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Global supply chains: A game of crack the whip

Aug. 31, 2007
As news flows out of China about poisoned pet food, lead paint on children’s toys and tainted toothpaste, companies connected in any way to long, global supply chains are beginning to ask tough questions about the risks and related costs of doing business globally.

As news flows out of China about poisoned pet food, lead paint on children’s toys and tainted toothpaste, companies connected in any way to long, global supply chains are beginning to ask tough questions about the risks and related costs of doing business globally. These international supply chains may be complex and sophisticated but they can still work much as an old-fashioned game of crack the whip-- with problems snapping along the length of the line and magnifying in impact as they move along it.

Carriers, of course, feel the shocks, too, as pressures increase to improve supply chain visibility and security all along the line while keeping a lid on costs. A recent press release issued by Seko (www.sekoworldwide.com), a global provider of supply chain solutions, provided advice for shippers doing business internationally. And for carriers with logistics operations, the advice also lends useful insights on what it takes to provide good service to shippers large and small that are doing business abroad.

“In a world gone global, with rapidly advancing technologies, emerging world markets and vastly extended supply chains, decision-making demands on logistics professionals are more critical than ever,” noted John Fitzgerald, vp of global sales & marketing for Seko. “Unlike a few years ago, a broad range of overall global logistical requirements must be considered today if shippers are to make knowledgeable supply chain management decisions in selecting the right global partner.”

Seko’s advice includes:

  • Keep in mind that price alone is not the only measurement to consider when selecting a global 3rd party logistics provider (3PL)
  • Ensure your 3PL shares the same values, such as ethics and accountability.
  • Make sure both parties have the physical resources and accessibility to shipment data to meet each other’s needs
  • Verify IT capabilities-- real-time data sharing and timely responsiveness are crucial to providing a seamless supply chain
  • Pay attention to intangibles like ease of doing business.
  • Work closely with your 3PL in sharing critical shipment and forecast information that will enhance visibility and help optimize the total value chain process.
  • Establish agreed upon benchmarks for success and frequently review the measurement data to ascertain if the global logistics process is performing well, or in need of improvement. Metrics should involve the measurement of on-time performance, damages, cost-per-touch, total landed costs and other indicators.

“As global trade and IT capabilities accelerate and trade complexities increase with new cross-cultural regulations, it becomes ever more imperative that great care is given to your selection of a global 3PL,” summarized Fitzgerald. “Selecting the right supply chain partner for your specific distribution needs will dramatically enhance your worldwide supply chain management results.”

About the Author

Wendy Leavitt

Wendy Leavitt joined Fleet Owner in 1998 after serving as editor-in-chief of Trucking Technology magazine for four years.

She began her career in the trucking industry at Kenworth Truck Company in Kirkland, WA where she spent 16 years—the first five years as safety and compliance manager in the engineering department and more than a decade as the company’s manager of advertising and public relations. She has also worked as a book editor, guided authors through the self-publishing process and operated her own marketing and public relations business.

Wendy has a Masters Degree in English and Art History from Western Washington University, where, as a graduate student, she also taught writing.  

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