DHL invests US$8 million in Sri Lanka

DHL has announced today that it will invest US$8 million in Sri Lanka over three years. It has signed a joint venture (JV) agreement with Capitol AEI Pvt. Ltd to form DHL Global Forwarding Lanka. The investments will go towards the joint venture, employee training, upgrading of information systems and introducing an enhanced range of services for businesses in Sri Lanka. As part of this investment, by end 2009, DHL will also launch the “DHL Fashion and Apparel Center for Excellence” in Colombo. The center will comprise of a core team of industry experts and be responsible for developing tailored solutions and provide consultancy services to customers.

Reports Show Rising Costs of Logistics

Two recent reports have given us an insight into the rising logistics costs faced by companies in this global recession. The Council of Supply Chain Professionals (CSCMP) reported in the 19th annual State of Logistics Report that logistics costs totaled $1.4 trillion in the US, which represented 10 percent of the gross domestic product. This figure showed a 7% increase on the previous year. In the other report, by the LTL carrier Purolator, the conclusion was that businesses could not operate without the logistics function, but with costs rising significantly, businesses may not be able to afford it. The Purolator report suggests some ways by which firms can control logistics spending including; package consolidation, trade incentives, managing returns and sensible shipping classifications for packages.

 

Companies still struggling to manage their supply chain carbon emissions

Just 10% of companies are actively modelling their supply chain carbon footprints and have implemented successful sustainability initiatives, according to research figures covering North America, Europe and Asia released this week by Accenture. The worldwide survey of supply chain executives had also found that supply chain “masters” − organisations that had achieved top-quartile performance in both cost effectiveness and customer service − were more than twice as likely as non-masters (20% versus 9%) to actively model their supply chain carbon footprints and implement successful sustainability initiatives. Accenture said its study had also found that more than one-third (37%) of supply chain executives had no awareness of the level of supply chain emissions in their supply chain network. However, more than three-quarters (86%) of respondents had undertaken at least one green initiative in their warehouses, predominantly in the areas of recycling and using natural light, lighting management systems and energy efficient bulbs, while more than one-third (38%) said they had undertaken at least one green initiative in their transport fleet, such as streamlined vehicle design, green fuels and vehicles with hybrid engines.

Rising supply chain complexity

A new Microsoft and Infosys research has detailed how much high-tech supply chains have increased in complexity. According to the research, companies reported a 62% increase in the number of suppliers they manage, 66% increase in the stock-keeping units they handle. They have also reported sharp increases in the number of production locations managed (59%), the number of geographies managed (63%) and the number of demand channels managed (59%). Many also complained of a lack of tools to manage this complexity.

A move towards Build-to-Suit Distribution Centre Strategy

The primary reason for the growing demand for build-to-suit distribution centers is in the difference between older and newer warehouse property design. Today’s distribution center is less a home for product and more a place to house material handling systems.  Therefore, it is reasonable to expect that the “science” of material handling would, and is, driving changes in distribution facility design. Given the magnitude and long term implications of such a decision, most companies specify and build their own distribution facilities only when nothing existing in the desired location fits or can easily adapt to their needs.

 

IBM Survey of Senior Supply Chain Managers

IBM has just released research study titled The Smarter Supply Chain of the Future-Global Chief Supply Chain Officer. The survey spoke to 393 executives, located in 25 countries, spanning 29 different industries. The top five concerns reported as significant for executive level supply chain leaders are supply chain visibility (70%), risk management (60%), cost containment (58%), increasing customer demands (58%) and globalization (43%). You can obtain more information on the survey through http://www-935.ibm.com/services/us/gbs/bus/html/gbs-csco-study.html