With Christmas approaching, there is currently a very high demand period for Apple and Amazon. Both companies are in an ongoing battle over market share because both have many rival products, such as the iPad and the Kindle Fire. Any advantage Apple or Amazon can get over one another is essential going forward. Many supply chain executives believe one advantage Amazon’s has over Apple is its supply chain.
SCM World surveyed 1,136 supply chain executives and the results showed Amazon’s supply chain is “more admired” than Apple’s supply chain. There were four key supply chain attributes both companies were rated on – agility, collaboration, execution, and innovation.
For agility, 62 percent of those surveyed sided with Amazon, while 33 percent were in favor of Apple’s supply chain agility. 59 percent voted for Amazon when it came to collaboration. 31 percent voted for Apple. With execution, 57 percent liked Amazon compared to 38 percent for Apple. While surveyors were in favor of Amazon by a decent margin for the first 3 attributes, Apple dominated the vote for the last attribute. On innovation, Apple had 78 percent of the vote, while Amazon got just 19 percent.
In addition to the four attributes, 58 percent of respondents said in general they like the way Amazon runs its supply chain, while 38 percent were in favor of Apple’s overall supply chain. The results of the survey from over one thousand supply chain executives show Amazon is ahead of Apple when it comes down to managing the supply chain.
One of the most important aspects of customer service is not what companies do leading up to a purchase by a consumer, but how they respond to a customer that is unhappy with their product. There are many e-commerce companies that don’t spend the time and resources they should on reverse logistics. According to the article, 85% of consumers will not be a repeat buyer of an online retailer if the return process is a hassle. On the other hand, 95% of consumers said they would return to an online retailer if the process is convenient.
Some online companies don’t have a return process at all, while others have one but don’t give it the attention it deserves. As a result, customers become irritated because they have to go through a long process to return a product. Online businesses need to have an efficient reverse logistics process to have repeat customers and sustain growth. To do this, there are three factors companies should consider. The three factors are the return process should be easy to implement, cost-effective, and customer-friendly.
A way for online companies to change or implement a return process is to hire a third-party company. A third party provider would allow for a better understanding of the return process requirements and whether a new return process could help the business grow. A provider could customize the return process so it is tailored towards what the online retainer wants. In addition, it could be integrated with the retailer’s web site, so the customer can easily see how to return an item if necessary.
Managing returns across boarders is also important. The following is a list of questions for companies to consider when managing their cross-boarder returns process:
• How long will customers have to wait for a refund or replacement item?
• How can customers track items in the system?
• How can you monitor the rate of returns by the market?
• How can you manage stock re-integration?
Saddle Creek Corp. is a third party logistics provider (3pl) that has recently just finished construction of its own compressed natural gas station (CNG) at its headquarters in Lakeland, FL. It is estimated that the company spent $2.2 million on the investment in the fueling station. Saddle Creek Corp. has recently planned to invest in 40 new CNG tractors for its for hire fleet. The investment in these new CNG trucks are suppose to reduce for hire fleet by 103,000 pounds per truck. Saddle Creek Corp. plans to have 120 CNG tractors by 2013.
“The station will provide the fuel needed to help us put cleaner, safer, quieter trucks on the road,” said Mike DelBovo, Saddle Creek Transportation president. “ Not only does the new CNG tractors help Saddle Creek’s sustainability but also it reflects on their customers. The new fueling station is the first of its kind for a 3pl company in Florida. The station will be able to handle 120 trucks a day. The station will have both fast fill pumps as well as “time fill” pumps.
Carrier bid optimization tools allow companies to bid out different combinations of volume levels and lanes, analyze carrier bids, and then it selects the most optimal distribution of carriers for those lanes and volumes consistent with pre-determined rules and constraints. This tool will deliver conditional bidding which means if a carrier receives the business in a given lane that may be good for its overall network, it can offer a lower price in a different one. This works as a technology that you would never be able to analyze manually with all of the hundreds and thousands of combinations.
Dr. Chris Caplice and Dr. Yossi Sheffi, published research on carrier bid optimization. They found that using carrier bid optimization tools on average reduced their carrier base by 88% and final freight bills by 17%. Recently, IBM has combined two of its recent software acquisitions, which offers procurement-related software including bid optimization to provide a transportation-specific carrier bid optimization tool. The advantages to this include automating the tender and acceptance process, freight payments, a company can get tighter control over its transportation spend, and have a better understanding of the total freight bill.
Some of the concerns was how long it will take to prepare for a procurement event using these tools. It really depends on the event’s size and scale, but it can take 1-2 months to gather all the information needed to run the event. Then the opportunities are sent to the carriers, and they are usually given a few weeks to put their bids on it. Where a lot of the time savings comes from analyzing the data that comes back from these type of events, because optimization engine is able to do that for you, so you are not using spreadsheets.
Airfreight has recently taken an unexpected jump to space travel. On October 7, 2012 a privately owned cargo ship blasted off headed for the International Space Station. The cargo ship is to drop off thousands of pounds of supplies and return to earth with blood and urine samples, as well as other supplies. This is the first mission that is able to return materials back to earth. SpaceX has a $1.6 billion contract with NASA to execute 12 resupply missions to the Space Station.
Competition in the space travel sector is limited and the SpaceX is a unique ship because it is the only cargo ship that is able to bring back materials. Although other countries and US companies have began developing their own cargo ships. Other countries have made runs to the space station but are unsuccessful on returning with materials. SpaceX and NASA are working together to engineer a manned cargo ship that can also transport the space station crew back and forth.