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Logistics to Avoid the Toys R Us Trauma

For those not in the shipping business, news that Toys R Us filed for bankruptcy protection had the same effect as a surprise Gatorade bath. For the rest of us with experience in the logistics business, this was just the latest stark reminder of the long-running battle between retailers and online sellers.

It’s next to impossible to drive in urban and suburban areas without noticing the telltale signs of the ongoing struggle. Empty store fronts and going out-of- business sale banners have been popping up in some of the plazas and malls I drive by on a regular basis.

Still, the Toys R Us news comes just a few months before yearend holiday shopping begins in earnest. Many of the company’s woes are connected to it carrying billions in debt and spending hundreds of millions annually to service it.

Learning Logistics

But another part of its predicament seems to be supply chain related.

In an extensive piece chronicling the company’s challenges in the Wall Street Journal, Toys R Us CEO Chief David Brandon reportedly said in court papers that the firm had fallen behind some competitors and cited “our inability to provide expedited shipping options, and our lack of a subscription-based delivery service.”

Logistics intelligence can play a vital role in helping retailers survive in these tough times, and thrive. A flexible supply chain, powered by a solid transportation management system (TMS) can definitely be part of the solution for retailers looking to better compete with e-commerce companies for customers.

I’ve seen plenty in working extensively in the retail and ecommerce industries. I’ve been asked the following question countless times over the many years since ecommerce began.

How can a TMS help retailers?

-Implement technology to support business functions. The right TMS can help streamline the retailer’s supply chain. Logistics managers need visibility into their operations as well as the control to manage them in a way that knocks out inefficiencies, cuts costs and provides revenue opportunities.

-Less product in the pipeline. Once they have control and management of their transportation systems, retailers can adjust them so that they keep less product in the supply chain, which incurs reduces freight cost. The opposite – keeping more coming, is also a benefit as predictable peak demand periods approach.

-Improve the customer experience. How many times have we heard a sales associate tell us “we don’t have any more in the back room and I don’t know when the next truck shipment is coming in?” The right TMS can allow the retailer to take control of their inbound freight by providing visibility to all deliveries, ensuring on-time deliveries and reduced freight costs.

-Quicker delivery. E-commerce companies have earned props for quickly delivering product, and rightly so. But two can play that game. By using a TMS to shorten their delivery intervals, retailers can make sure they have enough stock on hand.

-Optimize your supply chain. For this, you need a TMS with a global logistics community, which is essentially a real-time, online members-only network that connects all these parties online so they can collaborate across supply chains to find the best (sometimes fastest) and least expensive means to get cargo from origination to destination and from destination to consumers.

The Road Ahead

Investing in technology to enhance and evolve the way you do business is the way to drive your company forward from a logistics standpoint. There are TMS options that don’t require a big spend on hardware and staff, or a long, drawn out implementation. You need a quick ROI as well as a system that gives you control, visibility and cost savings ASAP.

It’s well worth your time to check out a TMS built with the freight intelligence necessary to advance in the toughest of times. Think about that the next time you’re driving past a shopping plaza and see the sad signs.

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Irma, Harvey, a TMS and You

With Hurricane Irma ready to deliver the back half of a devastating one-two punch to the south in the days ahead, you’re freight intelligence will once again put your TMS to the test. For those whose operations weren’t effected by Hurricane Harvey, let’s review what we learned or re-learned.

State of Emergency. Whether it’s MASH episodes, war movies or your favorite emergency rescue show, priority one is to stop the bleeding. That means deleting zip codes that either the feds or the state’s emergency management agency have closed to deliveries (and pickups).

Supply Chain Revamp. After you learn what supplies are needed in the area affected by the act-of-God event, you need to do a bit of reengineering with your supply chain to locate the sorely needed freight and plan with your carriers how to get it on its way to help power the recovery effort.

Reworking your freight shipping to accommodate the impact of natural disasters is no walk in the park, but it’s a shorter one when you consider a robust TMS and its one-source for talking to all your carriers and viewing changes in real-time and acting accordingly.

No Manual? That’s opposed to the plight of shippers who still rely on manual processes that include visiting numerous websites for critical information over and over, sending emails, power dialing and faxing that waste time when you’re trying the hardest to be quick and flexible.

Real-time communications. As the recovery evolves, freight shippers can really use truck and freight tracking functionality to flexible manage their assets – that’s a fancy way of saying know where your trucks are and be aware of their every move.

Go Mobile. This is where mobile technology shines. In dark times, you can reach drivers and they can reach you using nothing more than a smartphone and a simply app download. Yeah, there’s an app for that and it can be part of your TMS.

Multi-modal. Cover all delivery options. We saw – and still see – with Hurricane, Harvey in Houston that in worst case scenarios even delivery beyond trucks wasn’t initially an option. You probably saw the ad-hoc navy of folks with boats hitting the water to deliver emergency aid to the hardest hit areas.

With this in mind, it’s best to have shipping options which means the ability to cover all modes of freight delivery – ground, air and ship – in a single system.  Many complex problems can be solved simply by using multi-modal freight shipping.

Post Event Assessment. Once things return to fairly normal, the freight shipper still faces a big challenge: figuring out the price tag for surviving the latest act of God. A well-equipped TMS can help you figure out the costs associated with reacting to a disaster.

Justify spends. While a strong TMS can help you better deal with acts of God and man-made disasters, you’ll find that adding muscle often means going beyond a base system to include integrations, special apps and even managed services. Though this requires new spending for those who aren’t bulked up to tackle tragedies, look at the costs you incurred in dealing with the very latest act of God.

Cost avoidance itself can help you justify additions and improvements to your TMS.

The Road Ahead for TMS

We’ve all heard the saying “proper preparation prevents poor performance.”  That’s all well and good but freight shippers and carriers with years in the business know planning for the unplanned is far easier said than done.

But a robust TMS will be able to lighten the load.

 

Interested in learning more about Kuebix TMS today?

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A Clear Industry View

Dan Clark_3274_reduced

Dan Clark, Founder & President, Kuebix

The logistics industry revolution has begun. Technology is empowering supply chain visibility, control and collaboration that was unimaginable just a few years ago. My experience dates back more than two decades when, while working as a supervisor at a major LTL carrier, I spent my days walking the dock and learning everything I could about freight. I quickly worked my way up in the industry and at the age of 28 I was regional director of one of the largest freight divisions in the northeast, and from there became a divisional vice president overseeing 23 terminals.

While at USF group, I helped standardize business process across five different LTL companies and worked with the IT team to develop software applications to automate these processes. Back in 2007, I saw the emergence of cloud technology, knew the impact it would have on logistics, and founded one of the first true cloud-based transportation management systems, Kuebix.

Today, companies are looking more than ever at opportunities in the supply chain to increase efficiencies and bottom line dollars. Over the course of my career, I have met with thousands of companies and almost all of them have shared a common problem – pain points in their shipping process. Many companies outsourced shipping to third party logistics companies (3PLs), which have come to play a huge role in the industry. However, emerging players fueled by technology are challenging their dominance. This kind of disintermediation is not a new phenomenon; we’ve seen the impact on the travel and movie rental industries to name a few. Remember going to Blockbuster on a Saturday night?

Don’t worry, trucking isn’t going anywhere. Until someone invents a device that transports packages through space and time, almost everything will continue to be moved by trucks. However, what is changing is the inefficiency of an old school industry.

I believe that complete supply chain visibility is paramount for business success in this evolving marketplace. In Supply Chain 20/20, I offer my industry knowledge, opinions, insights and predictions as we witness the evolution of logistics. I hope that you will join the conversation by sharing and commenting on my posts. The time is now for the logistics industry to change. Get ready to embrace the change or be left behind!