GEODIS and Accenture Reveal eCommerce Surge and Challenges
One of the leading global logistic operators, GEODIS, has teamed up with Accenture Interactive, a subsidiary of Accenture, released a new study yesterday, on October 8th, 2020. The report found that while key logistics capabilities are required to build and maintain successful ecommerce operations, very few brands have actually managed to implement them.
200 American and European companies took part in the study; each company operates multiple channel logistics, and they were all interviewed about their ecommerce-related expectations for growing their brands’ sales. The study is a confirmation of what many of us within the industry already suspected ─ that forced lockdowns courtesy of pandemics drove the masses to ecommerce platforms to supplement their usual spending in brick and mortar outlets.
In fact, brands now estimate that sales via ecommerce will represent nearly half of their sales in 2020, compared to just one-third before COVID-19 hit the world.
“This study takes stock of the ambitions and concerns of European and American companies facing [a] rapid increase in ecommerce. If they want to take advantage of the rise in online sales, they must develop omnichannel logistics strategies tailored to their maturity levels,” said Marie-Christine Lombard, CEO of GEODIS.
According to the study, prior to the crisis, companies were making just 34 percent of their yearly sales through online portals (28% on average in marketplaces and 6 percent on their own websites), which increased to a staggering 65 percent during lockdown ─ split at 38 percent via marketplaces and 27 percent on the companies own website. Apparently, this was far more noticeable in European countries, where 40 percent of the brands surveyed estimate that sales lost due to COVID-19 will exceed 15 percent of their earnings on average.
Interestingly, though, it’s not unpreparedness of online marketplaces or websites that caused the loss of potential revenue, in the eyes of 52 percent of the companies involved in the study. Instead, it was the tardiness of logistical capabilities that hindered their ecommerce potential.
“Many brands use marketplaces as a one-stop-shop for selling their products online. This allows them to reach a wide audience and compensate for a lack of resources and logistical infrastructures, all while providing an expected customer experience,” said Sohel Aziz, managing director, Accenture Interactive.
Kuehne+Nagel cuts carbon footprint by 70% for Honda China
Around 16,000 tonnes of CO2 has been cut from supply chain of Honda's China-based manufacturing division through a road-to-rail transformation in partnership with logistics leader Kuehne+Nagel.
The programme was developed through KN Sincero, the joint venture between Swiss headquartered Kuehne+Nagel and Chinese automotive logistics firm Sincero, established in 2018.
KN Sincero worked with Honda China to develop an integrated solution to convert much of its domestic long-haul trucking to train lines, using regional hubs to improve supply chain performance and further reduce carbon emissions. The programme delivered consolidations as well as value-added services, including sorting, scanning, repackaging, GPS track and trace, and recyclable container management.
"Kuehne+Nagel has always been a supply chain partner that we can rely on, to help us improve our supply chain performance whilst also achieving our environmental goals,” said Mr. Jiang Hui and Mr. Takuji Kitamura, Joint General Manager of Wuhan Dong Hon, the logistics affiliate of Dongfong Honda Automotive.
After six months of shifting to the road-to-rail model, new supply chain reliability and efficiencies are expected too trip 16,000 tonnes of carbon emissions annually. The carbon savings represent an enormous 70% reduction in total.
"Automotive is one of the most important sectors in contract logistics, particularly in China, the world’s largest automotive market,” added Gianfranco Sgro, member of the Management Board of Kuehne + Nagel International AG, responsible for Contract Logistics. “I am glad that Kuehne+Nagel and Honda share a common vision of service, innovation and sustainability.”
Kuehne+Nagel’s Net Zero Carbon programme
Kuehne+Nagel announced its Net Zero Carbon programme in 2019 with a dual purpose to reduce CO2 output in its own logistics operations, as well as partnering with organisations to minimise their own impact on the planet. Kuehne+Nagel reached carbon neutrality globally in 2020 throughout its own, direct emissions, and is now focused on developing its capabilities to serve partners.
Dr. Detlef Trefzger, Chief Executive Officer of Kuehne+Nagel International AG, said the programme is “a package of measures to fight CO2 emissions and provide sustainable and innovative supply chain solutions – hand in hand with our suppliers and customers”.
As part of the initiative, Kuehne+Nagel established its own nature projects in Myanmar and New Zealand, and invested in ‘nature-based’ carbon dioxide compensation projects to strip harmful emissions from the environment. It is committed to being CO2 neutral for shipments in its network of transport suppliers by 2030.