This Week in Logistics News (January 23-27, 2017)

By Adrian Gonzalez

I was tempted to title today’s post “This Week in Trump News,” considering all of the actions he took this week that have supply chain and logistics implications. I also considered this title: “Another Week of Amazon News (plus Other Stuff That Happened in Logistics).”

I’ll keep working on it.

In the meantime, here’s Trump, Amazon, and the rest of this week’s supply chain and logistics news that caught my attention:

Amazon captured the headlines in recent weeks with its various patent filings — from floating warehouses to underground delivery networks to lane assignments for autonomous vehicles. This week the company generated buzz when the Wall Street Journal reported that Amazon “has begun handling shipment of goods by ocean to its U.S. warehouses from Chinese merchants selling on its site—taking on a role it previously left to global freight-transportation companies.” Here are some other details from the article:

Amazon has helped ship at least 150 containers of goods from China since October, according to shipping documents collected at ports of entry that were compiled by Ocean Audit, a company specializing in ocean-freight refund recovery for shippers.

According to the documents discovered by Ocean Audit, bills of lading dating back to October list Amazon Logistics as a named party, signaling it has entered into an agreement with another party to provide ocean-freight services. The parties shipping with Amazon primarily appear to be Chinese sellers on its website that use its “Fulfillment by Amazon” service, which allows merchants to store items at Amazon’s warehouses that Amazon then packs and ships when they are sold.

Is this further proof that Amazon wants to compete directly with third-party logistics providers? Or is it further proof that Amazon’s logistics strategy is a customer focused one — that is, Amazon is not making these moves to compete directly with entrenched players like UPS, FedEx, and other 3PLs, but rather it’s aiming to deliver the best overall customer experience possible? You decide. For related commentary, see Amazon: Disruptor or Distraction?

(By the way, to put “150 containers since October” into perspective: Walmart imported 775,400 TEUs in 2014, which works out to 2,124 TEUs imported per day.)

Moving on to President Trump, in my predictions for 2017 post last month, I wrote the following:

Will President Trump kill the Trans-Pacific Partnership (TPP) and renegotiate NAFTA? Will he impose tariffs on imports from U.S. companies that move manufacturing operations overseas? Will he declare China a currency manipulator? Will he take a more protectionist stance toward trade? The answers to those questions and more could significantly impact supply chain strategies, everything from sourcing decisions to network design, which is why my prediction from two years ago — that more companies will start treating Supply Chain Design as a continuous business process — is now a critical necessity.

It took less than a week since getting inaugurated for President Trump to answer most of those questions: Yes.

Withdrawing from the TPP was just a formality since it was already dead in Congress, with support from many Democrats and some Republicans to exit. But discussions this week about implementing a border tax on imports — such as a 20 percent tariff on products imported from Mexico, which could be used to pay for the president’s proposed wall along the U.S.-Mexico border — has many retailers and other importers concerned, to say the least. And the Twitter exchanges between President Trump and Mexican President Nieto, which resulted in a cancelled meeting between the two leaders next week, is a sign of the growing uncertainty and risk associated with U.S.-Mexico trade and relations, which is not only a concern for manufacturers and retailers, but also logistics companies. As Laura Stevens wrote in the WSJ this week, “While Mr. Trump’s barbs have been directed mainly at manufacturers, logistics companies that play a key role in moving auto parts, industrial equipment and other goods are watching them closely. These firms have spent billions of dollars upgrading rail facilities, building warehouses and expanding truck terminals.”

And this was just Week 1 of the new presidency. Buckle up.

Shifting gears to technology news, DHL officially launched CILLOX, “an online marketplace that connects shippers and transport providers on demand, thus increasing efficiency for both by enabling safe and convenient access to a highly fragmented market using a single digital freight platform.” Here are some additional details from the press release, plus a short video:

For companies with freight shipping needs, CILLOX gives access to reliable and suitable transport providers for their particular cargo – without time-consuming negotiations and difficult comparisons of prices and services. Shippers get immediate access to pricing information based on their shipment characteristics, availability of trucks and last-booked rates. This enables a better comparison and booking of incoming quotes from transport providers. CILLOX offers the freedom of choice of a marketplace, as shippers choose and book the transport provider that best fits their requirements yet enjoy a single point of contact with CILLOX as their contract partner.

CILLOX is ready to use for all companies and transport providers shipping road freight within Germany or from Germany throughout Europe. DHL will be continuously optimizing the platform to ensure long-term customer satisfaction by extending its transport modes, services and geographical coverage.

Simply put, this is a big, entrenched player in the logistics industry striking back against a myriad of technology-focused startups looking to disrupt the brokerage and freight forwarding industry. As Amadou Diallo, Executive Vice President Value Added Services & Integrated Logistics at DHL Global Forwarding and CEO CILLOX, says in the press release, “I’m confident we will shake up the freight forwarding business, and the digital transformation of our industry will benefit all parties involved.”

Translation: if anyone is going to disrupt us, it’s going to be us!

In other technology news, 3Gtms released version 16.1 of its 3G-TM transportation management system (TMS) software. Some key new features include:

Carrier web service rating automates the traditionally time-consuming work of ensuring contracts are entered and maintained accurately for proper rating. This new feature facilitates the rating request and response transaction to/from the format(s) required for 3G-TM and each carrier’s web service.

Broadcast spot offer provides the ability to publish a load to collect spot quotes from one or more carriers that exist within 3G-TM. Carriers may respond to the request through the 3G-TM Carrier Portal, after which the user can choose the desired spot quote option and assign the rate and carrier to the load.

Ad hoc reporting introduces additional data security controls to allow users operating in the multi-tenant SaaS environment to leverage self-service, custom report development.

Internationalization and localization offers geodata sets for regions outside North America, more options for data formatting, VAT calculations, and options to use a currency other than the U.S. Dollar.

Enhanced inbound vendor portal supports improved user and vendor/supplier collaboration, including requests for routing and issuing routing instructions for inbound collect shipments.

Launched in 2013, 3Gtms (a Talking Logistics sponsor) is one of the newer entrants in the TMS market, but the company has grown significantly over the past couple of years in both the 3PL and shipper space. While these new features strengthen their solution and bring them up to par with competitors in some areas, their key differentiator is their modern technology platform, which provides both users and their developers with greater flexibility and configurability than solutions based on older technologies.

And with that, have a happy weekend!

Song of the Week: “Modern Act” by Cloud Nothings