MHI Blog -- Almost a third of U.S. executives at large manufacturers plan to add U.S. production over the next five years for goods sold in the U.S. These shorter supply chains will also rely on automation to improve efficiency and control costs, according to a new study by The Boston Consulting Group (BCG).
Even though China will remain a major exporter to the U.S., which accounted for around 18% of its total exports through the first eleven months of 2015, the suggestion that the U.S. has surpassed China as the most likely destination for new manufacturing capacity is striking.
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Tech Crunch -- The real goldmine for Uber is in becoming the transportation backend for tons of other services, not just its own apps. Now this logistics layer strategy is coming to fruition through a partnership with Operator, the chat-based shopping assistant backed by Uber co-founder Garret Camp.
Together, Uber and Operator they could compete with Amazon’s massive warehouses by aggregating inventory for instant delivery from local shops that are closer nearby.
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The Wall Street Journal -- The Coca-Cola Co. bottler in Rio de Janeiro used to deliver crates of drinks in the city’s Copacabana area by truck until a parking ban forced the company to rethink its distribution strategy. The big cargo vehicles now arrive early in the morning, park at designated sites and transfer the goods to motorcycles that make the final delivery to customers.
Logistics changes like this will become more common in crowded urban centers around the world as local communities cope with growing congestion and companies develop new last-mile distribution models.
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Bloomberg -- Amazon.com Inc. is increasing its share of U.S. online spending during the holiday season, even as Wal-Mart Stores Inc., Target Corp. and other rivals seek to attract consumers with promotional sales and free deliveries.
Amazon took in 39.3 percent of e-commerce spending from Nov. 1 through Dec. 6, up from 37.9 percent during the same period a year earlier, according to Slice Intelligence, which gathers data through e-mail receipts of 3.5 million shoppers. You’d have to combine the Web sales of the next 21 retailers, including Wal-Mart, Target, Best Buy Co., Macy’s Inc. Home Depot Inc., Nordstrom Inc. and Costco Wholesale Corp., to match Amazon’s share, Slice data shows.
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Material Handling & Logistics -- The New York Shipping Exchange (NYSHEX), due to be piloted in January 2016, aims to overcome the chronic inefficiencies that afflict ocean transportation and add cost to global supply chains.
At MIT’s Center for Logistics (CTL) Supply Chain Innovation Summit 2015, Gordon Downes, founder and CEO of NYSHEX, explained the rationale behind the new market. He said, as reported by Ken Cottrill of MIT’s CTL, that container shipping changed in 2008 when the anti-trust immunity that groups of shipping lines enjoyed came to an end. As a result of that, extreme freight rate volatility has been a feature of the container trades.
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Industry Week -- The art of working capital management has declined since the 2008 market crash. The lingering low or no interest rate environment gave organizations little incentive to be disciplined in managing cash flow. Many have plenty of cash on hand or are unconcerned about debt, so they have let their cash management strategy muscles atrophy. This will undoubtedly come back to haunt them now that interest rates are rising and markets are becoming less forgiving of careless working capital management.
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As part of MHI view's ongoing video program, this new episode focuses on: Adopting Cloud Computing into the Supply Chain.
Mady Bricco, global logistics leader at Dow Chemical, discusses how her company has used cloud computing technology as a massive growth opportunity.
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Supply & Demand Chain Executive -- Sustainability was a major topic of conversation for businesses and the media over the last couple years. Today, consumers are willing to put their money where their morals are, but organizations have yet to do anything about it.
Consumers will often pay more and wait longer for products they buy to be delivered sustainably, but a new West Monroe Partners survey of North American supply chain executives found that half (49 percent) don't consider sustainability a strategic priority. To that end, only 36 percent of supply chain leaders have plans to incorporate sustainability into their operations and, of this group, 22 percent plan to do so in the next three years.
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EBN -- Just when you thought you had seen it all on Black Friday and Cyber Monday, this year's version of holiday shopping is again being reshaped by changing consumer e-commerce buying habits and retailer fulfillment strategies. While shoppers may be happier, early indications show that retailers may see a lot of profit "coal" in their Christmas stockings this year, and that they are still chasing consumer delivery expectations.
According to the Wall Street Journal, many retailers did not enjoy the Black Friday success of previous years as consumers chose to "cherry pick" heavily discounted items and not buy other goods at the same time. Cyber Monday was a different story, but also not necessarily the one retailers expected. While sales volume was up, revenue per order decreased, especially for those orders placed on mobile phones.
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Maritime Executive -- China's cabinet has approved the merger of its two biggest shipping conglomerates, China Ocean Shipping Company (COSCO) and China Shipping Group Company (parent of CSCL), in the government's latest effort to make the industry more competitive globally.
The combined entity would become the world's fourth-largest container shipper, with a market share of roughly 8.1 percent. That would be far behind AP Moeller-Maersk A/S, Mediterranean Shipping Co SA and CMA CGM SA.
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Supply Chain Brain -- By using adaptive software tools, you not only can lengthen the life of your existing WMS products, including legacy systems and systems no longer supported, you now can have all kinds of new functionality at your fingertips.
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Supply Chain Digital -- The recent Paris attack reminded the world that terrorism can hit at any time, any place. The response of governments has been to increase security in public spaces – and rightfully so. But what if these same terrorists would attack supply chains instead? Hitting just a few strategic targets in the energy trade, for example, could bring the entire global economy to a halt. To avoid such disaster, companies and governments should be more aware of this perceived "low probability threat", and develop the tools to protect their economic interests and those of the world.
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Material Handling & Logistics -- Profits this holiday season are facing challenges. For companies doing business both online and in store, out-of-stocks, overstocks and returns are costing retailers $1.75 trillion a year, as reported by Krystina Gustafson, of CNBC.
According to a study commissioned by IHL Group, "out-of-stocks" accounted for $634.1 billion in lost retail sales for the year ended in the spring — 39% higher than in 2012.
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MHI’s new Career Forum enables manufacturing and supply chain professionals to view current job postings of MHI member companies. Go to http://www.mhi.org/careers to find the perfect opportunity for you.
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Logistics Viewpoints -- The Internet of Things (IoT) offers the potential to enable industrial organizations to improve performance and enhance competitive advantage — not only in an individual facility, but across company’s supply chain and throughout its value network.
Without a doubt, IoT "things" – industrial smart devices that connect to the Internet and can collect useful data – will greatly outnumber people within a decade. Consider that IoT things can include a company’s transportation assets, industrial equipment, products made, and even the containers that carry products across a supply chain.
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Modern Materials Handling -- It’s service attributes, not product characteristics that are driving purchases of packaging containers, materials, equipment and supplies, according to research conducted by Priority Metrics Group (PMG).
The company has conducted more than 40 proprietary research projects on behalf of packaging suppliers (materials, containers, equipment, supplies) over the past two decades. After interviewing more than 4,000 purchasers, PMG has been able to identify a consistent pattern. The objective has been not only to identify how buyers of packaging rank performance, but also to determine which of the categories are of higher importance.
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Green Biz -- 2015 has been a breakthrough year for retailers’ supply chain transparency programs. When pressure from retailers’ own investors and Boards combines with existing and proposed legislation (consider the California Supply Chain Transparency Act, the Dodd-Frank Conflict Minerals Rule, the U.K. Modern Slavery Act 2015, and the Business Supply Chain Transparency on Trafficking and Slavery Act), transparent supply chains are driven to a top-level priority.
The outcome of these pressures is that retailers are forging new and deeper relationships with their suppliers to address both social and environmental challenges through increased transparency. What is transparency in the context of retail supply chains? It is the sharing, whether publicly or between business partners, data and information about business practices, policies, operations and more.
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