Above the Fold: Supply Chain Logistics News (May 29, 2020)

I’m on borrowed time this morning, so let’s go straight to the supply chain and logistics news that caught my attention this week:

There’s A Surcharge For That E-commerce Growth

COVID-19 has been a great disruptor, but also a great accelerator. With many retail stores closed and shelter-in-place policies in place, consumers have ramped up their e-commerce purchases. It is now Christmas in June. As Paul Ziobro reports in the Wall Street Journal, UPS is adding delivery surcharges “for companies that have been inundating its delivery network with many more packages and oversize items during the coronavirus pandemic.” Here are some details from the article:

The surcharge adds 30 cents on each package shipped under UPS Ground and SurePost, the service in which UPS drops packages at the Postal Service for delivery to homes. The added fee kicks in only on shippers that topped their average weekly volume in February by more than 25,000 packages.

Another surcharge adds $31.45 onto each large package shipped, which could hit items like desks, patio umbrellas and trampolines that have been popular online purchases during lockdowns across the U.S…That fee would apply to shippers after they ship more than 500 large packages in a week.

Delivering to homes has always been more costly than delivering to businesses. With more people likely to work from home after the pandemic is over, the shift UPS has experienced in home deliveries in recent weeks — 70% of packages are currently being delivered to homes compared to about 54% during all of 2019 — might not be a temporary one. In short, COVID-19 is accelerating the need for UPS, FedEx, USPS, and other carriers to reconfigure their networks and business models to succeed in this rapidly changing market.

Kuebix and Ryder: The Network Effect in Supply Chain Management

I first wrote about the network effect in supply chain and logistics back in 2014. The post built upon the concept of supply chain operating networks (SCONs) that I originally introduced in 2003. 

As I described it last year in “Putting Community In TMS: Enabling The Network Effect In Transportation Management,” the network effect exists in transportation when the addition of another shipper, carrier, freight broker, or other participant to the network makes all the existing members of the network better off — by more quickly and efficiently matching demand with supply; by executing transactions in a more streamlined and automated way; and by providing everyone with network-based business intelligence and analytics about capacity, rates, on-time delivery, and other metrics.”

The latest example of “the network effect” in action comes from Kuebix (a Talking Logistics sponsor) and its parent company Trimble. The two companies announced this week “new capabilities for its Community Load Match platform, a solution that facilitates collaboration between shippers and carriers to optimize how freight moves throughout the supply chain.” Here are some details from the press release:

Community Load Match enables shippers to use advanced matching capabilities to more easily find available carriers for their truckload shipments and leverage improved map visualization through Trimble MAPS. For carriers, these capabilities give them direct access to Kuebix’s community of more than 20,000 shippers for matching shipment requirements with available truckload capacity.

Kuebix integrates with Trimble’s Innovative, TMW.Suite and TruckMate carrier transportation management systems (TMS), allowing shipment data to seamlessly flow between systems for maximum efficiency. Connecting Kuebix shippers with Trimble’s carrier network through a single integrated platform brings together two of the largest shipper-carrier ecosystems in North America.

You can see a brief demo of the solution here.

In short, I’ve been a proponent of network-based solutions for almost 20 years, especially in the transportation realm. Network-based TMS platforms can eliminate many of the inefficiencies and waste in the industry, and enable smarter and more synchronized processes, by breaking down the data and workflow silos between shippers, carriers, and brokers. That is, by aggregating and providing real-time and forward visibility to loads, capacity, rates, service metrics, and other data, and coupling it with machine learning, optimization, and automated workflow capabilities. We haven’t reached the full potential of these solutions yet, but the pace of innovation and market acceptance is accelerating.

In related news, Ryder System announced this week the availability of RyderShare, “its one-of-a-kind collaborative logistics platform [that] enables everyone involved in moving goods through supply chains – including shippers, receivers, carriers, and service providers – to work together in real time to prevent costly delays and find efficiency gains.” According to the press release:

Historically slow to change, the logistics industry has relied heavily on phone calls, emails, spreadsheets, and disparate transportation and inventory systems, all managed by disconnected operating teams. This isolates information and access and, ultimately, restricts visibility.

RyderShare takes the opposite approach. It’s the first of its kind to integrate these silos of information and enable collaboration across the supply chain in real time. Leveraging the groundbreaking cloud-based technology Turvo, an industry leading collaborative logistics platform, and Ryder’s 87 years of operational and implementation expertise, RyderShare integrates the data from multiple transportation and warehouse management systems into a single, synergistic platform, which allows all parties involved in a supply chain to easily see potential problems and inefficiencies and take real-time action to course correct.

The solution is currently being rolled out with 18 customers across 90 locations, including Do it Best, a member-owned hardware, lumber, and building materials cooperative based in Fort Wayne, Ind. As highlighted in the press release:

“RyderShare has been a game changer for us,” says Tim Miller, vice president of logistics for Do it Best. “Tracking and tracing loads that used to take hours of phone calls and emails now takes minutes, and that enables our member-owned stores to better plan for on-time deliveries and for our teams to more efficiently manage their time. The Ryder team continues to add value to our organization, and RyderShare takes that to a new level.”

The title of Ryder’s press release begins “Going Beyond Visibility,” which is an important point to emphasize. As I wrote last summer in “TMS Visibility: See, Observe, Then Do”:

Visibility by itself, however, is not enough. Yes, seeing is believing, and having access to data you didn’t have before is powerful — but only if you do something with it.

And to do something with it, you need transportation management systems, warehouse management systems, demand planning systems, and other enterprise applications that convert data into insights and action (via optimization and automated workflows, for example), and that is what ultimately delivers value. This assumes, of course, that the quality of the data provided by visibility platforms is actually good (a big assumption in many cases). But I digress.

For more on network effects, check out “Here Comes The Chief Network Effects Officer.”

And with that, have a happy weekend!

Song of the Week: “Deleter” by Grouplove