Above the Fold: Supply Chain Logistics News (October 16, 2020)

By Adrian Gonzalez

So far this year, I’ve spent over 160 hours on a bicycle, traveled 2,744 miles, and climbed almost 155,000 feet.

The best statistic, however, is $26,034: the amount our Logistics Leaders for T1D Cure team has raised for JDRF this year, despite all of the challenges caused by the pandemic. It’s still not too late to donate and help us reach our goal.

I’m excited to share the design of this year’s team jersey. A big thank you again to our team sponsors BluJay Solutions and Descartes Systems Group for your support.

Calling all cyclists, especially those involved in supply chain and logistics: Interested in joining our team in 2021? Please contact me. Cyclists of all abilities welcomed! Whether we ride in person or virtually, we have some fun plans for the year ahead. Stay tuned!

Now, here’s the supply chain and logistics news that caught my attention this week:

E-Commerce Reshaping Supply Chain and Logistics

Almost half of the news items above are related to e-commerce, which continues to reshape supply chain and logistics processes, networks, and strategies.

Apple, for example, “is starting to use its network of retail stores as distribution centers for shipping products to consumers, joining a trend popularized by other retailers,” reports Mark Gurman in Bloomberg. Here’s more from the article:

The Cupertino, California-based technology giant has typically shipped devices like iPhones, Macs, iPads, and accessories from warehouses located across a customer’s region or directly from China. Now items that are in stock can be shipped directly to consumers from a network of almost 300 retail stores spread across the U.S. and Canada, according to people familiar with the matter.

In similar news, “Macy’s has closed its Dover Mall store [in Delaware] to shoppers and will instead use the building as a fulfillment center during the holiday shopping season,” reports Brandon Holveck in the Delaware News Journal. “The store will still facilitate in-store and curbside pickup orders, returns, bill pay and other customer services, while acting primarily as a fulfillment center for online orders.”

The buy-online-pickup-in-store (BOPIS) trend, which has gained momentum during the pandemic, will likely continue to grow. “[Curbside pickup] has emerged as many retailers’ best strategy for long-term survival in the e-commerce age,” write Sapna Maheshwari and Michael Corkery in The New York Times. “And what started as a coronavirus stopgap is likely to have a permanent impact on the way people shop, along with giving them a new reason to continue to visit beleaguered physical stores.”

As I wrote a couple of years ago, product returns are the hangover headache of e-commerce — a headache that is only going to get worse as e-commerce continues its rapid growth. Retailers are starting to address this problem. “Office supply chain Staples is following the lead of retailers like Kohl’s and is planning to use its stores as drop-off locations for returns of goods sold by other online brands,” reports Joan Verdon in Forbes. Here’s more from the article:

Staples is partnering with returns and reverse logistics tech firm Optoro to allow consumers to bring returns to the more than 1,000 Staples stores in this country, and get credit for returned items through a QR code on their phones.
Optoro and Staples plan to have the program, called Express Returns, in place in January, in time for the peak holiday returns period. Optoro also hopes to expand Express Returns to additional retail chains in the future.
The Staples partnership reflects the growing realization by retailers that while Americans love buying online, they greatly prefer making returns in stores, especially if they don’t have to box up, and label the return themselves.

E-commerce is also reshaping the third-party logistics industry, bringing both new growth opportunities and new competitors. Take Shopify as an example. The company’s “recent expansion into physical distribution is looking prescient, as surging digital sales during the coronavirus pandemic boost demand for the e-commerce technology company’s fulfillment services,” writes Jennifer Smith in the Wall Street Journal. “Ottawa-based Shopify launched its fulfillment service in June 2019 through partnerships with operators of seven warehouses around the U.S., aiming to speed delivery for small and medium-size brands. Shopify also bought warehouse robot-maker 6 River Systems Inc. for $450 million and began deploying the company’s robots in some partner warehouses to help workers fulfill orders.”

As I pointed out more than four years ago in The Convergence Of Logistics And Commerce (And Social Networking Too):

The traditional lines between software vendor and 3PL, and between the front-end of e-commerce and the back-end, are all starting to blur and dissolve. The reason is simple: customers are looking for Simplicity-as-a-Service — that is, they are looking for partners, regardless of what you label them, that can help them achieve their desired outcomes in an ever-changing business environment with less time, effort, cost, risk, and resources.

And with that, I’m out of time and space. Have a happy weekend!

Song of the Week: “Crystal” by New Order