Friday, September 30, 2016

2016 Logistics Trend Radar: Delivering insight today. Creating value tomorrow.

The latest update now confirms some familiar trends while also providing valuable glimpses of upcoming trends that are likely to shape the future of logistics, from the adoption of self-learning systems to leveraging the possibilities of smart energy logistics. By DHL Trend Research


DHL Trend Research regularly publishes a key instrument for the global logistics community - the Logistics Trend Radar.
Now in its fourth year, the Logistics Trend Radar is a dynamic, living tool that captures the development of society, business and technology trends.
It has become an inspiring benchmark for strategy and innovation in the logistics industry and has triggered a number of successful, award-winning pilots both inside and outside of DHL in close collaboration with our customers and partners.
Since the last update of the Logistics Trend Radar, we have conducted ‘deep dives’ into multiple specific logistics trends and the findings are published in the form of individual trend reports.
Recent reports include The Internet of Things, Robotics, Omni-channel and Fair & Responsible Logistics.
These DHL trend reports contain not only an in-depth analysis of each trend but also showcase first application ideas.
As such, their insights are fueling numerous roundtable discussions among industry experts.
By identifying and following changes in trends, we recognize and acknowledge that business is always changing, always growing.
Our update confirms some familiar trends while also providing valuable glimpses of upcoming trends that are likely to shape the future of logistics, from the adoption of self-learning systems to leveraging the possibilities of smart energy logistics.
We are excited to now invite you to review this latest edition, which features extended content and refreshed design.
We hope this publication will inspire and assist you once again in deriving innovative solutions for the world of logistics.

SenseAware is FedEx’s Internet of Things Response to Supply Chain Optimization

Chris Swearingen, manager of SenseAware at FedEx, gave a talk titled "How Innovations in Manufacturing and Supply Chain are Redefining Mobility and Reshaping the Globe" he spoke about the company’s “internet of things” product SenseAware and how it is driving supply chain optimization. By 24/7 Staff




Supply chain visibility is critical to a company’s operational performance improvement, according to 63% of 149 responding companies in a survey conducted by Aberdeen Group.
“Visibility is a prerequisite to supply chain agility and responsiveness,” the report states.
And it requires tracking the location of a shipment not only at the transportation level, but also at a unit and item level.
Location tracking is good protection against shipment theft or loss, but companies need a deeper level of visibility for their products, according to FedEx.
The company’s solution? The IoT-inspired SenseAware, a sensor-based logistics solution.
SBL uses sensors to detect the shipment’s environmental conditions while warehoused or in transit and sends the data - via wireless communication devices - to a management software system where the data is collected, displayed, analyzed and stored.
Chris Swearingen, manager of SenseAware at FedEx
“The IoT-inspired FedEx SenseAware, is a sensor-based logistics solution”Chris Swearingen, manager of SenseAware at FedEx
It is “the basis of a powerful new central nervous system for the global supply chain,” according toFedEx.
The device is meant to provide intelligence that can help enterprises coordinate and manage product, information and financial flows.
SenseAware is a sensor device for the IoT
SenseAware is a multisensor device that monitors critical shipments - in near real-time - from when they are packed and picked up to the time they’re delivered and beyond.
Typically placed inside packages, pallets, trailers and warehouses, the device collects data from items and transmits that data via wireless communication to an online application for monitoring and analysis.
SenseAware measures environmental conditions on the unit level, including:
  • Current location;
  • Relative humidity;
  • Temperature;
  • Light exposure;
  • Barometric pressure; and
  • Shock detection.
For example, vaccines must be maintained at a very narrow temperature range during shipping or they are compromised and cannot be used. A SenseAware device traveling inside the shipment container can monitor the temperature and help ensure the vaccines’ stability.
On its own, the SenseAware device can monitor temperatures between -20°C and 60°C, according to FedEx. With the dry ice probe, the SenseAware device can measure temperatures from -80°C to 60°C. Adding the cryogenic probe will allow for measuring temperatures as low as -195°C.
FedEx offers an online application that displays the collected data from SenseAware. The dashboard provides an overview of all of the active SenseAware devices in a network.
How an enterprise can connect its FedEx packages
Here are ways companies can monitor their shipments on a package or pallet level through the company’s ShipmentWatch software:
  • Order a SenseAware device for an individual shipment or multiple devices for larger projects;
  • FedEx will program device according to needs;
  • Device is shipped to enterprise;
  • Place the device in your package or on your pallet; and
  • FedEx monitors the SenseAware application 24/7 from pickup to delivery.

Thursday, September 29, 2016

Uber to move freight, target trucking for the long haul

With its recent acquisition of self-driving truck startup Otto, Uber Technologies Inc.[UBER.UL]is plotting its entry into the long-haul trucking business, aiming to establish itself as a freight hauler and a technology partner for the industry.
Otto plans to expand its fleet of trucks from six to about 15 and is forging partnerships with independent truckers, Otto co-founder Lior Ron told Reuters in an interview. Starting next year, Otto-branded trucks and others equipped with Otto technology will begin hauling freight bound for warehouses and stores, he said.
Uber has already started pitching services to shippers, truck fleets and independent drivers, and the services go well beyond Otto's initially stated goal of outfitting trucks with self-driving technology. It also plans to compete with the brokers who connect truck fleets and shippers.
Fully autonomous trucks remain years away - some trucking industry experts estimate two decades - and the Otto vehicles are currently manned by a driver and an engineer. But the Uber-Otto efforts include a host of other technologies involving navigation, mapping and tracking, which can be deployed even as work continues on self-driving systems.
An executive at one company told Reuters he had already been approached by Uber about hauling his goods, noting that Uber touted recent hires and advances in trucking technology.
Uber aims to ultimately transform the competitive and fragmented $700 billion-a-year trucking industry, which is notorious for low margins. The company is challenging a host of established players, ranging from publicly traded companies, such as third-party logistics firms C.H. Robinson and XPO Logistics, to countless mom-and-pop trucking businesses.
Otto has had motor carrier permits with the U.S. Department of Transportation and California Department of Motor Vehicles to move cargo since earlier this year. Eleven days after the close of the Uber acquisition last month, Otto filed for a new permit to haul freight, noting it would expand its fleet to 15 trucks.
Ron told Reuters that Otto also aims to partner with the industry, and that "thousands" of owner-operator truck drivers have reached out to the company.
"We are talking with everyone," he said. "We don't want to develop technology just for the sake of technology."
Uber - the dominant ride-hailing firm and the world's most valuable venture-backed startup, at $68 billion - last month bought Otto in a $680 million deal. Otto, with about 100 employees, had just launched in January.
While Uber's brand and financial backing could supercharge Otto's prospects, industry experts remain skeptical that a Silicon Valley startup with little experience can shake up long-haul trucking.
"The transportation industry is a relationship-backed business," said Kevin Abbott, a vice president at C.H. Robinson. "There's a lot more to it than just finding a piece of equipment."
Abbott noted that Uber is just the latest in a long line of companies that have tried to take the place of brokers, who typically match loads with vehicles.
Uber and Otto also face competition from a growing crop of startups eyeing the industry. Companies such as Transfix, Convoy and Cargo Chief are aiming to unseat traditional brokers by matching shippers with carriers using complex algorithms, while Trucker Path has built a popular navigation app for truckers.
BRAND ADVANTAGE?
One indication of Otto's ambitions is its recent hiring of Bill Driegert, a logistics veteran who helped found Coyote, a leading freight broker, and served as its chief innovation officer, according to his LinkedIn profile. Uber and Otto are working to build a freight network to connect shippers and carriers, much like Uber matches passengers and drivers.
The trucking push is partly a gambit to leverage the mapping and logistics expertise Uber has gained ferrying passengers and food in cities.
"This is really about connecting the dots, connecting the shippers and the carriers," Ron said. "We are building that on the long-haul piece. Uber, through UberRush and UberEats, built that on the urban piece," referring to the company's on-demand delivery services.
Self-driving trucks may eventually ease the driver shortage facing the trucking industry. But even absent autonomous technology, Otto says it could help decrease the cost of trucking goods by more quickly finding freight, mapping more efficient routes and reducing fuel consumption.
"In Uber, you press a button and an Uber shows up after three minutes," Ron said. "In freight ... the golden standard is that it takes (the broker) five hours of phone calls to find your truck. That's how efficient the industry is today."
Uber is hardly alone in tackling that problem. XPO Logistics - among the world's biggest logistics services - has invested heavily in software that maximizes the utilization of trucks and reduces fuel consumption.
C.H. Robinson has developed technology that allows companies to track their shipments, as well as an app for carriers with small fleets.
Moreover, the model that Uber used to disrupt the taxi industry may not translate easily to trucking, said transportation analyst Jack Atkins of investment bank Stephens Inc. Companies avoid risk when shipping goods more than consumers do when hailing rides, he said.
"I don't really see it as a near-term threat, just because of how complex the industry really is," he said. "It's not as simple as, 'Hey, I want to go from point A to point B in Midtown.'"
LOGGING THE MILES
Ron emphasizes that Otto's autonomous driving technology is still in a "testing regimen." The trucks can drive by themselves on highways, with two copilots as backup, but maneuvering off the open interstate remains a challenge.
The trucks now haul random items from the company's garage to test how the vehicles respond to hauling weight. But the company will "fairly soon" move goods for shippers - just about any type of freight, except for hazardous materials, Ron said.
Otto currently has about two dozen drivers who are employees, and next year the company will have more partnerships with independent drivers. Truck fleets will also help test its technology.
Otto has had talks with potential partners and is in the process of trying to cement deals with some of them, Ron said.
"This is all about putting it on the road," Ron said, "collecting the miles."

In order for its $17 billion deal with Rite Aid Corporation (RAD) to close, Walgreens Boots Alliance, Inc. (WBA) must
meet regulatory requirements, which calls for either selling or closing up to 1,000 stores. The exact number of stores Walgreens
is attempting to sell is 650, however nobody is biting. Regardless of this dilemma, Walgreens still expects its Rite-Aid deal to
close in the second half of this year.
According to the New York Post, private equity firms are not interested in the aforementioned Walgreens stores because
 they don’t see those them as high quality prospects. This doesn’t mean Walgreens stores themselves are low quality, but
it likely refers to poor locations, which is the most important factor for any brick-and-mortar retailer, including drugstores.
It has been reported that Walgreens and CVS Health Corporation (CVS) met with the Federal Trade Commission last week,
and that CVS would buy some Walgreens stores as long as they were not in areas where they competed with CVS stores.
CVS wants to avoidcannibalization. While it’s possible a deal like this could come to fruition, Walgreens would probably
much rather have one buyer for the 650 stores it wants to sell.
If the Walgreens/Rite-Aid deal is approved, it would form the largest drugstore operation in the country, and that new company
 would have 46% market share. Therefore, you can’t rule out the possibility that CVS will up its offer and buy more than “som
e"] Walgreens stores. However, this isn’t probable since the stores Walgreens wants to divest aren’t likely to be the best locations.

What Self-Driving Trucks Could Mean For Your Next Delivery

Can a line of trucks rumble down the highway by themselves? That's the plan.
What Self-Driving Trucks Could Mean For Your Next Delivery
Image credit: Daimler Trucks

This story appears in the October 2016 issue of EntrepreneurSubscribe »
Picture this: You’re driving down a highway, behind a pack of tractor-trailers. As you pass the truck in the back, you notice that its driver’s seat is empty. Next one, same thing. And again. All these trucks are being driven by themselves. Finally, when you reach the lead truck, you’re relieved to see a human behind the wheel. Except then you realize that the driver is reclined in his seat, flipping through a magazine.
This could be the future of long hauling, led by autonomous trucking platoons. It’s not just a hypothetical; it’s something the world’s largest auto companies are developing right now.
Automotive giant Daimler is currently testing its autonomous trucking system with Freightliner Inspiration trucks in Nevada and Mercedes Highway Pilot trucks in Germany. Cameras and radar mounted in the lead truck scan the road ahead in various lengths and widths, gathering data on lane markings, distant traffic patterns and even peripheral vehicles that could cut off the truck. That info is fed into computers that handle steering, acceleration and braking for the entire line. If the system can be mastered, teams of self-driving big rigs could eventually wind their way across our interstates, safely and efficiently transporting products.
That future is still at least 10 years away. “Large variations in lane markings, the behavior of other road users, and changing weather conditions mean significant testing is still needed,” says Derek Rotz, director of advanced engineering for Daimler Trucks North America. “This takes time.”
Still, lessons are pouring in, leading to advancements that will improve trucks long before they go driverless. Daimler says its motivation is to improve road safety; after all, most vehicle accidents are caused by human error. It also wants to smooth traffic flow. But its automated system could also mitigate a looming problem in the industry: a lack of labor. 
“We’re experiencing a driver shortage in the U.S.,” says Amelia Regan, professor of computer science and transportation systems engineering at the University of California, Irvine. “With long hours and low wages, it’s not an attractive job anymore. Autonomous trucks will make long hauling more alluring.” They’re also expected to save business owners a nice chunk of change, thanks to lower fuel and repair costs: Synced-up, autonomous trucks should be able to follow each other with just 50 feet between vehicles, instead of the industry-standard 165 feet. Narrower gaps mean less aerodynamic drag, increasing gas mileage and reducing wear and tear on the vehicles themselves. 
But there is a potential downside: slower deliveries. “Human truckers are paid by the mile, so they inherently drive more quickly than is efficient in terms of fuel economy,” Regan says. “Autonomous platoons may drive more slowly because they’re looking to lower gas usage.” But the bragging rights that come with delivering your goods via phantom drivers? That may just make up for it. 

Lessons Learned From The Hanjin Shipping Bankruptcy Featured


1-Hanjin container shipAfter four weeks of tension, uncertainty and fears over missed deadlines for holiday deliveries, bankrupt and embattled South Korean shipping giantHanjin Shipping Co. has unloaded more than $14 billion worth of cargo from containers around the world. And with that, the retail industry has managed to breathe a small sigh of relief. 
Despite earlier holiday optimism, 2016 has been decidedly grim for some retailers; with sales numbers declining and in-store traffic reaching record lows, the prospect of having merchandise shortages during peak selling season was too much for struggling retailers to even think about.
According to Fortune, 28 of Hanjin’s 97 stranded vessels have been unloaded, while the South Korean government negotiates with port authorities in New York, Singapore and Mexico on more potential cargo unloadings. But 34 Hanjin ships remain stuck at sea, and another 35 vessels are headed back to South Korea —and it is unclear whether those ships are still carrying their cargo. So what do we know?
Be Prepared For Disruption
If retail ever needed an example of the importance of supply chain continuity and its potential for disruption, the Hanjin Shipping bankruptcy may be the watershed event. Perhaps even more frightening than the bankruptcy itself is the underlying problem of supply chain market prices and what the future holds.
“Retailers have learned that the full-steam ahead capacity overbuild by the carriers over the last decade, and cut-throat price competition that has come with it, has created systemic risk,” said Michael Zimmerman, Partner at A.T. Kearney Procurement & Analytic Solutions, in an interview withRetail TouchPoints. “At some point the super-low rate environment cracks when one of the carriers can no longer sustain itself at market prices. Rates on lanes formerly covered by Hanjin have spiked but they are expected to settle in the coming weeks as the remaining overcapacity forces rates back down. Retailers can expect that the pattern will repeat itself.”

Take Control Of Your Supply Chain

As holiday decorations begin to go up in stores around the country, some retailers may not be able to keep up with shopper demand, forcing them to drive prices up. Those that have an adaptable supply chain will thrive and have success with their first mile. But for those who relied on Hanjin, the only thing guaranteed for the holidays at this point is uncertainty. If Hanjin is the flashpoint for supply chain disruption, how can retailers be prepared for future events? Following are some key learnings to be applied:
Optimize and automate fulfillment methods. Retailers that can leverage real-time data to predict supply chain disruptions and react accordingly will put themselves in a better position. This is key to ensuring a streamlined supply chain regardless of external circumstances. They should have reliable technology in place that can match supply to demand across their network quickly for responsive planning and analysis to serve and retain their higher-valued customers. 
Maximize each location’s capacity. Those retailers that can ship from any store are positioned to weather a supply chain shortage or emergency. By having supplies on store shelves rather than in warehouses or shipping containers, retailers have more merchandise within reach and can avoid incurring additional costs. Plus, shoppers can still purchase items through multiple channels and retailers can give products more visibility and improve conversion rates.
Outline risk mitigation strategies. Natural disasters are nearly impossible to predict, but retailers should maintain a robust network of suppliers, distributors and transportation methods so products can be re-routed and, if necessary, alternatively sourced when standard processes are compromised. 
And for retailers looking to shore up their supply chain strategies, Zimmerman had a message of caution: 
“Retailers have to protect themselves from the dual threat of the more aggressively priced but financially fragile carriers going bankrupt and the larger and financially strong ones raising rates on the argument of their financial stability,” he explained. “That means that when they source their capacity they should be looking to award region-to-region and even lane-level capacity to multiple carriers. The results should be lanes split between strategic partners with reliable capacity and more aggressive carriers who will keep the big ones honest without sinking the ship.”

Troubled Waters

Hanjin, the world’s seventh-largest shipping company by capacity, operates approximately 60 worldwide shipping lines and ships more than 100 million tons of cargo annually, although the company is actually part of an alliance of six shipping companies, further complicating its bankruptcy situation.
Hanjin’s financial troubles will force companies to seek alternate sourcing and more expensive transportation strategies, such as air freight, to ensure they have products to meet customer demand, which could well translate into higher costs for retailers.
In fact, when the news broke of Hanjin’s troubles, the price of shipping a 40-foot container from China to the U.S. jumped up to 50% in a single day according to a U.S. News Report. The price from China to West Coast ports rose from $1,100 per container to as much as $1,700 while the cost from China to the East Coast jumped from $1,700 to $2,400.

Associations Play Critical Role

The National Retail Federation and the Hardwood Federation led a coalition of 120 organizations representing retailers, manufacturers, agribusinesses and other sectors affected by the Hanjin Shipping bankruptcy, sending a letter to Commerce Secretary Penny Pritzker outlining specific concerns and urging her continued leadership in bringing about a resolution.
“U.S. businesses rely on predictability in their supply chains, particularly during the busiest shipping season of the year,” wrote NRF and the other coalition members. “The recent bankruptcy filing has caused widespread disruptions in freight shipments worldwide. The impact on small- and medium-sized companies could be particularly devastating if this situation is not resolved in a timely manner.”
One of the concerns detailed in the letter involved the ongoing confusion about the location of cargo, where it will be unloaded and whether a cargo owner’s goods would be seized by Hanjin’s creditors once the ships are docked. The coalition also told Secretary Pritzker that shippers are facing both higher fees assessed to pick up cargo as well as steadily increasing freight charges as they look for new transportation options.
The coalition thanked Secretary Pritzker for her outreach to the business community thus far and urged her to “continue to work with the South Korean government to bring about a swift and economically beneficial resolution that will allow cargo to move through the global supply chain and give certainty to U.S. businesses.”
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Disruption is one of the buzzwords that gets used ad nauseam these days.
All startups hope they’ll be the ones to shake up their industry, but true disruption is hard to find.
We know that all too well having set ourselves the challenge of identifying 100 brands that can be defined as innovators in their field.
Along with Marketing Week and Salesforce, we scoured the globe looking for exciting companies that offer something different.
Having tracked them down and produced a rather lovely Top 100 Disruptors 2016 report, we’ve asked a few of the founders for their opinions on what it means to be disruptive.
In this video you can hear from the following people:
  • James Kirkham, chief strategy officer at Copa90
  • Stephen Rapoport, founder of Pact
  • Kirsty Emery, co-founder of Unmade
  • Justin Basini, co-founder and CEO of ClearScore
  • Andy Hobsbawm, co-founder and CMO of EVRYTHNG
  • Erin Ozagir, founder and CEO of Push Doctor
  • Emma Chalwin, marketing leader UKI at Salesforce
And I’ve also summarised a few choice quotes below, but you’ll have to watch the video to hear from them all.

What does it mean to be disruptive?

James Kirkham, chief strategy officer at Copa90
"Crucially it means you then set the agenda that other people try to mimic or copy or follow suit.
"Disruption isn’t just doing things in a different way that then doesn’t resonate, or go any further, or becomes a one-off, because that’s more of a gimmick.
"It provides entirely new challenges of course, because to be continually disruptive you need to continually stay ahead of that chasing pack, but that’s also the exciting reason people like us are involved in a business like this."
Kirsty Emery, co-founder of Unmade
"Being disruptive means looking at a problem with a new perspective and finding a different solution through that new perspective.
"So the way we do that here at Unmade is by having a team full of lots of people from lots of different backgrounds.
"So although we’re solving a problem within the knitting industry we have people who are engineers, physicists, fashion designers, and also other creatives all working together."

Andy Hobsbawm, co-founder and CMO of EVRYTHNG

"The idea originally of disruption was that there are unmet market needs that incumbents can’t address because they’ve grown so broad in their approach to the market that they’re missing those fundamental pockets of needs.
"Then a new entrant comes, identifies that specific thing that they want to serve, and they do that more effectively, with more focus, better, cheaper and so on."

Emma Chalwin, marketing leader UKI at Salesforce

"I think to be a disruptor in today’s ever-evolving world you really need to not be afraid to take a risk.
"Some of the best innovators and disruptors in the world have just had that passion, tenacity and vision, and have never deviated away from the true core of their business.
"They’ve seen an area in the market that needs to change, or the customer experience needs to change.
"Brands such as Airbnb and Uber I think are perfect examples of where an industry has changed, someone has come in and disrupted and completely turned that industry on its head.
"17 years ago Salesforce disrupted the software market by wanting to make enterprise software as easy and simple as buying a book on Amazon."