This is What Happens in the Logistic Sector When you Optimize your Costs
Sven Verstrepen is Head of Supply Network Innovation & Analytics by Ahlers, international provider for logistics & maritime services. Ahler’s headoffice is located in the Port of Antwerp, but has departments and warehouses in Asia, Europe and the Commonwealth of Independent States. This article is a summary of Verstrepen’s presentation given at the STIMA congress in 2016.
Cost Optimization? Yes please!
Cost Efficiency is key in logistics. However, there’s still room for improvement. According to the report of the WEF Supply Chain Decarbonization, international transport reaches a fill-up rate of just 57%. This is resulting in a yearly loss of €160 billion, due to inefficient transportation.
Welcome to the age of co-opetition
A lot of companies have started carrying out a significant mental shift. More and more you see brands who are active in similar markets, working together by bundling, clustering and allocating their transport.
A wonderful example is the collaboration between P&G and Tupperware. Since 2013, they have been sharing a rail transport between Athens and Brussels. They save up to 17% each year and their carbon footprint decreased by at least 30%. The wagons are loaded at maximum.
3 easy steps to logistic collaboration
- Identification: Collect and map all logistic data. Think about transport routes, volumes, …
- Preparation: Implementation of algorythms for network senergy detection and matchmaking by a neutral third party
- Execution: Aside of the execution itself, there’s is often the challenge to share correctly the actual savings
Is this all legal?
The European law (Art. 101 EU) about cartel is very severe but does not forbid collaboration models as long as there’s a third party involved. This can be for example a joint purchasing organization which monitors the reliability and the sharing of data.
Conclusion
A successful collaboration in logistics will only work if it becomes the result of a process based on the following two major conditions:
- a strong confidence between the concerned parties
- efficient use of big data
The early movers already took off, don’t miss the next departure.
