sc digest
February 8, 2019 - Supply Chain Flagship Newsletter

This Week in SCDigest

bullet The Gurus Are Back! 2019 Supply Chain Predictions Part 2 bullet SC Digest On-Target e-Magazine
bullet Supply Chain Graphic & by the Numbers for the Week bullet Distribution Digest/Green Supply Chain
bullet Cartoon Caption Contest Winners bullet Trivia      bullet Feedback
bullet Expert Column bullet On Demand Videocasts


first thought


Supply Chain Graphic of the Week

A Mostly Optimistic View of Automation and Jobs


Amazon Growing 3PL Business Too

US Trade Deficit Finally Shrinks
Purchasing Manufacturers Index Shows Economy Still Strong
Ocean Container Rates Headed Up in 2019


January 1, 2019 Contest

See Who Took Home The Prize!



Feature Story: Once a Store, Now a Distribution Center


pic GSC Feature Story: Climate Leadership Council Continues Push for Carbon Tax and Dividend Back to Taxpayers to Reduce CO2

Weekly On-Target Newsletter:
February 7, 2019 Edition

Last Chance Cartoon, Stores to DCs, Amazon Logistics, Foxconn Fiasco, More


Supply Chain Wars: Episode IV - A New Hope

by Henry Canitz
Product Marketing & Business Development Director



In 1996, Robert Kaplan and David Norton published a book that popularized what important business performance management concept?

Answer Found at the
Bottom of the Page

The Gurus Are Back! 2019 Supply Chain Predictions Part 2

We're back as we have done for many years running with predictions for the year 2019 in supply from a virtual panel of supply chain gurus.

In fact, most of our prognosticators are back from 2018, selected again for this great honor - well, something of an honor - because in the past they have made insightful predictions and (very importantly) are able to get them emailed in before the deadline.

As I say every year, given how difficult it is to make predictions in this crazy world of supply chain, these prognostications are part prediction, part a discussion of trends, part some things to look out for - but it is all good, and I much enjoy these pieces every year.


Next week: 2019 supply chain predictions from the analysts.


Send us your
Feedback here

Last week, I summarized predictions from my friends Mike Regan, Gene Tyndall, and Chris Gopal.

Another group of prognosticators this week.


Marc Wulfraat of MWPVL International knows a lot about a lot - and is widely recognized for his knowledge of the Walmart and Amazon distribution networks.


He starts by noting that "Whether we realize it or not, we are living in a unique period of history that is profoundly impacting our world in several important ways" due to the growth of ecommerce.

Simply put: Today's busy consumer no longer has time to shop. That in turn has led to an "unprecedented rate of change taking place in the retail landscape."

For his first of six predictions, Wulfraat notes that few people realize that in 2018, Amazon surpassed Walmart in terms of US distribution footprint. At year-end 2018, MWPVL estimates that Amazon operated 141 million square feet of distribution and logistics infrastructure in the US versus Walmart's 132 million square feet.


With that threat from Amazon, Wulfraat notes that last year, Walmart sold off its Asda chain in the UK to Sainsbury's, leading Wulfraat to predict that "Walmart will likely continue to spin off under-performing rest of world assets to better defend its core North American business against rival Amazon. In particular, Walmart will focus significant resources on strengthening its on-line grocery business to better compete against Kroger and other regional supermarket chains."


Among other really great predictions, Wulfraat adds that the combination of the need for rapid delivery and a DC labor shortage will mean that "there will be an explosive increase in the demand for distribution automation technology over the forthcoming decade," adding that "The time to pursue automation is now and not when everyone else is jumping on the bandwagon as we quickly approach 2030."


Our friend and columnist Mike Watson of Opex Analytics is insightful as always. Watson says a combination of trends means "that 2019 will see a big rise in the development of custom supply chain apps" to supplement packaged software.

Then he adds that "My second prediction will find a lot of doubters and may generate some hate mail: I predict that in 2019 the hype will drain out of the use of Blockchain in the supply chain."


A Blockchain skeptic?

"I can see the value of Blockchain in Bitcoin where trust is a huge issue," Watkins explains. But "When it comes to the supply chain, I find it hard to believe that any outside entity has the right incentives to verify that a supplier shipped 20 cases of tomatoes to your local grocery store. So, we will still need the buyer and seller still to go back and change the ledger to correct the cases of tomatoes shipped."


He adds "Going even further, I don't see that trust is the big issue in most supply chains.  That is, Walmart already trusts that its vendors will ship pretty much what they order and have systems for checking this."


I am fully supportive of Watson's views.


David Schneider of David K. Schneider & Associates sent in a number of good observations and predictions. Let's start with "Surface transportation in the US continues to have capacity constraints in lanes and modes that support energy and infrastructure improvements, even if the broad economy cools off." Tightness exists for flatbed trucks in many markets, he says, and "Temperature control carriers continue to see robust rates and solid demand for moving protein and produce, enough demand to drive up rates for non-food products and beer."


He also observes that "Lean inventories of technical and complex products continue as companies struggle with the just-in-time supply chains they built over the past decade," noting that "Technology does not overcome the challenge of managing these complex networks, as more of the problem is a lack of understanding and mental ability of the humans behind the networks. Because of a lack of adequate knowledge and ability in the human arts of relationship management and communications, most companies will see component inventories grow as customers increasingly demand on-time/as promised delivery."

The supply chain is still about tradeoffs, and always will be.


My friend Rich Sherman of Tata Consultancy Service and long-time supply chain industry observer sent his predictions in early. Among my favorites: "In 2019, the pace of maturity among digital technologies continues to grow. The distance between leaders and laggards also grows."


I sense the same thing, but still think we need more clarification of what digitization really is in supply chain. I am working on that.


With regard to Omnichannel, no longer is it just about retail, Sherman says, adding that "Companies that are prepared for the ecosystem impact will thrive, while traditional brand stalwarts fall to the wayside."


Analytics also have become differentiators in terms of supply chain performance, Sherman adds, saying that "In 2019, Control Tower community ecosystem platforms will emerge from "under the radar' and companies will begin considering these supply network operating platforms for analytics-based and operational competitive leverage."


He concludes by noting that "The power is with the customer, e.g. 'showrooming,' price comparisons, reviews/reputation management, search engine optimization, and, most important, selection and convenience. The imperative: Being easy to do business with on steroids."


There is so much more, but I am out of space. All good stuff. Don't miss the full text of these guru predictions soon in our OnTarget newsletter.


Next week: 2019 supply chain predictions from the analysts.


Any reaction to the guru predictions? What resonates with you? What are some of your 2019 supply chain predictions? Let us know your thought at the Feedback button below.


On Demand Videocast:

Digital Transformation's Value to the Supply Chain

The Future of Order Management

This videocast breaks down what digital transformation is and how automated order management solutions equate to supply chain benefits.

Featuring Dan Gilmore, Editor along with Esker's Dan Reeve.

Now Available On Demand

On Demand Videocast:

Digitizing the Order Management Process

Orders Still come in Many Different Forms and Systems - Here's How to Get them Under Digital Control

This videocast discusses breaks down all the ways in which orders can arrive, the downstream challenges associated with each, and the benefits of digitization.

Featuring Dan Gilmore, Editor along with Esker's Sarah Joiner.

Now Available On Demand

On Demand Videocast:

Reducing Costs through Automated Inventory Replenishment & Analytics

How Motor City Industrial Taps into Data Visualization to Help Customers Identify Waste, Reduce Inventory

This videocast discusses how to connect people, processes and technology across commerce and supply chain operations to achieve unified commerce.

Featuring Dan Gilmore, Editor along with Joseph Stephens, CEO, Motor City Industrial, Jay Fielder, Supply Chain Technology Manager, Motor City Industrial and Mike Wills, Chief Revenue Officer, Apex Supply Chain Technologies.

Now Available On Demand


We received several emails on Dan Gilmore's First Thoughts column on his supply chain Christmas wish list for 2018 - including an interesting note from Jim Tompkins.

Feedback on Christmas Wish List:


Thanks for the note on "My friend Jim Tompkins is still thought leading, but he has a lot of business irons in the fire right now and seems to have slowed down a bit on the thought leadership side."


Sorry we have not been in touch on this. In my view, my thought leadership hit an all time high in 2018. Please consider

• Distributed logistics (LaaS-Logistics as a Service)
DIFF- Distributed Inventory Flow Forecasting: Multiple fulfillment locations without increased safety stock
MSP- MONARCHFx Sellers Platform: Self registration and integration platform
Tompkins Robotics- 9 Patents, more coming
New Retail: Uni-marketing, Uni-channel and Uni-logistics
Robotic induction
Disruption cycle
Digital Enterprise World
The challenge of brittle solutions due to uncertainty over uncertainty
Demand shaping application
Speed of implementation

I believe your perception of "slow down" is a result of current thought leadership is less published as thought leadership and more positioned as entrepreneurial deployment (thus your view of "irons in the fire"). So, application of thought leadership is at all time high, but number of thought provoking keynotes is down.

As always Dan, good stuff.

James A. Tompkins, Ph.D.
Chairman and CEO
Tompkins International





An interesting list of supply chain wishes.


I had not really thoughts about the fact that we lack clear supply chain thoughts leaders - think this observation is spot on.


What is driving this problem is not clear, however. Surely they are out there somewhere.


Ron Halpin
Toledo, OH






You might hope supply chain academic research was more valuable, but Santa is unlikely to grant your wish.


Academics in all disciplines write for each other and to get published, with little concern over whether there is any practical value.


As you note, a lot of talent and opportunity basically wasted. But it will never change.


Thomas Wright
San Diego



Q: In 1996, Robert Kaplan and David Norton published a book that popularized what important business performance management concept?

A:The Balanced Scorecard.

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