Visibility the Key to Keeping Pace with Increasing Supply Chain Complexity

After years of continuous physical expansion, with mega-stores and mega-trucks having progressively replaced their supersized siblings and expansion of retailers’ high street presence a critical measure of their success, the retail supply chain is now adjusting to a wider and more diverse variety of just about everything.

From channels, store formats, and types/sizes of vehicles used in the logistics process, in particular the critical last mile, success today involves rapidly adapting (often shrinking) to meet changing consumer and social habits (e.g. urbanization) and counter the associated issues. And much greater flexibility is required to deliver the necessary agility.

At the same time as mega-container ships were being introduced, motorcycle deliveries took on a key role in ensuring continuous supplies during travel restrictions applied for the London Olympics, with large municipalities including New York actively exploring the expansion of bike cargo.  And of course the news is full of the future potential of deliveries by drone, after Amazon’s announcement that it would be exploring this for local fulfillment.

Where 10 years ago, retailers were focused on out-of-town sites with ample parking and vast yards for receiving deliveries, now they are seeking small format stores to service the needs of single-person households picking up a few groceries on the way home and looking at the multimodal potential of new distribution centers.

The retail supply chain is definitely getting more complex, so it’s no surprise that the logistics industry has also evolved dramatically in recent years, and even the industry terms have begun to change. What used to be called a “warehouse,” is now known as a “delivery center or node” and is often referred to as a “fulfillment center,” aligning with the emerging trend of omni-channel and associated need for speed. In the past, it was sufficient just to have visibility into the pallet or case level, but shippers are now faced with the issue of “eaches” or “Single line Orders” as it becomes increasingly imperative to be able to work with multiple carriers, diverse networks, modes of transport and fulfillment models.

With more controlled or regulated and high-value items such as pharmaceuticals, dual use, and electronics being shipped around the world, shippers are now more accountable than ever and need to know the exact location of each item – down to the individual device. They are expected to utilize whatever means necessary to get goods where they need to go within the desired timescale and provide continuous notifications and alerts to the consumer about where each item is in the delivery lifecycle.

In addition to needing visibility into the location of inventory, shippers also need to determine the best mode or method of shipping that inventory, which may now come from a store directly to the consumer, direct from the manufacturer or from a fulfillment center to the purchaser. 

Omni-channel fulfillment and direct shipping options have created even more factors that need to be taken into consideration and without visibility into all of the data about the various shipping options, it is difficult to make the right decision for the business. Equally, without all-round visibility into goods under shipment, it is difficult for LSPs to meet their customers’ – and in turn end purchasers’ – demands to comply with increasingly specific delivery schedules.

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