The consumer goods supply chain has many issues to deal with. What is more, these issues are growing in complexity and need addressing immediately to eradicate problems that could severely affect the effectiveness of the supply of goods and its resultant influence on profitability on a companys profitability. By acting swiftly companies can turn issues into opportunities to further their success and add competitive edge to their businesses. We address some of the issues to Martin Hiscox, EMEA Leader, RedPrairie.
Q: What, in your view, are the most important issues facing the consumer goods supply chain?
A: There are many issues and opportunities that our customers will have to face and find ways to overcome potential and real difficulties. These include combating bio-terrorism, the introduction of RFID, rising fuel costs, optimising inventory levels, lowering operating costs.
Bio-terrorism. This has created a new requirement for consumer goods manufacturers, whereby they must track the source of raw materials as well as the destination customer of the finished goods.
RFID. With the new mandates coming from retailers, it has been challenging for the consumer goods manufacturers to find a way to embrace RFID at an acceptable cost.
Rising fuel costs. Transportation costs have risen. These have added an extra burden on consumer goods manufacturers who must try to pass on this added cost in their very competitive markets.
Inventory levels. Finding the right level of inventory that meets both production requirements and customer service is always a challenge.
Lower operating costs. Along with market share growth, lowering operating costs is a key way in which consumer goods manufacturers generate profits.
Q: As a leading supply chain technology vendor you have the luxury of stepping back and devising solutions to the problems highlighted above. But, have you witnessed solutions that end users have devised to their problems that work? And, what about those that didnt? Any observations?
A: Those are interesting questions; and, yes were seeing innovations on a regular basis.
For example, a major health food retailer has devised a web application that monitors items that are near expiry and pushes them out to the stores before they are out of date and therefore unsaleable.
And, within RedPrairie we have developed some interesting solutions for our customers. Heres some examples of what we can do.
We track inventory from raw materials to finished goods. We maintain inventory attributes such as: lot number, revision codes, manufacturing date, expiration date, serial number, etc. All of which enables our customers to combat bio-terrorism threats and manage product recall should it be necessary.
By integrating RFID capabilities into the WMS we eliminate the need for a standalone RFID application and its associated costs.
We offer a transportation solution that optimizes both inbound and outbound truck routes.
We provide real-time web-based inventory visibility to accurately monitor inventory levels.
By optimising warehouse tasks through minimising equipment deadheading (i.e., travelling with empty forks) and also with the use of engineered labour standards we can deliver labour cost savings.
Q: Both you and RedPrairie have been in this market sector for a long time, so theres no question about the companys hard-earned experience and the quality of its solutions; so, could you describe how DigitaLogistix fits the bill?
A: The DLx integrated suite of products provides an end-to-end logistics solution that tracks inventory, optimizes processes, increases throughput and lowers operating costs. These applications have been developed over the past 40 years and have been used and been influenced by some of the largest consumer goods manufacturing organizations in the world.
Q: Can you provide a few examples of consumer goods sector customers and how they are using DigitaLogistix to solve their problems and improve their customers satisfaction levels?
A: We have several examples that highlight the benefits that some of our customers are enjoying. For example:
Healthcare. For one customer, we are running more than 60 warehouses worldwide while being interfaced to SAP.
FMCG. We are running a global organisations warehouses, and providing a glass pipeline of web-based visibility to their corporate staff, customers, suppliers. We also run many of its co-packer sites using a web-based application.
Bulk consumables. We provide both WMS and TMS capabilities across multiple divisions and sites that optimise labour and freight costs in parallel.
Telecomms. We capture the serial numbers of cell phones both at receipt and as they are shipped. Also, the customer service reps use our web-based visibility applications to monitor shipments and activate the phones while they are in transit to the customer.
Q: Any closing remarks about how you see this market sector developing in the future?
A: There is a growing need for a more tactical approach to inventory optimisation. This is driving our development towards such things as inbound PO distribution, order sourcing, and item substitution. Well be talking more about this in the near future and well make sure that we keep your subscribers informed.
Martin Hiscox is EMEA Leader, with day-to-day management responsibility for the business, and for developing and achieving the business plans for RedPrairies markets in the UK and mainland Europe. Prior to his appointment, Hiscox was the CEO of LIS and facilitated the companys growth in the market through acquisitions, start-ups and strategic partnerships. RedPrairie provides industry-tailored solutions for diverse markets, including consumer goods, direct to consumer and traditional retail, food and beverage, high tech/electronics, third party logistics, industrial/wholesale, automotive and service parts, and pharmaceuticals.