3PLs weakest drivers of supply chain development, research reveals
This was the b...
Third party logistics companies are the weakest drivers of developments in supply chain and customer service, according to new research.
This was the belief of sector decision makers, which emerged from a recent survey conducted by leading supply chain and logistics consultancy, SCALA.
The respondents, made up of directors and senior managers from retailers, manufacturers, logistics companies and technology providers, overwhelmingly cited technology providers as the main drivers of change.
86% said they contributed significantly to developments, followed by retailers at 71%, with manufacturers and logistics providers well down.
In addition, a dramatic 76% said they thought that logistics companies should be contributing a lot more.
The findings are released ahead of the SCALA Annual Supply Chain Debate, a key highlight in the logistics calendar, returning this month to bring together leading industry professionals to discuss major changes affecting the supply chain sector.
John Perry, managing director of SCALA, said: “The findings of our pre-debate survey have shown distinctly divided opinions about who is driving changes in the supply chain sector. A number believe that consumers are the main driving force behind industry innovations.
“However”, he added, “if Jeff Bezos of Amazon believes it’s Amazon’s role to innovate – not the job of the consumer – and that Amazon focuses on enhancing and developing new consumer experiences, then it’s not the consumers driving requirements, it’s the new businesses. ‘The disrupters’ are driving the new world, and everyone else is having to follow the new expectations set.”
Cainiao Network Launches Customer-Centric Logistics
As the logistics division of the Alibaba Group, Cainiao Smart Logistics Network has decided to provide its Southeast Asian customers with unsurpassed service during its annual shopping festival. Based on customer feedback surveys, the company will expand its real-time customer service support and speed up delivery times. ‘By expanding and deepening our services, we aim to provide a stronger logistics infrastructure that can bolster the booming eCommerce sector, support merchants’ expansion into new markets and diversify retail options for consumers’, said Chris Fan, Head of Cross-Border, Singapore, Cainiao Network.
Who Is Cainiao?
According to TIME Magazine, Cainiao ‘is far from a typical logistics firm’. The company controls an open platform that allows it to collaborate with 3,000 logistics partners and 3 million couriers. This means that merchants can choose the least expensive and most efficient shipping options, based on Cainiao’s real-time logistics analytics. The company’s goal is to ship packages anywhere in the world in under 72 hours—and for less than US$3.00.
For countless small business owners around the world, from coffee-growers to textile-weavers, this could change everything. Usually, it costs about US$100 to ship a DHL envelope from Shanghai to London in five days. Cainiao aims to change that. Said its CEO Wan Lin: ‘The biggest barrier to globalisation is logistics’.
What’s Part of the Upgrade?
Throughout the Tmall festival, Cainiao’s logistics upgrade will be divided into four critical segments:
- Real-time customer service support. Cainiao has launched a direct WhatsApp channel for customers to receive logistics updates and ask questions.
- Expansion of air freight parcel size and weight limits. Packages can now be up to 30 kilograms or 1-metre x 1.6 meters to help ship large items such as furniture.
- Daily air and sea freight connections. Shipping frequency will almost double to seven times weekly to maintain resilience and efficiency.
- Compensation for lost or damaged packages. Customers will be reimbursed up to RMB 2,000 (US$311).
Where is the Company Headed?
From June 1st to June 20th, the finale of Tmall, Cainiao will ensure that its customers feel confident in the company’s ability to deliver their packages. Despite global shipping delays due to COVID, the show will go on. Said Fan: ‘This series of customer-centric logistics upgrades reaffirms our goal of pursuing value-added services to enhance customers’ shopping experience while mitigating challenges posed by external factors’.
Furthermore, Cainiao has recently expanded its Southeast Asian operations, achieving revenue growth of 68% year-over-year. In Malaysia, the logistics operation has partnered with BEST Inc. and Yunda; in Singapore, the company has partnered with Roadbull, Park & Parcel, and the Singapore Post. And if its recent measures help retain and grow its customer base, the company will be well-poised to lead the industry in resilient and customer-centric global logistics. ‘COVID-19 made everyone realise how important the logistics infrastructure backbone is’, said Wan. ‘And it gave us a peek at what Cainiao should look like in three years’.