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Archives for November 2009

Collaborative Distribution

By Chris Kane | 11/04/2009 | 1:25 PM

The price of oil is on the rise once again.

While not reaching the height of $145/barrel experienced in July 2008, many economists fear that as the world economy starts to get off the canvas, increased oil prices might not be far behind.

The ramifications to an already volatile transportation industry will be grave. In logistics, where an estimated $0.70 of every dollar goes to the movement of product, the erosion of a company's bottom line will be challenged.

Collaborative Distribution is a solution to this dilemma. It's a supply chain solution in which manufacturers and retailers collaborate to revolutionize their distribution models, making them more efficient and environmentally responsible. The program rewards both manufacturers and their retail customers for collaborating to ship and receive products from multiple vendors as part of a single shipment.

Collaboration is not a new concept in supply chain management. What is novel however, is a program that effectively reduces logistics costs and responds to the global drive toward energy-efficiency.

Today, ten smaller manufacturers likely have ten separate supply chains within a region, with ten or more warehouses shipping to the exact same customers using costly, less­than-truckload (LTL) shipments. Each supplier is interested only in its own line of supply. It's like taking a taxi to the airport, only to discover that five of your friends were going at the same time and you could have paid less, and burned less fuel, to ride a shared shuttle bus.

We keep hearing that we are in the midst of uncertain times and uncharted waters. Today's issues in logistics cannot be solved using yesterday's thinking.

It requires new approach. Collaborative Distribution is that solution.

The opinions expressed herein are those solely of the participants, and do not necessarily represent the views of Agile Business Media, LLC., its properties or its employees.

About Chris Kane

Chris Kane

Christopher J. Kane is Chief Customer Strategy Officer for Kane is Able, Inc., a family owned third party logistics provider in Scranton, Pa. that specializes in the consumer packaged goods sector. Kane has spent 32 years at the company, rising from driver to overseeing all marketing strategy and execution for Kane Companies.



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