts.

Stock Level and Back Order System

Check the suppliers have a stock system that will allow you to see what products are in stock and available. Knowing the stock levels will help you to provide excellent customer services and avoid disappointing your customers with long wait times or out of stock goods.