PALLETS LOAD UP ON TECHNOLOGY & SUSTAINABILITY
INTERMODAL ADDS VALUE
Ins and Outs of DC Eciency
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BITE SIZED SUPPLY CHAIN/LOGISTICS INFORMATION Info SNACKS
90% OF CAPITAL EXPENDITURES What Walmart plans to invest in e-commerce and automated order fulllment technology. 55% OF FULFILLMENT CENTER VOLUME Will be handled by automated facilities within three years. 65% OF STORES Will be partially or fully automated within three years.
ACER ON THE BIKE PATH A company known for laptops rather than vehicles is joining the electric mobility revolution. Acer, the Taiwan-based electronics maker, introduced the ebii, an electric bike with a host of intelligent features and safety systems designed for urban commuting. The company highlights a modular e-bike architecture and a controller that uses artificial intelligence to automatically adjust the output of the motor based on the rider’s pedaling patterns and route conditions. Acer has not yet released details on a purchase price or sales locations.
SMALL BIZ BUZZ Looking to start a small business? Here’s some regional information to help you decide on a location. Kentwood, Michigan , has the most aordable oce spaces, at an annual rate of $9.06 per square foot, which is 6.8 times lower than in Mountain View, California , the city with the least aordable at an annual rate of $61.85 per square foot. Isla Vista, California , has the lowest labor costs (median annual income) of $22,386, which is 11.2 times lower than in Los Altos, California , the city with the highest at $250,000. West Odessa, Texas , has the longest work week—46 hours on average, which is two times longer than in Isla Vista, California , the city with the shortest at an average of 24 hours. –Best Small Cities To Start a Business, WalletHub 150K Number of picking robots that will be installed by 2030, and we’re only scratching the surface, according to Interact Analysis’ new report on the robotics market.
–Walmart Investment Community Meeting
A DIME A DOZENS Someone recently broke into a trailer containing hundreds of thousands of dollars worth of dimes in a Walmart parking lot in Northeast Philadelphia. An estimated two million dimes—worth $200,000—were stolen from a total of $750,000 worth of dimes that were in the truck. The truck driver had picked up the dimes from the Philadelphia Mint but then went home to sleep before a long drive to Florida the next day. He parked the big rig in the Walmart parking lot. When he came back the next morning, he found the trailer door was open. “They were trying to cross-load the dimes into other things,” says Capt. Jack Ryan, Northeast Detectives. “There were dimes all over the parking lot.” 1M+ TEUs Shipment volume that has shifted from West Coast ports from the rst three months of 2019 vs. the rst three months of 2023. Gulf Coast ports are the biggest beneciary of this shift in import volumes. – Descartes study
May 2023 • Inbound Logistics 1
CONTENTS MAY 2023 | VOL. 43 | NO. 5
48 THE ROUTE TO THE RIGHT TMS
Transportation management systems (TMS) have evolved from an expense to an investment. But how do you choose the right one? What functionalities do you need? Follow this roadmap. 53 TMS GUIDE 2023 TMS vendors and service providers are expanding their oerings to meet your logistics requirements. This annual guide of top TMS providers and solutions can help you choose the best option. 68 MAINTAINING THE YARD INSIGHT & YMS GUIDE The right yard management system provides the insights needed to keep yard operations moving smoothly. Here’s what to look for.
Navigating the TMS roadmap
72 SPONSORED PALLETS STACK UP SUPPLY CHAIN ADVANTAGES From integrating with automated equipment to providing sustainability benefits, pallets provide steadfast support to supply chains while making gains in technology and versatility. 84 SPONSORED INTERMODAL ADDS VALUE Intermodal solutions boost shippers’ options and provide advantages. Here’s why intermodal remains key to eciency and how one port stacks up intermodal services.
Arvato’s depalletizing robot boosts DC eciency
FEATURES 40 INS AND OUTS OF DC EFFICIENCY
Proliferating SKUs, a labor shortage, and accelerating customer expectations are driving many companies to enhance and automate their warehouse and distribution center operations. Take a look at what they’re doing. 46 AUTOMATED MATERIALS HANDLING SOLUTIONS AMP WAREHOUSE OPERATIONS These automated materials handling systems reach high places, pick and stack quickly, and provide flexibility to help your facility run eciently.
Ports prioritize intermodal capabilities and infrastructure
2 Inbound Logistics • May 2023
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CONTENTS MAY 2023 | VOL. 43 | NO. 5
GOOD QUESTION How would you describe your job in five words or less?
CONTENT PARTNERS HOW: HELP ON THE WAY 24 HOW FLEXIBLE PARCEL HANDLING AUTOMATION CAN HELP OVERCOME LABOR CHALLENGES Oered by Engineering Innovation KNOWLEDGE BASE 26 SPECIALIZED PRODUCTS REQUIRE SPECIALIZED LOGISTICS CAPABILITIES Oered by Phoenix Logistics 27 BEST IN CLASS FOR 3PL SELECTION CRITERIA Oered by Pegasus Logistics 28 HOW AUTOMATION CAN EXPAND YOUR SITE SELECTION OPTIONS Oered by Hai Robotics 29 HOW TO CHOOSE DRAYAGE SOFTWARE THAT KEEPS YOU AHEAD OF THE GAME Oered by PortPro 30 BETTER SERVICE, LOWER COST— THE LTL ELECTRONIC BILL OF LADING Oered by SMC³ SOLVED 32 SYSTEMS INTEGRATION ENABLES FULFILLMENT EFFICIENCY FOR GROWING COMPANY Oered by Aero Fulfillment Services 33 PROVIDING INBOUND FREIGHT VISIBILITY AND ENHANCING SAVINGS Oered by ARTC Logistics 34 MASTERFUL MOVES: OVERCOMING DEADLINES, PRESSURES, AND DISTANCE WITH EXTRAORDINARY SERVICE Oered by Holman Logistics 35 3PL PROVIDES RECIPE FOR DISTRIBUTION AND FULFILLMENT
36 INVENTORY MANAGEMENT Don’t blame lean manufacturing 38 VIEWPOINT Rail must prioritize safety over profits INFO 90 SUPPLY CHAIN INSIGHTS 97 WEB_CITE CITY 118 RESOURCE CENTER
Take It Easy , the classic Eagles song, gets a supply chain twist
INFOCUS 1 INFO SNACKS 14 VERTICAL FOCUS: AUTOMOTIVE 18 NOTED 20 TAKEAWAYS 92 PRODUCT SPOTLIGHT Safety and ergonomics 94 IN BRIEF 120 LAST MILE Supply chain is easy? INSIGHT 6 CHECKING IN 4 reasons for the warehouse investment boom 8 GOOD QUESTION How would you describe your job in five words or less?
INPRACTICE 16 READER PROFILE As president and chief operating ocer with Fernish, which oers furniture and home decor, Kristin Toth uses her cross-functional experience to foster innovation. Taking on the high stakes and rapid growth of an early-stage company, Toth relishes the camaraderie and collaboration of working at a startup.
10 DIALOG 12 10 TIPS Future-proof your supply chain
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, 5 Penn Plaza, NY, NY 10001. Periodicals postage paid at New York, NY, 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, 5 Penn Plaza, New York, NY 10001
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4 Inbound Logistics • May 2023
CHECKINGIN 4 Reasons for the Warehouse Investment Boom
Vol. 43, No. 5 May 2023 THE MAGAZINE FOR DEMAND-DRIVEN ENTERPRISES www.inboundlogistics.com
STAFF PUBLISHER Keith G. Biondo
R ight behind the frenzied investment in ChatGPT and related AI is an investment boomlet in distribution center and warehouse automation and robotics. Four convergent trends are at work here. 1. Driven by current economic challenges is the necessity to extract every ounce of ROI from each sale’s dependency on inventory and the infrastructure that supports that inventory. Extracting that value takes visibility, control, and speed to connect demand (sales)
EDITOR Felecia J. Stratton
SENIOR EDITOR Katrina C. Arabe
MANAGING EDITOR Robert Fee
CONTRIBUTING EDITORS Thomas Gresham • Karen M. Kroll Gary Wollenhaupt
CREATIVE DIRECTOR Jeof Vita
Keith Biondo, Publisher
DESIGNER Nicole Estep
email@example.com Amy Palmisano firstname.lastname@example.org
to supply for the lowest cost possible. 2. The burning need to drive the sales cycle—grow sales and expand markets. The crossroads of that need run right through the warehouse or DC. Antiquated, manual, slow, or out-of-date ways to move product stalls sales, period. When times are ush, the focus is elsewhere. When times are lean, those failings become clearer and gain importance. 3. Today’s buyers have delivery fulllment expectations that border on unreasonable. Faster touches cost more. Amazon created this customer expectation as a way to dominate markets. Now, the etailer and others are instituting delivery charges based on order size, offering perks for delayed delivery and a cash bounty if you drop off your returns instead of expecting a pickup. This same challenge, especially in a down economy, has created a smaller, local and direct-to-consumer warehouse movement requiring investment in new facilities or in retrotting retail locations abandoned by shoppers. 4. Labor. On-site worker scarcity is still a thing, way past the COVID shutouts. Even if you can nd and hire fulllment workers, wage increases are tracking ination. That appears to be the new normal if you want to get and keep reliable warehouse workers. If there is little motivation within the company to raise pay, the government is here to help. Several states are pushing new minimum wage levels, which will raise all boats. Compliance is tightening. New York State, for example, has a new Warehouse Worker Protection Act that takes effect in June 2023. Others may follow. But the net result of having humans in the warehouse is that compliance costs will increase substantially. If these four reasons sound a bit like trying to stave off the four horsemen of the economic apocalypse, there is a bright side just over the horizon. At some point we will come out of this and enter the economic promised land. Investment in automation and robotics will deal with those challenges, making our networks fast, efcient, and—most of all—ready to handle an explosion in economic growth.
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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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6 Inbound Logistics • May 2023
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GOODQUESTION Readers Weigh In
How would you describe your job in five words or less? job in five words
and activate areas for sustainability. From reducing food waste to carbon footprints, I find ways to drive results that improve our supply chain and our world. –Svante Göthe Head of Sustainability, RELEX Solutions S olutions H appening I n P ressing S ituations –Steve Schwipps Operations Manager, TA Services
GROWTH ENABLER WHO REIMAGINES POSSIBILITIES. Since logistics is the end of the value stream, we can clearly define problems and opportunities through our customers’ eyes, enabling more robust, creative solutions. As we expand into new product categories, we are reimagining new processes that exceed customer expectations. –Marcia Brey Vice President of Distribution GE Appliances CAN-DO ENGAGEMENT OPPORTUNIST –Eric Allais President & CEO PathGuide Technologies LEADING CHANGE THROUGH METRIC VISIBILITY –Josh Gore Director of Business GROWTH REIMAGINES Since stream, and customers’ creative into reimagining customer
–Jackie Csiszar Vice President Customer Experience, ContainerPort Group
KEEPING IT COLD, WHEN HOT –Jake McPaul Head of Refrigerated Operations and Product, WARP SUPPLY CHAIN INNOVATION EVANGELIST –Chris Jones EVP Industry, Descartes BRINGING TRANSPARENCY TO CARRIER NEGOTIATIONS –Josh Dunham CEO and Co-founder, Reveel FRESH CHALLENGES AROUND EVERY CORNER –Crissy Hatfield Dispatcher Xcel Delivery Services EXPANDING THE POTENTIAL OF AUTOMATION –Matt Somerville Director of Sales, North America Realtime Robotics
Performance Management, Sunland Logistics Solutions
KEEP RETAILERS AHEAD OF CHANGE
SUPPLY CHAIN AND PROCUREMENT ADVISOR
–Eric Linxwiler Senior Vice President, TradeBeyond
–Joe Adamski Senior Director ProcureAbility TRANSPORTATION: EVOLVING FAST, ADAPTING CRITICAL! –Gene Welsh Chief Transportation Officer MODE Global SO MANY PROBLEMS TO SOLVE –Carston Cash International Trade Analyst, UWL MAKING SUPPLY CHAINS MORE SUSTAINABLE. On the surface, it seems straightforward, but with the complexity surrounding our supply chain, it’s challenging to identify
CRAFTING SEAMLESS, MEMORABLE CUSTOMER EXPERIENCES
–Nicole Butcaris Director of Customer Experience, WDS LEADING AND DRIVING TEAM SUCCESS –James Woodham General Manager, Charleston, TI & NTG GROCERY SUPPLY CHAIN PROBLEM SOLVER –Troy Prothero SVP, Product Management,
Supply Chain Solutions, SymphonyAI Retail CPG
8 Inbound Logistics • May 2023
CURIOSITY, NEW PERSPECTIVES DRIVE INNOVATION. Step outside of your comfort zone to gain new
Making Sense of Chaos
perspectives from co-workers, clients, carriers, and community partners. We all have something to oer. We all have something to learn. –Sharmila Fowler-Pos Head of Diversity, Equity & Inclusion Echo Global Logistics FEEDING THE WORLD EFFICIENTLY –Gregory W. Tuthill Chief Commercial Officer SeaCube Containers WHEN CUSTOMERS SUCCEED, WE SUCCEED –Nomar Ramis Chief Customer Officer, Magaya MIRACLES ONLY HAPPEN EARLY MORNING! –Vincent Cellard Vice President, Commodity Management, Flex REWARDING, EXCITING, STRATEGIC . But the most important adjective is TRANSFORMATIONAL . I get to work with innovators to help them mold their technology to meet the warehouse’s needs. Seeing that process at work is incredibly fulfilling. –Kristi Montgomery Vice President of Innovation, Research and Development, Kenco Group
Controlling chaos for our customers
–Keith Andrey President, U.S. Freight Forwarding UPS Supply Chain Solutions Organized chaos. Serving. Analytics. Ownership. –Gary Harber Distribution Manager, Milgard Overseeing creative chaos –Bryn Heimbeck President and Co-Founder Trade Tech
DELIGHTING EMPLOYEES, CUSTOMERS, AND SHAREHOLDERS
ACCELERATING SUPPLY CHAIN DIGITALIZATION. As the industry faces new challenges, technology investments are required to help reduce complexity. In my role, I lead the charge to define and execute digital strategies with cutting-edge technologies that optimize productivity and create a seamless connection of operation systems. –Paul Gaffney Chief Digital Officer, Omni Logistics SUPPLY CHAIN PROCESS IMPROVEMENT STRATEGIST. I work closely with my team to ensure our processes are ecient, that our customers’ supply chains are optimized, and that we are highly proactive in our scheduling, planning, and other activities. –Art Van Der Stuyf Director of Supply Chain Strategy iGPS Logistics
–Paul Boothe President, Last Mile and Dedicated Transportation, RXO COLLABORATIVE, CUSTOMER- CENTRIC, INNOVATIVE, SUPPORTIVE. My job oers variety, challenges, and opportunity to have real impact. –Eric Elter Director of Information and Technology Services, KDL Logistics DRIVE BUSINESS VALUE FOR CUSTOMERS –Mehul Kapadia Chief Revenue Officer, Locus I CREATE TRUSTWORTHY RELATIONSHIPS –Melissa Somsen Chief Commercial Officer, AFS Logistics
TRANSFORM DATA INTO ACTIONABLE INSIGHTS
–Mingshu Bates Chief Analytics Officer, AFS Logistics SUPPLY CHAIN TECHNOLOGY LEADER, MENTOR –Steve Sommer VP Supply Chain Engineering, Optilogic FINDING INSIGHT IN NOISY DATA –Tony Pelli Practice Director, Security and Resilience, BSI HELPING COMPANIES MANAGE SUPPLIER RISKS –Patrick Higgins Principal, Procurement & Supply Chain Management, Avetta
Have a great answer to a good question? Be sure to participate next month. We want to know:
What one supply chain adjustment would make the biggest impact on environmental, social, and governance (ESG) goals? We’ll publish some answers. Tell us at email@example.com or tweet us @ILMAGAZINE #ILGOODQUESTION
May 2023 • Inbound Logistics 9
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: firstname.lastname@example.org to be placed in the locations that offer the best chance for full-price sales and/or align with corporate objectives. Minimum, maximum, and/or capacity values can also be used as “guardrails” to further rene the nal distribution quantities. Lastly, when possible, retailers should allocate product in higher frequency, but in smaller quantities. This will allow them to react and course-correct when necessary, as market conditions change rapidly. –Jonathan Doller Sr. Business Consultant, Logility On Automotive Supply Chains Electric vehicle supply chains are impacted by constraints in critical battery minerals such as lithium, nickel, and cobalt. In addition to the physical constraints on chip production and mineral extraction and processing, the war in Ukraine, political tensions between China and the United States and its allies, the European energy shortage, and expectations of a global recession further exacerbate the situation. Timely, end-to-end visibility into supply networks, and the ability to derive insights from the data owing within these networks, are critical to mitigating these risks. Two technologies—intelligent, multi- enterprise cloud platforms and articial intelligence/machine learning (AI/ML)— will be key to meeting these challenges. AI/ML technology, with its predictive and prescriptive capabilities, can provide a competitive edge and a much-needed margin of business resilience. –Peter Maithel Automotive Industry Principal, Infor
CONTENT GETS SOME LOVE
value. Lean inventory is the right phrase for, well, lean inventory management. –Gordon Donovan Global Market Research Director, Procurement and Supply, SAP
Re: Gettin’ Giggy With It By IL Publisher Keith Biondo bit.ly/CheckingIn_0323
“Gettin’ giggy with it” is surely the wave of the future. Well done! –Bill McClennen Transportation Guru of Motorcycles
Re. Good Question: What’s one supply chain misnomer? What would be a better term? bit.ly/GoodQuestion_0123 Just in time (JIT) is not so much a misnomer, but too often we confuse it with lean inventory. JIT is a philosophy of reducing waste and driving improvement. At its core, it’s about minimizing time, processes, resources, and materials that don’t add I just received my copy of the March edition of Inbound Logistics . Love the articles. Keep them coming. –Julie Humphreys Logistics & Inventory Manager DOWN inc. Thank you for the short, to-the-point articles. All publications should take your lead. –Steve Liberti Harbor Freight Transport Corp.
On Ecommerce Fulllment The past few years have shown us how critically important it is to optimize distribution and maximize the value of inventory. Retailers can use a few different strategies to better manage constrained inventory. First, they should have a good understanding of whether or not additional product will be available at some future date. If no additional product is available, then some sort of pro-rated or “fair-share” distribution is often the best course of action. Second, if additional product will be available at some point, retailers can use existing inventory to try and maximize protability over equitability (which, by denition, is what a “fair-share” allocation attempts to do). Prioritizing locations based on key metrics or attributes (e.g., margin, category ranking, new stores, etc.) allows inventory
10 Inbound Logistics • May 2023
Unpredictable demand has become standard, but there is no reason why it should cause your business to be unaware, unfocused, and unready. Consider these action items to overcome challenges and future-ready your operations during peak seasons. Future-Proof Your Supply Chain
1 CONSIDER NEW
6 CONCENTRATE ON AGREED ALIGNMENTS. Gather stakeholders from the outset to ensure that no one is confused about the immediate objectives of the plan. Prior to deployment, ensure that it is formalized with secure sign-os from all stakeholders. 7 BOLSTER DAILY STAKEHOLDER COMMUNICATIONS. Ensure that all stakeholders are kept up-to-date on how things are progressing daily, from the time the draft is completed to the conclusion PLAN EXECUTION WITH of the peak season. Also create a simple dashboard that provides all concerned with needed callouts. And schedule regular conference calls with stakeholders to discuss relevant matters and address those issues promptly.
8 RELY ON ALTERNATIVE RESOURCES AS BACK-UP. The best laid plans will always encounter issues that can range from the departure of a key sta member to a supplier not being able to deliver in full. It’s always a good idea to have a backup plan and remain “open for business” with alternative providers. 9 INTEGRATE EXCEPTION MANAGEMENT. It is frequently thought that this is dicult to achieve, but if you get ahead of the process with your plan, your peak season should arrive at a point where everything is functioning well and the only issues that arise should be exceptions. If you lay the groundwork, you will have created the space to solve the inevitable challenges by implementing a well- thought-out plan that puts the majority of the increased peak workload on autopilot.
INNOVATION AND IDEAS. Peak season is an opportunity to demonstrate the value that you and your team contribute to your business every year. Therefore, gain advantage by being open and receptive to new innovations and ideas that can optimize operations and better manage peak seasonality fluctuations.
2 UTILIZE THE INTERIM FOR OPTIMIZATION. Eectively manage the time between peak periods for review, consideration, and improvement in order to future-proof operations before the next peak season. 3 FINE-TUNE STAKEHOLDER RELATIONSHIPS. Ask everyone from vendors and manufacturing to supply chain management, carriers, brokers, and truckers TIME BETWEEN “PEAKS” this question: “Who are you in business with and why?” Need to review and understand advantages, disadvantages, successes, failures, concerns, potential ongoing problems? Address areas of concern and work to eliminate any unaddressed weaknesses or issues before the next peak season. 4 CREATE A PEAK SEASON PLAN. Your plan ought to be an ever-evolving document that specifies what you
are expected to deliver— when, where, why, and how much. Put it all together in a well-organized document that everyone involved understands. 5 ESTABLISH EXPECTATIONS AND DELIVERABLES. Don’t draft the operational plan separately. In order to have an action plan that leads to positive outcomes, clear expectations, responsibilities, and deliverables need to be in place after the plan is finalized.
10 REMAIN FOCUSED ON
BOTTOM-LINE DELIVERABLES. As you prepare and implement the plan during peak season, remember to ask yourself if any new matter you have been asked to assist with or develop is as critical as what you’ve been asked to accomplish during peak. Be comfortable with declining new commitments or projects that might prevent you from meeting your peak season goals.
SOURCE: RICHARD KOHN, DIRECTOR, GLOBAL LOGISTICS & OPTIMIZATION SEACUBE CONTAINER LEASING LTD.
12 Inbound Logistics • May 2023
Running late can hurt your reputation. That’s why Penske offers customized transportation and logistics solutions, drawing from real-time data to optimize shipments, minimize disruptions and improve fleet efficiency.
AUTOMOTIVE INDUSTRY STEERS TOWARD THE FUTURE As the freight forwarding market grows, here's how the automotive sector is evolving, according to Thomasnet. 1. More reshoring and nearshoring. To mitigate supply chain disruptions and the inflationary impact on the cost of goods, many automotive manufacturers are looking to bring production operations back to the United States or closer to their customers. 2. Investing in data analytics. Respondents to a 2022 Deloitte transport industry report say that adopting a more robust approach to data management is increasingly critical. To achieve this improved transparency, many automotive companies are leveraging the expertise of startups and cloud services providers rather than hiring in-house data scientists. 3. A rise in electric vehicles (EVs) and autonomous vehicles (AVs). Players in the automotive industry are investing in EVs and AVs to manage costs, drive sustainability, address driver shortages, gain real-time insights, and improve brand reputation. 4. Cross-company collaboration. Automotive organizations are implementing products and technologies to transform day-to-day operations. For example, the Internet of Things enables real- time monitoring of inventory and shipments, machine learning helps with route optimization, and blockchain improves transparency for the end customer. To reap the full benefits of these technologies, organizations must share things like shipping schedules or warehouse space with competitors more readily than in the past.
Flying cars were a staple of The Jetsons cartoons, but are they practical in the real world? The multi-billion-dollar industry needed to make flying cars a reality has massive potential to solve societal problems and develop a new revenue stream for the United States and other economies, finds new research published in Manufacturing & Service Operations Management, an INFORMS journal. Researchers say it’s one thing to have vehicles capable of “Urban Aerial Mobility (UAM),” and quite another to make the societal changes needed for normal use of UAMs. “Technologies already exist to build and fly the kinds of vehicles that could ferry people throughout urban areas as part of a normal routine,” says Vikrant Vaze, a professor in the Thayer School of Engineering at Dartmouth, which conducted the survey along with MIT and Tsinghua University. “But the big challenges center on conceiving and creating the kind of transportation infrastructure, systems, and protocols that would enable the safe and smooth transition to urban aerial mobility,” he adds. The study points to cities, operators, and agencies—such as New Zealand, Singapore, NASA, and several airlines—that are already investing heavily in UAM to develop electric vertical- takeo-and-landing vehicles (eVTOL) or flying cars, UAM systems, and networks. “We will need to establish flying lanes and ‘roads’ not far dierent from today’s transportation systems built around paved roads on land, ocean shipping lanes, or air corridors,” says Vaze. WINGING IT
14 Inbound Logistics • May 2023
ROLLS-ROYCE EV HITS IT RICH All-electric vehicles (EVs) represent a relatively small share of the overall car market. Concerns over battery ranges and relatively high prices continue to limit their broader appeal. Electric vehicle prices, however, likely don’t matter much to buyers who inundated Rolls-Royce with orders for its debut EV, which comes with a $400,000 price tag. The British car company unveiled a prototype of the vehicle in summer 2022, and production is set to get underway this year. The Spectre ( pictured ) seats four and can travel 260 miles on a charge. It can go from zero to 60 in 4.4 seconds with 577 horsepower and 664 foot-pounds of torque. Rolls-Royce plans to phase out its internal-combustion vehicles this decade and transition to entirely electric vehicles by 2030. Initial demand for the Spectre could force the company to alter its production plans in order to meet it, according to company executives.
TIRE PRESSURE As part of a broader initiative to accelerate the use of sustainable technologies in the NTT Indycar Series, tire maker Bridgestone developed Firestone Firehawk race tires made with guayule natural rubber grown and extracted at the company’s guayule R&D facilities in Arizona. The company debuted the tires during the Indy 500 Pit Stop Challenge on May 27, 2023. Bridgestone aims to commercialize the use of sustainable guayule natural rubber in tires by 2030, creating a promising new domestic industry. • Guayule is a heat-tolerant, woody shrub that thrives in America’s desert southwest. • The shrub can be farmed with existing row crop equipment, saving costs for farmers. • Guayule creates up to 10 new
GM SHIFTS TO CHATBOTS ChatGPT is “going to be in everything,” says Scott Miller, vice president of General Motors. To that end, the automaker is reportedly working on a new virtual assistant for its vehicles powered by advanced artificial intelligence (AI) technology. GM could implement chatbot-type technologies into its cars in coming years under an existing partnership with Microsoft, according to Reuters. GM’s virtual assistant research features the same AI models as ChatGPT, reports Semafor. An advanced virtual assistant could quickly provide answers ordinarily found in vehicle owners' manuals or help drivers with routine tasks, such as checking their schedules or opening garage doors.
industrial processing jobs per 1,000 acres of harvested crop.
• Guayule rubber has the potential to have a lasting
economic impact, Bridgestone says, while reducing the energy and other environmental impacts associated with the transportation of rubber sourced overseas.
May 2023 • Inbound Logistics 15
as told to Karen Kroll
Start Me Up
RESPONSIBILITIES: Identify short- and long-term priorities and goals and support the executional teams as they translate the financial model into action. EXPERIENCE: President and chief operating ocer, investor, and board member, Fernish; board member, Radiant Logistics; chief operating ocer, Dolly, Inc.; vice president, operations, logistics, fulfillment and supply chain, zulily; leadership and managerial positions with Amazon.com and with Dell Computer Corporation. EDUCATION: MBA, MIT Sloan School of Management; S.M., transportation and supply chain, MIT; MSE and BSE, industrial engineering and operations research, University of Michigan. KRISTIN TOTH is president and chief operating officer with Fernish, which offers furniture and home décor through rent, rent-to-own, and buy options.
E arly in my career I was lucky to experiences. At Dell, for example, I worked on a massive reimagining of our manufacturing and logistics processes. To understand them, I went on the plant oor and physically walked the processes, while also observing the virtual, software-driven process. I’d see that if we got rid of one step, we still had to gure out how to get certain information to the right person at the right time. have several formative and amazing I pulled together about eight software teams and two hardware teams. Initially, I didn’t know the difference between, for instance, a router and a switch. I had to facilitate very humble conversations and ask, ‘How does this look to you? Does this seem like I have it? What am I missing?’ That experience showed me I could learn and have an impact, even in
ambiguous or scary situations. It allowed me to see I could provide real value by marrying the worlds of supply chain, logistics, operations, and technology. A WELL ROUNDED EDUCATION I grew up thinking cross-functionally. I was interested in theater and music, and I also liked math, science, and writing. That’s how I ended up at the University of Michigan. It’s an amazing school with a lot of colleges that are top in their elds. I applied to the College of Engineering. During my freshman
year, they were recruiting for a program to build operational leaders. I didn’t think I wanted to be in operations, but I would get to take classes in engineering, business, foreign language, and culture, so I’d have an incredibly well-rounded education. I fell into the operations world, and really love it. In any company that’s growing quickly, it’s easy to be overwhelmed by growth. You have to establish processes that are repeatable and predictable, so you don’t have to think about every action. With these processes in place, you can focus on where innovation will
In any company that’s growing quickly, it’s easy to be overwhelmed by growth. You have to establish processes that are repeatable and predictable, so you don’t have to think about every action.
16 Inbound Logistics • May 2023
come from and where the opportunities are. Facilitating these conversations is a big part of my job. My impact as an individual is limited to the time in the day and the skillsets that I have. But if I can remove roadblocks for others, I can get huge wins. The greatest thing for me is to watch others grow and develop, and even surprise themselves with what they’re able to do. With each of my career moves, I’ve gone to earlier-stage companies. There’s a great phrase: ‘Running a startup means oscillating between terror and euphoria.’ You’re constantly faced with things that can feel very high stakes. But the sense of collaboration, the camaraderie, the feeling that you’re all working in one direction and taking ownership in what you’re trying to build— even through the ‘oh my gosh, are we going to be able to do this?’—that’s why I keep going to startups. n
Kristin Toth Answers the Big Questions 1 What supply chain disrupting technology would you like to see developed quickly?
a lot of love into it, and then see the results. During the pandemic, I began baking sourdough bread. When I try to work through a tough problem, I switch gears and might bake cupcakes for the team. I get lost in the process; it’s very zen and helps me reset and think things through. 3 If you could have one superpower, what would it be? I wish I could teleport. I have teams and friends everywhere and would love to be able to see them more easily. I’d love to, say, hop into our warehouse in Austin, solve a problem, and hop back out.
Transparency in the supply chain is so key because there are risks to participating in the global economy. I would like anything technology that could provide transparency to questions like: Where are my shipments? When should I expect them? Are things on track or not? 2 What hobbies or activities make you better at supply chain management? I love cooking and baking and that’s also why I love operations; you follow a set of instructions, pay attention to what you’re doing, put
May 2023 • Inbound Logistics 17
NOTED [ IN FOCUS ]
The Supply Chain in Brief
> M & A
> GOOD WORKS
• As part of Combilift’s celebrations for its 25th anniversary, the Irish materials handling specialist donated its
n Global third-party logistics company DSV reached agreements to acquire U.S.-based
transport and logistics companies S&M Moving Systems West and Global Diversity Logistics . n RoadOne IntermodaLogistics, a single- source intermodal, warehouse, and logistics services company, acquired Ace Transport Miami , an intermodal and transload service provider. Going forward, the company will become a division of RoadOne known as Ace IntermodaLogistics . n Horizon Air Freight and Swift Marine entered a strategic business partnership and will unite as a single company, Horizon Group. The new joint company will oer marine logistics and port agency services in North America, South America, Asia, and Europe.
75,000th truck—an Aisle Master articulated forklift—to Convoy of Hope, a non-prot humanitarian and disaster relief organization.
• Maersk Air Cargo donated the airfreight capacity to send 440 pallets of U.S.-donated relief goods to Türkiye in response to two earthquakes that struck the region in February 2023.
> GREEN SEEDS
n Ryder will introduce 4,000 BrightDrop Zevo 600 and Zevo 400 electric vans to its lease and rental fleet through 2025 to meet rising demand for commercial EVs.
n Primary Freight Services, an integrated logistics services provider, is celebrating 25 years of offering customized solutions to 100+ countries.
> SEALED DEALS
• DHL Supply Chain is extending its strategic partnership with Nestlé Nespresso S.A. DHL will now provide logistics and fulllment services in Brisbane and Sydney, Australia, building on existing partnerships in Italy, Brazil, Malaysia, Taiwan, UK, and Ireland.
> UP THE CHAIN
• Hans Stig Moller was named chief executive ofcer of Odyssey Logistics & Technology. Moller brings 20-plus years of progressive global logistics industry leadership to Odyssey, having held leadership positions within some of the industry’s largest players, including Maersk and XPO.
• General Motors recognized global logistics company Ascent as a 2022 Supplier of the Year. GM’s award recognizes global suppliers that distinguish themselves by exceeding GM’s requirements, in turn providing customers with innovative technologies and high quality in the automotive industry.
• Supply chain visibility company FourKites appointed Rocky Subramanian as president. Subramanian was most recently executive vice president and chief revenue ofcer at Ceridian and previously served as senior vice president and managing director of one of SAP’s largest market units.
18 Inbound Logistics • May 2023
TAKEAWAYS Shaping the Future of the Global Supply Chain
A Healthier Pharma Supply Chain To improve their bottom line, many healthcare providers are applying supply chain know-how to healthcare decisions. One example: Cardinal Health collaborated with Palantir Technologies to design a solution that provides health systems and hospitals with dynamic purchase decision insights. The solution uses articial intelligence and machine learning to analyze real-time clinical and purchasing data, then creates a clinically integrated supply chain for pharmaceuticals. The tools integrate with Foundry, Palantir’s operating system, and could help health systems right-size pharmacy inventory. The solution takes constantly evolving payer formulary updates into account, which should help ease the high costs associated with drug expense increases due to the growth of specialty therapies and biosimilars. Future updates could help inform purchasing decisions for therapeutic utilization, reimbursement insights, and predictive drug inventory needs. A DIRECT HIT As retail businesses explore all their supply chain options, many nd that direct-to-consumer (DTC) models may be the right approach. In fact, two-thirds of North American organizations say their investment in the DTC delivery model has increased since early 2020, according to a new Deposco report, The Rise of Direct-to-Consumer in North America . Respondents from ecommerce, manufacturing, retail, transportation, logistics, supply chain, and wholesale businesses who invested in DTC point to the following benets: • 38% say DTC models can improve prot margins. • 31% say it will reduce costs. • 23% note the ability to personalize their service offering as a key driver. There are, however, some barriers to DTC success. Nearly one- quarter of respondents (24%) point to a lack of skilled staff, while physical infrastructure (23%) also creates some difculties. But planning can overcome these roadblocks. More than half (54%) say preparing with the right mix of people, processes, and technology positions their organizations for DTC success.
TEAR IT DOWN THEN BUILD IT UP Recent systemic supply chain challenges have forced some companies to scrap contingency plans and rebuild their supply chains from the ground up. This has created demand for relevant business interruption coverage, according to a new WTW study. The survey polled supply chain risk decision makers in industries including life sciences, semiconductors, food and beverage, agriculture, logistics, complex manufacturing, construction, energy, and renewables. Most respondents say they experienced larger-than-expected losses during the supply chain crisis, and many say they are still recovering. The survey finds that most responded to disruptions by reducing supply chain complexity. For example: ● 83% have made supply chain changes. ● 18% completely transformed their approach. ● 58% plan to make significant changes over the next two years.
20 Inbound Logistics • May 2023
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The labor shortages, supply chain disruptions, and high fuel prices brought on by the pandemic continue to reverberate in the trucking industry. To identify challenges and potential solutions, Rose Rocket surveyed trucking executives, carriers, and brokers and aggregated usage data from its transportation management system. More than half (53.5%) of those surveyed cite hiring and retention as their top challenge. Of those, 36% say that improving hiring programs is the preferred approach, 18% say improving company culture would help, while 11% opt for improving pay and incentives. Although carriers often deal with higher employee churn when compared to brokers, aggregated product use data TRUCKING GETS A TUNE UP
shows turnover increases in broker organizations. This suggests that companies are facing retention concerns across the board. Inflation and reduced market demand may compound the problem, and trucking companies are placing increased focus on growing their customer base. When asked how they plan to remedy slower sales amid market volatility, 29% of respondents say that acquiring new customers through cold calling is the top approach to building business, 18% focus on better communication with existing customers, and nearly 10% say improved service will help retain current customers.
22 Inbound Logistics • May 2023
Winning the Data Game
Rates shift as dynamically as the market does so it’s important for shippers to have some benchmarks in place to navigate it as cleanly—and cheaply—as possible. However, that requires investing a lot of time and focus on top of simply getting the job done right. So where can shippers go to manage all the information they need? Chad Kennedy, group product manager at DAT Freight & Analytics, shared his advice in a recent Inbound Logistics podcast, and Will Post, CSCP, offers three key takeaways: 1. Conduct thorough market research and benchmarking to identify your highest cost lanes. Use this data to target these lanes for improvement and negotiate better rates with carriers. Do this before running an RFP.
2. Avoid taking your below-market lanes out to RFP and potentially losing your best partners. Instead, have a strategic conversation with your carriers and work out a mutually benecial agreement. 3. Update your fuel surcharge program by adjusting your miles per gallon assumption to reect carriers’ increased efciency. This will help you save money on fuel costs and renegotiate better rates with your carriers.
May 2023 • Inbound Logistics 23
SALES & LEASING TERMINAL TRACTORS & TRAILERS
H.O.W. HELP ON THE WAY
SPONSORED BY ENGINEERING INNOVATION
How Flexible Parcel Handling Automation Can Help Overcome Labor Challenges
Warehouse and distribution center operators are investing in parcel handling automation to help them succeed as DCs must adapt to handling thousands of parcels each day. According to BCG, consumer companies that have invested in warehouse and fulfillment automation have experienced 20% to 50% improvement in service levels while reducing costs to a similar extent. Companies face two primary challenges in transitioning to increased ecommerce volumes: material handling equipment and labor. An existing distribution center may have been designed to support pallet loads and store fulfillment, so the current handling systems are not optimized for parcels. Adapting inflexible equipment and a facility for parcel operations could be costly and time consuming. Some equipment simply can’t be unbolted and redesigned. At the same time, companies are challenged with labor issues, including hiring, retention, and training. Warehouse labor pools are experiencing high levels of turnover, even with rising wages as an incentive for longer tenures. e rapid influx of new employees requires constant vigilance in training and management to ensure accuracy and product quality. In addition, ecommerce is typically more labor-intensive than pallet operations. Staffing and training are ongoing obstacles to supporting ecommerce operations capable of meeting customer service expectations. With the ongoing labor gap, warehouse mechanization and automation are essential for parcel shippers to achieve their business and service goals. Automated Parcel Handling Solutions Automated parcel solutions streamline the process of measuring the dimensions and weight of packages within a warehouse or fulfillment center. Automation employs AI and computer vision-based dimensioning technology that measures the dimensional information of all regular and irregularly shaped parcels in less than a second. Integrate automated parcel solutions with label printers, automated label application, scales, barcode scanners, and various shipping software to streamline the entire shipping process. Modular, scalable equipment parcel handling architecture allows the facility and operation to adapt to changing requirements for inbound and outbound processing. Growing parcel processing operations require flexible automation solutions designed to provide customizable options, such as sorting, dimensioning, labeling, barcode reading, OCR reading, and RFID capabilities. A flexible automation solution allows operators to adapt to existing facilities while supporting variable volume and market requirements. Automated parcel solutions can help companies transform ecommerce fulfillment operations through greater efficiency and lower costs.
5 REASONS TO AUTOMATE PARCEL HANDLING
Automated parcel handling solutions help warehouse and distribution center
operators boost speed and accuracy with lower labor costs to meet the demands of consumer buying habits. 1. Labor. Process more packages faster with fewer people. Let automation handle the details and spend less time training. Reduce the need for manual dimensioning, labeling, and routing. 2. Cost. Reduce the need for manual labor and handle higher volumes without incremental cost increases. 3. Accuracy. Measure parcel dimensions consistently and accurately for fewer errors and lower shipping costs. Real-time data can flow from the parcel handling system to the WMS, OMS, ERP, and other solutions. 4. Flexibility. The ability to handle different types and dimensions of parcels increases the warehouse’s capabilities to adapt to changing inventory and operations. 5. Customer service. Improve traceability and visibility of parcels and give customers more accurate shipping time estimates while reducing shipment handling time. There’s less chance of product damage
with automated handling before the package enters the delivery stream.
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