Above the Fold: Supply Chain Logistics News (August 25, 2022)

The streak ends at 35 years.

That’s how long I’ve been driving and I’ve never gotten a ticket. Until last Saturday.

I wasn’t speeding. I didn’t run through a red light or roll through a Stop sign. I didn’t do any of the usual things people get ticketed for. What I failed to do is move over and change lanes in time to give additional clearance to a police car and another vehicle stopped in the breakdown lane. From my perspective, I didn’t feel like I had enough time to safely move over in time, but it is what it is.

It’s now Week 1 of a new safe driving streak.

Moving on (or over) to this week’s supply chain and logistics news:

Truck Trailers as Temporary Mobile Warehouses

Back in January 2019, in a guest commentary titled “Excess Inventory? No Problem. You Have Trailers In The Yard,” Matt Yearling (former CEO of PINC, now part of Kaleris) wrote the following:

“Much like your neighbors use portable on-demand storage to store their household items during move-ins, move-outs, or home renovation projects, truck trailers in yards increasingly are being used to hold goods as mobile warehouses.”

Yes, history continues to repeat itself.

As Liz Young reports in the Wall Street Journal this week, “Companies flush with inventories and straining for warehouse space are increasingly turning to ad hoc arrangements that include storing goods in parking lots and on truck trailers as they cope with an ongoing disconnect between supply and demand.”

However, by trying to solve one problem, you create others. As Young points out, “Shipping experts say the practice of keeping goods on transport equipment adds to broader strains in already-stressed supply chains because it ties up shipping containers, truck trailers and the truck frames needed to keep goods moving, making it tougher for trucking companies and ocean carriers to get the equipment they need at the right place and the right time.”

There is the added issue that many companies lack yard management capabilities, including not having detailed visibility into the inventory in these trailers. As Yearling wrote:

“Few would argue with the level of flexibility that mobile trailers provide to companies that need more space, but with this emerging warehousing option comes new requirements and challenges for companies that use it. Within the supply chain, for example, knowing what inventory is on hand at any given time, quickly finding where inventory is, and then tying that data to transportation and delivery is an ongoing challenge.”

I echoed this point this past May in “Why Implement A Yard Management System?”:

Historically, yard management has been the weakest link in the end-to-end supply chain, with many companies still relying on clipboards or low-tech solutions to manage their operations. As a result, they are incurring significant costs in the form of unproductive labor, higher demurrage and detention fees, lost or misplaced trailers, product spoilage, and excess inventory (among other cost factors). They are also failing to meet customer expectations around service, visibility, and responsiveness, which limits their ability to differentiate themselves and compete on customer experience.

Simply put, using truck trailers as temporary mobile warehouses is a strategy worth considering, but you have to understand the broader implications — and if you don’t have good yard management capabilities, all you’re really doing is playing Whack-a-mole.

For related commentary, please read “Yard Management: The Most Important Limiting Factor In Supply Chains.”

Robots in the Warehouse

Whether it is driven by a tightening labor supply or a need to cost-effectively scale operations, companies and logistics service providers will almost certainly continue to implement robots and other types of warehouse automation technology in the years ahead. 

I wrote that back in January 2022 in “Robots In The Warehouse: A Question Of When.”

The latest example of this trend: GEODIS and Locus Robotics announced this week “a new expansion agreement to deploy a total of 1,000 LocusBots at GEODIS’ worldwide warehouse locations over the next 24 months. This represents one of the industry’s largest AMR [autonomous mobile robots] deals to date.” Here are some excerpts from the press release:

GEODIS has currently deployed Locus AMRs at 14 sites around the world, serving a wide range of retail and consumer brands, including warehouses in the U.S. and Europe. The agreement will expand that footprint significantly as new sites are deployed.

“As we continue to navigate industry-wide challenges such as skyrocketing e-commerce demand and labor constraints, it is crucial we remain committed to implementing the most innovative and effective robotics automation solutions available into our warehouses to allow us to best serve our customers,” said Eric Douglas, Executive Vice President of Technology and Engineering at GEODIS in Americas. “Locus’ collaborative multi-bot approach has proven its effectiveness and reliability at each of our sites, giving us the ability to easily scale performance while providing a safe, smart working environment for our teammates. This new expansion agreement reinforces our clear and ongoing commitment to cutting-edge technology to meet our exploding customer volumes globally.”

I’ll repeat what I said back in January: The question for most companies is not if to implement robot technologies in the warehouse, but when.

And with that, have a happy weekend!

Song of the Week: “Unconditional I (Lookout Kid)” by Arcade Fire