In this week's edition of The Backorder:
- REI Co-op gives back $270 million to global communities
- 6 quick ways to improve supply chain visibility
- An ecommerce logistics insider shares her best industry advice
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In supply chain headlines
- Etsy improves delivery date precision with new machine learning model. In an attempt to discard its reputation as a 'laggard', the online ecommerce marketplace has successfully reduced transit time estimates by more than one day, writes Max Garland.
- REI Co-op invests $270m in global communities despite sales miss. Eric Artz, president and CEO of the retail and outdoor recreation giant REI Co-op, didn't let a 2.4% sales decline stop them from giving back to the co-op community through investments in nonprofit partners, employees, and the planet.
- UK & US manufacturing sectors shrink as costs rise, new orders fall. Unstable market conditions, client destocking, and the Red Sea crisis – in combination with the rise of average purchasing costs – are responsible for the recent drop in manufacturing PMI, according to data provider S&P Global.
Mini quiz: How well do you know inventory accounting?
1. What is the formula for calculating inventory turnover?
a) Cost of Goods Sold divided by Opening Inventory
b) Cost of Goods Sold divided by Average Inventory
c) Cost of Goods Sold divided by Ending Inventory
d) Cost of Goods Sold divided by Net Purchases
2. Which of these inventory valuation methods is not permitted under the IFRS?
a) FIFO
b) Weighted Average
c) LIFO
d) Specific Identification
3. Fill in the blank: The two common inventory accounting methods are cash basis accounting and ______ basis accounting?
a) Actual
b) Aquatic
c) Acrylic
d) Accrual
(Scroll to the bottom of this page to reveal the solutions)
6 ways to improve supply chain visibility
1. Request (and provide) timely updates. OTIF, lead times, order accuracy… if it matters to you, then promptly report it back to your suppliers – and ask they do the same. Those uncomfortable meetings will go much smoother if you can point to an established history of performance.
2. Ditch the spreadsheets. The biggest killer of supply chain visibility is running a business on different systems. Shared spreadsheets are a common solution, but quickly become ineffective as the business becomes more complex. Upgrade to cloud software as soon as your budget will allow it.
3. Forecast demand. Not only will forecasting your sales demand improve internal visibility (for example, with the purchasing teams who ensure your best lines remain in stock) but, where appropriate, you can also share forecasts externally to help your suppliers better plan.
4. Get transparent with ecommerce. One of the advantages of selling online is the ability to manage buyer expectations by providing real-time stock availability. If you’re using digital systems to manage your products then a good integration with your sales portals and platforms will keep this information automatically visible (where appropriate), reducing delays and customer complaints.
5. Use a ‘stock-aware’ CRM. CRMs like Salesforce and HubSpot do an excellent job of enabling salespeople – but fall short in supply chain visibility. A ‘stock-aware’ CRM, on the other hand, connects the activity of your sales teams at one end of the business with the physical goods and processes at the other, making it easier to manage everything from product margins to purchasing.
6. Take advantage of EDIs. With the right Electronic Data Interchange set up between partners you can achieve the fabled ‘one up, one down’ supply chain visibility we’re all supposed to strive for – on selected metrics at least. For example, being able to transmit shipping notes from your warehouse to your 3PL (and their couriers) will give you valuable oversight of products you’ve sold and how long they take to reach customers.
The current state of ecommerce logistics - Meet Diana Zheng
We recently chatted with Diana Zheng, HOM at Stallion Express –Canada's #1 ecommerce shipping company handling cross-border, domestic, and international services – to hear about the state of Canadian logistics in 2024.
In your own words, what does Stallion Express do?
"Stallion Express is a Toronto-based company specialising in shipping and logistics solutions for online sellers. Our clients range from part-time eBay sellers to bigger ecommerce web stores, shipping hundreds of packages per day! We’re a dynamic team working towards a common vision: to help Canadian sellers ship parcels at the lowest possible rates."
What are the main challenges facing logistics teams right now?
"Where to begin? One of the biggest challenges has been adapting to the ever-evolving rules and tariffs for cross-border shipments. My top advice is to remain agile and proactive. Establish strong relationships with customs officers and stay on top of policy updates. Invest in technology that automates compliance processes to reduce mistakes and delays."
Are there any resources that have helped your career so far?
"If you’re looking for business tips and tricks, check out Tony Hsieh’s Delivering Happiness. It’s an all-in-one guide to how great customer service drives business success. And if you’re a podcast junkie, check out The Tim Ferriss Show – it’s a compilation of best-selling books and podcasts from some of the biggest names in business. For ecommerce, I’d highly recommend listening to The eCommerceFuel Podcast, which is a goldmine of industry insights."
What are your top 3 tips for ecommerce brands seeking success in 2024?
"1) Customer experience is at the core of eCommerce. 2) Stay ahead of the technology curve. Whether it’s AI, blockchain, IoT, embrace innovation as if your business depends on it—because it does. 3) Don’t underestimate the value of partnerships. Partner with other businesses to expand your reach and capabilities."
Any parting words of wisdom you'd like to share?
"It's never too late to learn and grow. The world of ecommerce is changing faster than ever, and the people who succeed are those who remain curious and adaptable. Experiment, innovate, and above all, keep delighting your customers."
Mini quiz solutions
1. b) Cost of Goods Sold divided by Average Inventory
2. c) LIFO
3. d) Accrual
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