This Week in Logistics News (July 20-24, 2015)

By Adrian Gonzalez

There was a lot of supply chain and logistics news this week, so let’s go straight to it.

Bloomberg broke the news this week that UPS is reportedly in talks to buy Coyote Logistics for $1.8 billion, which if it happens, would be another large deal in the third-party logistics (3PL) industry since December (see, for example, FedEx acquisition of GENCO and XPO Logistics acquisition of Norbert Dentressangle). Even if this deal doesn’t happen, it demonstrates, nonetheless, that there is plenty of money and interest swirling in the industry for more $1B+ transactions in the weeks and months ahead. For related commentary, see Is the 3PL Industry Becoming Barbell Shaped? and Convergence is the Word for 3PLs.

In my post last week about Descartes’ user conference, I commented on how the company had made 28 acquisitions since 2005, including 7 acquisitions since 2013, and how global trade content was a growing focus for the company (evidenced by its acquisition of Customs Info). Well, Descartes announced two acquisitions this week, including MK Data Services, a leading US-based provider of denied party screening trade data and solutions, that augments its global trade content capabilities. Here are some details from the press release:

For over 20 years, MK Data has provided comprehensive technology solutions that help more than 900 businesses comply with these restrictions by screening for transactions with specified parties. As an existing business partner of Descartes with a connection to the GLN, MK Data’s technology screens shipments against a comprehensive, frequently updated international database of restricted parties. MK Data’s proprietary matching algorithms, which customers can sensitivity-adjust to suit their own risk concerns, flag potential compliance issues for prompt resolution. Like Descartes’ Customs Info trade data content, MK Data’s content also powers leading Global Trade Management (GTM) systems, and can be integrated with Customer Relationship Management (CRM) and Enterprise Resource Planning (ERP) systems to enable customers to implement a comprehensive trade compliance program.

Simply put, Descartes continues to aggressively pursue a roll-up strategy in the Global Trade Management (GTM) space, focusing on all “3 Cs” — Compliance, Content, and Connectivity. For related commentary, see A New Era for Global Trade Management Software? and Accelerating Supply Chain Speed and Efficiency with Global Trade Data.

Descartes also acquired BearWare, a leading US-based provider of mobile solutions to improve collaboration between retailers and their logistics service providers. Here are some details from the press release:

BearWare’s system leverages mobile technologies to scan cartons at each point from the distribution centers through to the store front. This carton-level tracking complements shipment-level tracking and helps pro-actively identify potential inventory replenishment for each store, reduces theft and claims for lost cartons, and streamlines shipment payment. It also supports pool distribution, which helps retailers to reduce logistics costs and minimize store disruptions by eliminating unconsolidated direct shipments from suppliers and retailer distribution centers into the stores. The BearWare system is being used by leading retailers, including L Brands, Restoration Hardware and GNC to save money, support loss prevention programs and improve delivery operations effectiveness.

BearWare’s system is another example of a “white space” solution in logistics — or a “1+1=3” solution, as I wrote about last week — that enables a business process that either falls outside the scope of, or hasn’t been addressed very well by, traditional logistics applications such as WMS or TMS solutions.

Earlier this week, I commented on C.H. Robinson’s introduction of Freightview, which illustrates a trend I’ve been talking about the past few years: how the lines between 3PLs, consulting firms, and software vendors continue to blur. Transplace provided yet another example this week by formally launching its supply chain consulting practice. Here’s an excerpt from the press release:

Transplace Supply Chain Consulting includes a broad, yet focused, spectrum of service capabilities:

Supply Chain Optimization: Developing an end-to-end, integrated solution across the entire transportation strategy for continuous improvement and enhanced efficiency.
Transportation Optimization: As the largest and most costly subset of the supply chain, Transplace Supply Chain Consulting provides analytics, process redesign, methodology, tools and technology for optimizing complex transportation networks to improve supply chain performance.
Sourcing and Procurement: Assessing current sourcing practices and procurement processes across all categories of indirect spend and then executing work to optimize controlled spend, perform category management and build capabilities for continuous improvement.
Asset Management: Envisioning, designing and blueprinting solutions to efficiently utilize asset capacity, as well as optimizing the use of those assets in transporting and delivering product efficiently and effectively; improving asset utilization, particularly in specialized fleets such as dedicated contract carriage, electric, gas and water utility fleets.
Business Intelligence and Analytics: Providing the BI and analytics to manage and monitor supply chain performance and analyze operational and service issues, as well as monitoring compliance and adherence to operating plans and budgets.
Enabling Technology: Determining the optimal network design, as well as the supporting technology stack, to enable and improve operational execution, visibility and compliance.

Finally, in other 3PL news, LEGACY Supply Chain Services announced the release of The Supply Chain Performance Grader: Instant View™, a tool that “allows businesses to evaluate over 25 aspects of the supply chain, grouped within six supply chain disciplines – supply chain visibility, mapping & visualization, risk management, supply chain design, business intelligence, and talent retention & workplace culture development. The tool provides a supply chain report card along with specific recommendations on how to improve supply chain performance and increase efficiencies.” I participated in the development of this tool, and in writing a new eBook, “Keeping Up With the Retail Consumer: 6 Supply Chain Disciplines Retailers Must Master.” I’ll share an excerpt next week along with some additional commentary, but this is a great example of how 3PLs are responding to something customers are increasingly expecting from them: thought leadership and advice on industry trends and practices.

And with that, have a happy weekend!

Song of the Week: “The Wolf” by Mumford & Sons