Supply Chain Management News Roundup from August 2019

Editor's Note: As we do at the start of a every new month, here's a roundup of significant events and news from the last one.

Connie awards.

William J. “Bill” Shea, Jr., Chief Executive Officer of Direct ChassisLink Inc. (DCLI), will receive the 2019 Connie Award presented by the Containerization and Intermodal Institute (CII) on September 17. The industry-wide event to honor Shea will be held at the Renaissance Hotel in Long Beach, CA. In his current position, Shea has been instrumental in shaping the strategic vision of DCLI and facilitating the acquisition of major legacy chassis fleets while maintaining oversight of the company’s growth and financial performance. In addition, J. Christopher Lytle, the Executive Director of the Port of Oakland, CA, and longtime shipping industry veteran, will be presented with the Lifetime Achievement Award. At the event, CII will carry out its industry education mission by presenting scholarships to students studying logistics as well as the institutions that are educating our future leaders. Under its auspices, CII has awarded nearly $1 million toward scholarships.

Warehouse demand.

While volatile U.S. trade policies had pushed imports forward in 2018, utilization of warehouses has stabilized this year and new supply is coming online. Thanks to e-commerce, Prologis says demand is still robust and is predicting a vacancy rate of 4.5%. Furthermore, says the industrial real estate giant, U.S. market rents are poised to grow by roughly 6% in 2019, after increasing by 8% in 2018. Prologis just released its latest Industrial Business Indicator (IBI) index report, a quarterly survey of over 10,000 customers across several industries measuring the volume of goods flowing through supply chains and industrial real estate in the U.S. The six hottest markets for logistics facility construction are Pennsylvania, Atlanta, Chicago, the Inland Empire, Dallas and Houston. Prologis expects the completion of 260 million square feet in logistics facilities development during 2019.

Speed-to-market.

Among the scores of announcements coinciding with this month's annual mega-conference “Oracle OpenWorld” in San Francisco, was news that JASCI is leveraging Oracle's Autonomous Database technology to enhance its cloud-based software platform for leading retailers. With its self-driving database, JASCI's enterprise shipppers may be able to process twice as many orders at half the labor costs, which is critical to success in an industry where profit margins are razor thin. JASCI's all-in-one SaaS platform embeds AI into its applications to provide shippers with real-time visibility into their warehouse, inventory, orders, labor and shipping. “Today's greatest challenge is meeting shipper demands for order fulfillment. Speed is no longer a luxury, but a requirement,” said Craig Wilensky, CEO, JASCI. “With Oracle Autonomous Database, we are creating a new status quo for our industry to deliver their goods faster and successfully compete in the age of next-day shipping.”

Finding cash.

Flexport Capital released a “financing solution” to help alleviate the working capital constraints caused by the U.S.-China tariffs. According to the company, this software is designed to help shippers – especially “fast-growing companies” – keep their capital working for them. Researchers discovered that over 60% of Flexport clients have had products affected by the tariff increase, resulting in higher duty payments since January 2018. Additionally, of shippers affected by this trend, Flexport researchers found that the average landed unit cost has increased by about 30% due to the tariffs when comparing the first half of 2019 to 2018. To beat the January 1, 2019 tariff deadline, many U.S. brands imported large volumes of inventory. According to the Wall Street Journal, inventory stockpiling led to $3.4 trillion in working capital getting locked up across U.S. companies at the end of 2018, up from $2.7 trillion five years ago.

Smart move.

Internet of Things (IoT) networking is one of the biggest trends to hit the maritime sector in years, with “smart containers” having the potential to radically boost the utility and value of shipping equipment assets by allowing businesses to track their cargo, a new report says. Smart containers have increased in prominence in a very short space of time and the pace of adoption is expected to accelerate over the next five years, according to the U.K. shipping consultancy Drewry Shipping Consultants Ltd. Despite that rising popularity, the adoption of smart containers has a long way to go, since Drewry estimates that at the end of 2018, just 2.5 percent of the global container equipment fleet was fitted with smart technology devices, according to the firm's “Container Census & Leasing Annual Report 2019/20.” A container becomes “smart” when fitted with a telematics device that provides real-time tracking and monitoring, enabling operators to increase turn time of their container equipment and improve utilization rates.

Blockchain buddies.

IBM and Chainyard announced “Trust Your Supplier,” a new blockchain network designed to improve supplier qualification, validation, onboarding and life cycle information management. Anheuser-Busch InBev, GlaxoSmithKline, Lenovo, Nokia, Schneider Electric and Vodafone are founding participants alongside IBM in the network and share a common goal of solving challenges related to supplier information management. By 2023, blockchain will support the global movement and tracking of $2 trillion of goods and services annually, according to technology research firm Gartner Inc. Traditional methods of managing suppliers often involve cumbersome manual processes, which make it difficult to verify identities and track documents like ISO certifications, bank account information, tax certifications, and certificates of insurance throughout the lifecycle of a supplier. By using a decentralized approach and an immutable audit trail built on blockchain, Trust Your Supplier is designed to eliminate manual time-consuming processes and help reduce the risk of fraud and errors, ultimately creating frictionless connectivity across supply chains.

Cool cargoes.

“Of course it's cold…it's German.” Lufthansa Cargo has approved the CSafe RAP for transport on their extensive network of cargo airlines, serving over 300 destinations in more than 100 countries worldwide. The strong performance and thermal protection of the CSafe RAP is quickly attracting attention and gaining approval to fly on cargo airlines around the world. According to Lufthansa, the CSafe RAP represents CSafe's dedication to quality, ensuring the temperature integrity and safe delivery of temperature-sensitive, life-enhancing products across the globe. By utilizing CSafe's proprietary ThermoCor VIP insulation together with an innovative cooling and heating system, the CSafe RAP precisely maintains a defined payload temperature set-point throughout product transport, even in the most extreme ambient conditions (-30°C to +54°C). This is the broadest operating range in the industry, contend spokesmen

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