When you think of e-commerce, Amazon stands out as one of the global giants. As part of their supply chain strategy, and a way of reducing their freight costs, they’ve purchased their own planes, ships and vehicles. But that’s not where the real gains are being made; they’re constantly analysing their massive amounts of data to find ways to improve their delivery model, and their supply chain solutions.
A recent Logistics Management study concluded that: “Based on volume, scale and buying power, Amazon will command more attractive pricing than other freight forwarders, enabling them to secure capacity at a lower cost and ensure profitability as they fill that space more easily than competitors."
Amazon have recognised that the most powerful weapon in the global logistics battle is no longer equipment, container vessels, or fully automated ports. It’s information.
When logistics companies decide they can’t compete much on the products they are offering, the solution is to focus on their service, and that comes down to price and speed. This has led to them being very private about their data, which increasingly will be to their detriment.
Sharing works better when it is driven by the user of information, rather than always controlled by the provider. When applied to supply chain management, this means enabling customers to access and use cargo data however they want, to get complete visibility to what’s happening with their goods at any time, so they can make smarter, more efficient decisions.
Instead for many customers, their cargo falls into an information black hole from the time it is collected from their facility to when it is delivered to the final recipient. The real battlefront in global supply chain management is trying to bring more light to that dark place.
It’s tough to argue with the reasoning. When all supply chain partners work together to fulfil orders, make sure shipping runs on time, and make use of early alerts to problems, the supply chain runs more efficiently, accurately and cost-effectively. Ultimately, it’s boosting the customer experience from one end of the chain to the other.
Lack of supply chain visibility means businesses are missing out on the benefits of building a single, efficient global data flow. Our latest insights paper goes into this concept in more detail. Download Who shares, wins.