Summary: XPO Logistics plans to nearly double its current last mile footprint to 85 service hubs by late 2018 and position XPO’s last mile footprint to within approximately 90% of the U.S. population, further reducing transit times.
The network is designed primarily to move larger items that do not necessarily fit into small parcel networks. As noted in numerous publications, consumers are becoming more accustomed to order online large items such as appliances and exercise equipment. Through acquisitions including 3PD, XPO has gained the know-how and established networks for the movement and handling of larger items.
As noted in the company’s press release – XPO Logistics facilitates nearly 13 million home and commercial deliveries, with the majority including installation and assembly of appliances, large electronics, furniture and other hard-to-handle items each year.
XPO expects to open its next eight hubs in Birmingham, Ala.; Buffalo, N.Y.; Jacksonville, Fla.; Long Island, N.Y.; Los Angeles, Calif.; Milwaukee, Wisc.; Tulsa, Okla.; and Washington, D.C. Skilled teams at each facility will perform inspections, repairs, pre-assemblies and other value-added services in preparation for delivery.
LogisticsTI Take: 3PLs, LTLs and more are introducing services focused on e-commerce – B2C and B2B. XPO has a leg up on many of its competitors thanks to its numerous acquisitions such as 3PD, Menlo and Norbert Dentressangle. However, delivery, installation and assembly is labor-intensive plus if one offers this type of service for the medical equipment industry, there are strict standards that must be adhered to. Will this service be part of “free shipping” that many end-customers have come to expect or will the costs be passed on to the final customer? A difficult decision for shippers when trying to compete in this cut-throat market.
Summary: Driven by customer growth, and the growth of the Malaysian economy, OIA Global announced the opening of its first company-owned office in Kuala Lumpur, Malaysia. According to the Branch Manager for the Malaysian office, “Malaysia continues to lead in exports of energy, electronic equipment, wood products, textiles and Chemicals. The increased volume of imports and exports are a clear message for OIA Global to continue to expand here in Malaysia.”
LogisticsTI Take: Indeed, according to OIA Global’s press release, Malaysia recorded a 5.6% growth in GDP for the first quarter of 2017. The continued growth is being driven by good economic conditions, ASEAN membership and China’s ‘One Belt One Road’ initiative. Growth is expected to continue and as a result, the number of logistics providers will continue to grow creating a highly competitive environment.
Summary: Yusen Logistics has opened its Thilawa Logistics Center in the Thilawa Special Economic Zone (SEZ) in Myanmar. The facility covers 6,300 square meters out of a total area of 30,000 square meters. Within the facility there will be temperature-controlled storage areas offering four temperature settings of -20°C, 5°C, 15–20°C, as well as room temperature. There will also be an assembled vehicles yard area for such services related to assembled vehicles as vehicle storage, pre-delivery inspections, and customs procedures. The press release notes that Yusen Logistics will use this facility as a base to offer a variety of storage and delivery methods for cross-border trade between Thailand and Myanmar.
“This logistics center will be a cornerstone of our logistics business in Myanmar and an important part of our global network including the connection to surrounding countries,” according to the President of Yusen Logistics.
LogisticsTI Take: Yusen Logistics has expanded its Thai operations which are 70% related to the automotive industry. This move into Myanmar will help in particular its Mazda joint venture. Mazda has noted its plans to expand further into ASEAN and the Middle East.
Summary: Newegg has launched Newegg Logistics, its branded logistics solution to help e-commerce sellers and other organizations streamline order fulfillment, shipment and returns.
The service includes the following:
- Forward Logistics – Newegg warehouses the sellers’ products, processes incoming orders and readies them for shipment.
- Transportation Management – Sellers benefit from Newegg’s vast carrier network and enjoy discounted, pre-negotiated shipping rates to get orders in the hands of customers quickly, and at the lowest possible cost.
- Value-added Services – Newegg supports a full suite of custom fulfillment options, including (but not limited to) insertion of promotional materials, pre-shipment assembly and secondary product inspection.
- Reverse Logistics – Returns are streamlined, with Newegg managing return shipping, post-return inspection and resolution either by disposing the product, or returning it to a pool of open-box stock for resale.
According to its press release, almost all orders are processed within 24 hours of receipt can reach 92% of customers in the United States and Canada within two days. Target customers include companies selling direct to customers (B2C) and distributors shipping to a broad network of sellers.
LogisticsTI Take: Days after Flexe’s announcement that it was providing fulfillment services and next day delivery, online retailer, Newegg announces its own fulfillment service. Are these a direct attempt to compete against Amazon? It is looking more like it. However, it will be difficult for Newegg to compete head-to-head with Amazon. Instead, Newegg should focus on its niche, electronics, and perhaps find partnerships among electronics companies or maybe even Alibaba since it has a presence in China.
Summary: UPS Express Critical service launched in Europe for urgent, time-critical shipments that require special handling such as aircraft parts or surgical tools. A UPS team assesses the shipping request through a round-the-clock contact center, identifies transportation alternatives and implements a delivery solution that meets time and cost requirements. Options include air, charter, surface and a personal courier who can carry the shipment by hand from origin to destination on a commercial flight.
LogisticsTI Take: This niche solution will face plenty of competition in the European market. Designed for industries such as healthcare, manufacturing and aerospace, speed of delivery takes priority and often comes at a hefty price. It’s great to see UPS expanding this service beyond the borders of the US but shippers need to consider their options. If the shipper is already an existing UPS client, this could possibly be bundled with their existing UPS services.
Summary: FLEXE a marketplace for on-demand warehousing and fulfillment services announced FLEXE Next-Day Delivery, a new fulfillment solution that enables e-commerce brands to reach 98% of the US population via next-day ground shipping.
According it its press release, FLEXE Next-Day Delivery gives companies control of the end-to-end fulfillment process, from identifying ideal fulfillment center locations to delivering product via integration with all major carriers. FLEXE integrates with all major shopping carts, provides inventory control and enables dynamic order management.
LogisticsTI Take: FLEXE notes that it now provides a faster delivery service versus Amazon Prime. Watch out, Amazon Prime has been expanding its same day delivery service across the US as well as outside of the US.
In all honesty, there is no need for FLEXE to compare itself to Amazon. Yes, I know it could possibly be compared to FBA. However, FLEXE sets itself apart by offering a neutral and unique solution for e-commerce providers as well as other businesses in need for extra space for product launches, peak seasons or for any other reason. By adding a next day delivery solution it’s like icing on the cake and provides an additional option for shippers looking to add flexibility into their supply chains. One size does not fit all supply chains. Shippers will need to decide on the best option that fits their strategic goals and objectives.
Summary: FedEx Express opened its latest facility, FedEx Logistics Center, in Panama Pacifico. The opening is part of its plan to provide a broader portfolio of solutions and expand its presence in the Latin American and Caribbean region.
The facility features the following:
- Strategic location in the condominium zone in Panama
- Temperature-controlled capabilities of 15-25 degrees C and 2-8 degrees C
- Capability for modular expansion and flexible enough to expand under the same roof
- Free trade zone
- Regional coverage with transportation services such as less-than-truckload (LTL) shipping and full-truckload (FTL) shipping needs.
Services are targeted to specialized sectors such as technology, healthcare (medical devices and pharmaceuticals), the automotive industry, telecommunications, electronics and retail.
FedEx has also extended its network of logistics solutions in Puerto Rico, Chile, Costa Rica, Guatemala, Mexico and Brazil with services including:
- Managing critical inventory with proactive monitoring and visibility
- Accessing inventory and order information in real-time
- Utilizing warehouse space
LogisticsTI Take: The Panama Canal expansion along with specific vertical logistics needs and growth within the Latin American market are resulting in growing expansions/new facilities from logistics and transportation providers.
Summary: Emergency logistics specialist, Evolution Time Critical announced the opening of a new office in Atlanta GA. According to the press release, the expansion is due to the increased demand for time-critical logistics services from the automotive industry. The US launch for Evolution Time Critical follows the company’s acquisition by Canada-headquartered North American third party logistics provider Metro Supply Chain Group in 2016.
According to the company’s managing director, “An Evolution Time Critical facility with on-location expertise is a major advantage for manufacturers and suppliers operating supply chains in North America, and enables us to offer existing customers an enhanced service and even greater in-depth knowledge.”
LogisticsTITake: Time critical logistics service providers such as this are important to not only the automotive industry but to other industries such as industrial manufacturing, healthcare and more. Evolution time Critical faces stiff competition with other providers such as DHL, Kuehne + Nagel and UPS offering similar solutions but because of its single focus could prove successful and result in further expansions within the US and Canada.
Summary: Yusen Logistics Americas new group, Transportation Solutions Group, has been set up to create customized solutions for new and existing customers. Services will be provided under three categories:
- Specialized and niche transportation services such as cross-border Mexico intermodal and truckload transportation and less than truckload brokerage.
- Adjacent handling services such as cargo consolidation and de-consolidation; cross dock and trans load; value-added product handling; forward inventory positioning and customs house brokerage.
- Managed transportation services including centralized execution and account management; purchase order and vendor management; route management and optimization; carrier management; and control tower.
In addition, according to its press release, the group will provide value-added warehouse services from its Charlotte NC and Laredo, TX facilities.
LogisticsTI Take: It appears that Yusen Logistics Americas is aligning its US network to its parent company’s global network. The press release notes that the Americas group will collaborate with Yusen Logistics’ global network to ‘seamlessly connect is services across multiple groups and to focus on key vertical markets such as automotive parts and components.”
Summary: DHL e-Commerce latest fulfillment center in Hong Kong is located within DHL Supply Chain’s one million square foot Interlink operation. It will primarily work to provide overseas e-tailers with fast and flexible shipping solutions that integrates inbound freight, inventory and last-mile delivery in an one-stop solution.
According to its press release, merchants looking to move into the Greater China market find that customs and regulatory requirements are major setbacks in running a smooth inbound cross-border clearance. Running the products through an established fulfillment center mitigates these risks and combined with flexible warehousing, closer proximity to the end consumer and last mile options these solutions will benefit e-tailers.
The Center is designed to accommodate three key features of an ‘ideal’ fulfillment system, accommodating a front-end integration with a range of popular marketplaces and webshop platforms alongside multichannel order management, as well as last-mile solutions to quick and accurate deliveries. With a focus on cost-effectiveness throughout the entire process, all of the center’s services operate on a pay-per use model with no capital spend or fixed costs.
LogisticsTI Take: Similar to its recent Australian facility, DHL e-Commerce’s fulfillment strategy is a unique one that not only sets it apart from increasing competition but it should benefit both small, medium and large e-retailers looking to expand sales beyond home borders.
Summary: Panalpina opened a 40,000 square meter facility adjacent to Al Maktoum International Airport. The facility supports circular supply chains and according to its press release, enable the company to grow its logistics and freight forwarding business in the Middle East, Africa and CIS (MEAC) region. Currently, Panalpina mainly serves customers from the technology, oil and gas as well as consumer and retail sectors in Dubai.
The facility is located in Dubai Logistics City and forms part of the bonded logistics corridor that links the Al Maktoum International Airport and Jebel Ali Port. Most of the operational space is used for inbound to manufacturing and vendor managed inventory services in support of its Logistics Manufacturing Services (LMS). There are separate areas for the break-down or build-up of air freight, intermediary storage of valuable goods and other special activities. Furthermore, goods are kept and handled in clean and fully air-conditioned chambers where the room climate is monitored and controlled.
From its press release – In a separate repair room, equipped with antistatic flooring and special lighting, specialists grade used mobile phones, tablets and laptops before they are reintroduced into the supply chain, recycled or discarded. Specialists also refurbish game consoles, which involves diagnostics, repair and testing. In the LMS area, also equipped with special lighting and electrical supply points, Panalpina engineers and technicians pick semi-knocked down units, configure, assemble and test them with the latest software uploaded.
LogisticsTI Take: Growing opportunities exist in the MENA/CIS region domestically as well as a transshipment location and is prompting logistics providers such as Panalpina to expand services. According to Panalpina, more companies want to configure and customize their products closer to market and then deliver them to the end customer as quickly and efficiently as possible.
Summary: Lineage Logistics, a temperature controlled warehousing and logistics company, announced plans to expand two existing facilities in the Dallas-Fort Worth area as well as the completed acquisitions of two buildings, one in Phoenix AZ and one in Bethlehem, PA.
For one of the expansions, the facility will be a rack-supported, fully automated building. The automated addition will be designed to provide over 7 million cubic feet of frozen and refrigerated space with 19,000 pallet positions to support fast-moving distribution product. The other facility will see its total capacity increase to 23.9 million cubic feet with 54,000 pallet positions to house frozen and refrigerated product.
The Phoenix facility is 200,000 square feet and the Bethlehem facility is 265,000 square feet.
LogisticsTI Take: According to Lineage, the company is expanding and automating to support customers’ supply chain initiatives. In addition, the press release notes that Lineage’s customers need state-of-the-art cold storage facilities to ensure their product is stored in the safest and most efficient manner.
Summary: According to the press release, the new facility, located in Sydney, will offer flexible, full-integrated cross-border shipping, inventory management and last mile delivery for e-commerce retailers. The facility will join DHL’s network of ‘plug-and-play’ fulfillment centers.
The center’s design accommodates front-end integration with a range of marketplaces and web-shop platforms as well as multichannel order management and last mile solutions for immediate and accurate deliveries across Australia. All of the center’s services operate on a pay-per-use model with no capital spend or fixed costs.
LogisticsTI Take: DHL’s CEO of Asia Pacific eCommerce notes the need for fulfillment solutions that “keeps operations lean no matter the delivery distances and volumes involved.” Indeed, the retail industry is a highly competitive market and operates on very lean margins. Reducing costs such as shipping and fulfillment are necessary to stay in the game. DHL’s simplified fulfillment network should benefit retailers who are on a tight budget but need to expand cross-border services quickly and efficiently.
Summary: Amazon announced its Fulfillment by Amazon (FBA) service delivered more than two billion items for Marketplace sellers worldwide in 2016. Besides a record-breaking year for FBA, the company notes, “according to our economic studies, sellers have created over 600,000 new jobs outside of Amazon. Sellers are choosing Amazon because we help them build and grow their businesses with impactful programs like Seller Fulfilled Prime.”
Some statistics highlighted in its press release:
- Active sellers worldwide using the FBA service grew more than 70%
- Outside the US, FBA units shipped grew more than 80%
- Using the FBA service, Amazon sellers from more than 130 countries fulfilled orders to customers in 185 countries.
- The Seller Fulfilled Prime program added more than 6 million new items that are now Prime eligible across the US, UK, France, Germany and Japan.
- Sellers on Amazon that reached $100k in sales grew by 30%
- FBA items shipped worldwide grew more than 50% year-over-year during the holiday season.
LogisticsTI Take: Amazon continues to encroach in the logistics space. Should DHL, FedEx and UPS be concerned? Definitely and more logistics providers should be as well. Not only does FBA provide general fulfillment and shipping services but it also provides international/cross-border services, financial lending and more to sellers in addition to a platform that has at least an estimated 55 million US Prime members. No estimates currently available for outside of the US. The benefits are compelling to small and medium-size businesses. Next target are the large businesses – the bread and butter for DHL, FedEx and UPS.