With globalization and growth of Chinese manufacturing, Chinese container ships are a common sight.

What are the top challenges for today’s logistics providers?

Logistics

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Today’s logistics customers demand flexibility and visibility. In a recent survey based on interviews with 62 international supply chain executives as well as over 1800 respondents from the logistics and manufacturing industry found that the top priority for logistics managers was “meeting customer expectations” followed by “on-time delivery”.  Many of the respondents noted that customers can change delivery orders based on 10 days or less, and a majority indicated that that this window can be one day or less. (Read the whole survey here). 

Even more challenging, customers are also increasingly demanding full transparency to their orders and inventory through the entire life-cycle of raw-material to finish-goods to sale to sometimes reverse-logistics.  That means full sight of each order and its associated item level detail at all times in real time.

Giving customers the flexibility and visibility they want is especially difficult given that many logistics service providers must serve customers with operations that are spread out across the globe.  The chart below shows the results of a 2014 survey that asked where companies are operating today and where they expect to operate in 5 years. Clearly the challenges of globalization are only going to grow:

 

Yet while a global customer base certainly presents a lucrative target, it also provides a new set of challenges for logistics service providers (LSPs) accustomed to providing standard logistics solutions to a homogeneous regional customer base.  Their solutions must be tailored for each customer to accommodate different  government regulations,  new retail channels such as mobile applications,  and industry specific requirements such as tracking and tracing, cold chain, and shelf-stocking services.

In future posts, I’m going to further explore this theme of LSP challenges and also discuss some of the opportunities that LSPs have to add more value to their customers. If you’re impatient however, I suggest you read the new whitepaper “8 Opportunities for Today’s Logistics Providers“.

Gene Trousil
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