Accelerate your expedited transportation strategies with this edition covering the technologies underpinning expedited delivery and the automation innovations boosting distribution center operations. Including a handy guide listing expedited carriers that can handle your time-critical shipments and an update on air cargo capacity, this edition can help you pave the way to supply chain efficiency.
NOVEMBER 2022
ACCELERATING DC EFFICIENCIES
EXPEDITED: HOW NOT TO LOSE YOUR MIND
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HOLIDAY SEASON: FROM CRUNCH TO GLUT 99% of retail executives say increasing promotional activity and availability guarantees form part of their company’s plans for the holiday season. 37% say their company is stockpiling goods to ensure supply. 35% say their companies are taking special measures or deep discounting to of oad surplus stock. 32% are re-optimizing pricing and promotions.
BREAKING WIND RECORDS Siemens Gamesa’s breakthrough development in o shore wind turbine technology, the 14-222 DD o shore prototype, has set a new world record for the most energy generated over 24 hours. The prototype delivered 359 megawatt-hours in a single day— roughly enough to power 18,000 households, or keep a Tesla Model 3 charged for more than 1 million miles. Siemens Gamesa estimates the 14-222 DD turbine will go into production in 2024, and already has preorders from wind farms o the coasts of the United States, UK, and Taiwan.
CATCH ME IF YOU CAN Cassie, a bipedal robot designed by the Oregon State University College of Engineering and built by Agility Robotics, ran 100 meters in 24.73 seconds, o cially setting a Guinness World Record for fastest time by a two-legged robot. The robot’s legs are similar to those of an ostrich and it moves without using cameras or sensors. Instead, Cassie relies on machine learning to control motion. If Cassie the robot can continue to improve its bipedal movements, it could eventually fulfill use cases such as package delivery. AND THAT’S ON... Take a look at TikTok’s recent job postings. They indicate that the short form video hosting service is looking to build an “international e-commerce ful llment system” that will include warehousing, customs clearance, and supply chain systems to support e-commerce efforts in the United States and across the border. The ful llment systems will eventually perform parcel consolidation, transport goods from one stage to the next, and manage free returns. –Axios
–Accenture survey
U.S. HUNGRY FOR FAST DRIVE-THRUs In a rush for your fast food? Here’s where to go when speed matters:
November 2022 • Inbound Logistics 1
CONTENTS NOVEMBER 2022 | VOL. 42 | NO. 11
46 SPONSORED DCs LEVEL UP Achieving eciency is more pressing and challenging than ever for distribution centers. DC operators can turn to flexible automation solutions to boost productivity and optimize space utilization. 46
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36 EXPEDITED CARRIERS GUIDE 2022 These carriers handle tight timeframes, specialized equipment needs, and mission-critical shipments by oering same-day and next-day options using ground expedite and air charter solutions. 42 AIR CARGO CAPACITY COMES BACK Since the pandemic began, demand for air cargo exceeded supply, but at the end of 2022, air freight capacity approached pre-pandemic norms. What happens next?
FEATURES 30
EXPEDITED DELIVERY: TECHNOLOGY MAKES IT HAPPEN
When customers want their products quickly, technology oers shippers increased visibility, optimized loads and routes, data-sharing, and digitized documents.
42
CONTENT PARTNERS KNOWLEDGE BASE 22 3PL WAREHOUSE RAPID DEPLOYMENT AND ADAPTATION O ered by QSSI 23 DIGITAL SUPPLY CHAIN TECHNOLOGY INVESTMENTS SPURRED BY DISRUPTION O ered by MHI
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
2 Inbound Logistics • November 2022
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8
GOOD QUESTION Is supply chain globalization in retreat? Why or why not?
Supply chain trends from the automotive aftermarket
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INFO 54 WEB_CITE CITY 58 SUPPLY CHAIN INSIGHTS 62 CALENDAR 63 RESOURCE CENTER
INFOCUS 1 INFO SNACKS 12 VERTICAL FOCUS: AUTOMOTIVE AFTERMARKET 16 NOTED 18 TAKEAWAYS 60 IN BRIEF 64 LAST MILE Pumpkin spice pandemonium is a fall tradition in the United States
A new lightweight truck body and other recent innovations
14
INSIGHT 4 CHECKING IN Robots: Walmart advances, Amazon retreats 6 DIALOG 8 GOOD QUESTION Is supply chain globalization in retreat? Why or why not? 10 10 TIPS Becoming a demand-driven enterprise
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24 DISRUPTION MITIGATION Supply chain strain: how to navigate disruption 26 TRANSPORTATION Winning in a contract market 28 SC SECURITY Four tips to strengthen cybersecurity
10
INPRACTICE 14 LEADERSHIP
Nicole Glenn, founder and CEO of Candor Expedite, thrives on the fast pace of logistics but knows how to slow it down when it comes to growing her company thoughtfully.
Tips for responding to demand signals with agility
November 2022 • Inbound Logistics 3
CHECKINGIN Robots: Walmart Advances, Amazon Retreats
Vol. 42, No. 11 November 2022 THE MAGAZINE FOR DEMAND-DRIVEN ENTERPRISES www.inboundlogistics.com
STAFF PUBLISHER Keith G. Biondo
publisher@inboundlogistics.com
W hen faced with anticipated fall-off in consumer purchases, Walmart leans into new robotic solutions. The retailer also re-tasks existing store
EDITOR Felecia J. Stratton
editor@inboundlogistics.com
SENIOR EDITOR Katrina C. Arabe
karabe@inboundlogistics.com
infrastructure by attaching market ful llment centers (MFCs)—compact warehouses inside, or tacked onto, retail stores to help ful ll pickup or delivery orders. It gets inventory closer to the customer and amps delivery velocity to serve consumers when they want. How does Walmart do it? Robotics. To further build and expand its omnichannel ful llment capabilities, Walmart recently acquired robotics automation company Alert Innovation. Walmart’s marriage to Alert did not happen overnight. Over the past ve years, the retailer has been helping Alert ne-tune its materials handling robotics technology for use in Walmart’s MFCs. Why buy the company when you can just buy the robots? Just like Amazon did when it acquired Kiva Systems one decade ago, Walmart is bringing Alert’s capabilities in-house to scale the impact of that automation and deploy additional fully operational MFCs more quickly. That 10-year head start helped Amazon write the book on same- and next-day delivery. Walmart is writing the sequel. Alert Innovation custom-built autonomous bots to store, retrieve, and dispense orders in Walmart’s MFCs. The bots move up, down, and sideways without lifts and conveyors, so they require less space—perfect for a store add-on. Warehouse space has become increasingly expensive as many U.S. companies have larded up on inventory as a hedge against disruptions. Now, as consumption has fallen, companies large and small are faced with excess inventories and fewer less-expensive storage options. Re-tasking store infrastructure capacity by adding custom-built ful llment robotics from Alert is brilliant. A side bene t of robot-assisted ful llment is it offsets the scarcity of labor for those tasks in some markets. Instead of a Walmart associate walking the store to ful ll orders from store shelves, automated bots retrieve the items from within the MFC and deliver them to picking workstations for quicker assembly, sale, and nal delivery. Location and velocity combine to give Walmart competitive props over e-commerce competitors, including Amazon. And what of Amazon? In one of those rare retail behemoth competitive coincidences, Amazon announced almost simultaneously that it is pulling back on a glamorous and much-celebrated robotic investment and will end eld tests of Scout, an autonomous delivery robot. The company is “reorienting the program,” it says, after certain aspects failed to meet customer needs. Will Walmart’s less glamorous and behind-the-scenes MFC robot ful llment strategy help meet customer needs? Yup.
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4 Inbound Logistics • November 2022
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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/cms/podcast DROP US A LINE: editorial@inboundlogistics.com soybeans. Much of that is shipped by barges, as are other products like fertilizer, coal, oil and petroleum, and metals. One 15-barge tow has the same freight capacity as 1,050 trucks, so with 2,250 vessels stranded, that is the equivalent of more than 2 million truckloads. This product cannot be easily moved to other modes of transportation and the deepening of the Mississippi River by the Army Corps of Engineers is a slow process. We’re already seeing the impacts of delayed deliveries with plummeting barge spot rates. It’s just a matter of time before this affects the prices of the products that these commodities are used in, such as groceries or cars. –Bart De Muynck Chief Industry Officer, project44
LUNCH AND LEARN
Re: Good Question: If you could invent one tool to help you do your job better, what would it be? bit.ly/IL_GoodQuestion_Oct2022 Touchless inbound freight. This tech tool would help warehouse managers do their job better (which would, in turn, help management do their jobs better). Essentially, the solution would enable inbound freight to be received, automatically inspected when required, and then put away or cross-docked with no human intervention. This would allow employees to focus much more of their time, energy, and know-how on the activities that matter most for their business. –Keith La Londe VP, Systems, PathGuide Technologies
Frank Mullens @FrankMullens Chicken bowl with @ILMagazine’s feature “Technology Soups Up the Supply Chain” bit.ly/April2022_IL_feature
Fast TAKES
On the potential rail strike impact on the supply chain, as negotiations hit an impasse
Supply chain professionals must consider immediate impacts and contemplate possible implications for materials. As always, in developing internal supply chains, evaluating vendors and supplies, contingency planning, and communication will be critical. This major challenge highlights the need for all stakeholders to have the vision to be aware of possible significant supply chain disruptions, the need to be innovative, and the need to provide leadership at all levels. In order to minimize impacts, stakeholders need to voice concerns immediately and make contingency plans. –Andrew Kirk Chief Revenue Officer, BioCare, Inc.
Re: Good Question: What’s the biggest supply chain silo? bit.ly/IL_GoodQuestion_ May2022
On the broader supply chain impacts of the drying Mississippi River
The Mississippi River dropped to record low water levels in October 2022. We didn’t see an immediate major impact on the supply chain, as water transport accounts for less than 5% of overall U.S. freight volume. However, the drying Mississippi will have an extensive longer- term impact, especially for industries with concentrated use of barges like the grain and soybean industries. The Mississippi River Basin produces 92% of U.S. agricultural exports and 78% of the world’s exports in feed grains and
The biggest silo is psychological. We can present a solution—based on data and decades of time-tested advice—that works, but if leaders are afraid to embrace change or collaborate to find alternative solutions, they will stunt growth. Being open to new technologies or ways of thinking fosters creativity and proactivity to keep supply chains nimble and customers happy. –Charlie Midkiff SVP, Corporate Strategy, Odyssey
6 Inbound Logistics • November 2022
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GOODQUESTION Readers Weigh In
Is supply chain globalization in retreat? Why or why not?
Absolutely Not It’s an irreversible trend ; nations rely on each other for goods and services. What’s new is the trend of low-cost country sourcing; companies are looking for nearshore options, which means they are focused on securing suppliers closer to their consumption point. –Amit Gupta, Ph.D. Chief Product Officer, TADA The “retreat” is more an illusion than a reality. Globalization of the economy hasn’t stopped, so the supply chain can’t stop, i.e., just because the United States will make microchips, it doesn’t mean U.S. companies will stop buying from others, or that the United States will not sell to other countries. –Dimitre Kirilov President of Consumer Services, Montway Auto Transport Globalization is not going away. It must combine with regionalization to enable supply chain flexibility. By understanding the impact of internal and external factors, supply chain stakeholders can evaluate constraints and make the decisions that create the most value for the enterprise. –Patrick Van Hull Senior Director, Product Marketing, o9 Solutions irreversible trend ; trend of Absolutely
YES AND NO. We’ve seen the rush of knee-jerk reactions to onshore more. But the longer-term norm will be to balance offshoring and onshoring as companies seek to meet their cost objectives yet learn to keep their supply chains agile to meet service-level commitments. THE ANSWER IS NON-LINEAR. With supply chain disruptions, emerging technologies, and rising labor costs in developing countries, more firms are considering regionalizing their supply chain. Execution is the hard part. The more complex one’s supply chain ecosystem, the harder it is to onshore. –Dan Son Head of Global Banking, U.S. Bank
IT DEPENDS ON LOCATION. Companies that globalized their
NO. Today’s supply chain requires both a local and global source of supply. As a result, we have shifted from a low-cost to a results-driven approach, focused on driving better customer experience. –Matt Reddington CPSM, CPM, VP Operations Procure Analytics SUPPLY CHAINS ARE BECOMING GLOBALIZED AND LOCALIZED simultaneously. The perpetual search for cost savings resulted in global supply chains, and increasingly, automated manufacturing, higher transportation costs, and environmental concerns are now driving a shift toward localization.
operations 20 or 30 years ago when there were major cost benefits, are now dealing with rising labor and logistics costs in many locations. They’ll need to compare current globalized cost structures against the costs of onshoring to see if an advantage still exists.
–Lachelle Buchanan Vice President, Logility
–Tom McDonough Senior Director of Supply Chain Solutions, Anaplan
NO. But select businesses are seeing a tradeoff value in a simplified system with more control and visibility from end to end. Simplified systems offer ways to identify, assess, and manage risks such as inventory irregularity and unpredictable lead times. –Andrew Billings Vice President & Supply Chain Lead North Highland
NO. Shippers have had to be increasingly flexible in recent years, leading to a greater reliance on international partnerships. Because these partnerships can take years to form and shippers must make
–Matt Spooner Industry Thought Leader, Kinaxis
8 Inbound Logistics • November 2022
GOODQUESTION
significant investments to mitigate the inherent risks, supply chain globalization is here to stay.
But It’s Complicated It’s definitely hitting some speed bumps and in the long-term picture, there are elements that are going away. Chip manufacturers have shown it is not viable to have all manufacturing located with a few sources. And we are seeing that shipping being controlled in one direction is problematic both on the shipping and receiving sides. Ultimately manufacturing is going to pick up around the world but products like steel, chips, and other complex products will take time to come online. –Muffie Alejandro President, Jan-Al Cases Yes, to a degree. It is a process that will play out incrementally, over time. However, there are pressures to diminish some of these dependencies that weren’t there a few years ago, including reducing reliance on lengthy inbound transportation modes that are susceptible to price spikes and capacity constraints, and, of course, geopolitical risks. –Mark Wheeler Director, Supply Chain Solutions, Zebra Technologies hitting some But
–David Spencer Director of Business Intelligence Arrive Logistics
NOT AT A MEANINGFUL SCALE. We may be in a moment of pause and tectonic shift, like taris growing, but globalization is a Pandora’s box that won’t close unless global economies shrink exponentially. Even with aggressive reshoring/nearshoring initiatives, it would take decades to displace China as the world’s manufacturer.
–Ryan Lynch SVP Marketing, OnPoint Group
MANY COMPANIES HAVE ADDED REDUNDANCIES like nearshoring to minimize their supply chain risk. However, new supply chain technological innovations being developed around the world will continue to spur globalization.
NO. It would be naive to suggest we’ve seen a complete pivot given the infrastructure that’s already in place and the economic benefits from globalization. Additionally, hopefully there will be a de-escalation in the current geopolitical turmoil and the broader positivity of globalization will persist. –Geoff Kelley President & COO Transportation Insight & NTG NO. As supply chains adapt to market conditions, whether punitive trade barriers, geopolitical conflicts, weather events, or logistics shocks, trade flows will shift, but globalization always wins because economics always wins.
development, and labor availability are critical to success and foreign governments will look to capitalize on these opportunities. The next black swan is unclear but it is clear that globalization is here to stay. –Glenn Koepke
–Felix Vicknair VP, Supply Chain Solutions Kenco Group
SUPPLY CHAIN GLOBALIZATION IS IN RESET, not retreat. Shippers are reassessing the fundamentals of their supply chain strategies. Whether their manufacturing is situated in the United States or abroad, shippers are looking to tighten their networks to build resilience and reassert control.
General Manager, Network Collaboration, FourKites
GLOBALIZATION IS IN TRANSITION. We are seeing companies evaluating dierent operating models and how these could be impacted by varied factors—taris, regulatory changes, geopolitics, etc. A shift to reorient supply chains from a globalized model would be significant and would require huge investments. –Alex Pradhan Product Strategy Leader John Galt Solutions
–JJ Schickel CEO, Omni Logistics
YES AND NO. When the pandemic started, many columnists wrote that everyone will be doing local and regional sourcing. What happened? People stockpiled inventory. You can’t shift entire supply chains overnight. What many organizations are moving toward is multi-sourcing strategies to build resilience. –Gordon Donovan
–Tom Nightingale CEO, AFS Logistics
Have a great answer to a good question? Be sure to participate next month. We want to know: What’s your best customer service tip for supply chain stakeholders? We’ll publish some answers. Tell us at editorial@inboundlogistics.com or tweet us @ILMAGAZINE #ILGOODQUESTION
Director of Market Research for Procurement and External Workforce, SAP
NO. While sentiment has shifted on globalization, networks are too vast to localize. Raw materials, research and
November 2022 • Inbound Logistics 9
10 TIPS
The key to becoming more agile when responding to demand signals is overcoming data and decision-making siloes that impact your ability to deliver. Here are 10 ways you can start to optimize your operations to become more predictive and proactive. Becoming a Demand-Driven Enterprise
1 GET AN ENTERPRISE-WIDE VIEW OF DATA.
Artificial intelligence and machine learning can harmonize tangles of disconnected systems . Cognitive technology can crawl those systems and create a harmonized “golden data layer” that provides an up-to-date, accurate view of key metrics such as shipping lead times and inventory coverage.
2 KNOW YOUR SOURCES OF VOLATILITY. Gain a holistic view of internal and external challenges—including market trends, competitors’ actions, supplier performance, and logistics cost drivers—and make this analysis an ongoing exercise. 3 GATHER INSTITUTIONAL KNOWLEDGE. The Great Resignation spurred longtime employees to move on to new opportunities, while many others retired. Capture your best practices and processes today and ensure that expertise is not lost when experienced team members move on. 4 ADDRESS MASTER DATA CHALLENGES. When neglected, issues with foundational master data— both static data (product categorizations) and dynamic data (lead times) can provide the wrong signals and impact product visibility, material
data sources that add insights beyond your own view, you can better adapt to changes in demand— for instance, by making adjustments automatically that maximize loaded miles. 7 ADD DECISION INTELLIGENCE. With more decisions to make in a day than time or people to make them, using artificial intelligence and machine learning to support and automate decision making is a necessary source of competitive advantage. 8 MAINTAIN AN INNOVATION MINDSET. Digital native companies and agile startups delight
sourcing decisions, and more. Good data hygiene pays dividends in decision making. 5 FOCUS ON DECISIONS, NOT TASKS. A focus on decisions and outcomes helps ingrain strategic thinking into day-to-day operations. Task- oriented thinking can miss the big picture. For example, how can augmenting logistics decisions with data- driven insights help reduce or avoid less-than-truckload shipments? 6 INTEGRATE OUTSIDE DATA SOURCES. When you draw on port congestion data, logistics marketplace information, and a wide range of other
their customers and disrupt markets by innovating. To keep pace, examine the value you provide and challenge yourself to find better ways to collaborate with customers, suppliers, 3PLs, and other stakeholders. 9 EMBRACE ADAPTIVE S&OP. The Demand Driven Institute defines Adaptive Sales & Operations Planning (S&OP) as “the integrated business process that provides management the ability to strategically define, direct, and manage relevant information.” All organizations could find benefits when undertaking this process.
10 FOCUS ON
CONTINUOUS IMPROVEMENT. Response to the unexpected too often involves endless calls, slide decks, and spreadsheets. Instead of static emergency action plans, adopting digitized decision-making promotes a focus on continuous improvement. This helps improve decisions over time as your business evolves—as opposed to a “one-and-done” technology implementation mindset.
SOURCE: FRED FONTES, HEAD OF GROWTH, AERA TECHNOLOGY
10 Inbound Logistics • November 2022
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Automotive Aftermarket
At a time when the automotive aftermarket economy—like everything else—is on shaky ground, tire manufacturers feel as if their road may be a little smoother than others. The tire sector is predicted to fare pretty well, according to recent 2023 market analysis from Tire Review magazine. Federal Reserve data shows U.S. industrial production of tires climbed 3.5 points in August 2022 from a month earlier, and was also up 4.2% over August 2021 levels. This increase in domestic tire production volume indicates that supply chains are being freed from historic bottlenecks, giving manufacturers an opportunity to supply tires for inventory, the analysis shows. Three key automotive indications fuel this positive outlook for the tire sector: 1. Gas prices are coming down. The four-week moving average of gas prices was down to $3.71 a gallon at the end of September 2022, according to data from the U.S. Energy Information Administration. While still up 17% from the same time last year, the trend is a favorable one. 2. Truck tonnage is increasing. The Truck Tonnage Index, which measures the gross tonnage of freight transported by truckers in the United States for a given month, was up sharply in June 2022, with a one-month gain of 2.9%, and a year- over-year change up 8%, according to the U.S. Department of Transportation and the American Trucking Associations. These kinds of strong increases in trucking activity help to support future heavy-duty tire sales and service. 3. Retail sales have remained strong. Retail sales at auto parts, accessories, and tire stores remained strong in July, according to Census Bureaus data. Sales were up 0.3% from the month earlier, and up a more substantial 11.1% compared to July 2021. TIRE MARKET KEEPS ROLLING
UNLOCKING EFFICIENCY FOR RECONDITIONED VEHICLE DEALERS A picture may be worth 1,000 words, but photos may also help sell 1,000 vehicles. In today’s fast-paced market, auto dealers selling reconditioned vehicles need to load photos on their website’s vehicle detail pages as quickly as possible, so they can boost clicks and leads. Streamlining photography and merchandising of vehicles is crucial for dealers. A new partnership helps dealers unlock efficiencies in this area. Dealer Image Pro, a professional photo, video, and interactive software provider for automotive dealerships, recently integrated its Photo Assistant and Autoport software with reconditioning workflow software from Rapid Recon to improve time to market for reconditioned vehicles. With the Rapid Recon status of their used vehicles displayed within the Photo Assistant and Autoport inventory dashboard, dealership sales teams can quickly identify the stage of the reconditioning process for a specific vehicle— and whether it is ready to be photographed. Once photos are ready, Dealer Image Pro provides inventory photo feeds directly to Rapid Recon, which makes it easier for dealership staff to verify that the photos have been published on the website.
12 Inbound Logistics • November 2022
VERTICALFOCUS
RIGHT TO REPAIR ACT: THE RIGHT MOVE FOR THE AUTOMOTIVE AFTERMARKET? A new bill, H.R. 6570, known as the Right to Equitable and Professional Auto Industry Repair, or REPAIR Act, has the automotive aftermarket industry buzzing. Introduced into the House by Rep. Bobby Rush (D-Illinois) earlier in 2022, it centers around how making vehicle data available will spur greater competition in the aftermarket repair segment. Here’s a quick breakdown of the bill: Overview: The bill will ensure that owners and independent shops have access to necessary vehicle repair and maintenance tools and data. It requires automobile manufacturers to provide the same information to independent repair shops as they do for dealer shops. This includes all tools and equipment, wireless transmission of repair and diagnostic data, and access to onboard diagnostic and telematics systems needed to repair a vehicle. Supporters: Proponents of the bill include The Automotive Aftermarket Suppliers Association, Auto Care Association, Consumer Access to Repair Coalition, and Specialty Equipment Market Association. Status: In February 2022, the Committee on Energy and Commerce referred the bill to the Subcommittee on Consumer Protection and Commerce. In June 2022, New York became the first state in the country to pass its own Right to Repair Act. GLOBAL AUTO PERFORMANCE PARTS MARKET ON THE RISE High expectations surround demand for automotive performance parts going forward, according to a recent report from Future Market Insights, which says the market is likely to reach nearly $340 million by the end of 2022—and skyrocket to $532 million by 2032. The report cites escalating demand for passenger cars and a rise in disposable income across the globe as the driving factors. Here are some key takeaways from the report: • The automotive performance parts market in the United States will account for 87% of the market share in North America. • Sales of shock absorbers will grow at 4.6%. • Sales of torque converters will hit a 5.8% compound annual growth rate (CAGR). • The air filters segment will grow at a CAGR of 4.2%. • Asia Pacific is projected to lead the global automotive performance parts market by 2032.
THE TRENDIEST AFTERMARKET VEHICLES Which vehicles are the top trend- setters for the automotive aftermarket? Exhibitors at the recent Specialty Equipment Market Association (SEMA) show voted for the vehicles that represent the best business opportunities for the aftermarket. SEMA Award finalists represent exhibiting automakers that support the aftermarket with accessory- friendly models based on their potential for customization. The finalists are: SEMA Car of the Year Nissan Z Dodge Challenger SEMA Mid-Size Truck of the Year Jeep Gladiator Toyota Tacoma SEMA Full-Size Truck of the Year Ram Toyota Tundra SEMA 4x4/SUV of the Year Jeep Wrangler Toyota 4Runner SEMA Sport Compact of the Year Toyota GR86 Volkswagen Golf GTI SEMA Electric Vehicle of the Year Nissan Ariya Volkswagen ID.4
November 2022 • Inbound Logistics 13
LEADERSHIP Conversations with the Captains of Industry Leading With Candor and a Dash of Empathy
Nicole Glenn thrives on chaos and enjoys creating solutions on the fly that make someone else—her customer—into a hero. “Customers call with their hair on fire,” says Glenn, founder and CEO of Candor Expedite in Plano, Texas. “A shipment got routed incorrectly, someone missed something. When I tell them we can make it happen, it’s rewarding to hear their sigh of relief.” Glenn founded Candor—a logistics company for time- sensitive shipments—in 2017. We talked with her recently to learn her history and how she’s leading Candor into its next stage of growth. IL: Why have you made transportation your career? I fell into it as an administrator, but then I found I loved the opportunity to talk with people. Back in 2000, we still did a lot of our work over the phone. I enjoyed crafting relationships that way. I had friends—trucking company owners—all over the country who would call me when they had shipments. Now, I don’t think I could work in any other industry. I’m too used to the fast pace. IL: Tell us about an event that helped to shape you as a leader. I worked for many years as a transportation sales rep. There’s a mindset in that role that you should hustle to get as much freight as you can and increase your commission check. When I was asked to become vice president, I almost turned it down because I’d trained myself to constantly ask, “What’s next?” Leadership requires slowing down to think about the next step in the company’s journey, and slowing down wasn’t my style. But I took the position, and soon fell in love with managing people, figuring out how to help them grow. I went from having to be selfish to having to be selfless. Now that I own my own company, I get to do that every day. IL: What changes have you seen in Candor’s business since the start of the pandemic? In 2020, things went into radio silence for about five weeks. Then we started transporting some new commodities, such as hand sanitizer and respirators going into New York City. After a while, as e-commerce grew in importance, we started a new division that helps business-to-business companies with
Nicole Glenn Founder and CEO Candor Expedite
While she thrives on the fast pace of transportation and logistics, Nicole Glenn also knows how to slow it down when it comes to growing her company thoughtfully.
by Merrill Douglas
14 Inbound Logistics • November 2022
LEADERSHIP
IL: What’s the hardest aspect of your job? Knowing only what I know. I’d like to have the answer for everything. Making sure I’m coaching my team in the right way is a challenge. To keep reiterating our core values, our mission, our vision for where we want to bring this company, is hard. So is generating new ideas and executing them. IL: If you could have lunch with anyone, who would it be? I’d like to hear Brené Brown’s ideas on vulnerability and putting yourself out there. I’d also like to talk to Warren Buffet, to learn how he became a serial entrepreneur. I’m so passionate about my business, it boggles my mind to know that someone has such a huge portfolio of companies that all run successfully. I’d also want to hear about his philanthropy. IL: Outside of work, how do you like to spend your time? I’m one of the founders of a podcast for women in business called the Ladies Leadership Coalition (LLC). We are six women who own businesses focused on logistics. This project has given me the chance to meet some amazing people and hear their stories. I also have three kids—twin boys who are 13 and a 17-year old daughter. I try to spend quality time with each of them, one-on-one, whether we drive go-karts or take vacations. One unusual fact about me is that I like to crochet. It’s good stress relief. My mom, my daughter, and I sit down together, get our needles out, and talk. n Wisdom to Share Looking for leadership advice? Nicole Glenn has a few suggestions. The first is a book called The E Myth: Why Most Businesses Don’t Work and What to Do About It , by Michael E. Gerber. “It helped me through that pivotal moment when I went from the operations side to running and growing a business,” Glenn says. “It explains how you need to trust others, build a solid plan, share your vision, and keep people going on their paths.” Next is Brené Brown’s Dare to Lead podcast, where guests describe how they’ve overcome obstacles to achieve their goals. And then there’s Extreme Ownership: How U.S. Navy SEALs Lead and Win , by Jocko Willink and Leif Babin. “It’s about being very intentional, owning both the good things and the bad things that happen, and always working to be the best leader you can be in an organization,” Glenn says.
final-mile service. We also started crafting creative solutions for customers with specialized needs. For instance, one shipper struggled to find refrigerated capacity. They typically moved one pallet at a time, but they were so desperate, they were willing to pay for an entire truck. We suggested an alternative solution we called “wrap and run”: we wrapped the product in insulation and delivered it without refrigeration to distribution centers within a 300-mile radius. We also considered putting the product in coolers. IL: What’s new and interesting at Candor these days? In 2021 we developed a time-sensitive truckload division that services a number of verticals. Responding to customer demand, we recently started to offer first- and final-mile solutions that are non-exclusive, which means we can put more than one customer’s product on the truck or van. Currently, we’re launching The Circle, an online platform where carriers offer quotes to shippers who need expedited capacity. Our goal is to get a price and a truck back to a customer in 10 to 15 minutes, with all the details confirmed. IL: What characteristics make you an effective leader? One is empathy. I try to put myself in other people’s shoes, to understand what they’re going through as I coach them. I also like to challenge people. If someone tells me they can’t do something, I try to instill them with the mentality that they can. They just have to break the process down into a series of steps. IL: How do you give criticism or correction when it’s required? It’s not by accident that my company is named Candor. I believe in being blunt and forthright when I express my expectations—with a dash of empathy. IL: What makes you excited to go to work each day? It’s watching this company grow from where it was in 2017. In the beginning, I was deep into the operations, moving freight alongside my team, getting dirty. Working remotely during the pandemic taught me that I have to trust my people. That allowed me to do other things I love: make new relationships, strategize about where the company can go, put people in uncomfortable new roles so they can grow. I’m also excited about the opportunity for constant learning.
November 2022 • Inbound Logistics 15
NOTED [ IN FOCUS ]
The Supply Chain in Brief
> GOOD WORKS
> M&A
• The National Tank Truck Carriers donated $2,500 to the St. Christopher Truckers Development and Relief Fund on behalf of Highway Transport driver Thomas Frain, who was
recognized earlier this year as the 2021-2022 Professional Tank Truck Driver of the Year Grand Champion. The fund helps support drivers who are out of work due to a recent illness or injury, and their families. • CSX Corp. is contributing $200,000 to support relief and recovery efforts underway in the Florida and South Carolina communities affected by Hurricane Ian. The funds will be split between the American Red Cross ($150,000) and Florida’s Disaster Fund ($50,000).
n SATS , a provider of air cargo services in Asia, acquired Worldwide Flight Services , the world’s largest air cargo handler, to create a global air cargo platform with a network of stations across Asia, the Americas, and Europe. n Millwood added its first facility in Texas and 34th location nationwide by acquiring Austin Pallet Company . The acquisition enables Millwood to expand distribution of its custom crates and new and recycled pallets. n Imperial Dade, a distributor of foodservice packaging and janitorial supplies and printing paper, acquired two companies: Dees Paper Company and Boudreault Packaging, both distributors of janitorial sanitation and foodservice products. n Baylor Trucking, a truckload carrier with 200 trucks and 980 trailers, is now part of Werner Enterprises, one of the nation’s largest transportation and logistics companies. n To help grow its North American market share and geographical footprint, logistics service provider DB Schenker acquired USA Truck , a capacity solutions provider.
> UP THE CHAIN
• Hostess Brands appointed Adrian Poretti chief supply chain officer to oversee the sweet snacks company’s operations and supply chain. His previous experience includes nearly 30 years at Kimberly-Clark, where he most recently was vice president, global supply chain capabilities.
• Sam’s Club named Matt Connolly vice president, supply chain, distribution. Previously, Connolly spent more than 30 years at Clorox in positions including vice president of global operations and logistics.
• Greg Schwendinger joined American Airlines Cargo as president. His airline and business background includes more than 15 years of experience at American, where he has held various roles leading teams across the airline.
• West Hutchison is the new president and CEO of Vertical Cold Storage, a developer and operator of temperature-controlled distribution centers. Hutchison brings 25 years of experience growing temperature- controlled businesses. Most recently, he was senior vice president of network optimization/M&A for Lineage Logistics.
16 Inbound Logistics • November 2022
NOTED
> SEALED DEALS
> GREEN SEEDS
n DHL Express will invest more than $11 million in Canada to update its ground fleet with 110 electric vehicles over the next 12 months. The investment includes the vehicles, charging stations, and other related infrastructure. DHL Express will deploy the first 10 vehicles by the end of 2022 in Montreal.
• Canadian healthcare products manufacturer and distributor A.M.G. Medical
recently implemented a cloud-based distribution ERP and a warehouse management solution, both from supply chain management software company Tecsys. The solutions provide A.M.G. Medical’s headquarters and distribution center with a scalable platform that accommodates business- critical complexity and drives financial performance.
n A.P. Moller-Maersk continues its green fleet transformation by adding six large ocean-going vessels that can sail on
• Global digital sports platform Fanatics tapped crowdsourced delivery platform Roadie to deploy a new retail logistics solution, delivering from
green methanol. Hyundai Heavy Industries will build the ships, which will have a nominal capacity of approximately 17,000 TEU containers. n Pacific Drayage Services (PDS), part of marine drayage firm IMC Companies, is adding six Volvo electric trucks to its fleet in 2022. PDS will deploy these Class-8 battery electric vehicles in Southern California as part of its goal to run carbon-free drayage operations by 2030.
warehouses directly to consumers. As a result, customers in several U.S. cities can order sports team gear using local next- day delivery. • The Timpson Group , a UK and Irish retailer with more than 2,100 stores offering shoe repair and other services, teamed up with package logistics and asset tracking firm Position Imaging to offer a self-service package pickup solution in stores. The new AI-based iPickup Courier Access Point helps the retailer capitalize on demand for in-store pickup and drop-off services.
> RECOGNITION
• Echo Global Logistics received two workplace accolades. The company, a technology-enabled transportation and supply chain management provider, was recognized as a great place to work by Chicago’s 2022 Best and Brightest Companies to Work For, and was also selected for the Chicago Tribune 's Top Workplaces list. • Avetta , a supply chain risk management software provider, received the Gold Stevie Award in the supply chain management solution category at the 19th Annual International Business Awards. The company was chosen from among more than 3,700 nominations for its innovative approach to reducing supply chain risk. • The American Logistics Aid Network honored four companies with its annual ALAN Humanitarian Logistics Award: GP Transco, Fleet Advantage, SEKO Logistics, and Vector Global Logistics . The companies were selected for their assistance during disasters like the recent flooding in Kentucky, COVID-19, and the war in Ukraine.
• Tea company ekaterra , which manages brands that include TAZO and Lipton, has selected the Kinaxis RapidResponse platform for supply chain planning to create transparency across its supply chain and empower planners to make informed decisions based on up-to-date data.
• Fashion firm Zalando is upping its use of TORU, the mobile, intelligent picking robots from German manufacturer Magazino . A
new deal brings Zalando’s fleet of TORU robots to 57; the new units will be used for picking processes at two Zalando warehouses in Italy.
November 2022 • Inbound Logistics 17
TAKEAWAYS Shaping the Future of the Global Supply Chain
LAND OF THE LOST AND OTHER PEAK SEASON CHALLENGES A whopping 92% of merchants surveyed by UPS Capital report costly impacts to their business as a result of lost, stolen, or damaged shipments. Half of merchants say they lost $50,000+ in the past year. As peak season arrives, and more packages hit the road, businesses and carriers are becoming more aware of shipping mishaps in the delivery experience—and for good reason. These incidents range from traditional hiccups, such as late, lost, and damaged deliveries, to emerging threats like porch piracy, fraud, and climate-related issues. Among UPS Capital’s key findings on these emerging threats: • 61% of shoppers say they won’t order from a small or mid-sized business anymore after two or three delivery issues—meaning shipping incidents are not only damaging to a merchant’s reputation, but also damaging to the bottom line. • 75% of merchants experienced an increase in damaged, expired, or lost packages due to climate change over the past 12 months. • 37% of merchants report credit card fraud is a growing risk to their business, while 31% say that return shipment fraud—such as missing merchandise and altered labels and return addresses—significantly impacts profitability.
How Macy’s Avoids Inventory Glut Retailers across the country are struggling with inventory pileup due to 2021’s massive supply chain delays. Unloading these previous-season goods has become a top priority for the upcoming holiday and winter season. But Macy’s is singing a different tune: the retailer managed to avoid most of this inventory glut, and reported to the Wall Street Journal that more than half of its offerings for the holiday season will be new. Macy’s inventory was up just 7% at the end of its most-recent quarter compared with a year earlier. Counterparts are not faring as well— inventory jumped 48% at Kohl’s, 44% at Nike, and 37% at Gap Inc. How did Macy’s do it? Analyzing credit-card data earlier this year, the company noticed changing trends in spending patterns and, in response, cut orders and shifted inventory. Execs from finance, supply chain, merchandise, and planning departments decided together to move away from the pandemic big-sellers like comfy clothes and home décor items and instead increased orders of dresses, suits, and shoes for a return to office and formal wear. Also helping Macy’s is the fact that it does not rely as much as other retailers on private-label goods. This makes it easier to adjust inventory nimbly. Also in store: Macy’s is building its first automated fulfillment center. Located in China Grove, North Carolina, the 1.4m-sq.-ft. fulfillment center will account for nearly 30% of Macy’s digital supply chain capacity and serve customers nationwide. The facility will be equipped with automation technology to increase capacity and productivity to help drive digital sales growth.
18 Inbound Logistics • November 2022
TAKEAWAYS
• Top operational concerns when trying to fulfill contracts include: • Rising costs (46%) • Product issues from suppliers struggling to meet demand (43%) • Logistical challenges when implementing new supply chains or contingency planning approaches (43%) Survey respondents report turning to four key approaches to mitigate these issues: 1. Strengthening existing relationships. 83% of manufacturers are investing in their existing supplier relationships as part of their overall supply chain investments. 2. Diversification of supply chains. 81% of manufacturing executives are also working to engage multiple suppliers. However, they still struggle to implement regional diversification of suppliers, citing cost as the primary concern. 3. Implementing digital solutions. 78% say using digital solutions and/or monitoring tools enhances visibility and transparency through the supply network, and 76% plan to do so. However, 88% report concerns about legal, financial, privacy, IP theft or cybersecurity due to digitized supply chain ecosystems. 4. Returning to a just-in-case inventory approach. 65% of manufacturing executives are shifting from a just-in-time approach that capitalizes on lean inventory investment to a just-in-case approach to mitigate any upcoming issues. CHALLENGES THAT HAD THE BIGGEST IMPACT ON MANUFACTURERS’ SUPPLY CHAINS IN THE PAST 11-18 MONTHS
Supply chain disruptions over the past 12-18 months—including shipping delays and parts shortages due to truck driver issues and congested ports—have heavily impacted manufacturers ( see chart, right ). That’s the consensus of Deloitte’s new study, Meeting the Challenge of Supply Chain Disruption , which was conducted in partnership with Manufacturers Alliance. MANUFACTURERS FEEL THE DISRUPTION BURDEN TOP OPERATIONAL CHALLENGES
Rise in shipping cost
46%
Product issues from suppliers who are struggling to meet demand
43%
Logistical challenges while implementing a new supply chain mode or contingency planning
43%
Continued shortage of critical parts
41%
Cost challenges while implementing a new supply chain mode or contingency planning
40%
Limited availability of suppliers to form new relationships with
59%
Shipping delays
40%
Inability to fulfill ongoing contracts
31%
56%
Part shortages
Excess or obsolete inventory due to inaccurate forecasting
31%
56%
Transportation delays
Limited ability to diversify suppliers
30%
53%
Talent shortage
Uncertainty in consumer demand
27%
50%
Restricted supplier network
Source: Deloitte analysis of 2022 manufacturing supply chain study data
The study surveyed more than 200 U.S.-based manufacturing executives to examine how traditional manufacturing supply chains are evolving to balance costs, efficiency, and resilience. Findings include: • 80% of respondents have experienced a heavy supply chain disruption in the previous 12-18 months.
46%
Cyber risk failure
41%
Supplier bankruptcy
Excess inventory
41%
Source: Deloitte analysis of 2022 manufacturing supply chain study data
November 2022 • Inbound Logistics 19
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