The oil and gas industry are an irreplaceable part of people’s lives: it warms houses and offices, fuels cars and other vehicles and makes the world go around. It is incredible how many processes depend on energy supplies. The logistics behind the oil and gas industry has many moving parts. Logistics providers help companies maintain the efficiency of their supply chains to help keep projects and shipments in order. Oil and gas industry can be complicated when it comes to logistics due to shipping items like bulky equipment, hazardous supplies, and strict delivery deadlines. Although it can be complicated, there are many ways to optimize an energy supply chain.
Due to constant changes in the transportation and logistics industry, it is even more important to be up-to-date with shifts and adjustments during energy services shipments. Here are some strategies that will help optimize your business:
The first step of solving a problem is to define it. Run through all of your operations and use an expert help detect where you could possibly reduce costs, eliminate waste and increase productivity. Further investigation will give you a clear image of your company’s current situation, letting you make profitable decisions.
Use advanced technologies
Staying up to date with new technology innovations is essential for the progress of oil and gas logistics. Supply chain technology, such as transportation management systems (TMS) is an online system for companies to use for data storage and analysis. A TMS allows companies to save time, money and gain visibility into their supply chain processes. A robust TMS lets you see details and get insights about any part of the shipment. It is an excellent solution for oil and gas companies to use when managing their shipments and moving important loads from one location to the next.
The energy services industry is a very fast-paced environment and experiences new shipment modifications all the time. Government regulations, including the import/export laws, drilling policies, and environmental regulations are vital things to track to renew offers for your customers and to function correctly.
Use effective communication
Getting feedback from your customers, suppliers and business partners will help you understand which parts of your operations are working well and which ones are going poorly. Be as transparent as possible on your shipments needs to ensure all involved parties understand goals clearly and work towards reaching them.
Working with experts and outsourcing energy logistics services is a smart decision for the companies who want to focus on their core goals and keep their supply chain running smoothly. We understand how critical time and precision is for oil and gas transportation, and offer customers various solutions for problems of any level of complexity.
There are many new technologies affecting the logistics industry, and one of the most promising among new technology is blockchain. Blockchain can be used successfully in many different industries that have nothing to do with cryptocurrency. Technology like blockchain is believed to dramatically change company’s supply chains and save billions of costs on operations.
What is blockchain?
Blockchain is a digital register with advanced encryption mechanisms that lets companies track and record transactions and securely store data, making it almost impossible to steal, delete or change information. Every transaction or record is a single block, and after verification, it becomes a part of the sequence. This technology allows companies to keep every transaction, documentation and any manipulation made on an object in one place. This allows companies to have complete transparency on every single action or data unit, as well as protection from ransomware and cyber attacks.
How can blockchain be used for supply chain needs?
A supply chain is a very complex structure with hundreds of transactions and modes of communication involved. Verifying and maintaining information that flows through the supply chain can be time-consuming and expensive. Blockchain technology allows companies to immediately verify and lock each data unit, which supplies robust protection against data stealing, deleting or unwanted modifications. In a nutshell, blockchain provides transparency on every transaction and manages the data in a systemized and easily accessible way. Any manufacturer, auditor or supplier can access required data or payment in no time, which makes operations processes much faster and more efficient. The difference in supply chain performance could potentially be incredible after the blockchain contribution, as it drastically reduces extra interactions, increases data security and authenticity, apart from significant time and cost savings.
How it affects the logistics industry?
Apart from supply chain needs, blockchain can be utilized for many other needs of the logistics industry. Temperature-sensitive shipments often suffer from delays and temperature deviations, and lots of them may become damaged during transit. It happens because of poor temperature tracking, customs delays and more. Blockchain can help solve these problems, as it allows fast access to any data and transaction on a certain shipment. When combined with connected devices (Internet of Things), the data from trackers is transmitted to the blockchain, where it is stored and used for analysis.
In conclusion, blockchain is one of the most up-and-coming innovations to grow, develop and enhance the performance of the logistics industry. Companies that invest in such technologies would certainly be ahead of the competitors and will save a significant amount of money.
There were many new and exciting developments throughout the transportation and shipping industry during this month. Check out some of the top stories that made headlines during November!
Largest Ocean Carriers Announced a Formation of Industry Association
The ocean shipping giants, A.P. Moller Maersk, CMA CGM, Hapag-Lloyd, MSC and Ocean Network Express (ONE), recently confirmed their plan to set a global association in their announcement. The organization will be a non-profit, and all of the ocean carriers will be invited to join when it is officially established. The main purpose of this decision is to smooth the shipping processes and create common standards inside the industry. According to the release, it will help the industry gain more transparency, and easily implement new technologies. To read more about new association, click here.
Walmart Will Open an AI Lab in One of its New York Stores
The retail giant announced its plan to create an Intelligence Retail Lab right in Levittown, New York. Walmart executives claim developing AI technologies and applications will help them proactively improve the customer’s experience and business performance by identifying which products are in low demand, and replace them effectively. To read more about the AI lab, click here.
Amazon is Building an Operations Center of Excellence in Nashville
In its latest press release, Amazon revealed that a new supply chain hub is about to open in Nashville, Tennessee. The facility will handle more than 5,000 employees and costs $230 million in investments. Apart from the Center of Excellence, the retailer will also open two new headquarters in New York City and Virginia. To read more about center in Nashville, click here.
California Fire Impacts Thousands, Including Logistics Workers and Truckers
Three wildfires caused an enormous amount of fatalities and property damage in Northern and Central California and have continued to impact supply chain performance in the affected areas. Smoke areas endanger truck drivers and workers because of hazards and bad road visibility. When the largest burning began, a huge Amazon warehouse with 2,000 employees in Sacramento, CA, was closed because of the health damage due to hazardous gas emissions. To read more about California’s fire impact, click here.
Today, brand image plays a noble role in a company’s presence, so it is crucial for companies to move from the traditional corporate model to a sustainability-focused business model. As companies aim to be more customer-oriented, there is a need to respond to your audience’s wants and needs. Customers become more interested not only in your product, but in your company’s philosophy, values, and concerns. It is essential for companies to help the surrounding environment and put in effort to help combat the world’s global issues in any way that they can.
One of the industries main concerns is green logistics – a trend that became extremely widespread in recent time.
What is green logistics?
Green logistics includes a company’s effort of lowering emissions, implementing more sustainable operations processes and reducing environmental pollution. There is a variety of solutions that companies can apply to be greener, from simple to very advanced, progressive actions. The environmental issues in the world are only getting worse, and it is now more important than ever for companies to get involved and help out however they can.
How going green can reduce your supply chain costs?
An eco-friendly strategy can allow a company to remain focused on bringing in profit while helping the environment. A sustainability approach can help companies have better brand representation and fewer expenses. Integrating current processes and strategies to be more “green” and environmentally friendly can help companies increase efficiency and possibly decrease costs.
Pool distribution. Pool distribution helps reduce the wasted use of trucks and helps save costs. Pooling means consolidation of shipments from a single shipper that is collected altogether and then dropped off at one point (normally at the shipper’s distribution center). Benefits of using such an approach are evident. Gathering shipments with the same route lets you save costs on fuel, reduce human labor expenses, and efficiently use truck capacity.
Optimize packaging materials. One of the best ways to make shipments more “eco-friendly” is picking recyclable packaging materials. However, the point is not only in the package itself, but in the way you use it. Optimizing the way shipments are packed is a great consideration not only for the environment, but for a company’s budget as well.
Implementing energy management systems. An energy management system is a set of tools used to track, control and optimize the generation and use of energy. Such solutions works best for warehouses and can significantly reduce the expenses on transmission systems performance.
Efficient use of warehouses space. Pollution and inefficient use of resources are often associated with trucks, but things such as warehouse space management play an influential role in environmental awareness as well. The point of optimizing warehouses is using less capacity, packaging materials, and maintenance resources for the same amount of assets. The benefits of optimizing warehouses helps companies save costs on electricity, create more space for new items, and have better management.
Whether you are taking small steps forward a greener policy or planning major changes, green logistics is a successful decision. Green logistics works to improve your brand ideology and eliminate waste from your companies supply chain.
The holiday season is a tough time for retailers and the transportation industry, and the time between Black Friday and Cyber Monday can be the peak period of the rush. Large volumes of e-commerce purchases are putting more and more pressure on businesses and their logistics managers every year. Today we will look at how the crazy shopping day known as Black Friday came about to change the holiday shopping season forever.
What is the origin of Black Friday?
There are many stories about how Black Friday got its name, but the main story says the origin of the term “Black Friday” came from 1960’s retailers’ slang. After Thanksgiving, the stores went from being “in red,” which meant having no money, to being “in black,” which implied making a profit. Black Friday also stands for the extreme rush caused by the beginning of the shopping season.
Interesting facts about Black Friday and Cyber Monday
Usually, buyers and retailers do not see the details of a company’s logistics and supply chain processes, but there is a huge engine running behind the scenes to keep companies organized and keep shipments coming in and out properly. The journey a package takes from a warehouse to your front door is far more complex than you may think. In honor of Black Friday later this week, here are some interesting facts and insights about the busiest shopping day of the year:
Almost 74 percent of Americans plan to spend big on Black Friday sales in 2018.
The average purchase amount is estimated to be $483, which equals $90.14 billion of total expenses between Black Friday and Cyber Monday.
Surprisingly, men will spend twice as much as women, reaching an average $626.44 for men compared with $342.50 for women.
To handle the mass amount of shipments and demand, UPS and FedEx are hiring 95,000 and 50,000 people accordingly as additional workforce.
On average, 6 people deal with a package directly before it reaches its final destination.
Since 2006, 7 deaths and 98 injuries occurred during Black Friday shopping.
Most companies start holiday preparation in the summer or even earlier.
The most wanted objects for gifts or personal purchase are gift cards, clothes, electronics, and jewelry.
Almost 52 percent of Americans have said they regret their purchases during Black Friday, and nearly 30 percent end up returning items they bought.
In 2017, Amazon took 54.9 percent of all online transactions during Black Friday.
People shop online more than in stores during Black Friday.
As the competition among logistics companies and retailers becomes fiercer every year, it is important to analyze the data and watch the trends to stay relevant and competitive. If you are a large company that needs help with your Black Friday shipment preparation, reach out to a third party logistics provider like PLS today to let us move your loads for you!
“The line between disorder and order lies in logistics.” – Sun Tzu
Logistics and supply are one of the most essential functions for any military, modern or historical. Operational logistics for a military refer to the set of activities carried out in order to satisfy the needs of those involved. This includes food, transportation, war materials, medical services, and much more.
Dawn of War
Since the first recorded war in history took place in Mesopotamia, there has always been a need to supply the troops fighting it. Some of the first kings and generals had two simple choices for supply chain management when they chose to send their army out on a campaign.
The first method was simple, bring what you need however you can. Pack animals, wagons, and ships were the leading means of transport in antiquity. This has one major fault in that bringing supplies on a campaign leads to long lines of ‘baggage’ following the army. Movement is slowed and the supply train becomes a prime target for enemy forces.
Option two was the practice of foraging and looting supplies, primarily fodder. This method was efficient but by no means perfect. No guarantee on supplies could lead to a very unsettled army and too much pilfering could lead to a very unhappy populace in the surrounding countryside. Nothing spurs an armed insurgency better than an occupying army raiding civilian food stores and warehouses.
An Age of Empires
As the size of armies grew and the scope of conflicts greatly increased so did the need for supplies. Alexander the Great’s army of 65,000 men required 195,000 pounds of grain and 325,000 pounds a water every single day. Following in the footsteps of Alexander, the Romans needed to master supply chain management to ease the burden of their massive empire. The Romans saw the importance of supply and created a highly sophisticated logistical system that allowed them to provision large armies at long distances. The reach and organization of the Roman Legions were unparalleled in the ancient world.
Supply chain management for an army remained relatively unchanged up until the 16th and 17th century when the logistics of overseas campaigns nearly bankrupted the Spanish Empire on several occasions. A new world to explore meant logistics needed to change again. Reforms would highlight the next era of military logistics as armies continued to grow.
Over the Hills and Far Away
The global wars that started to arise in the 17th century posed a multitude of new problems for military logisticians. Supplying a fighting force overseas in a hostile country was a monumental task for the technology at the time. Even after reforming processes the sheer scale of the operations needed was sometimes too much for a nation.
The British faced a horrendous supply situation during the American Revolutionary War. A 3,000-mile journey between ports in Ireland and the colonies was a massive undertaking in its own right. The distance coupled with bad weather, American privateers, and food going bad hampered the British at every turn. Foraging and using the colonies for supplies only further enraged the populace and embroiled the cause that the British were fighting. Ultimately it can be said that supply chain management was a major factor in the British loss.
Major reforms followed the defeat just as the dawn of a new force in military logistics came to power, and his name was Napoleon Bonaparte. Before him, military supply was based on contracts with private companies, looting, and requisition. Logistics became a major internal function of the Grande Armée and was extremely successful during the Ulm campaign in 1805. France’s German allies turned entire towns into supply depots ready for the dedicated supply personal of Bonaparte’s imperial army. Despite early successes at Ulm and Austerlitz, the French mastery of supply and logistics faltered under the British blockade and in the face of guerrilla warfare in the Peninsular War in Spain.
The next major advance came in the form of a new transportation method, railroads. Rail transport greatly expanded an armies mobility and reach. The American Civil war was a hallmark moment for military logistics. Railways were used to great effect, but they became yet another target for guerrillas and raiders. Men, weapons, and supplies could now be moved across vast distances in a very short amount of time compared to traditional methods. The Prussian use of railways during the Franco-Prussian War is often cited as a prime example of logistic modernizations where the Germanic army crushed the French Empire in a very short period of conflict.
Industrialized and Mechanized Warfare
The turn of the century and the beginning of the Great War led to yet another shift in military logistics. Conscription led to absolutely massive armies numbering in the millions and battlefronts that spanned an entire continent. Industrialized firepower such as massed artillery, machine guns, and airplanes led to an increased demand in munitions. Most logistics strategies during the war relied on 19th-century techniques.
The First World War saw the capabilities of rail and horse-drawn supply stretched to their limits. The German Army had an initially successful spring offensive in 1918 devolve into utter failure when the logistics failed to keep up with the army’s advance over the destroyed landscape. The failure of Operation Micahel was the final nail in the coffin for the Central Powers.
The Second World War saw an increase in mechanization with the widespread usage of trucks replacing horse-drawn supply lines. While they require better roadways they are much faster than their animal counterparts. The lack of infrastructure and climate greatly affected the logistics of any troop movements in the North African Campaign, Burma, and elsewhere. Germany’s invasion of the USSR, Operation Barbarossa, lost momentum due to poor logistical planning despite victories on the battlefield.
Air power targeting supply lines, submarines attacking shipping, and the island-hopping campaigns of the Pacific Theater made logistical planning a vital part in the Allied victory in the war on all fronts.
Modern military logistics is now a high tech field with predictive forecasting, operations research, and the most efficient means to get the supplies where they need to be. Technology coupled with a global playing field has made the task even larger than before. Military logistics techniques have become widely deployed in the commercial world and vice-versa.
Conflicts, resources, and technology continue to evolve and so will the need to supply armies in the field. Military logistics is a key component in any fighting force on the planet. As often seen throughout history the victor is typically the one that can keep their troops supplied.
October was full of many significant events, bringing in new advanced developments to the industry. Here are some industry updates from last month!
Uber Announces “Powerloop” and Plans Drone Delivery by 2021
Uber has been extremely active with new projects recently, including the start of Uber Freight in August. The tech start-up has released the launch of “Powerloop,” a trailer rent program that will reduce delay time used on unloading the truck. While the unloading is going to proceed without driver presence, the pool-trailer system lets drivers focus on transporting freight. Along with the Powerloop project, WSJ recently published that Uber is working on a drone delivery program which is planned to be released in 2021. To read more about Uber’s Powerloop, click here.
Rolls Royce Collaborates with Intel for Self-Driven Vessels Project
Rolls Royce recently announced a partnership with tech giant, Intel, for constructing self-operated ships. The project is estimated to start in 2025. For the idea to become a reality, companies need powerful resources and a lot of work to be done. The sea environment is more variable and needs a broader, more flexible scalability of sensors that will be able to collect increased amounts of data from different characteristics. To read more about Rolls Royce and Intel project, please click here.
Walmart to Expand 2-day Shipping and Open the High-Tech Distribution Center
Walmart announced the plan to expand its 2-day shipping to a wide range of various items. Walmart will also be adding the new option of return delivery, which is when the customer will be able to return the purchased product to any brick-and-mortar store, and Walmart will deliver it to the primary seller. Another notable addition that’s about to start functioning soon is Walmart’s newest distribution center for fresh and frozen groceries. The facility will serve almost 200 stores and will be located in California. To read more about Walmart innovations, please click here.
Hurricane Michael Hits Florida Panhandle
Hurricane Michael swept through the Florida panhandle region in early October as a category 4 hurricane, which is one of the worst hurricanes since 1969. The areas that were affected by the storm experience substantial flooding and damages. At least 36 people died as a result of the hurricane, and many were left without homes or their belongings. To read more about the aftermath of Hurricane Michael, click here.
In today’s global economy, customers set the bar of what is considered quality service or what is a good brand. In any business, a customer’s experience determines the reputation of the company, and the logistics industry is not an exception.
The bigger your business is, the more complex your supply chain gets. It can be hard to maintain perfect customer service because everyone involved in the shipping process is constantly affecting a company’s reputation through customer experience. In client service, it’s impossible to be perfect, but it is possible to be better and provide your customers with the best service possible. Customers want to have a smooth, easy experience when working with a company. It is up to the company on how good that service can be delivered.
If you are striving to build long-term relationships with your customers and gain their loyalty, you should consider shifting from product-oriented strategy to customer-focused one. Here are some useful tips on how to take customer service to the next level:
Choose the tools and partners accurately. No matter what strategies and technologies you use, there is always a human factor present. That’s the reason why choosing partners properly will enhance your customers’ experience. If you are outsourcing your logistics to a 3PL provider, make sure they have skilled and professional brokers and a network of experienced and reviewed carriers. Such services offer logistics management from A to Z and will take most of the hassle away. But as you select a key link in your logistics, you should invest time researching how to pick the best third-party logistics provider.
Transparency and personal approach. Try to make the process as easy as possible for the customer. Supply chain visibility will reduce the time your client’s spending on shipping, therefore improving the overall experience they get from working with you. Transparency involves not only shipment tracking but also the option to compare available prices, services and understand how they work without any trouble. The more personalized approach you provide, the higher your chances are to retain customers. Send tracking updates and reports to customer to keep them in the loop, ranging from shipment transits to weather reminders. This strengthens your company’s credibility and simplifies the process for your customers.
Establish the last mile delivery. This is a final and crucial element in the transportation process and obviously demands more concentration. The last stage of delivery is the most vulnerable to mistakes or damages that may occur due to different reasons. To reduce the likelihood of such circumstances, assure that everything goes the way it should.
Provide feedback. No matter what issue took place, the response should be swift and intended to solve the customer’s problem, or at least to figure out what is the issue. Businesses should invest more in their staff training to reduce the chance of errors while interacting with customers. Solving problems that occurred on behalf of your company can make a big difference in a customer’s experience with your company. Many 3PL companies provide customer service and can help their customers simplify this complicated process.
Technology & analysis. Don’t underestimate the power of data: new technologies let businesses track every step of the customer, existing or potential. Knowing the deep insights of your audience leads to better performance, updated strategies, and better service. Such innovations like transportation management systems, tracking devices and CRM systems let businesses study customer’s behavior and improve marketing strategies. So, researching and analyzing big data is the best way to achieve a better understanding of customers’ demands.
After all, you can reach your goals and improve the service when you are always up to date with new technologies and industry renovations.
Third-party logistics providers already make a big impact in the transportation industry today. According to surveys, the amount of 3PLs users is growing and has reached 81 percent for domestic transportation in 2018. There is no surprise that fast and convenient shipping is a must for a company’s success. As demands for delivery rates and customer service rise every day, efficient transportation management becomes crucial to stay in the game.
There is a boiling competition between 3PL providers to stay ahead of trends on the market and in the industry. As big players like Amazon set the shipping standards higher and higher, third-party logistics services must apply smart technologies and follow the trends to keep moving forward. Here are the main trends that 3PLs should focus on to in order to enhance their service and capabilities:
1. Value-added services and transparency. One of the most influential and enduring trends in 3PLs’ future is efficient communication with clients. No business today survives only on a good product or technology — customer service is vital for building brand identity and obtaining loyal partners. Unorganized and complicated transportation management is reasonably outdated, so transparency and value-added services will become more prevalent in the upcoming years. Free audits, forecasts, list of available services, and freight visibility will increase customers’ confidence level, giving you a primary advantage over the competitors.
2. Analytics and automation. Year after year, it becomes more relevant and needed, and 3PLs need to invest in new technologies to keep an eye on insights and have more accountability and information for boosting sales. New technology helps bring more consistency to the supply chain, and automation is essential for operating the logistics process. The decrease of labor-intensive tasks and cut of manual work involvement causes faster and more efficient production. 3PLs should utilize technologies that will fill in the current gaps in the chain, from transportation management systems to self-driven vehicles.
3. Investing in the last-mile delivery. We all have to confess that shipping giants like UPS and Amazon are setting the trends for the industry. At this point, they have already developed specialized services for quick and reliable delivery directly to the customer. Last-mile delivery is the final element of the shipping process that leaves a certain impression about the shipping provider in the customers mind. Even if someone else failed, you are responsible for the consequences and customers’ experience. Investing in better service and technology to improve the last step of shipping is vital.
There is no doubt that 3PLs are in demand, but this also means an increase in the competition. As technology continues to advance and companies integrate their shipping process and supply chains, new trends will come into focus throughout 2019 and into the future.