Is Software the Key Differentiator for Customs Brokers and Freight Forwarders?

ocean freight linerHaving worked in the near to saturation industry of Customs Brokerage and Freight Forwarders; I have always found it difficult to make my company stand out form other 3PL service providers. Every Customs Broker or Freight Forwarder essentially does the same thing – that is, they move they cargo from one place to another. So what is it that differentiates one Customs Broker / Freight Forwarder from another?

I ran a LinkedIn discussion on this topic and was amazed to see the responses from the group, which comprised of Customs Brokers and Freight Forwarders. Responses ranged from good customer service to deep knowledge . Let us assume that a particular service provider has excellent customer service staff and also people with in-depth industry knowledge. If those people don’t have tools to exercise their knowledge or customer support how would they fare on the scale of their clients?

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London Olympics cause fewer logistics problems than anticipated

Team_GlobeIn the run up to the 2012 London Olympic and Paralympic Games, the logistics trade press was full of doom-mongering statements predicting Armageddon for businesses and consumers, who were expected to experience extreme delivery interruptions for the duration of the events. But the great disruption seems not to have happened.

I wonder how much of this was due to better planning by logistics providers, and how much was due to low expectations from consumers?  On one hand, Logistics Service Providers certainly had enough notice of the event, and four years should surely be enough time to prepare for the road closures and traffic exclusion zones that go hand-in-hand with any major event, and even for the widespread ‘Olympic Lane’ disruption which is unique to this one.

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The logistics world continues to consolidate…

ocean freight_nightHaving been away on vacation recently, I’ve been catching up on industry news and it struck me just how long it’s been since the weekly logistics news updates I subscribe to didn’t feature at least one story on an acquisition of a transport company, freight forwarder or warehouse operator by either a regional peer or an international heavyweight.

Of course, a degree of on-going M&A activity is usual and indeed healthy in a free market economy, but the prolonged global economic downturn has proved a catalyst for much more movement in this area than usual. I do wonder whether some of these ‘fire sale’ purchases will prove to be a good move for their new owners and customers?

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Click and collect: convenience for the customer, logistical complexity for the retailer

parcelAs we move firmly into the peak Christmas trading period, a number of recent reports have predicted that the number of customers opting to have online orders delivered to a collection point away from their home address is set to soar. It seems that click-and-collect from store is often more convenient than having to wait in for a courier in order to sign for the goods, especially when not all give delivery windows of an hour or two.

However, this trend could well cause a few headaches for multi-channel retailers who have taken advantage of the opportunity to offer a wider range of products with lower fulfilment costs, and cash-flow advantages in offering goods via direct despatch from the supplier to the customer. However as click-and-collect becomes more and more popular and expected as standard, many retailers will have to address the issue of ensuring a seamless service to customers, regardless of the channel the goods were ordered from.

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iPhone 5 – production delays another blow to the logistics industry?

Air FreightThe Apple iPhone 5 has been released to great fanfare, with initial distribution reported to cover 31 countries, a huge increase on the initial 7 countries that received the iPhone 4S in 2011. Apple’s new baby is much-anticipated by techno-geeks and logistics professionals alike, as the former look forward to getting their hands on the latest piece of kit, whilst the latter hope the inevitable consumer rush to be early adopters will create a much needed surge in shipments to meet demand.

It says a great deal about the state of the global economy in recent years and in particular the fortunes of the global logistics industry to date in 2012, that so much emphasis is placed on the launch of an updated version of an existing product by one manufacturer. Freight forwarders in particular have been looking to the demand surge expected around the iPhone 5 launch to help rates and volumes along some way to recovery and the launch is expected to make a material difference to US growth figures.

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BYOD – win:win for improved supply chain collaboration?

Files‘Bring your own device’ (BYOD) is the current buzzword amongst CIOs, with the number of employees using their own smart phone or tablet for work purposes expected to increase exponentially over the next decade. The appeal to businesses is obvious – reduced handset costs and staff who are almost permanently contactable. The debate rages on as to the suitability of BYOD, in terms of ensuring the security of customer and operational data and enforcing company IT policies, with even greater compliance concerns in regulated environments.

As consumers continue to embrace social media platforms for both work and pleasure and increasingly rely on the convenience of all-in-one data and voice technology, as employees they are becoming more and more particular about the devices they would prefer to use, even to the extent of providing their own. It’s not uncommon for employees to be happier to use their own device without any cost contribution from their company, than to have to carry two phones, for example, or to use a less prestigious brand.

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Economic cost of supply chain disruptions on the increase. Is the logistics industry doing all it can to mitigate disruption?

icebergLike many other logistics industry professionals, I wasn’t surprised to read this week’s headline figures from the 2012 16th Annual Third-Party Logistics Study (published by Capgemini Consulting, in cooperation with Penn State University, Korn/Ferry International, and Panalpina), which reported a 465 per cent increase in economic losses arising from supply chain disruptions from 2009 to 2011.

The timeframe scrutinised by the report covered two major environmental incidents that went way beyond the usual bad weather and more extreme environmental conditions that already strike fear into the logistics planner. Those incidents where the eruption of ash from the Eyjafjallajökull volcano in Iceland in 2010, which disrupted air cargo for several weeks, and the 2011 earthquake and tsunami which hit Japan and affected the surrounding areas, causing major supply chain disruptions affecting all modalities.

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Golden week hangover for logistics services providers?

Paper FilesAnd so China is back to work after the week-long Golden Week public holiday. And whilst the vacation may have proved profitable for retailers and the tourism industry, with early figures suggesting healthy increases in spending and visitor numbers (retail sales up 15 percent on 2011 according to the New York Times), the ‘hangover’ is not necessarily so much fun for the logistics industry.

Long periods of shut-down (also common in parts of Europe with high-summer factory closures) inevitably create backlogs when everyone does get back to work. There will be workers at the offices of logistics service providers all over China putting in very long hours over the next day or so, to catch up with requests that stockpile from the holiday week. Ports and airports that were manned by skeleton staff will have mountains of paperwork to wade through.

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Lack of commercial property development during global downturn hampers logistics service providers’ expansion plans

Despite continuing pressures on volumes and rates, the indicators of recovery amongst logistics service providers are growing stronger, with announcements of M&A activity, new routes and new partnerships.

The signs are encouraging, but growth may yet be curtailed by the lack of commercial property development during the darkest days of the global economic downturn. Whilst half-finished residential property schemes are conspicuous throughout the urban landscape, new commercial property developments are conspicuous by their absence.

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Logistics Service Providers (LSPs) to use social media to connect with customers and partners

As a great fan of social media for business and pleasure, I’ve been keen to see it used more widely in logistics, and I can really see how Twitter in particular could be a very advantageous method for LSPs to communicate with their customers and partners. By simply publishing status feeds, anyone who is interested would be able to access the information they need. Here’s how it would work.

Logistics Company X use transport management software (TMS) to manage its operations. If that solution is web-based and operates in Service-Oriented Architecture (SOA), like Kewill’s TMS, it’s simple to configure it to create a feed that posts to Twitter every 30 minutes (current Twitter limitations), with an alternative RSS feed option created simultaneously, offering LSPs an alternative to Twitter which is updated in real-time.

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Why Visibility is Top Priority for Supply Chain Managers?

BinocularsI was at SCOPE (Supply Chain Operations Private Exposition) in Dallas, TX 2 weeks back. SCOPE is one of the most respected forums where 500 of the Supply Chain industry’s most influential executives meet for 2 days of educational sessions, software solution research and peer networking. I got an opportunity to meet at least 50 delegates over a 2-day period and a recurring theme with almost all of them was the need for visibility in their operations.

One interesting conversation I would like to share on this blog further strengthens my conviction that visibility is the key to control the Supply Chain. I met a consultant from a company that had conducted a survey on top priorities for logistics operations. He told me they had interviewed 300 CXO level people who were responsible for logistics and supply chain functions in their respective companies. The interview had questions related to day to day challenges in their operations and asked them to list top 3 issues that they faced. The participants had to rank 3 challenges that they felt were most critical to their operations and affected their companies the most. The survey results were startling.

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Top 10 questions a Logistics Service Provider should ask potential TMS vendors

Trucks_BlueMany different types of organisations use, or would benefit from using, a Transport Management System (TMS), and there are many options on the market today. Yet choosing the best fit TMS for your business isn’t as straightforward as it may seem. The best fit, and the right choice, depends very much on the type of business you operate, and there are some marked differences depending on the scale and nature of your activities.

In theory, the same issues affect all businesses involved in the movement and management of goods, however there are some distinct differences between moving goods around for one company and moving goods for many, especially if you offer value added services.

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