Inbound Logistics | January 2024

JANUARY 2024

THE 2024 LOGISTICS PLANNER

Info SNACKS BITE-SIZED SUPPLY CHAIN/LOGISTICS INFORMATION

7 COOL FACTS ABOUT AMAZON ROBOTICS 1. Amazon is the world’s largest manufacturer of industrial robotics.

48% of manufacturers say they experienced regret from at least one software purchase in the past 12 to 18 months. 38% of manufacturers say they experienced regret because the total tech investment was more expensive than they were led to believe. 35% of manufacturers attribute regret to a difcult or slow technical implementation. 54% of manufacturers plan to increase tech spending by at least 10% in 2024

BLOWING IN THE WIND As part of an eort to use renewable wind energy to reduce air pollution from ocean vessels, Airbus has commissioned Louis Dreyfus Armateurs to build and operate three ships with giant, high-tech sails— modern versions of ancient ships. The Airbus ships will use “large, rotating cylinders” that can move the haulers with help from the wind. While they don’t look like typical sails, the equipment will generate lift, “propelling the ship forward,” according to Dreyfus. The ships will also have two dual- fuel (dirty diesel and cleaner e-methanol) engines. And with help from software, the ships will navigate ocean conditions to best use the wind. Airbus anticipates the vessels will be sea-ready by 2026.

2. Amazon has created 700 new categories of jobs since introducing robotics in its fulfillment network in 2012. 3. Amazon currently uses the help of 750,000+ mobile robots around the world to fulfill customer orders and 75% of all customer orders globally are delivered with the assistance robots working within Amazon’s operations. 4. A new robot called Titan can lift up to 2,500 pounds. The robot will carry larger, bulkier items like small household appliances and pallets of pet food across Amazon fulfillment centers. 5. More than 2 billion packages have been sorted by Robin, a robotic system used across the Amazon operations network. Robin uses visual-perception algorithms to segment, identify, and locate packages. 6. Sparrow is Amazon’s first robotic system that can detect, select, and handle individual products in inventory.

– 2024 Tech Trends Report, Capterra

$14 billion Amount the trucking industry invests annually in technology, training, and other expenditures to improve highway safety. – Safety Spend Survey, American Trucking Associations

75% of hiring managers say AI is very important (33%) or somewhat important (41%) to their company 6 IN 10 hiring managers would choose a less-experienced candidate who has AI skills

77% of hiring managers say AI is a beneficial resume skill for 2024 73% of hiring managers say their company will definitely (41%) or probably (32%) expand its use of AI in 2024

AI HIRES RANK HIGHER Artificial intelligence (AI) is increasingly shaping the modern workplace, automating tasks and transforming decision-making processes. How does that aect hiring? A ResumeTemplates survey of 780 hiring managers assesses the importance of candidates having AI skills on their resumes.

7. Amazon is testing a robot arm called Cardinal ( pictured above ), which can lift and turn heavy packages of up to 50 pounds in a confined space.

January 2024 • Inbound Logistics 1

CONTENTS JANUARY 2024 | VOL. 44 | NO. 1

106 THE SECRETS BEHIND TODAY’S LEADING SUPPLY CHAIN COMPANIES Behind the seamless delivery of everything from your afternoon candy bar to the latest iPhone lies some pretty complex logistics strategies. Take a peek inside four of the best supply chains operating today. 116 2024 SUPPLY CHAIN PREDICTIONS Pencil in these tips, unexpected insights, and fearless forecasts from supply chain leaders.

136 CURING THE HOLIDAY RETURNS HANGOVER

FEATURES 82 PRIMED FOR GROWTH: 3PL PARTNERSHIPS HELP SHIPPERS ROLL WITH IT Despite persistent supply chain challenges and uncertainties, now is the time to prep your supply chain for future growth. 3PLs have the talent to take you there. 90 GAINING VISIBILITY TO SUPPLY CHAIN BLIND SPOTS Keeping supply chain risks in your line of sight can protect your profits, people, and productivity. 98 FORWARD MOTION With innovative solutions and technology and productive collaborations, freight forwarders position complex global supply chains for success.

Explore how retailers combat holiday shopping excess with savvy reverse logistics, steering clear of the seasonal returns “hangover.”

128 GIVE YOUR SHIPMENTS THE RED-CARPET TREATMENT When a shipment needs to be handled like a VIP, shippers depend upon white-glove services for deliveries that exceed customer expectations.

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CONTENTS JANUARY 2024 | VOL. 44 | NO. 1

176 FROM SKY TO DOORSTEP: DRONES DELIVER THE MIDDLE AND LAST MILE We’re in the midst of an aerial revolution, as the soaring potential

144 U.S. SITE SELECTION: HOW TO KNOW WHERE TO GO Finding the right location to grow your distribution or manufacturing network depends on following certain tried-and- true practices. 150 GETTING TO BIG: SMB S EMBRACE TECH AND PARTNERSHIPS While small businesses often have limited resources, selecting the right technologies and partners enables them to develop supply chain strategies on par with the big players. 156 HOW TO WRITE A GREAT RFP Everything you need to successfully navigate the RFP process—from building a relationship with

and advancements of drone technology help streamline middle-mile and last-mile deliveries.

164 TECHNOLOGY BRINGS A NEW DAWN FOR DRAYAGE New investments in technology are transforming drayage—a crucial, long- overlooked component of the supply chain.

180 ROBOTS STEP UP

Taking on hazardous and physically demanding tasks in supply chain operations, mobile robots are gaining ground at the loading dock and in warehouses and distribution centers.

carriers to adapting to changing conditions.

170 TECHNOLOGIES STREAMLINE GLOBAL TRADE

See how AI and blockchain are helping to boost the eciency, economy, and velocity of global logistics.

4 Inbound Logistics • January 2024

2003 – 2023

For the past 20 years Odyssey Logistics has delivered adaptive multimodal logistics on a global scale By converging an expansive freight network, personalized customer-focused relationships, and specialized modern technology, we’re ready to lead our customers into the next 20 years— and beyond.

2003–2023

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CONTENTS 186 WAREHOUSE SOLUTIONS HIT THE MARK These warehouse innovations rack up e ciency gains and process improvements, bringing competitive advantages to supply chain operations big and small. JANUARY 2024 | VOL. 44 | NO. 1 INPRACTICE 2024 LOGISTICS PLANNER LEADERS IN LOGISTICS: SOLUTIONS FOR GROWTH 243 SPOTLIGHT: LEADERS IN LOGISTICS

28 READER PROFILE Jessica Yurgatis is the first female to run her family’s 107-year-old industrial-supply business. Her bold vision has included new technology, new systems, and new o ces.

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January 2024 • Inbound Logistics 161

30 LEADERSHIP Moid Alwy, chief supply chain o cer for American Tire Distributors, makes all the right moves: building a strong team and guiding a compelling vision of the company’s future. 205 CASEBOOK Artisan chocolate maker Bon Bon Bon partnered with Evans Distribution Systems for help with surging order volumes. Now the chocolatier enjoys the sweet experience of elevated distribution capabilities and customized packing solutions. 209 IT TOOLKIT To reduce manual processes, improve freight audit capabilities, and boost visibility for in-transit freight, Musco Family Olive Co. turned to a 3PL partnership .

218 MOST READ ARTICLES OF 2023 See which articles resonated most with our audience last year.

195 WINTER READING GUIDE The best supply chain management reads to add to your bookshelf this season. 212 TRADE SHOWS YOU NEED TO ATTEND IN 2024 Mark your calendars and get ready for this year’s key supply chain events.

220 PODCAST ROUNDUP: LISTEN & LEARN!

GOOD QUESTION You wrote a book about supply chain management. What’s the longest chapter?

Stay ahead of the curve in the ever- evolving world of logistics with 2023’s top Inbound Logistics podcasts.

6 Inbound Logistics • January 2024

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CONTENTS JANUARY 2024 | VOL. 44 | NO. 1

64 SUPPLY CHAIN RESILIENCY Reestablishing contractual rigor after force majeure 66 SMART MOVES The power of empathetic communication 68 LEAN SUPPLY CHAIN Sustain the chain with technology 70 VIEWPOINT Illuminating the supply chain with dark data 72 SC SECURITY Five ways to mitigate SaaS app risk 74 RISKS & REWARDS Preparing to navigate new regulations 76 LAST MILE Delivery workers are your biggest asset 78 FREIGHT OUTLOOK The future of freight: what to expect 80 SC VISIBILITY Eight steps to cracking the traceability code INFO 224 SUPPLY CHAIN INSIGHTS 230 CALENDAR 232 RESOURCE CENTER

CONTENT PARTNER PERSPECTIVES 48 How Articial Intelligence Will Impact the Supply Chain in 2024 Oered by Phoenix Logistics 49 Five Ways AI-Powered Logistics Maximize Eco Savings Oered by Jarrett Logistics 50 Warehousing Team Solves Client’s Off-Site Warehouse Inventory & System Issues Oered by Logistics Plus 51 Using Articial Intelligence Oered by RedStone Logistics 53 Providing Pharmaceutical Manufacturing Support in the Southeast Oered by MD Logistics 54 Custom Dashboard Provides Visibility and Clarity for Rail Data Oered by RSI Logistics 55 Partnering to Provide a Solution for Lower GHG Emissions Oered by ProTrans International to Increase Forklift Safety Oered by Holman Logistics 52 Powering Up a Better Supply Chain 56 How Shippers Can Manage Risk During the Great Trucking Recession Oered by WSI Freight Solutions 57 You Should Be Asking What You Left on the Table! Oered by Tansect 58 Key Factors to Consider When Choosing a WMS for Your 3PL Business Oered by Mantis 60 Celebrating a 20th Anniversary With a Bold Brand Refresh Oered by OpenRoad

INSIGHT 10 CHECKING IN Skills to navigate 2024 12 GOOD QUESTION You wrote a book about supply chain management. What’s the longest chapter? 16 DIALOG 18 10 TIPS Selecting a warehouse management system 20 WHAT’S THE WORD? 62 IT MATTERS Dynamic freight pricing done right INFOCUS 1 INFO SNACKS 24 VERTICAL FOCUS: AEROSPACE 32 NOTED 38 TAKEAWAYS 226 IN BRIEF

Inbound Logistics (ISSN 0888-8493, USPS 703990) is mailed monthly to approximately 60,000 business professionals who buy, specify, or recommend logistics technology, transportation, and related services, by Thomas, a Xometry company, 6116 Executive Blvd, Suite 800, North Bethesda, MD 20852. Periodicals postage paid at North Bethesda, MD, and additional mailing oces. All rights reserved. The publisher accepts no responsibility for the validity of claims of any products or services described. No part of this publication may be reproduced or transmitted in any form or by any electronic means, or stored in any information retrieval system, without permission from the publisher. Postmaster send address changes to: Inbound Logistics, P.O. Box 1167, Lowell, MA 01853-9900

8 Inbound Logistics • January 2024

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Vol. 44, No. 1 January 2024 THE MAGAZINE FOR DEMAND-DRIVEN ENTERPRISES www.inboundlogistics.com

Are You Ready to Navigate 2024?

STAFF PUBLISHER Keith G. Biondo

publisher@inboundlogistics.com

L et’s put last year’s pain and friction points out of our minds and stage for growth this year. We asked our readers what skills we should tune up and emphasize to drive value and maximize growth in 2024. Keep your cool. “Circumstances can turn on a dime and require not only quick, but also clear thinking when it feels like all options are lost. Those with composure— who can collect themselves, stay calm, and rely on the processes and tools they’ve put into place to handle the

EDITOR Felecia J. Stratton

editor@inboundlogistics.com

SENIOR EDITOR Katrina C. Arabe

karabe@inboundlogistics.com Amy Roach amy.roach@thomasnet.com

DIRECTOR OF STRATEGIC CONTENT

CONTRIBUTING EDITORS June Allan Corrigan • Merrill Douglas • Tom Gresham • Karen M. Kroll • David Levine • Rich Osborne • Gary Wollenhaupt CREATIVE DIRECTOR Jeof Vita jvita@inboundlogistics.com DESIGNERS Nicole Estep Arlene So DIGITAL DESIGN MANAGER Amy Palmisano apalmisano@inboundlogistics.com PUBLICATION MANAGER Sonia Casiano sonia@inboundlogistics.com CIRCULATION DIRECTOR Carolyn Smolin

Keith Biondo, Publisher

unexpected—will excel.” — Tony Harris, SAP Stay resilient and mentally tough. “Changes and setbacks are

inevitable. It’s important to know how to anticipate, deal with, and recover from those challenges. Resilience requires the commitment to stay the course, keep a positive attitude, and forge a path even when the future is uncertain.” — Heidi Ratti, RXO Have empathy. Seeing and listening through the eyes and ears of your supply chain partners speeds the pace of negotiations, trust building, and handling crises. — Dr. Darren Prokop, University of Alaska Broaden your perspective to have empathy. “When I can shift my perspective to the point of view of my customers, stakeholders, or employees, that is how I can understand and meet their expectations. And that helps to build trusted, sustainable relationships that position you for success.” — Dave Anderson, TA Services Check and double check. “Checking to see what shutdowns are going on all over your destination cities and countries is the most underrated thing.” — Ronnie T. Evans, Oil States Industries Be curious. This involves channeling relentless curiosity into problems, having meaningful dialogues with users—warehouse managers, last-mile delivery folks, or suppliers across the globe—and implementing hardware and/or software solutions that solve those problems.” — Jason Hehman, TXI Approach problems creatively. “Consider coloring outside the lines when problems happen. People think managing a supply chain is analytical and focused on managing the minutiae. And it is, at times. But when problems occur, the individual who can think outside the box and devise innovative solutions will be the unsung hero.” — Joe Adamski, ProcureAbility Avoid analysis paralysis . “Quickly analyze short- and long-term impacts. Over-analyzing wastes time and money. In operational excellence models, it’s called over-processing. To analyze quickly, use data and your inner experience circle. Ask for full opinions and full judgment, then go. Stop wasting time. —Ann Marie Jonkman, Blue Yonder Keeping these skills top of mind will help shake off the doldrums of late and stage for growth in the year ahead.

SALES OFFICES PUBLISHER: Keith Biondo

212-629-1560 FAX: 212-629-1565 publisher@inboundlogistics.com WEST/MIDWEST/SOUTHWEST: Harold L. Leddy

847-446-8764 FAX: 847-305-5890 haroldleddy@inboundlogistics.com Marshall Leddy

612-234-7436 FAX: 847-305-5890 marshall@inboundlogistics.com DIRECTOR, NEW PRODUCT DEVELOPMENT & MARKETING, SOUTHEAST/MIDWEST/ECONOMIC DEVELOPMENT:

Joseph Biondo 516-578-8924 jbiondo@inboundlogistics.com NORTHEAST: Rachael Sprinz 212-629-1562 FAX: 212-629-1565 rachael@inboundlogistics.com MEXICO & LATAM: Guillermo Almazo 212-629-1560 mexico@inboundlogistics.com FREE SUBSCRIPTIONS bit.ly/get_il

Inbound Logistics supports sustainable best practices. Our mission is rooted in helping companies match demand to supply, eliminating waste from the supply chain. This magazine is printed on paper sourced from fast growth renewable timber.

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10 Inbound Logistics • January 2024

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GOODQUESTION Readers Weigh In

You’re Writing a Book About How to Manage Supply Chains in 2025. What’s the Longest Chapter?

PEOPLE ARE THE MISSING PIECE. While technologies allow practitioners to rethink supply chain management and add value from data, the real value comes when people—the practitioners themselves—eectively leverage these tools. The emphasis is on developing progressive leaders, the key driver of success. –Omer Abdullah Co-Founder, The Smart Cube INDIA, THE NEW CHINA? As companies diversify manufacturing away from China to build more resilient supply chains, India is one of the primary options for friendshoring as it oers low geopolitical conflict and a low cost base. However, the lack of infrastructure support poses another significant challenge that takes time and resources to address. –John Donigian Senior Director, Supply Chain Strategy Moody’s Analytics

TRUE PARTNERSHIP. This would be even more essential in 2025. You see supply chain cycles happen every 4-5 years; this puts us due for another spike in rates and lack of capacity in 2025 and 2026, for both land and ocean movements. I’ve seen this time and time again in my 26+ years in this industry. Many supply chain managers choose the lowest cost carrier that doesn’t have crappy service. When the supply chain shifts, these carriers immediately look for the highest paying freight or tell you their new high rates are eective tomorrow. What kind of partnership is that? Managing supply chains is about finding true partnerships that will be with you when the (well, you know what fits here) hits the fan, and in turn, you will be there for them when your freight volumes dip. –Mitch Luciano CEO, Trailer Bridge

AUTOMATION—WHY IT’S ALL ABOUT THE GOOD DATA. Managing supply chains in 2025 will be all about automation. The longest chapter would explore the limitations of the hype and discuss why a focus on the data building blocks is core for successful automated supply chain system deployments. –Brian Krejcarek Co-founder and CEO, Reelables NOT SO HAPPY RETURNS? With the return of physical retail and record- setting online commerce, returns could hit an all-time high. Building agile inventory management through artificial intelligence-based assortment and allocation planning, fulfillment, returns, and pricing based on real-time data will be crucial for retailers to stay competitive. Taking this approach, retailers can optimize their inventory position without sacrificing margin. –Inna Kuznetsova CEO, ToolsGroup PREVAILING WITH ALTERNATIVES. The focal point is adeptly handling and capitalizing on alternatives—a top supply chain strategy. Spanning across raw materials, production, logistics, freight contracts, and 3PL providers, the emphasis lies in managing these alternatives for enhanced flexibility, strategic negotiation leverage, and comprehensive risk mitigation. –Chris Dodd

You’re Walking a Tightrope But Who has the Net? 1 This chapter explores risk management—the balancing of what we can control along the supply chain in the face of what we cannot control. I will start by quoting Burns’ 1785 warning about best-laid plans; and, after a 240-year romp, end o in 2025 with where we are post-COVID and pre- net zero 2050. –Dr. Darren Prokop Professor Emeritus of Logistics, College of Business & Public Policy, University of Alaska Anchorage

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12 Inbound Logistics • January 2024

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You’re Writing a Book about How to Manage Supply Chains in 2025. What’s the Longest Chapter?

GOODQUESTION

THE BOTTOM LINE OF SUSTAINABILITY. Before long, sustainability will be just as critical as pricing to our partners. We’re teetering on that tipping point now. But we need to internalize that sustainability isn’t illusory—it’s measurable, actionable, and a close cousin to eciency—i.e., it has power over your bottom line. –Glenn Riggs Chief Strategy Ocer Odyssey Logistics PRESERVING THE HUMAN ELEMENT IN AN AUTOMATED SUPPLY CHAIN. Despite the increasing use of automation in the automotive supply chain, the human touch is significant in a service- focused industry. Regardless of how technologically advanced the process becomes, personal relationships hold immense value that benefits the end user experience. –Mike Trudeau Executive Vice President, Business Development, Montway Auto Transport BREAKING THE BRITTLE. Learning lessons to identify hollow supply chains and blind spots in critical component supply. Taking the lessons of the greatest disruption of the past 70 years to apply to steady state operations to better identify and manage risks to build resiliency. –Joe Adamski Senior Director, ProcureAbility NAVIGATING THE DIGITAL LABYRINTH. The chapter would emphasize the merging of technology

Welcoming Our New AI Overlords: Harnessing AI for Good 2 This chapter delves into how to eectively integrate artificial intelligence into supply chain management. AI systems will be suciently advanced by this point to intelligently make supply chain decisions, and humans will need a guide for how to oversee and steer them. –Tony Pelli Practice Director, Security and Resilience, BSI

NEAR AND ONSHORE MANUFACTURING RESURGES. With wars and trade disruption, we’re seeing a decline in global manufacturing. This makes near and onshore manufacturing economically favorable, which is great for our planet and sustainable commerce startups. Cities, universities, and startups are reclaiming manufacturing for the United States through collaborative multi-sector approaches built around advanced sustainable manufacturing. –Al Sambar General Partner, XRC Ventures HYPE TO REALITY: THE REAL IMPACT OF AI IN SUPPLY CHAIN. The chapter would focus on the tangible changes that AI brings to analytics and decision-making, while addressing the hype of AI being the magical solution to all problems. –Mingshu Bates Chief Analytics Ocer, AFS Logistics

integration, businesses can thrive despite uncertainties.

–George Maksimenko CEO, Adexin

HONEY, I SHRUNK THE EOQS! Anticipate a decline in the economic order quantity (EOQ) for many SKUs in 2024. This shift will be driven both by evolving demand patterns and a proliferation of retail channels by which inventory is allocated (resulting in lower expected demand for any given stock- keeping location) and high carrying costs from stubbornly high interest rates. While we expect some relief on interest rates at some point, demand and inventory planning aren’t going to get any easier. The winners will be those that build flexibility and agility into their supply chains and transportation strategies.

–Chris Pickett COO, Flock Freight

with tangible processes, crucial for orchestrating the advanced,

interconnected supply chains of 2025. This is vital due to its complexity and impact on future supply chain resilience and eciency. –Spencer Steliga Founder and CEO, shuddl ADAPTIVE RESILIENCE: NAVIGATING GLOBAL DISRUPTIONS. The chapter explores strategies to address unforeseen challenges in the evolving supply chain landscape. With a proactive approach to risk management and technological

Have a great answer to a good question? Be sure to participate next month. We want to know: Have companies made progress toward supply chain resiliency since the pandemic? How? If not, what do they still need to do? We’ll publish some answers. Tell us at editorial@inboundlogistics.com or tweet us @ILMAGAZINE #ILGOODQUESTION

14 Inbound Logistics • January 2024

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DIALOG @ILMagazine [ INSIGHT ]

Want to join the conversation? FOLLOW US: linkedin.com/company/inbound-logistics facebook.com/InboundLogistics twitter.com/ILMagazine youtube.com/user/InboundLogistics inboundlogistics.com/podcast DROP US A LINE: editorial@inboundlogistics.com

4 TRENDS IN 2024

Re. Good Question: What’s one underrated skill in supply chain management? bit.ly/IL_Good_Question_11-23 Communication is often overlooked. I have found that 99% of all problems can be solved with relative ease if issues are communicated in a timely manner. I respect my business partners who are not afraid to alert me of any issues they may be experiencing. –Kenneth Kleppin Customer Service/Logistics Manager Classic Stone Manufacturing

Re. Shipment Speed and Size: Why It Matters bit.ly/IL_CheckingIn_11-23 Your column contains some good observations. First-world aims and “problems” to continually optimize. Ination, however, affects services, also. The higher holding cost of inventory is in the same environment as higher freight costs (fuel, tires, labor, etc.). This furthers the divide between rail and everything else. Though I’ve seen some shift to intermodal for chemical commodities, it’s going to be short lived, as we’ve valued velocity for too long now. Truckload prices have dropped and the move to intermodal was probably months in the adoption, missing the peak trucking rates. Transportation gets it right over and over—I’m amazed at the ease of Amazon, especially since I know all the steps that take place invisibly to the consumer. –Danny R. Schnautz Clark Freight Lines

Expect less crisis management and more focus on balancing how supply chain operations were conducted before the pandemic and incorporating lessons learned since then. 1) Companies may be hesitant to invest signicant money in building their own logistics operations. They will be less likely to invest long-term capital in operating their warehouses. That means there will be an additional need for warehousing and logistics providers to ll in the gaps. 2) Flexible warehousing options abound. The Federal Reserve has signaled it will reduce interest rates in the coming months, which should put the economy back on a growth trajectory; however, there will be ts and starts, and companies will be looking for exible warehousing solutions that allow them to expand or contract as market conditions dictate. 3) More companies will share warehouse space. In the past several years, I have seen more collaboration between non-competing companies, who are starting to pool their resources to acquire warehouse space. 4) More automation and electrication are coming—but don’t forget the basics. More rms will strivew to automate internal processes, such as employing self-driving forklifts and automated pick-and-pack machines. Don’t forget, however, that automation will only take you so far. Make sure your employees are focused on providing the highest levels of customer service. –Ari Milstein CEO, BroadRange Logistics

Quick TIP

Keep it simple. Home in on initiatives that contribute to meeting customer needs. Focus your energy on

doing what it takes to deliver for the customer’s needs and remove anything that does not work toward that goal. –Brian Dean President, Managed Transportation, RXO

LUNCH AND LEARN

Frank Mullens @FrankMullens Spinach, chicken, and spicy gouda salad with @ILMagazine’s Highlighting DC Efciency. “Consumer demand for order fulllment speed and accuracy highlights the central role distribution centers now play in the supply chain. ” bit.ly/IL_DCEfciency_11-23

16 Inbound Logistics • January 2024

10 TIPS

Selecting a Warehouse Management System

Companies must understand some important considerations to ensure they select the best warehouse management system (WMS) for their needs today and the future. These 10 steps can help focus your decision.

1 DETERMINE OPERATIONAL COMPLEXITY AND STRATIFY THE WAREHOUSE NETWORK.

6 CONSIDER BUSINESS PROJECTIONS. A WMS has a long life span. Looking at short, medium, and long-term business projections into the future helps ensure scalability to support the business long term. Under-invest and you could be back looking at a new WMS in a few years. Buy too much and you will under-utilize the system, sometimes for decades. 7 DETERMINE LEVEL AND TYPES OF AUTOMATION. Consider current and future automation needs and how the WMS will support and integrate with them. Historically, this was easier as material automation was often a signicant investment and the cost helped dictate the strategy. Now, with exible automation like intralogistics smart robots, just about any warehouse could consider automation.

8 GAUGE EMPLOYEE READINESS. Labor is a major challenge for warehouse operations. Evaluate the current composition of your team to ensure the right balance in both the business and technical aspects of deploying a new WMS. Few, if any, companies buy WMS to slash labor, but rather to improve productivity and reduce workforce churn. Aspects like user experience, exibility, and new ways of working can lead to a more engaged workforce and should be highly rated criteria. 9 IDENTIFY IMPROVEMENT OPPORTUNITIES (ROI). Companies must nd additional business value for the system, such as labor management, warehouse redesign or automation. The key is identifying these opportunities and then demonstrating both hard and soft benets to leadership.

Every warehouse is unique and can vary in complexity and sophistication, even within the same company across different warehouse sites. Understanding your warehouse network and the levels of complexity by warehouse helps when identifying the right WMS.

2 UNDERSTAND THE CURRENT STATE. Take stock of current

they absolutely must have, or the system will not work for them. These are not basic features and functions that might show up in an RFP. These are “must haves” that may require customization. 5 MAP END-TO-END PROCESSES. WMS solutions are good at handling the processes that take place inside a warehouse, but sometimes companies have processes that extend into other areas like manufacturing or omnichannel fulllment. Understanding the extended process ow and integration needs is critical to success.

operations. Are processes manual and paper-based or supported by legacy systems that might be functionally robust but aging and technically obsolete? This will inuence whether you should simplify or select an advanced system. 3 GET FAMILIAR WITH EXISTING APPLICATIONS. If you have an existing WMS (or multiple), familiarize yourself with the vendor(s) and determine if they have newer systems that you could adopt. Also, an ERP with WMS capabilities might be another route to explore if and where it makes sense. 4 IDENTIFY FUNCTIONAL ESSENTIALS. WMS is mature with parity but not equality across WMS offerings. Companies must identify the typically small number of non-standard or differentiating capabilities

10 PUT A SHARP EYE TO BUDGET AND FINANCIAL CONSTRAINTS (TCO). Be brutally honest about nancial constraints that could slow or stop an evaluation. Mandating a payback in less than two years might make justifying a new or replacement WMS difcult. The good news is since most WMS purchases are now cloud and SaaS- based, OPEX (an expense that is incurred through normal business operations) can help with capital appropriation. But total cost should be evaluated in both scenarios.

SOURCE: DWIGHT KLAPPICH, RESEARCH VICE PRESIDENT AND FELLOW; SIMON TUNSTALL, DIRECTOR ANALYST; AND FEDERICA STUFANO, SR. PRINCIPAL ANALYST, GARTNER SUPPLY CHAIN PRACTICE

18 Inbound Logistics • January 2024

We know the way to optimize your supply chain and move your business forward. Hub Group offers comprehensive transportation and logistics management solutions. Keeping our customers’ needs in focus, we continuously design, optimize, and apply industry-leading technology to our customers’ supply chains for better service, greater efficiency, and total visibility. Learn more at hubgroup.com.

WHAT’S THE WORD

The Language of Logistics

PREDICTIVE ETA > TRACKING UPDATES You can spend a lot of money and devote a lot of sta time to checking on tracking updates without necessarily improving on-time delivery. The most significant element of real-time visibility is the predictive ETA (estimated time of arrival). While knowing where your freight is at every point during transit is great, knowing whether the truck will arrive during the scheduled appointment window is what shippers and receivers plan for. For retailers, the predictive ETA aects stang and throughput at their warehouses, at their distribution and fulfillment centers, and at their stores. –Noah Homan, Head of Retail Logistics, C.H. Robinson

IN OUT Preparing for growth Mitigating disruptions Responsible business ESG Embracing uncertainty Defining the new normal Slowcession Recession Demand driven Demand responsive Fraud detection Easy returns

Find out what Digit does for Amazon on page 180.

Humanoids

We’ll talk a lot about humanoid or human-form robots, but wide deployment in warehouses will remain elusive. In 2024, expect some splashy pilot projects and updates on Agility Robotics’ Digit (pictured) at work for Amazon.

2024 ECOMMERCE WORD TO WATCH

Rom-commerce

Walmart arranged a meet-cute between romantic comedy and social commerce with its holiday series “Add to Heart” in December 2023. Viewers can buy more than 330 items—from clothes and decor to luggage and food—while watching the 23 short episodes on TikTok, Roku, or YouTube. Walmart’s shoppable commercial series aims to change American consumers’ lukewarm reception toward shoppable content, which is popular in China. In any case, social commerce—selling products directly on social media platforms—is one trend that’s gaining steam. Social commerce is anticipated to hit nearly $80 billion by 2025, or about 5% of all ecommerce purchases, according to research by McKinsey.

Antifragile Supply Chain An antifragile supply chain starts with the chief supply chain o cer’s mindset. Rather than trying to keep uncertainty out of the supply chain, antifragile supply chains embrace uncertainty with the objective of learning, evolving, and adapting their capabilities based on their improved knowledge of it. –Tim Payne, Vice President Analyst, Gartner Supply Chain

Mindsets Behind the Three Coping-With-Uncertainty States Fragile Resilient

Antifragile

A scene from rom-commerce series “Add to Heart.”

Uncertainty

Hates A cost

Tolerates

Loves

Flexibility Tactics

An insurance Prioritization

An investment

Future

Precision

Probability

Decisions

Plan-driven

Scenario-driven

Experiment-driven

Data

Batch

Real-time

Enough

ROI

Payback period

Net present value

Option-based

Structure

Ecient

Responsive

Modular

Technology

Homogeneous

Heterogeneous

Composable

Source: Gartner

20 Inbound Logistics • January 2024

Extraordinary Service for Over a Century

We are your perfect logistics partner. Established in 1864, Holman has provided logistics services continuously for 160 years. Customers stay with Holman because we provide an Extraordinary Service Experience . We provide a wide array of services . With locations across the U.S., Holman offers complete supply chain and logistics services— including warehousing, manufacturing support, transportation, and omnichannel fulfillment—to several of the world’s most recognized brands. We create custom solutions. Whether you need food-grade warehousing, custom-kitting and re-packing, or manufacturing logistics staffing support, Holman can provide your organization with efficient, cost-effective, custom solutions. Your search for the perfect partner is over. Let the experts at Holman help you solve your latest challenge.

Warehousing | Manufacturing Logistics | Transportation solutions@holmanusa.com holmanusa.com

WHAT’S THE WORD

The Language of Logistics

Freight

Shipping vs.

Logistics Refresher Technically speaking, freight is defined as the commercial transportation of goods, merchandise, or cargo by air, land, or sea. The term is generally used to refer to the transportation of goods in bulk. Originally, the term “shipping” referred to the transportation of goods by…you guessed it, ship. Since the 15th century, shipping has evolved to encompass the transportation of any quantity of goods by air, land, or sea. So, the main dierence between freight and shipping is the former specifically refers to transportation in bulk—often enough to fill up an entire truck. And since shipping doesn’t necessarily involve a particular quantity of goods, anyone can ship something from one place to another. Freight is mostly used by wholesalers, distributors, manufacturers, suppliers of raw materials, or any business that regularly ships large quantities of goods. Additionally, freight services are often set up to handle fragile or sensitive cargo during long- distance shipments. The need for accommodations, such as temperature or humidity-controlled transportation, is more prevalent in freight customers who often ship their goods across great distances. These businesses often turn to freight forwarders who can help them navigate tedious processes like customs, documentation, or coordinating shipments across multiple modes of transportation. Shipping is usually the preferred choice for any business that is transporting small quantities of goods to consumers or another business. Basically, if your items don’t require some sort of specialized handling, shipping is almost always the easier and more cost-eective option, especially in today’s convenience-driven economy. A company that experiences extreme fluctuations in demand throughout the year might find it more cost-eective to use freight for bulk shipments during peak seasons and shipping for smaller deliveries during slower periods. –Carl Wasinger, CEO & Founder, Smart Warehousing

POLYCRISES Organizations no longer have the luxury of planning for individual incidents. They must now prepare for multiple concurrent or cascading business disruptions. Some refer to this as “layered” crises, or “polycrises,” where the shocks are disparate, but they interact so that the whole is even more overwhelming than the sum of the parts. –Frank Shultz, Founder and CEO, Infinite Blue

Flow center

Think warehouse but smaller and faster. Retailer Target coined this term to describe facilities that support nimble store replenishment. Using automation, flow centers break down shipments to replenish stores frequently with in-demand items in smaller quantities. This allows Target stores to hold lower levels of backroom inventory. Meanwhile goods ordered online are packaged at stores and sent to small sortation centers, which batch them by neighborhood for final delivery to customers. In short, flow centers can help retailers feed the flow—the flow of consumer demand, that is.

LAND BRIDGE A land-based solution for trade flow restrictions or disruptions in ocean routes. For instance, Maersk started a land bridge or rail route across Panama to minimize service interruptions for customers amidst Panama Canal transit restrictions.

22 Inbound Logistics • January 2024

Maximizing customer value through continuous improvement and innovation, CJ Logistics provides customers visibility to supply chain data to help them improve, optimize and make informed decisions. Data is transformed into intelligence. Maximizing customer value through continuous improvement and innovation, CJ Logistics provides customers visibility to supply chain data to help them improve, optimize and make informed decisions. Data is transformed into intelligence.

america.cjlogistics.com

WAREHOUSING TRANSPORTATION FREIGHT FORWARDING SUPPLY CHAIN CONSULTING WAREHOUSING TRANSPORTATION FREIGHT FORWARDING SUPPLY CHAIN CONSULTING

Aerospace

FLYING HIGH The 10 largest aerospace companies in the world: • Boeing, US • Airbus, France • United Technology, US • Lockheed Martin, US • Northrop Grumman, US • GE Aviation, US • Raytheon, US

Aerospace is one of the top five industries impacted by supply chain disruptions, according to EventWatchAI, Resilinc’s global event monitoring platform, which collects information and monitors news on 400 dierent types of disruptions across 104 million global sources. Here’s a look at what Resilinc identifies as the biggest challenges facing the aerospace industry. #1 Factory fires. Fires and explosions at warehouses, factories, and plants, as well as investigations and force majeure due to fires, are the top disruption in aerospace and have been the leading supply chain disruption across all industries tracked by Resilinc for five consecutive years. Simple safety measures—such as stocking extinguishers and training employees—can reduce the potential risk of factory fires. #2 Labor disruptions. In 2023, the aerospace industry saw approximately 562 labor disruptions, which can include company, site, union, and national strikes as well as layos, labor walkouts, protests, and more. Labor disruptions were a particular problem across all forms of global transportation as well. #3 Mergers & acquisitions. While M&As can positively aect the industry, leading to improved technologies and more resilient companies, it takes time to merge data, suppliers, and systems, which can cause challenges. #4 Business sale. 2023 saw more than 500 business sale disruptions in aerospace. Business sales include the sale of factories and plants, the sale of assets and subsidiaries, and brand/portfolio sales. Similar to M&As, business sales can increase supply chain resilience as companies acquire new technology and expand portfolios. However, business sales can also create increased security threats and delays while assets and information change hands. #5 Factory disruptions. Factory disruptions include accidents, closures, and temporary shutdowns at warehouses, plants, and factories. There can be many reasons for factory closures—including industry growth. Even the most minor delays and shutdowns can cause significant issues across the supply chain. TOP 5 AEROSPACE SUPPLY CHAIN DISRUPTIONS

• Rolls-Royce, UK • Leonardo, Italy • Safran, France

After United Airlines and Alaska Airlines discovered loose parts on multiple Boeing 737 MAX 9 aircraft, grounding 171 planes, industry experts raised new concerns about how the aircraft is manufactured. The Federal Aviation Administration completed inspections of 40 grounded planes and says it will "thoroughly review the data" to determine if it is safe to allow the planes to resume flying. LOOSE ENDS

24 Inbound Logistics • January 2024

Domestic & International

Freight to Puerto Rico

We Do It All!

OCEAN FREIGHT LCL AND FCL

INTERMODAL SHIPMENTS

AIR FREIGHT SHIPMENTS

PICK UP AND DELIVERY

WAREHOUSING AND DISTRIBUTION

DRAYAGE

LEARN MORE AT

APPROVEDFORWARDERS.COM

The aerospace industry should keep an eye on five sustainability trends, according to Bryan Christiansen, founder and CEO of Limble CMMS. #1: Advanced aircraft design. Aircraft manufacturers can improve performance by making slight improvements to aircraft. They can enhance engine designs for improved fuel e ciency, improve aerodynamic designs, explore the use of lightweight fabrication material, and use advanced coatings. #2: Use of sustainable aviation fuels. The utilization of sustainable air fuels (SAFs) is taking shape as airlines strive to achieve net-zero emissions. These fuels have similar chemical characteristics to fossil fuels but with fewer ozone depletion capabilities; they release carbon that has already been extracted from the environment. Emissions from SAFs have a shorter life cycle, which further reduces their ozone depletion rates. #3: Urban air mobility. Two technologies—electric vertical takeo and landing (eVTOL) aircraft and drone deliveries—are front runners in the urban air mobility sector. Although at an infancy stage, eVTOLs promise to revolutionize air travel for short and medium-distance flights. Companies are using drones for last-mile deliveries across cities, with their payload capacities increasing over time. #4: Advanced propulsion technology. Modern and future aircraft will not rely only on fossil-powered engines. The push for sustainable flights is revolutionizing the design of aircraft and spacecraft propulsion systems. #5: Optimize air travel management. Airlines can minimize their carbon footprints by digitizing air travel management and leveraging advanced technology to improve route planning and asset maintenance and enhance operational e ciency. 5 SUSTAINABILITY TRENDS DRIVING CHANGE IN AEROSPACE

COMPLEXITY CLOUDS A&D The aerospace & defense (A&D) industry is facing unique challenges created by geopolitical conflicts, sustainability regulation and expectations, and shifting demand, finds Deloitte’s 2024 A&D Outlook report. Key takeaways for supply chains include: The A&D supply chain remains complex. The A&D supply chain is a complex, globalized ecosystem of customers and original equipment manufacturers; multiple tiers of suppliers; and maintenance, repair, and overhaul providers. This complexity makes implementing diversification and transparency across the value chain extremely dicult, but imperative. By maintaining strategic raw material reserves, committing to bulk buying of long lead time items, exploring alternate sources of supply, and digitizing operations, A&D companies may position themselves well to handle any continued fragility across the entire supply chain. Digital transformation will make a dierence. Digital transformation in the A&D industry is largely impacted by regulations, priorities, and resources— but those who are prepared to adopt digitalization and advanced technologies such as Generative AI could gain a competitive advantage. Sustainability matters. The industry faces evolving consumer demands for enhanced technology, greater sustainability, reduced emissions, higher performance systems, and lower costs, which may all factor into decision-making on supply chain processes.

Aerospace Market Size 2022 to 2032 (USD Billion)

$678.17

680 612 544 476 408 340 272 204 136 68 0

$626.77

$579.81

$536.86

$497.55

$461.55

$428.55

$398.28

$370.50

$344.97

$321.5

2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032

Source: Precedence Research

26 Inbound Logistics • January 2024

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