Category Archives: Strategy

Walmart tightens on-time, in-full requirements

Posted on September 14, 2020 by | 1 comment

A large shipping firm has grabbed a problem by the throat.

Wal-Mart has raised its on-time in-full (OTIF) shipment requirements for all suppliers to 98%. It’s in response to a significant drop-off of on-time deliveries and short shipments, possibly due to COVID-19, but also connected with general carrier and business distress. By punishing suppliers, Wal-Mart sets a standard that others will want to match.

Failure of on-time and in-full deliveries poses a severe problem for managing inventory and matching supply to demand. Carriers won’t be able to get away with it now, and suppliers won’t do as much short-shipping. The standard will ripple over first to other consumer-oriented firms, then to all sorts of firms.

Standards for delivery are a good thing if they become industry-wide. They change the stakes, and give the consumer a clear idea of what to expect for a shipment. They set a basis for deciding what a reasonable charge is. If you can cheat on the delivery date or amount and get away with it, you are likely to when you think it’s to your advantage. And that violates customer trust.

A good example is Amazon’s pioneering of two-day shipping via Amazon Prime. It created a standard for the e-Commerce practice that firms in that market have to be clear about when they set the price for their full offer (including shipment terms)– are they following it or not?

Improving customer trust is a good thing, and sets up sound guidelines for customers to evaluate the value of an offering.

Mark Solomon Friday, September 11, 2020

Link: https://freightwaves.com/news/walmart-tightens-on-time-in-full-requirements

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Posted in Logistics, Production Operations, Strategy, Supply Chains

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‘Data sharing is nice, but cooperation is key’ to ending congestion

Posted on July 13, 2020 by | 1 comment

The speaker, Stefan Pieters of Jan de Rijk, was speaking of the relation between road hauliers and airport stakeholders. I believe most hauliers at ports, warehouses, inland terminals, and any cargo transfer points would be saying the same thing. And so far there has been little effort on this score.

Truckers are the low person on the pole, and are not connected to the facilities they must rely on for service. They have no leverage. So their problems go ignored.

There is a lot of money to be made by coordinating this aspect of the trucking business, if anyone will step up and do it.

And as the interview claims, data takes you only so far. There has to be a willingness to act and change procedures, rather than just send data. Facilities don’t want to recognize that; it requires workers with the power to make decisions on behalf of the cargo owner, and that would erode ‘profits’, meaning costs. You’d have to pay workers more for the ability to make decisions.

It makes a stronger case for end-to-end coordination by the same vendor, such as Amazon or Wal-Mart. But truckers would still often be left out.

By Alex Lennane 13/07/2020

‘Data sharing is nice, but cooperation is key’ to ending congestion, says Jan de Rijk – The Loadstar

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Posted in Logistics, Service Management, Strategy, Supply Chains, Trucking

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Shippers ‘held to ransom’ from blanked sailings and feeder problems

Posted on June 29, 2020 by | 1 comment

The constant stream of blanked sailings is predictably disrupting many supply chains and networks. Shippers are not getting the message, and it’s costing them extra, unplanned expense. That will percolate down to their customers as well, both in reliability and costs.

And shippers are complaining. No wonder!! The carriers are bringing it on. They are not considering ultimate customer needs.

Anyone wanting to create a disruption in maritime and hinterland supply chains will pay attention and try to do something about this.

By Mike Wackett 29/06/2020

Shippers being ‘held to ransom’ as blanked sailings and feeder problems bite

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Posted in Logistics, Service Management, Shipping, Strategy, Supply Chains

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