Tag Archive: distribution

What’s Next in the Supply Chain?

August 10th, 2018

Our most successful clients always ask “What’s next?” as they want to stay ahead of the curve.  It is quite clear that staying on top of current trends and what is expected down-the-road is essential to successfully navigating your business to scalable, profitable growth.

For example, if you think your industry might develop a new way of servicing customers, you need to attack it quickly as you afford to be left in the dust.  Clearly, providing an exceptional customer experience is important but so is developing this new service method in a scalable, profitable way. It will be much harder if behind the eight ball. Are you thinking about what is next?

With our definition of the supply chain from creation to customer, there are countless topics to be thinking about when it comes to What’s Next:

  • New Products and Services: What new products and services will your customers want?  We have found that most customers (just like most of our clients) might not know yet.  You better be thinking about it and prompting ideas!
  • Suppliers: What new materials, components and supplies will you need to improve performance at a lower cost? (These win-win successes require innovation and collaboration.)
  • Transportation: What’s next in transportation?  Think of the relevance – from suppliers to manufacturers, from manufacturers to manufacturers, from manufacturers to distributors, from distributors to end customers, from one facility to another facility, and so on.
  • Technology:  What’s next in technology as it connects each of these people along with equipment, and much more (think IoT) with data and information flows.  We find that this often-times can be the bottleneck to achieving scalability.
  • Manufacturing:  What’s next in manufacturing?  Even if you aren’t thinking about using 3D printing, you should be considering the impacts if your competition, your suppliers, your customers and more start using this additive manufacturing capability.  It is likely to impact every step of the supply chain. What else is likely to happen in your industry?
  • Distribution:  What’s next in distribution?  In your industry, what is essential?  To think about distribution, you must think about your customers’ needs.  You also should be thinking about the rest of your supply chain. For example, if 3D printing takes off, it changes the distribution model.  If e-commerce continues to be important, your entire setup would change if you are more traditional currently. Do customers want you to take over worrying about what to stock and where to stock it?  Perhaps you should suggest taking on VMI/ replenishment.
  • Customers: What’s next with your customers?  How about your customers’ customers? Are you even talking with your customers’ customers?  Do you understand the industry trends throughout your chain? If you aren’t getting out of your office with an internal focus, you won’t.  Who have you called lately? Who have you visited? Do you ask questions? Attend conferences?
  • People:  What’s next with your colleagues and partners?   Nothing else will be achievable if you don’t have the best people on the team.  It wasn’t that long ago we thought virtual meetings were a big deal. Now they occur daily.  (Remember, illennials often-times like coming into the office for the community – and prefer the Google-like environment.)

Thinking about what’s next can distinguish you from your competition.  Eventually, a decision will arise that requires this knowledge. If thinking of the future is part of your daily culture, you’ll pass by the rest!

 



Warehousing Strategies for Success

July 12th, 2018

The Amazon Effect is creating elevated levels of stress in the warehousing and distribution world. The key question is how to provide immediate deliveries, customized service, easy returns, and more for a reduced cost – a very good question indeed!

A few considerations to ponder:

  •  Storage capacity -What is your storage capacity?  How does that compare with your requirements?  And how can you maximize what you can store in your warehouse?
  • Flow – Are you running in circles around your warehouse to support your customers?  Similar to a manufacturing environment, flow can be an essential ingredient to warehousing success – or not.
  • Productivity – Have you automated what makes sense and will increase your speed/ throughput? If it doesn’t improve speed (and accuracy) to your customers, is it really more productive?  Similarly, is outsourcing truly more productive?
  • Equipment – What equipment is built into your warehousing strategy?  Would an upgrade provide a return on investment?
  • Data – Are you using predictive analytics and data analysis to make informed decisions to stay ahead of your competition?
  • WMS tools – Whether “poor man’s” or sophisticated, do you have a way to pick, put away and sort efficiently?
  • Inventory – Don’t ever forget inventory.  Without having the right product in the right place at the right time at the lowest system-wide inventory (and potentially end-to-end supply chain network inventory), what else will matter?

We have yet to come across a warehousing or distribution client that didn’t have at least a 20% improvement opportunity.  Have you looked into your opportunities lately?  Most likely your competition is!

If you need help thinking through your warehousing and distribution strategy, contact us.

 



APICS-IE Symposium & Key Take-Aways on GROWTH

June 14th, 2018

Supply Chain Briefing

Our APICS Inland Empire chapter hosted the 12th executive panel and networking symposium (over 7 years) on the theme of “Managing Rapid Growth when Manufacturing and Distribution are HOT”.  We had a fabulous panel (clearly enjoying the conversation – see below) of manufacturing and supply chain CEOs and experts.  Thanks to the APICS BOD and Kash Gokli and the Harvey Mudd team for putting on such a value-packed day!

Overall, we discussed the power of manufacturing and supply chain in today’s environment.  In the era of the customer, it is all about the customer experience, rapid deliveries, e-commerce and responsiveness.  From that point-of-view, Southern CA has enormous opportunity since it is larger than all but 5 or 6 states in terms of population – and customers/ consumers! We also have access to technology, high-tech skills and more.  The tax law gives us additional great advantages. The only downer is the lack of support from the state California.

In addition, the panel talked about ways to thrive regardless of your circumstances.  For example, Mirna Elnar (CEO of Regal Spas) wanted to sell into Brazil but ran into horrible tariffs.  So, she collaborated with a local Brazilian company to achieve success.  Several of the themes boil down to the following: Innovation. Culture. People. Technology. Metrics.

What Should We Consider and/or What Impacts Could Arise?
First and foremost, we are in the “right” fields – manufacturing and supply chain (along with related disciplines such as IT/technology and Organizational development) are HOT and there is vast opportunity.   However, we must take advantage of the opportunity and have a voice! Would we prefer to leave our future up to the California lawmakers (for example) or take a proactive approach? Certainly our panel encouraged us to be proactive.

Think about your supply chain: How are you positioned in comparison to your customers’ locations, your end users (consumers, patients, or the base player in your industry such as Boeing) and how well positioned are you to create value-added customer experiences?  What do you expect to happen in the future? Are you still positioned effectively? Are you prepared for growth?

One of the most common issues our clients call about is unexpected demand: Are your products and services going to be in the right place at the right time, in relevant ‘packaging’ (meaningful to your customers’ current needs) at the right margins and cash flow?

Many of these questions go back to aligning your demand with your capacity, starting with your people.   It takes a minute to lose a customer – and a LONG TIME to win them back.

Keep innovation and future disruptors top of mind.  The last thing any of us wants is to come up with the best strategies and plans that are outdated by the time they are implemented!  If you’d like to talk about performing an audit of your supply chain positioning, contact us.



The Amazon Effect Remains Hot

April 20th, 2018

Our marketing guru asked whether we should start talking about other topics aside from the Amazon Effect since there are a vast number of key topics occurring in manufacturing and distribution, and she wondered if it was becoming stale (and it’s her job to make us look at timely as possible). The answer came in from all angles – conference leaders continue to request this topic, news reporters continue to ask about it (including the Wall Street Journal in a recent conversation) and everyone is STILL talking about it.

For example, when the Ontario Chamber CEO mentioned this topic for Good Morning Ontario, it drew the largest audience to date!  Our Amazon Effect: Pass or Play: the New Sales & Distribution Game and How it Affect Manufacturers panel at the Manufacturers Summit was packed.  It was fun to participate with two heavyweights, BJ Patterson and Dan Vest talking about this hot topic.  Here is a short snippet from that panel:

                             

 Why is the Amazon Effect so compelling?

  1. We are in the year of the customer – According to the 2018 predictions by the Tech Girl in the Press Enterprise, the customer was a common theme.  You don’t have to read the paper to figure that out; just look around you. Every client talks about elevated customer expectations, stemming from Amazon-like offerings.  Even my Mom’s expectations have been raised significantly – 2 day deliveries are a bit slow in her mind now.
  2. Innovation trumps all – Amazon is constantly innovating and trying new ideas.  Testing drones, delivering food, leveraging technology (with their e-commerce site, in their warehouses and more), and even the classics such as Amazon Prime (one of the most successful subscription services). Are you innovating?
  3. Collaborating with strange bedfellows – From the start, we have been fascinated with Amazon’s collaboration strategies.  Starting with an entity known for the opposite of innovation, the U.S. Postal Service – Amazon has been partnering with them to provide deliveries. Did you ever think you’d see a U.S. Postal truck delivering on a Sunday? Whatever you think about the recent news on this topic, it is an interesting choice for a partner.  It has not stopped there. They are partnering with Kohl’s and Whole Foods – the Whole Foods CEO spoke at the APICS International conference (after the purchase) on the collaboration, etc.
  4.  Sheer size and impact – Amazon is bigger than most brick and mortar retailers put together.  As of Dec 2016, Amazon’s market value exceed Walmart, Target, Best Buy, Macy’s, Kohl’s, JC Penney, Nordstrom and Sears put together.  Currently their market value is $681 billion. In February, Amazon surpassed Microsoft for the first time. Thus, it is worth paying attention.

Are you paying attention to the Amazon effect?  You should be! If you’d like help in positioning your organization for success in today’s Amazonian environment and the year of the customer, contact us.

 

 



The Economy and the Inland Empire are on Fire!

April 17th, 2018

IE Forecasts
Since we attended not one but two economic forecast events last week (one hosted by Claremont McKenna and one hosted by the Inland Empire Economic Partnership), we thought it made sense to share the take-aways:

 

 

  1. The economy has never looked better especially in the Inland Empire – All the signs point up.  Even though folks are concerned about when the other shoe will drop, from an economic point-of-view, all appears positive.
  2.  Jobs at record levels with the Inland Empire leading California –  We are virtually at zero unemployment. Perhaps we need to be concerned about retaining our top talent!
  3.  Tax law is a boost for manufacturers! The Claremont McKenna economic forecast showed the progression and the definite boost from the tax law.  Not only is it increasing profit but it is also encouraging investment. It is likely to lead to interest rate increases as the Fed meets in 2018.
  4.  The Inland Empire is on fire!  First, did you know that just the Inland Empire is larger than 25 of the 50 states, let alone if we added the rest of Southern California?  It is leading California in many respects – job growth for one. And it is an attractive place to be in business, surrounded by tons of customers/ consumers, lower wages on average, more space availability at lower prices than Los Angeles and Orange County, access to a growing Ontario airport (with a new international direct flight to China soon) and with significant advances in technology and access to skills.We believe the IE is the place to be in manufacturing and distribution today! Amazon agrees since they have 21 of their 26 million square feet in Southern CA in the IE!
  5.  And a few cautionary comments…  There was a panel of CEO’s at the Claremont McKenna economic forecast that spoke about the California minimum wage hikes.  These are definitely not popular with manufacturers and distributors who utilize talent in the lower pay scales – challenging to compete with other states of course. At the IEEP, there was talk about the pace of automation and technology. From a profit, customer and competitive perspective, there are lots of advantages. In manufacturing, this is already prevalent and the impacts aren’t expected to be dramatically different.  However, in distribution, they are just getting started.  Although there are several positive points, it will be disruptive in terms of jobs and there will be a need to redeploy these blue collar employees.Lastly, trade can certainly impact the IE – stay tuned. In talking with two IEEP manufacturers, one said the tariffs helped, and the other said it could go well or really, really poorly depending on a few factors.

The IE is on fire and  growing!