This Week in Logistics News (July 31 – August 4, 2017)

Last week I asked “What can potentially stop or bring down Amazon?” In case you’re wondering, the top vote-getter in our highly unscientific poll was “A massive asteroid hitting the Earth.”

It’s actually not a far-fetched possibility.

“A leading astrophysicist from Queen’s University Belfast has warned that an asteroid strike is just a matter of time,” states an article published this past June in Phys.org. Here’s more from the article:

Professor Alan Fitzsimmons from the University’s Astrophysics Research Centre has said it is a case of when an asteroid collision will happen, rather than if it will happen.

On [June 30] in 1908, a small asteroid exploded over Tunguska in Siberia and devastated 800 square miles. Professor Fitzsimmons is warning that a similar unexpected strike in today’s world could easily destroy a major city and a larger asteroid could be more dangerous.

“Astronomers find Near-Earth Asteroids every day and most are harmless. But it is still possible the next Tunguska would take us by surprise, and although we are much better at finding larger asteroids, that does us no good if we are not prepared to do something about them.”

Considering all of the wacky patents Amazon has been issued, such as a shipping label with a built-in parachute, it wouldn’t surprise me if Amazon has already patented ways to operate on the Moon or Mars in case Mother Earth gets vaporized by an asteroid.

Anyway, speaking of Amazon, it tops the list of the supply chain and logistics news that caught my attention this week:

Returns is the migraine headache of e-commerce, for both sellers and consumers. In an effort to make it more convenient for consumers, Amazon is introducing a new returns policy for sellers that fulfill orders themselves (instead of using Amazon Fulfillment Services). Here’s an excerpt of the email Amazon sent to sellers, as posted by a seller in an online forum:

Dear Seller,

Amazon is simplifying the returns process on items fulfilled by sellers. Starting October 2, 2017, returns of items that you fulfill and that fall within the Amazon returns policy will be automatically authorized. Customers will be able to print a prepaid return shipping label via the Online Return Center instantly.

We are also introducing ‘returnless refunds,’ a feature that is highly requested by sellers. If you so choose, you will now be able to set rules and automatically issue a refund without requiring an item to be shipped back to you. Sellers have requested this because, in many cases, it allows you to save on both return shipping and processing costs.

We hope these changes will reduce the effort required to manage your returns and decrease your customer Return Dissatisfaction Rate (RDR), thereby improving your ratings. Additionally, you will have full visibility into the end-to-end return process through shipment tracking information located on the Manage Returns page in Seller Central.

As reported by CNBC, the automatic returns authorization “means a buyer will no longer need to contact the seller before sending an item back, and the merchant won’t have the opportunity to communicate with the customer. If a consumer is returning an electronic device because it’s difficult to use, for example, the seller won’t be able to offer help before being forced to pay a refund.”

The article also states that “some sellers noted in the forums that Amazon is allowing them to exempt a certain number of items from the automated returns process. Amazon confirmed in a statement that sellers can ‘receive exemptions to have specific inventory excluded’ and said that the returnless service is optional.”

So, is selling on Amazon worth this returns migraine? Absent a better alternative, I believe most sellers will pop some Advil and go along with it. That said, it’s these types of policies that open the door to would-be competitors to offer a better mousetrap, ideally for both sellers and consumers (think Facebook as a storefront with a network of 3PL partners to handle order fulfillment, or some other creative partnerships).

One of my predictions for 2017 was that we would continue to see the convergence of commerce and logistics, as well as the ongoing convergence of technology and logistics service providers. For example, earlier this year, FLEXE announced a new fulfillment solution that enables e-commerce brands to reach 98 percent of the US population via next-day ground shipping. Other examples include Symphony Commerce and the MonarchFX Alliance (comprised of Tompkins International, Kenco Logistics, NFI Interactive Logistics, and JDA Software) who are coming to market with solutions to help retailers and others compete against Amazon and its vast fulfillment network and services.

Which brings us to the news this week that CommonSense Robotics has raised $6 million in seed funding from Aleph VC and Innovation Endeavors. The company’s website doesn’t say much other than they’re “building on-demand supply-chains that enable sustainable, 1-hour delivery to online customers.” A TechCrunch article provides a bit more insight into the company:

CommonSense Robotics wants to make near-instantaneous deliveries accessible to smaller businesses with micro-fulfillment centers that can be built inside existing retail spaces.

[The company] is now getting ready to deploy its micro-fulfillment centers for the first time and is not giving away a lot of details until they start operating. Each one combines robotics and artificial intelligence to automate the preparation of orders, including receiving inventory, picking orders and packing them. Then deliveries are carried out by the retailers themselves or third-party services. Building micro-fulfillment centers into stores means retailers can save on overhead and sell more things to their existing customers.

If not an asteroid, then maybe competitors can slow down or outmaneuver Amazon (or at least level the playing field) by deploying next-generation robots and artificial intelligence in more creative ways within their existing stores and fulfillment networks.

Maybe.

And with that, have a happy weekend!

Song of the Week: “Eyes Wide Open” by Gotye

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