COVID: a turning point for supply chain complexity?
SKU proliferation has become a fact of life for companies constantly looking for ways to improve market share by finding ever-more narrow market niches with personalisation, increases in package size options, line extensions, languages, or flavours.
Supply chain managers have struggled for years to bring attention to the costs of product complexity. All manner of activity-based costing, zero-based budgeting, and SKU profitability analysis usually results in simplicity programs that struggle to gain traction. This is because it is difficult to convince internal profit & loss (P&L) owners to forego real, tangible gross margins in exchange for indirect savings that are difficult to quantify.
But, at a minimum, the experience of companies that have successfully leveraged simplicity for market share and revenues during the pandemic will serve as a powerful argument in favor of at least some supply chain simplification.
No one would advocate that the egg or flour supply chains should relinquish the massive benefits of their dedicated supply chains. These efficiencies have enabled lower food prices enjoyed by millions of consumers. But the experience of Barilla and others shows that perhaps companies would be wise to understand that bringing complexity into supply chains does come with a very real cost, and the reasons for introducing inflexibility should be compelling and real, even if the economic equation can at times be difficult to quantify. Supply chain managers would be wise to consider citing these examples when faced with skepticism as to the cost of complexity and benefits of simplicity.
It will be interesting to see just how product portfolios evolve in the near future. Perhaps we can do more with less. Both from both a consumer and company point of view, COVID has helped prove the point.
Building business cases for Industry 4.0
Choosing a path through the myriad technologies that Industry 4.0 offers is hard enough, but with uncertainties generated by the pandemic, perhaps the universe of viable options has become smaller and more manageable, and the business cases clearer.
After the tumult of the spring and a rebalancing act in the summer, companies are now entering another stage of deep uncertainty brought about by the pandemic.
Without a confident view of future markets and margins, many companies are understandably scaling back their capital investments.
For supply chain managers looking to maintain the momentum of their Industry 4.0 efforts, or looking for how to get some in motion, there is room for building a compelling business case in spite of the pandemic.
Market opportunity analysis
These times are unprecedented for many reasons, one of which is the huge spikes in e-commerce demand.
In response, perhaps it would be helpful to start making a set of tools able to provide quick improvements in online experiences: investments in order management systems (OMS) that allow for integrated omni-channel capabilities, customer databases and order status; and automated customer ordering utilities are the sorts of initiatives that may get traction.
There have been some articles suggesting that now is the time to leverage Artificial Intelligence (AI) to improve demand planning. However, AI is most effective when there is a historical database to learn from and exploit, to better predict the future. It is hard to see how it would be easier to build consensus for AI-based forecasting right now.
For demand planning, the dominant uncertainty argues for better collaboration between functions to improve visibility into trade inventories and sell-out. When demand planning is difficult, demand sensing is even more critical. This thinking also bolsters arguments for investments in supply-chain control towers and transportation management systems — two other ways to improve visibility.
If we can’t reliably predict the future, quick decision making and reactivity is the best we can do.
Some companies leading the way in tackling supply challenges during the pandemic by simplifying their catalogues and removing complexity. This creates an opportunity for big data and advanced analytics to help identify those products that make the most sense to keep and focus on — and to do so by looking at products over their whole value chain.
Indeed, perhaps the collaboration success stories we have seen can be a springboard to true end-to-end Sales and Operations Planning; a fundamental practice needed for using AI in Demand Planning.
There has never been a more critical time to be able to do scenario planning (for example, high/low sales ranges or further lockdowns) that must consider customers, consumers, production capability and raw material supply.
Opportunities facing manufacturing
One of the key variables in choosing which products to focus on was the need to maximise the use of production assets. Larger runs and fewer changeovers were a priority. This will surely not remain the case forever. However, it does create conditions for more ROI-based Industry 4.0 initiatives that emphasise efficiency, such as automated guided vehicles, logistics automation and co-bots.
Initiatives that help keep machines running and have tangible benefits, such as predictive maintenance or AI vision recognition for quality assurance, are also good fits in the current moment.
These capabilities — given that they are more removed from the strategic business drivers of other Industry 4.0 technologies — offer another dimension of appeal. At some point, the pressures around supply-chain resiliency may lead to tangible incentives designed to push companies to onshore production. Capital investments that lower operating costs will be particularly attractive, and those companies that have always moved in this direction will be better positioned to act quickly and reconfigure their supply chains.
Another day at the grindstone
With e-commerce and market uncertainties currently at the forefront of supply chain executives’ minds, now may not be the ideal moment for most companies to exercise ambitious strategic capabilities. For example, making the case for initiatives like product personalisation is more challenging in the current moment of catalogue decomplexifying and demand questions.
In the same vein, network-scale initiatives such as Blockchain traceability or 3D printing fat-tail products are likely not going to be targets for investment.
At the factory level, augmented reality maintenance tools or digital twins could well prove to be the sort of initiatives better suited to capital investment when the horizon is clearer and confidence is higher.
Making the case for Industry 4.0 initiatives is already a fraught exercise of blending business drivers, building business cases and managing change. In a time when uncertainty rules, change is even scarier and capital investments harder to come by. But perhaps there is a way to continue forging ahead by being opportunistic and leveraging the constraints of the pandemic into new capabilities.
The Federation of Freight Forwarders’ Associations in India (FFFAI) held its 6th EC Meeting for the term 2021-23 on May 27 and 28 in Bengaluru. The meeting was attended by the Office Bearers and 28 Member Association representative of FFFAI from across the country, there were many issues discussed and updates provided concerning customs, CBLR, EDI, Service Tax/GST, logistics, air cargo, sea cargo, skill development,importance of social media which FFFAI has expanded recently, technology developments, etc. The special focus of the 6th EC meeting was the updates on forthcoming 24th Biennial Convention of FFFAI to be held from August 12 to 14, 2022 in Chennai with the theme LOGISTICS RESHAPE, EMBRACE AND SURGE IN THE DIGITAL ERA. At this EC meeting, FFFAI also implemented Digital Learning platform for members and next generation for e-learning. It has been decided that FFFAI would initiate FIATA eFBL here in India to benefit the trade, which empowers customs brokers, freight forwarders and logistics service providers. In addition, updates on the recently held FIATA HQ Meet was also provided by the concerned members of FFFAI. FFFAI members present at this EC meeting stressed upon enhancing productivity on ICEGATE for trade facilitation and Ease of Doing Business. The FFFAI members also urged for creating a dedicated portal for LSP integration. As regard to skill development initiatives, IIFF’s (training arm of FFFAI) past and forthcoming training programmes (both online and classroom/physical) for the entire logistics industry were presented at the EC meeting. In addition, FFFAI’s various initiatives on capacity building through technology/IT also discussed withadequate importance. Recent activities of FFFAI Women’s Wing including organising interactive meetings with Government of India officials and industry experts were highlighted at this meeting which drew huge appreciation from the members. The members committed to expand the activities of the Women’s Wing in all the 28 member association locations to empower/encourage the women logistics practitioners. At this EC meeting FFFAI has signed an MoU with the National Institute of Industrial Engineering (NITIE) with an objective of skilling the aspiring candidates looking for opportunities in the logistics sector. Notably, a special session was organised at this 6th EC Meeting where N Sivasailam, former Special Secretary (Logistics), Ministry of Commerce, Government of India was present to address the FFFAI members and highlight the recent initiatives of the government in strengthening the logistics infrastructure, thereby leading in increase of international trade through multimodal connectivity and faster cargo clearance. He projected the ambitious growth potential of the logistics industry in India with a strong collaboration between government and industry people. Also speaking on the occasion was Bani Bhattacharya, IRS, who interacted with members of FFFAI on various initiatives of CBIC for the trade facilitation without human intervention. FFFAI Chairman Shankar Shinde thanked all the 28 associations for their support and appreciated the contribution of CBIC/DG systems trade facilitation measures. FFFAI Member Associations are: 1. Ahmedabad Custom Brokers' Association2. Aurangabad Customs House Agents Association3. Association of Custom House Agents Thiruvanthapuram4. Bangalore Custom House Agents Association5. Brihnamumbai Custom Brokers Association6. Calcutta Customs House Agents Association7. Chennai Customs House Agents Association8. Cochin Customs Brokers' Association9. Coimbatore Customs House and Steamer Agents Association10. Custom Brokers Association Hyderabad11. Delhi Customs Brokers Association12. Goa Custom Brokers Association13.Indore Customs House Agents Association14. The Kakinada Customs Brokers Association15. Kandla Custom Brokers Association16. Kanpur Customs Brokers Association17. Ludhiana Customs House Agents Association18. Mangalore Customs House Agents Association19. Mundra Customs Brokers Association20. Nagpur Customs House Agents Association21. Nashik Customs House Agents Association22. Nadia Custom Brokers Association23. Pipavav Custom Brokers Association24. Pune Customs House Agents Association25. Rajasthan Customs House Agents Association26.Tuticorin Custom Brokers Association27.Visakhapatnam Cusotms Brokers' Association28.West Bengal Custom House Agents Society FFFAI welcomes Women in Logistics/Youth in Logistics to participate on FFFAI forums and also invites membership application form logistics service providers in industry as this is a big national and international forum to network.
Ecom Express Limited, India’s sole pure-play B2C e-commerce logistics provider as of the Financial Year 2024, has introduced a new brand identity, underscoring its commitment to customer-centricity. This rebranding reflects a focus on addressing specific customer needs, prioritising customer-facing metrics, and integrating innovative technology across its nationwide express logistics network. The goal is to enhance speed, agility, and network reach, ensuring a customer-focused approach. The rebranding includes a dynamic logo and a refreshed visual identity, symbolising Ecom Express’s pursuit of excellence. The new logo features a forward-moving arrow within a square, representing the company’s dedication to delivery. The letter "E" in the logo stands for Expression, Innovation, and Progress, while the bold magenta colour signifies bravery, self-expression, and strength. This vibrant magenta reintroduction reflects Ecom Express's renewed commitment to customers, partners, and team members, as the company aims to simplify and democratise logistics for all. Ajay Chitkara, CEO and MD of Ecom Express, elaborated on the transformation, stating, “Our refreshed brand identity reaffirms our customer-first approach as we continue to integrate technology and innovation to provide reliable, high-speed services with the widest network reach. This transformation also underscores our commitment to our employees and delivery partners, who are essential to our business.” The new logo embodies Ecom Express’s dedication to its core values, focusing on customer welfare and fostering a diverse, inclusive environment. This rebranding signifies a promise to redefine logistics through advanced technology, making life easier for all types of customers.
Delmos Aviation has transported the second lot of 300 units of oxygen concentrators from Russia to New Delhi for the Rajasthan state government. The consignment was airborne on an Aeroflot A333 aircraft (SU 232) and reached at 10:10 AM in New Delhi. The shipments were shipped by road and sent back to Swasthya Bhawan, Jaipur, Rajasthan Medical Services Corporation (RMSCL). RMSCL obtained oxygen concentrators from Russian companies together with Delmos Aviation. Delmos Aviation is procuring, transporting and supplying COVID-relied materials to the Rajasthan Medical Services Corporation with the mandate signed with the Rajasthan Government. There will shortly be two consignments with the remaining 800 oxygen concentrators. "We are ready to assist governments in the provision and delivery of any type of essential medical supplies, oxygen concentration and equipment as quickly as possible," said Dr Naveen Rao, Director, Delmos Aviation. "At this juncture, time-based deliveries are paramount. We can handle the airlift and deliver the shipment to the last point." In four lots, 100, 300, 450 and 400 units, a total of 1250 oxygen concentrations are ordered and continue to reach New Delhi in batches of shipments. On 14 and 16 May 2021, the remaining lots will arrive. Oxygen concentrators of Single flowmeter (0.5-10LPM Adjustable) and double flowmeter (0-5LPM Adjustable) are included in the delivery. The models are JAY-10A & LFY-I-5A. "The government of Rajasthan is working hard in this raging second wave of the pandemic to provide basic medical equipment to head Minister Ashok Gehlot and Minister of Health, Raghu Sharma. The government plans to import 1250 oxygen concentrators from Moscow, Russia, in partnership with Delmos Aviation, as part of its efforts to enhance medical oxygen in the state," said a spokesperson.
Omnichannel lifestyle brand The Souled Store has partnered with third-party logistics firm Emiza to manage its primary warehouse operations in Mumbai. The collaboration positions Emiza’s Mumbai warehouse as a central hub, managing orders from The Souled Store’s website, marketplaces, and offline stores across India. “This partnership marks a significant milestone in The Souled Store’s journey, enabling the brand to streamline operations and refocus on growth by partnering with Emiza as a trusted 3PL provider,” the company said. The strategic collaboration goes beyond standard logistics, providing services such as inventory management and order processing. The Souled Store has reduced its order processing time from 24 hours to just 12 hours, significantly enhancing customer satisfaction, a key factor in the competitive D2C market. Ajay Rao, Founder of Emiza, highlighted the value of the partnership, stating, “Their trust in our services underscores the value we bring, not just in warehousing and fulfilment, but in enhancing overall customer satisfaction. As India’s fashion e-commerce market is projected to reach USD 112 billion by 2030, our role is to provide the infrastructure and fulfilment expertise necessary for brands to thrive.” Aditya Sharma, Co-founder of The Souled Store, noted the impact of the partnership: “Emiza stepped in, providing exceptional warehousing and fulfilment services aligned with our commitment to delivering quality products. Their focus on optimising our fulfilment process has allowed us to cut order processing time by half, ensuring that our customers receive their orders faster.” With 27 fulfilment centres across 14 cities, Emiza is well-positioned to support The Souled Store’s expansion beyond metro cities, tapping into the growing consumer base in Bharat, the company added.
Mahindra World City Jaipur (MWC Jaipur), a joint venture between Mahindra Lifespace Developers Ltd (MLDL) and Rajasthan State Industrial Development and Investment Corporation (RIICO) announced it concluded 26 new lease agreements between April 2021 and June 2022. The new signings included both new customers and expansion of facilities by existing clients, together leasing about 137 acres of land. In the same period, MWC Jaipur and its constituent units' aggregated investments crossed Rs 721 crores, and cumulative exports by MWC Jaipur exceeded Rs 15,930 crores, of which Rs 3,321 crores were in the last 15 months. Over these fifteen months, a total of 69 companies have completed their facility buildout at MWC Jaipur and become operational. The new entrants to MWC Jaipur represent a variety of sectors, like Logistics and Warehousing, IT & ITeS, Engineering, Furniture Manufacturing, Solar Energy, Gems and Jewelry manufacturing. The newly added roster of clients at MWC Jaipur includes Wipro Hydraulics, Shakti Hormann, Renew Photovoltaics, Kerakoll India, Normet, Gulmohar Lane Lifestyle, Manor & Mews, J Atelier Pink City, Kamal Coach Works, Maxop Engineering, amongst others. Rajaram Pai, Chief Business Officer – Industrial, Mahindra Lifespaces said, “MWC Jaipur today is home to prestigious domestic and international manufacturing companies from across the world, who have established a manufacturing base in India for the first time. Enabling business acceleration for customers has always been our focus. We continue to deliver the highest urbanisation standards by leveraging innovation, thoughtful design, and a deep commitment to sustainability. MWC Jaipur contributes towards generating incremental employment and income for the state while creating world-class infrastructure which would serve the nation for many years to come. We are glad to be the enablers of Make-in-India and Make-for-India.” Becoming a preferred destination of choice for over 121 global and domestic companies, MWC Jaipur is enabling business growth for customers by crafting a conducive environment, with robust infrastructure and facilities that propagate ease of doing business. Mahindra World City Jaipur is the first project in Asia to receive Climate Positive Development Stage 2 Certification from the C40 Cities Climate Leadership Group (C40), a global network of large cities taking action to address climate change. With a focus on climate-positive development, MWC Jaipur is continuing its efforts on integrating sustainability within the city. Green, integrated developments is continuously being upgraded to mitigate the impact of business operations on the environment. As of March 31, 2022, a total of 59,955 trees have been planted in government-approved forest areas and rural areas under the Mahindra Group’s flagship program – Hariyali. Around 11,100 trees have been planted within the industrial park.
The Indian Railways has unveiled an innovative new look for the Vande Bharat goods carrier, designed to enhance efficiency in freight transport across the nation. This state-of-the-art freight train features advanced technology and modern design, aimed at reducing transit times and improving the overall supply chain network. Equipped with upgraded features, the Vande Bharat goods carrier can transport a wide variety of goods, ensuring a more reliable and faster delivery system. The initiative is part of a broader strategy to modernise India's logistics infrastructure and promote the use of railways for cargo movement, which is essential for sustainable economic growth. This new freight carrier will not only help in decongesting road transport but also contribute to reducing carbon emissions, aligning with the government's commitment to environmental sustainability. With its introduction, Indian Railways aims to enhance cargo capacity and operational efficiency, providing a significant boost to the logistics sector. As the demand for efficient logistics solutions continues to rise, the Vande Bharat goods carrier is poised to play a crucial role in shaping the future of freight transportation in India.
The Zero Emission Port Alliance (ZEPA) has recently announced the onboarding of 11 key organisations from the container port industry. Notable members include APM Terminals (APMT), CATL, DP World, Kempower, Patrick Terminals, Port of Aarhus, Port of Rotterdam, Rocsys, Sany, SSA Marine, and ZPMC. These members are united in their commitment to accelerate the adoption of Battery-Electric Container Handling Equipment (BE-CHE). ZEPA aims to significantly advance port decarbonisation efforts, making BE-CHE both affordable and accessible within the next decade. In recent months, ZEPA has conducted working sessions, initial analyses, and held its first formal Steering Committee during the TOC Europe conference on June 11. The Steering Committee, which met at TOC Europe in Rotterdam, emphasized the importance of their collective membership in reducing emissions and achieving Total Cost of Ownership parity for battery-electric equipment compared to diesel. Industry leaders underscored that rapid change is achievable through cross-value chain collaboration. ZEPA's initiatives are meticulously designed and implemented in compliance with anti-trust and competition laws, with oversight from external legal counsel to ensure transparency and legality. Sahar Rashidbeigi, Global Head of Decarbonisation at APMT, reflected on ZEPA’s progress: “Reflecting on our journey, it is incredible to see how far we have come since defining the problem at last year’s TOC Europe conference. From the ‘tipping point’ White Paper nine months ago to launching ZEPA with DP World in December during COP28, and now onboarding 11 key members across the value chain, our progress highlights that we are addressing a valuable problem that resonates across the industry, and it affirms our conviction that collaboration is essential to tackle it effectively.” ZEPA's collective effort marks a pivotal step in the pursuit of sustainable and zero-emission port operations, showcasing the power of industry-wide cooperation in combating climate change.
Ekart introduced a new ‘Refinish Service’ to tackle the challenges of returns management in the fashion and lifestyle sector. This innovative service enables retailers to refurbish over 90 percent of returned inventory, helping brands mitigate losses and maximise revenue potential. The Refinish Service is designed for direct-to-consumer (D2C), e-commerce, and retail players in the fashion and lifestyle segments. It also caters to other industries, including footwear, handbags, accessories, and home and decor products such as curtains, bed sheets, and blankets. With a combined processing capacity of 55,000 units daily, Ekart employs best-in-class machinery and energy-conserving technologies. The refinishing process at Ekart's facilities involves rigorous quality checks, stain removal, box replacement, ironing, stitching (if needed), and final quality control to ensure the finesse of refurbished products. Mani Bhushan, Chief Business Officer of Ekart, commented, “By harnessing cutting-edge technology and sustainable practices, the refinishing service empowers brands to optimise their supply chains and drive positive change on a broader scale. The service sets a new standard for returns management, demonstrating our commitment to innovation, efficiency, and sustainability.” Ekart operates Refinish centers across major demand clusters in India, including Gurgaon, Mumbai, Bangalore, and Kolkata. These strategically located centers facilitate swift return processing and reduce transport costs for brands. The facilities are equipped with advanced machinery, including up-steam tables, steam vacuum tables, and industry-leading foam finishers, ensuring thorough and efficient processing of returned inventory. Ekart's Refinish Service marks a significant step forward in returns management, offering a sustainable and efficient solution that benefits both retailers and the environment.
