Category Archives: Logistics

BizSlate Releases its ERP for Mid-Sized Distributors and Retailers to the Masses

Last fall we introduced you to BizSlate, an ERP for small to mid-size distributors and retailers that is bringing a useable, affordable ERP solution with exceptional supply chain support to the masses. (Basically, it’s doing what Compiere and Made2Manage did for small to mid-size manufacturers.)

As per our our introductory post, the founders, who were with Ezcom software, noticed the (utter) lack of appropriate ERP support for the small and mid-sized retail and distribution space and decided they needed to do something about it. The solution? A new SaaS based ERP system (re) built from the ground up to address the everyday accounting, inventory, catalog management, and order management/e-Procurement requirements of small and mid-sized distributors through a simple web-interface that is as easy to use as most of the new SaaS e-Procurement enterprise systems on the market.

Developed in conjunction with two dozen beta users, as per this VentureBeat article, Version 1 is now launched and is quite slick. As per our last post, the batch create function is incredibly powerful and easy to use. Not only can an administrator batch-create new products by entering all of the base product information, but he or she can select categories, suppliers, locations, terms, etc. from easy-to-use auto-complete pull-downs or from generic saved templates for product type. Extensive profiles can be created in a matter of minutes and hundreds of line items in a matter of seconds.

Order generation is as quick and painless as possible. A user can easily add items to an order through a simple-to-use but powerful search function that allows a user to search by name, code, style, or other attribute values and, as mentioned in the VentureBeat article, order generation can be done on the showroom floor on a mobile (Android or iOS) tablet. As per the batch generation, customer information, (preferred) supplier(s), terms, and other data can be quickly retrieved from pre-populated lists.

And the system even supports a sales order multi-edit capability which allows a user to update information across multiple sales orders (such as ship dates, payment terms, shipment location, etc.) simultaneously and to rationalize orders as need be. For example, if necessary, orders can be combined, split, and individual line items swapped. This is a powerful capability as it negates the need for orders to be cancelled and recreated or items to be deleted from one order and then added to another order, two very error prone processes.

And the rest of the system, which is configured around inventory, logistics, customer, supplier, and accounting management, is quite easy to use as well — and, in some instances, quit powerful. Consider inventory management — searches can include both open stock, pre-packs, and in-transit inventory and be performed with respect to any date. Thus, if a customer doesn’t want an order to be shipped for a week, you can see how many units you will have in a week after all orders scheduled to be received and shipped out over the next week are accounted for. The ability to search open stock and pre-packs together or separately is quite powerful. For example, let’s say a customer wants an order tomorrow, but you don’t have the open stock and if you don’t ship tomorrow, you lose the order. You can search pre-packs, determine that there is enough inventory in pre-packs, send someone into the warehouse to rip the pre-packs open, assemble the inventory and ship — and then replace the pre-packs with an order arriving in two days to be shipped out in the order the pre-packs were intended for that doesn’t have to ship for three days — and get a sale you would likely have missed otherwise.

With regards to inventory, customer, and supplier management — the ability to track the different SKUs used by each customer and supplier for each product and cross-correlate them across the supply chain is quite valuable. This allows you to search inventory and available suppliers off of a customer’s SKU and get complete, accurate information every time.

The document generation functionality was very well thought out — for each customer you can define what should be on the packing slip and invoice in addition to default shipment profiles to facilitate quick order entries. This simplifies the customer’s order verification and invoice processing and can speed up your payments. Similarly, you can specify what information should go on the good’s receipt to the supplier, what information should be associated with the payment, and what information should be matched before payment is issued. This simplifies transaction management for Accounts Payable and minimizes the chances of over-payment or payment for merchandise not received. And the system can even generate customized receiving forms for the warehouse personnel that makes it easy for them to check off items, and easy for whomever is doing data entry to check it off if they don’t have mobile system access.

It’s one slick SaaS solution and if you are a mid-sized retailer or distributor, BizSlate should be on your must-review list.

Delivery Success Demands Delivery Planning

DC Velocity recently ran a good article on how “Home Delivery Success Starts at the Order” that had some good pointers on delivery success in general. The article, designed to help retailers, gave the following advice:

  • Steer the Customer to the Delivery Times You Want Them to Take
    If you’re not really setup for next-day service, but you have optimized 2-day service, steer them to 2-day.
  • Upsell Premium, Expedited, or Tighter Time Windows and Value-Added Services
    Delivery doesn’t have to be free, and if it’s low-cost (or free), it doesn’t have to be speedy. After all, the if the customer wants a speedy, free, delivery — he can pick it up in the store (unless it’s Best Buy, where he’ll get to stand around and be ignored by no fewer than three associates before anyone even attempts to serve him). Time may not always be money to the end consumer, but it is always valuable. If you’re working, an evening install is worth a small premium vs. having to sit home all day waiting. And if you’d rather watch the game than drive 2 hours to get something for tomorrow, that’s worth it too.
  • Omni-Channel Retailing Needs Omni-Channel Delivery
    All deliveries should go through one scheduling solution — whether the order was made in-store, on-line, or over the phone.

If you reverse this, you can see how you can optimize your inbound supply chain delivery success when ordering from a supplier.

  • Try to Choose a Delivery Schedule a Supplier/Distributor Wants You to Take
    If you have a set of almost equal choices to you, pick the one that’s the easiest / most cost-effective for the distributor / supplier. Not only will it keep your costs down, but it will maximize the chances of getting the order on time as you will be using schedules (and routes) the distributor / supplier has optimized for.
  • Avoid Unnecessary Expedited Shipping or Value Added Services
    Suppliers will use the same tactics on you that you use on consumers to maximize their revenue. It doesn’t mean you have to buy into them. In many cases, shaving a few days off of shipping time to the warehouse doesn’t make much of a difference, especially if you forecast properly, and paying the supplier to do trade document management that your 3PL can do cheaper with an effective system integration isn’t worth the savings of dealing with one less partner.
  • Single-Channel Ordering Should be Fulfilled, Whenever Possible, by Single-Channel Delivery
    If you are ordering five products from the supplier, and they can all fit (and go) on the same truck, they should all be on the same truck. Delivery density reduces costs.

Pretty simple, eh? Almost as easy as getting the mouse in the bottle …

Headline From the Land of D’oh: Notorious Somali pirate quits: Now is shipping safe?

A recent CNN article which noted that the retirement of the pirate leader Mohamed Abdi Hassan, also known as “Afweyne,” has generated much media coverage, but the real significance of his announcement is the indication it gives of how Somalia’s pirates currently view their business model and that it appears that hijacking vessels in the Indian Ocean and the Gulf of Aden is no longer seen as a relatively risk-free affair concluded that while piracy off the country’s coast will not be ended conclusively … it might be contained to a manageable level.

Depending on what you conclude a manageable level to be, that might happen, but shipping is NOT safe. If a pirate can make 10 times the average annual salary in one hijacking, and one hijacking can command a 5M ransom, even with the introduction of international naval ports, armed guards aboard vessels, and best practices, piracy is not going to stop. First of all, it’s still way too lucrative when the right ship is passing through. While it is true that an average shipment of consumer goods is many times safer, the risk for high-value petroleum, weapons, pharmaceutical, and hi-tech shipments is still there. If there’s a 100M worth of easily-moved cargo on the ship, and pirates know about it, the risk is there — especially with more organized crime getting involved in supply chain thievery. Secondly, when a void is created — there’s always a rush to fill it. Recent warfare against gangs across North and South America has shown us that if multiple gangs are vying for a territory, and the biggest one is wiped out, violence escalates as the smaller gangs jockey for position.

The reality is that, for some of you, shipping is now more dangerous than ever. And any article that tries to insist otherwise is giving you a false sense of security that is even more dangerous. Especially when your cargo is more valuable than drugs and guns.

For All Our Sakes, Let’s Hope Shipping Cleans Up Its Act!

Everybody likes to blame the pollution in our cities on our cars. They do emit pollution, especially poorly maintained cars, and there are quite a lot of them, and they make an easy scapegoat. But they are far from the worst offenders. Every since the introduction of the catalytic converter, we have the reality that the riding mower you use you cut your lawn is probably more polluting than the car you drive to work every day.

People who put a little more thought into it blame the trucking industry. Those 18 wheelers are big, burn a lot of gas, and, in olden days, used to emit more fumes than a small mill. But that was yesteryear. Today, these trucks are as clean as the common automobile and, in some cases, cleaner as many shipping giants are experimenting with, and moving to, hybrids.

And airplanes aren’t the problem either. Modern jets take a lot of expensive fuel to run, which airlines don’t want to pay for. Plus, unless the burn is clean, you can’t get the same power.

The real problem are container ships. As per my post back in 2009 where I asked, What’s Worse? The Personal Automobile or 15 container ships, a single giant container ship can emit the same amount of cancer and asthma-causing chemicals as 50 Million cars in the course of a year. Think about that. There are roughly 250 Million passenger vehicles in the US, which says that it only takes 6 container ships to produce more pollution than all of the vehicles on the road! And there are over 10,000 container ships in the world!

So what brings on this rant again? A recent article over on CNN.com on how shipping looks to clean up its act. According to the article, some ships are now burning low-sulfur fuel while in port, which can reduce toxic sulfur dioxide emissions by 85%. And this is supposed to be a good thing. First of all, at an 85% reduction, that means the ship could still be as damaging 7.5 Million automobiles. Ouch! Secondly, ships spend most of the time at sea. If they are still burning high-sulfur fuel at sea, then, at least three quarters of the time, they are as polluting as ever, which means the 85% pollution reduction in port, reduces their pollution output by at most 20%.

At least (part of) the IMO (International Maritime Organization) greenhouse gas reduction program comes into effect this year and, for the first time ever, includes CO2 emissions. Maybe now that the industry is forced to do something, we’ll see some progress. Because, as noted by Chew Hwee Hong, a good 95% of (shipping industry green initiatives) is incentivized or is driven by international regulations. Shippers ain’t doing it for themselves!

Think about that next time you needlessly outsource something to China. No matter how many CSR (Corporate Social Responsibility) programs you put in place, the minute that product hits the ship, you’re doing more environmental damage than you’re likely to negate with any lean or sustainable development / production program.

So You Need To Save On Ocean Freight

You could start with these pointers from Inbound Logistics on Reducing Ocean Freight Costs:

  • Consolidate LTL/LCL to FTL/FCL
       (and use 40-foot and high-cube containers)
    It costs almost as much money to run a truck almost empty as it does to run a truck almost full (when you consider that an empty trailer weights around 12,000 lbs or 5500 kgs), so a trucking company has to charge you more on a weight/volume basis if you don’t ship FTL as they might not be able to consolidate someone else’s cargo and lose money otherwise. Similarly, it’s cheaper to ship full containers, and for a carrier to standardized on 40-foot containers.
  • Transload operations to inland destinations
    Once shipments arrive, route them through a transload facility to be repacked and loaded to inland destinations. Avoiding unnecessary warehousing reduces costs and expedites shipments.
  • Make round-trip opportunities available.
    Providing inbound and outbound flows from a location allows carriers to make optimal use of equipment. While it will not be possible from final destinations, especially if shipping direct to stores with transload operations, you can give the carrier outbound shipments from US production facilities / (return) service depots on its return route to minimize it’s costs, and yours.
  • Know the market
    You should know the current market prices for fuel costs, capacity on your lanes, and provider overheads. You should also know total demand. This way you can negotiate a good (fair) deal.
  • Pay carriers on time according to agreed terms.
    Delaying payments only costs your company in the long run. If you don’t, the carriers will likely have to borrow at an interest rate that (far) exceeds any interest you may make keeping the cash in the bank. This means that they will have to build these costs into their fees, which will go up and cost your organization ore over the long run.

Or, you could just eliminate the need for (a significant quantity of) ocean freight (entirely). Let’s face it — 100% savings is WAY more than the 5% to 10% the above will shave off your costs.

How do you do this? Nearsource (or, better yet, Home-source)! In North America, consider Mexico or Brazil. With overseas labour costs and logistics costs climbing significantly year-over-year, for some products, it’s just as economical to produce them south of the equator — especially when you consider overseas labour rates and logistics costs are NOT going down. Now, SI knows this isn’t necessarily possible for all categories (as high-tech requires very advanced production facilities which can’t be thrown up or staffed overnight, for example), but with the exception of high-tech, biotech, and other industries that require a large pool of very specifically educated people and very high-tech production facilities, there’s no good reason NOT to be looking at locales like Mexico and Brazil right now. (And even if the raw materials need to come from overseas, the cost of shipping (refined) raw materials, which are very dense, is much less than shipping final goods, which typically aren’t dense and which require a fair amount of packaging — and which often have lower import duties!)