Supply Chain Now Radio Episode 244

Supply Chain Now Radio, Episode 244
The Supply Chain Buzz Series
Sponsored by The Effective Syndicate:

In this episode of the Supply Chain Buzz, Scott Luton discusses the latest topics and top stories in supply chain, in 15 minutes or less!

[00:00:06] A good morning in Scott Luton here with you lives on Supply Chain Now Radio. Welcome to the show. In today’s show, we’re continuing our Supply chain Buzz series, a brief weekly look at some of the top news and trends across the global India in Supply chain community. All in fifteen minutes or less. Today’s episode of the Supply chain Buzz on Supply Chain Now Radio is brought to you by the Effective syndicate, a leading coaching and consulting firm that helps companies win by optimizing process and developing winning cultures.


[00:00:37] Unlike many consulting firms, the been there done that Pros. Over at the Effective syndicate work side by side with all levels of the organization from the frontline to the C-suite. All in order to drive sustainable improvement that enables profitable growth. You can learn more at the effective syndicate dot com. It is Monday, December 23rd. Now let’s get to the buzz in our first story here this morning, coming to us from Fast Company. Let’s talk about supply chains returns in the holiday season. One hundred billion dollars, that’s the dollar total of product that is expected to be returned in just the United States between Thanksgiving and New Year’s this holiday season. And that’s up a whopping six billion dollars from last year. And companies continue to look for ways to make returns even easier. So the consumer wins. Right. But more and more, the environment is losing. Think not only about the resources consumed by moving product forwards and in reverse. In fact, the returns Logistics provider named OP Tauro says that most of the goods returned aren’t even able to be resold. In fact, only 10 percent of products were turned. This season is X is expected to hit shelves again to be resold. And unfortunately, a lot of the returns are getting thrown away and shipped off to the landfill. Up Toro estimates that five billion tons of returns end up each year in landfills each and every year. So why is this Adrià Vasyl environmental journalist, was quoted in the Fast Company article speaking to the problem.


[00:02:23] She said, quote, It actually costs a lot of companies more money to put somebody own the product to visually eyeball it and say, is this up to standard? Is it up to code? Is this going to get us sued? Does somebody tamper with this box in some way? And is this returnable? And if it’s clothing, it has to be repressed and put back in a nice packaging. And for a lot of companies, it’s just not worth it. End quote. And as Tony Shroder with the Reverse Logistics Association has told us on our Reverse Logistics podcast series here on Supply Chain Now Radio, many companies will end up burning returns in order to protect their brand. But hey there, there is good news. A new niche industry continues to grow to help companies better and more stane sustainably rather handle returns up. Tauro, as we mentioned, is one company that’s helping organizations like IKEA get better at returns and reverse Logistics B stock is another company that is helping as it has created a marketplace for returned excess or liquidated goods. And they are more, more tools and apps popping up that helped make the gift giving process more efficient and accurate. You can check out gift hero dot com to build and share specific gift lists, for example. The industry will get better. It’s certainly part of the e-commerce journey that we’re all on.


[00:03:50] But we’d venture to say that if consumers can get better at less than the problem, then we’ll all be better off. OK. And our second story here on the Supply chain Buzz, let’s talk global manufacturing according to the ICM, manufacturing PMI. Manufacturing activity has been contracting here in the U.S. for several months. So instead of expanding, it’s contracting. However, according to an article in The Wall Street Journal, one country’s surprising manufacturing industry is getting more and more attention. Not too long ago, the country of Greece’s economy was in tatters. Its unemployment rate was eye-popping 25 percent. And while we have all heard about the record levels of debt and raging debate of how to manage it moving forward. But according to data firm IHS Market, Greece is the world’s number one ranked manufacturing industry. Rounding out the top five behind Greece, at number two is Colombia, followed by Brazil, Myanmar and the United States, obviously as a 90 fifth largest country in the world, not the fifth largest country in the world. Greece’s manufacturing. Industry is limited in size, but what it lacks in size, it makes up for inactivity. In November, Greece’s PMI came in at fifty four point one, its 30th month above 50, which means expansion in the PMI world. Greece’s concentration and manufactory market, such as food and beverage, have helped it operate at a strong clip and maintain it while many other countries are lagging behind from an activity standpoint.


[00:05:32] Another tell win for the Greece manufactory market is that it’s highly domestically focused. So if global trade is dipping, the country will feel the repercussions, much less. All good news for a country that is in many ways still recovering from an extraordinary depression in 2009. Analysts are expecting Greece to grow 1.8 percent as an economy in 2019 and over 2 percent in 2020. And we hear the buzz, which our friends over in Greece much look in 2020 and beyond. OK, our third story today comes to us from IBM. A supply chain digital with the holiday crazyness upon us, Big Blue is suggesting five ways that supply chains can withstand the fury of the season. Number one, make sure business and I.T. is aligned. This is suggested to take place all year long. Make sure to learn key takeaways from all departments with regard to last year’s holiday season and leave no stone unturned and leave no question unasked. Number two, lay the groundwork. Think security updates, patches and new software versions make these items part of the blocking and tackling that is expected so it doesn’t pop up at the wrong time of the year. Number three on the list of five ways that supply chains can withstand the fury of the season. Number is test the limits. Be sure to take your order management system for a test drive early in the year. Find out where the gaps are on a proactive basis, not in crunch time.


[00:07:12] Plus, it gives the team enough time to resolve issues, creating action plans and ensuring a nice, steady and stable environment for the end of the arush. Number four avoid unforeseen risks. World class companies conduct conduct rather a wide range of contingency planning that involve even the most unlikeliest scenarios. Some companies even plan around multiple contingencies that might take place simultaneously and fight. Number five, remain alert during peak periods. Be sure to optimize your company’s monitoring, alerting and notification processes and tools. IBM suggests you do things such as facilitate regular standups and offer 24/7 cross-functional teams that can be deployed quickly to mitigate problems that might arise. So, of course, no plan is foolproof, but this sounds like a solid and simple five point plan to the buzz team. All right. Story number four is one of the hottest stories in Supply chain last week. Our team read more about it in Supply chain Dove. So Morgan Stanley is projecting that Amazon Logistics parcel volume will overtake FedEx and U.P.S. in 2022. Just a few short years from now. And get this, the estimate does not even take into consideration the fact that Amazon is building out a shipping service that caters to parcels that originate from sites other than Evidently, according to Supply chain, divx and other reports, Amazon has been approaching other shippers in efforts to gain additional shipping volume. Those efforts, by and large, have haven’t been fruitful thus far, but the company is expected to improve the pitch and ability to offer more competitive levels of service very soon.


[00:09:09] In fact, analysts say that soon enough, Amazon Logistics parcel volume will be better measured by not just what share it’s carying of Amazon orders, but rather by its overall share of what its shipping for the entire U.S. e-commerce market. Morgan Stanley further estimates that Amazon is delivering roughly 46 percent of its own items ordered in the U.S. in 2019, which is about double the amount from last year. Amazon’s parcel volume is projected to be 2.5 billion parcels in 2019. FedEx is at 3 billion and U.P.S. is at 4.7 b. As we’ve reported on earlier, Amazon is also super focused on delivering in the densely populated areas rather than the rule routes. Morgan Stanley researchers conclude that it’s critical to. Amazon’s profitability that the company carries a significant portion of its own volume, and that’s one more reason while the analysts believe Amazon will aggressively expand its external parcel shipping volumes in the years to come as well. So for our fifth and final story on today’s Supply chain Buzz here on Supply Chain Now Radio. Let’s break out the crystal ball as we love do and project the 2020 workplace and what some of the trends will be. So according to research from fierce conversations and published in Industry Week, business leaders are told to expect five key workplace predictions. Prediction number one.


[00:10:49] Remote work will no longer be treated as a perk, but rather a necessity for employee retention. So did you know that the Bureau of Labor Statistics has found that remote working as in has rather increased one hundred and fifteen percent since 2005? However, by offering more remote work to more employees now, companies have got to figure out successful engagement and inclusion approaches to make sure these remote team members feel like they are truly plugged into the organization and the culture. So number two and list leading through rapid change will be a critical skill to master. Massive business trends such as digitization are all rippling through the global business environment and the organizations involved. Not only will employees need to know how to better manage faster change, but leaders will need to be, well, adept at leading. As the cadence continues to increase, number three, inclusion will be at the forefront of diversity and inclusion efforts. So. Fierce conversation sees that diversity initiatives will continue to thrive, but including all employees and team members will become much more of a priority and 2020. Of course, being an election year might present an extra challenge at maintaining a healthy, peaceful and productive work environment in the U.S., at least number four on the list of the 2020 workplace and some of the predicted trends here. Predictive analytics and artificial intelligence will be used to improve H.R. outcomes. And to do so, more data analysts will be hard and H.R.


[00:12:36] organizations than ever before. H.R. leaders will be more available to be proactive when it comes to managing the organization’s pool of talent. And finally, number five, virtual reality technology will become more prevalent and leadership training programs. So it looks like VR headsets may finally be poised to to proliferate throughout industry, offering employees a more immersive training option. But what are your predictions? Feel free to drop us a line with a few thoughts and you can shoot that over to Amanda at Supply Chain Now Radio dot com. OK. So there you have it. That’s a wrap for today’s episode of The Sporting Buzz. Several of the leading Supply chain news stories and trends right here on Supply Chain Now Radio. You’ll find links to each of the stories that we featured today on the show, notes for your convenience, including a few additional resources. Big thanks to today’s sponsor of the Supply chain Buzz. The Effective syndicate. And be sure to check out. Check them out wherever you get great leadership advice, including the effective syndicate dot com to our listeners everywhere else from Fulton, Mississippi to Toronto and Ontario, Canada, to a kunda in Kenya and all points in between. Thank you for joining us. And on behalf of the entire Supply Chain Now Radio team, this is Scott Luton. We wish you all a very successful week ahead. Happy holidays. Merry Christmas to you and your families and have a wonderful day. Thanks, buddy.

Scott W. Luton is the founder & CEO of Supply Chain Now Radio. He has worked extensively in the end-to-end Supply Chain industry for more than 15 years, appearing in publications such as The Wall Street Journal, Dice and Quality Progress Magazine. Scott was named a 2019 Pro to Know in Supply Chain by Supply & Demand Executive and was named a “2019 Supply Chain & Logistics Expert to Follow” by RateLinx. He founded the 2019 Atlanta Supply Chain Awards and also served on the 2018 Georgia Logistics Summit Executive Committee. He is a certified Lean Six Sigma Green Belt and holds the APICS Certified Supply Chain Professional (CSCP) credential. A Veteran of the United States Air Force, Scott volunteers on the Business Pillar for VETLANTA and has served on the boards for APICS Atlanta and the Georgia Manufacturing Alliance. He also serves as an advisor with TalentStream, a leading recruiting & staffing firm based in the Southeast. Follow Scott Luton on Twitter at @ScottWLuton and learn more about SCNR here:

Upcoming Events & Resources Mentioned in this Episode

Retail Returns: the $100B Problem:
Greece on the Rebound:
IBM Shares 5 Ways to Prep Your Supply Chain for Holidays:
Amazon Logistics on the Move:
2020 Workplace Predictions:
Connect with Scott on LinkedIn:
Subscribe to Supply Chain Now Radio:
SCNR to Broadcast Live at CSCMP Atlanta Roundtable Event:
Reverse Logistics Association Conference & Expo:
SCNR to Broadcast Live at MODEX 2020:
SCNR to Broadcast Live at AME Atlanta 2020 Lean Summit:
2020 Atlanta Supply Chain Awards:
SCNR on YouTube:
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