Some myths about horizontal collaboration As Europe's first and still premier forum for the promotion and facilitation of "horizontal collaboration" across supply chains, ELUPEG has the advantage of a great deal of knowledge about what does—and just as importantly, what does not—work in this area.
There is a great deal of "noise" around collaboration right now, and hence ELUPEG has decided to share its vast knowledge in order to "explode" a few of the myths regarding collaboration:
Collaboration is a "strategy." It is not a strategy, per se, but it can add value to a strategy. The only sense in which a company can adopt horizontal collaboration as a strategy would be tactically or as a guiding principle. Collaboration is the output of a culture based on trust and openness, where individual requirements are, overall, met better in concert with others than by striving to make it on one's own capabilities and resources.
Collaboration is dangerous and could lead to a fine of 10 percent of revenue under European Union (EU) anti-competition law. Provided companies adopt horizontal collaboration based on sharing of assets or non-commercially sensitive information with a view to reducing overall costs, reducing congestion, and improving customer service, they will not fall afoul of the European Union's anti-competition authorities. Utilizing an independent, trusted third party such as ELUPEG to hold and analyze confidential or commercially sensitive data for the purpose of evaluating collaboration potential without risk is a well-tried and proven process.
Companies with inefficient supply chains will benefit from collaboration the most. Wrong! We have categorically proved that companies that have the most efficient supply chains get more from horizontal collaboration. They know their costs to the last cent; indeed, such efficient companies have squeezed out all possible costs internally and need to look outside the business for future big savings. They have overcome the problem of internal collaboration, and they have secured significant benefits from vertical collaboration with suppliers and customers. Most importantly, they have the time as well as senior management endorsement, which is vital to making horizontal collaboration work.
Companies always fall out over how to share the savings. We would not say this never happens. But this can be avoided by benchmarking the respective supply chain costs of each collaborating party before commencing the project, and then agreeing on a fair formula for the distribution of the savings that are achieved. It is also interesting to note that "reinvesting" some of the first savings in order to drive deeper collaboration can ultimately lead to even better results. ELUPEG can facilitate any of these services if required.
Businesses and products change, and hence any strategic investment in horizontal collaboration is doomed to end in tears. If you treat the collaboration project as you would any other significant investment and include the costs of winding up the collaboration and replacing it with an alternative solution, then you will soon see whether the benefits outweigh the risks. If they don't, you will not proceed—just as would happen with any investment opportunity. This is not "planning to fail," but rather recognition that in the real business world only really viable projects get implemented. An agreement on the arrangements for sharing the benefits, and for ending the collaborative operation before the operation starts, is just as important as the methodology for dispute resolution. By agreeing on the difficult issues beforehand the venture stands a far greater chance of success and management of both companies will not sit there worried about how to deal with future changes.
Collaboration leads to loss of control and reduction in customer service. If collaboration is done properly, then the opposite can be true. Collaboration enables more economic and more frequent shipments, which can increase delivery frequency to customers. This is precisely what retailers are looking for. For suppliers, the benefits of higher on-shelf availability or in-stock availability can lead to fewer lost sales.
Collaboration takes work. It is not like flipping a switch. It's work, not talking, that will make collaboration happen.
Brian Bolam
Vice Chairman, ELUPEG Ltd.
brianbolam@omprompt.com
The venture-backed fleet telematics technology provider Platform Science will acquire a suite of “global transportation telematics business units” from supply chain technology provider Trimble Inc., the firms said Sunday.
Trimble's other core transportation business units — Enterprise, Maps, Vusion and Transporeon — are not included in the proposed transaction and will remain part of Trimble's Transportation & Logistics segment, with a continued focus on priority growth areas following completion of the proposed transaction.
Terms of the deal were not disclosed but as part of this agreement, Colorado-based Trimble will become a shareholder in Platform Science's expanded business. Specifically, Trimble will have a 32.5% stake in the newly expanded global Platform Science business and will receive a Platform Science board seat. The company joins C.R. England, Cummins, Daimler Truck, PACCAR, Prologis, RyderVentures, and Schneider as a key strategic investor in Platform Science along with financial investors 8VC, Activant Capital, BDT & MSD Partners, Softbank, and NewRoad Capital Partners.
According to San Diego-based Platform Science, the proposed transaction aims to enhance driver experience, fleet safety, efficiency, and compliance by combining two cutting-edge in-cab commercial vehicle ecosystems, which will give customers access to more applications and offerings.
From Trimble customers’ point of view, they will continue to enjoy the benefits of their Trimble solutions, with the added flexibility of the Virtual Vehicle platform from Platform Science. That means Virtual Vehicle-enabled fleets will receive access to the Virtual Vehicle Marketplace, offering hundreds of new and expanded applications, software, and solution providers focused on innovating and improving drivers' quality of life and fleet performance.
Meanwhile, Platform Science customers will enjoy the added choice of Trimble's remaining portfolio of transportation solutions which will be available on the Virtual Vehicle platform, the partners said.
"We believe combining our global transportation telematics portfolio with Platform Science's will further advance fleet mobility and provide our customers with a broader portfolio of solutions to solve industry problems," Rob Painter, president and CEO of Trimble, said in a release. "Increased collaboration between the new Platform Science business and Trimble's remaining transportation businesses will enhance our ability to provide positive outcomes for our global customers of commercial mapping, transportation management, freight procurement, and visibility solutions. This deal will result in significant synergies along with tremendous opportunities for employees to continue to grow in a more-competitive business."
The acquisition comes just five months after Platform Science raised $125 million in growth capital from some of the biggest names in freight trucking, saying the money would help accelerate innovation in the commercial transportation sector.
Nearly one-third of American consumers have increased their secondhand purchases in the past year, revealing a jump in “recommerce” according to a buyer survey from ShipStation, a provider of web-based shipping and order fulfillment solutions.
The number comes from a survey of 500 U.S. consumers showing that nearly one in four (23%) Americans lack confidence in making purchases over $200 in the next six months. Due to economic uncertainty, savvy shoppers are looking for ways to save money without sacrificing quality or style, the research found.
Younger shoppers are leading the charge in that trend, with 59% of Gen Z and 48% of Millennials buying pre-owned items weekly or monthly. That rate makes Gen Z nearly twice as likely to buy second hand compared to older generations.
The primary reason that shoppers say they have increased their recommerce habits is lower prices (74%), followed by the thrill of finding unique or rare items (38%) and getting higher quality for a lower price (28%). Only 14% of Americans cite environmental concerns as a primary reason they shop second-hand.
Despite the challenge of adjusting to the new pattern, recommerce represents a strategic opportunity for businesses to capture today’s budget-minded shoppers and foster long-term loyalty, Austin, Texas-based ShipStation said.
For example, retailers don’t have to sell used goods to capitalize on the secondhand boom. Instead, they can offer trade-in programs swapping discounts or store credit for shoppers’ old items. And they can improve product discoverability to help customers—particularly older generations—find what they’re looking for.
Other ways for retailers to connect with recommerce shoppers are to improve shipping practices. According to ShipStation:
70% of shoppers won’t return to a brand if shipping is too expensive.
51% of consumers are turned off by late deliveries
40% of shoppers won’t return to a retailer again if the packaging is bad.
The “CMA CGM Startup Awards”—created in collaboration with BFM Business and La Tribune—will identify the best innovations to accelerate its transformation, the French company said.
Specifically, the company will select the best startup among the applicants, with clear industry transformation objectives focused on environmental performance, competitiveness, and quality of life at work in each of the three areas:
Shipping: Enabling safer, more efficient, and sustainable navigation through innovative technological solutions.
Logistics: Reinventing the global supply chain with smart and sustainable logistics solutions.
Media: Transform content creation, and customer engagement with innovative media technologies and strategies.
Three winners will be selected during a final event organized on November 15 at the Orange Vélodrome Stadium in Marseille, during the 2nd Artificial Intelligence Marseille (AIM) forum organized by La Tribune and BFM Business. The selection will be made by a jury chaired by Rodolphe Saadé, Chairman and CEO of the Group, and including members of the executive committee representing the various sectors of CMA CGM.
Economic activity in the logistics industry expanded in August, though growth slowed slightly from July, according to the most recent Logistics Manager’s Index report (LMI), released this week.
The August LMI registered 56.4, down from July’s reading of 56.6 but consistent with readings over the past four months. The August reading represents nine straight months of growth across the logistics industry.
The LMI is a monthly gauge of economic activity across warehousing, transportation, and logistics markets. An LMI above 50 indicates expansion, and a reading below 50 indicates contraction.
Inventory levels saw a marked change in August, increasing more than six points compared to July and breaking a three-month streak of contraction. The LMI researchers said this suggests that after running inventories down, companies are now building them back up in anticipation of fourth-quarter demand. It also represents a return to more typical growth patterns following the accelerated demand for logistics services during the Covid-19 pandemic and the lows of the recent freight recession.
“This suggests a return to traditional patterns of seasonality that we have not seen since pre-COVID,” the researchers wrote in the monthly LMI report, published Tuesday, adding that the buildup is somewhat tempered by increases in warehousing capacity and transportation capacity.
The LMI report is based on a monthly survey of logistics managers from across the country. It tracks industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
That hiring surge marks a significant jump in relation to the company’s nearly 17,000 current employees across North America, adding 21% more workers.
That increase is necessary because U.S. holiday sales in 2023 increased 3.9% year-over-year as consumer spending grew even amidst uncertain economic times and trends like inflation and consumer price sensitivity. Looking at the coming peak, a similar pattern is projected for this year, with shoppers forecasted to drive a 4.8% increase in holiday retail sales for 2024, Geodis said, citing data from Emarketer.
To attract the extra workforce, Geodis says it will offer competitive wages, peak premium pay incentives, peak and referral bonuses, an expedited payment option, and flexible schedules. And it’s using an AI-powered chatbot named Sophie to serve as a virtual recruiting assistant.
“We acknowledge the immense responsibility we have to our customers to deliver exceptional service every day, and this is especially true during peak season,” Anthony Jordan, GEODIS in Americas Executive Vice President and Chief Operating Officer, said in a release. “Because peak season is the most business-critical sales period of the year for many of our retail clients, expanding our workforce is vital to ensure we have a flexible, dynamic team that can handle anticipated surges in demand.”