Tuesday, February 25, 2014

The 2020 Future Supply Chain

Integration of solutions and collaboration of concepts into cohesive model will provide the future of supply chain architecture and will bring in new efficiency and cost reduction to the industry. There are 3 key collaboration concepts that will be the focal point of the 2020 future supply chain architecture.
Information Sharing
Information transparency will be the key thing for effective supply chain collaboration. This is important to improve on-shelf availability (OSA). Information about the actual status of items in the supply chain, at any given instant, is essential to correctly co-ordinate all the combined logistics streams in the overall future supply chain architecture

Collaborative warehousing
Collaborative warehousing is a core component of the future supply chain architecture. The key element is that both retailers and manufacturers must be part of such collaborative warehouse concepts; they should not just encompass warehouse sharing by manufacturers alone. Collaborative warehousing should improve several KPIs: Capacity utilization of the total warehouse, Transport optimization through shared delivery from the warehouse, CO2 and energy reduction through the use of the latest technologies.

Collaborative distribution
The future supply chain architecture anticipates new collaborative models for city distribution that need to be applied in urban and rural infrastructures. For transport congestion and CO2 emissions are the main challenges that need to be addressed.

Now let’s compare the current model with the future supply chain model, and then things will be clearer to you.

As-Is Model 2013
Stakeholders: manufacturers and retailers.
Consumers and stores: located in both urban and non-urban areas.
Warehouse: Each manufacturer has its own.
Distribution center: Each retailer has its own.
Shipment: The manufacturer ships its products to each distribution Centre. Retailer ships the products from its distribution Centre to each of its stores.
Collaboration: No or very less physical supply chain collaboration takes place among manufacturers, among retailers, and between manufacturers and retailers.

To-Be Model 2020
Stakeholders: manufacturers and retailers.
Consumers and stores: located in both urban and non-urban areas.
Warehouse: The manufacturers have a collaborative warehouse, possibly run by a logistics service provider.
Distribution Centre: The retailers do not have their individual distribution Centre’s anymore; products will be cross-docked by either a city hub for urban areas, or by a regional consolidation centre for non-urban stores.

Collaboration: Transport from the city hub/regional consolidation centre will be shared and goes to the stores of the different retailers. Full truckloads will be released more easily.


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