ANZ supply chain consultancy Prological has released a new white paper on the future of supply chains – examining geo-political factors, the Covid-19 pandemic and advancements in automation and technology.
The white paper – Supply chain network decentralisation: A practical guide to making it work – discusses decentralisation as one of several emerging trends, with key learnings from Apple, Amazon and Volkswagen.
“In the past two years, the strategic shift from ‘Just in time’ to ‘Just in case’ has been well documented,” said Peter Jones, Managing Director at Prological.
“However, whilst ‘Just in case’ has offered a temporary resolution to the pressures of rising costs, increased demand and inventory delays, it is now clear that additional steps are required in order for the strategy to be sustainable,” Jones said.
“These steps, as well as additional factors such as industrial property constraints, the sharp rise in e-commerce and the rapid emergence of social commerce, are explained in the white paper. By offering a local lens on traditional network designs, we hope to help retailers, industrial businesses and logistics providers best prepare for the future.”
The paper offers three clear opportunities for businesses to consider as they create more flexible, agile and resilient supply chains.
By discussing the differing landscapes between ANZ and the EMEA markets, the white paper highlights the complexities of selecting and operating a centralised or decentralised network – as well as offers practical advice on the key personnel requirements to support the chosen direction.
Utilising Prological’s first-hand industry experience and citing research from Thomson Reuters Institute and J.P. Morgan, this latest white paper from the leading supply chain and logistics consultancy offers commentary on effective strategy shifts and the steps required to thrive in the industry’s ‘new normal’.
“With Australian networks commonly based around five capital cities, there are clear opportunities to be cost effective whilst shipping to multiple locations, due in part to changes in warehouse availability,” said Alex Witzke, Senior Associate at Prological and lead-author of the white paper.
“The broader rationale for this is uncovered in the white paper, which considers perspectives on freight, warehouse costs and environmental emissions,” Witzke said.
“Further, it offers practical advice on how to effectively operate a decentralised model in Australia – creating last mile efficiencies, environmental benefits and importantly, major risk mitigation,” he said.
The white paper discusses three opportunities for creating a resilient supply chain:
1. Decentralised networks: do the numbers work in Australia?
Australian organisations have viewed decentralised networks as cost-prohibitive, largely due to US or European business cases being used to benchmark an Australian operation. However, when examining the Australian landscape, the white paper reveals this is no longer the case.
2. The insourcing opportunity: people, processes and profits
Much like decentralisation, the decision to out-source or in-source delivery partners has different ramifications in the Australian market, relative to the EU, UK or USA. With less choice of delivery partners in Australia causing pressure on Tier One carriers, there is an increasing desire for retailers to ‘own’ the delivery component, rather than outsource.
3. Digitisation: reshaping supply chain and logistics with SaaS
Once reserved for Tier One firms, major software upgrades required significant upfront capital and took years to embed. However, with the plethora of cloud-based software-as-a-service (SaaS) and pay-as-you-go services, companies of all sizes can now use technology to support their supply chain operations.
Check out Prological’s latest whitepaper here.