Morai-Logistics-Blog-robo-boat

Two Norwegian companies are working together to build zero-emission, completely unmanned ships

Several companies have been very public about their race to introduce fully-automated cars to the marketplace by 2020. Did you know that two Norwegian companies have teamed up to do the same but with a fully-automated boat?

A Costly Start but Promising Future

The Yara Birkeland will be a short-range, fully electric coastal container ship. It will begin its career modestly as a “feeder” cargo ship, ferrying containers of fertilizer to and from larger ships.

It’s co-developers, Kongsberg Gruppen and Yara International, plan for the Birkeland to start operations by 2018 with a human crew aboard. Over the next two years, more of the ships’ functions will move away from human operation until its running remotely by 2020.

“At first, a single container will be used as a manned bridge on board,” Kongsberg’s chief executive Geir Haoy told the Wall Street Journal. “Then the bridge will be moved to shore and become a remote-operation centre. The ship will eventually run fully on its own, under supervision from shore, in 2020.”

The technology isn’t cheap though. The price tag for the vessel sits at $25 million, almost three times the cost of standard container ships of similar size. The cost has to do with the ship’s enhanced capabilities. It’ll be able to handle things like docking and navigation on its own (something regular container ships don’t do). Given the specialized systems onboard, the cost of on-site repairs will also be pricey further driving up the cost.

Despite the high initial investment, both companies claim that the benefits are worth it. The vessel will:

  • Eliminate 40,000 diesel trucks trips annually
  • Significantly reduce harmful carbon emissions
  • Improve the safety of local roads
  • Save up to 90% of its cost by what it reduces in crew member and fuel spending

Autonomous Vessels are the Future

The push towards autonomous sea faring vehicles isn’t being driven by Norwegian companies alone. An article in Arstechnica referencing the Wall Street Journal interview points out that Rolls-Royce Holding PLC has similar plans. Rolls Royce plans to launch robot ships by 2020, but its fleet may include tugboats, cargo ships and ferries.

SpaceX piloted a program to use uncrewed drone ships. However, their interest was in having the ship do the dangerous task of rocket landing and retrieval.

Kongsberg itself has been active with its investments in autonomous technology with its partnership with Automated Ships Ltd (ASL). They worked together in the past to develop a prototype unmanned utility ship and are now working with Bourbon Offshore to construct a robot oil rig support ship.

Autonomous vehicles are the future. Whether it be through land, air or sea, both people and cargo will soon be transported safely and efficiently to their destinations. While there are still concerns over the legal, moral and economic consequences of such technology, its benefits for supply chains and especially for the environment are too important to halt.

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

.Morai-Logistics-Blog-logistics-ecommerce-convenience

E-commerce giants are turning to brick-and-mortar stores to supplement their continued growth trajectories. Could this mean the e-commerce market is too saturated?

To say that online shopping and e-commerce has boomed in the last decade would be a gross understatement. In 2014, retail e-commerce sales worldwide were 1.3 trillion U.S. dollars. That number rose by 954 billion as of this year and is estimated to hit nearly 4 trillion by 2020. However, despite the impressive numbers, there seems to be a shift in strategy amongst the titans of the booming online retailer industry.

A few weeks ago, Reuters reported that Chinese e-commerce giant Alibaba had announced plans to move into the physical realm of brick-and-mortar stores. The move is a strange one for the company given that until now, its made $392 billion through digital sales alone.

Alibaba’s American counterpart, Amazon, has made similar announcements. Its recent purchase of Whole Foods and unveiling of an automated physical store late last year indicates the company is already on a similar trajectory.

The question to ask is why is this trend happening. Reporter Robyn Mak, who broke the Alibaba story, suggests that its because the retail e-commerce market is reaching its limits for the industry titans.

Alibaba’s New Strategy—Invest in Old Models

According to the Reuter’s article, Alibaba founder and executive chairman Jack Ma, has outlined the following plan for the company:

  • The company will upgrade existing physical shops in partnership with established retailers.
  • The company will also build its own stores from the ground up.
  • Continued support for “Hema”, Alibaba’s own supermarket chain where can customers buy and have groceries delivered. Some stores even allow customers to choose fresh produce and have cooked in-store.
  • Explore a similar Hema strategies for clothing.

Hema has been especially successful for Alibaba so it makes sense for the company to increase investment. As Robyn Mak stated:

The attraction for existing retailers is a chance to boost their notoriously low margins by tapping into Alibaba’s technology and platforms to manage inventory, supply chain, and logistics. Stores can also benefit from using the tech giant’s algorithms to analyse shopping habits and by moving to cashless checkouts, powered by Alibaba’s payments affiliate […] The e-commerce group boasts that sales per unit area at Hema are up to five times higher than a traditional supermarket

e-Commerce Around the World

The potential windfall profits that could be made through e-commerce has led to many new online businesses. In fact, there was an estimated 12 to 25 million online stores worldwide according to a 2014 study.

Most of that money trades hands in North America, followed by Europe and then China.

The world of ecommerce is dynamic and has opportunities for innovative new start-ups. At this point, Amazon and Alibaba might be too big to grow further.

Currently, 85% of China’s retail spending happens in brick-and-mortar stores. So while Alibaba is starting to stagnate in its online sales, it can continue its expansion into physical markets.
As mentioned earlier, Amazon has already started on this path. They invested $13.7 billion to acquire and rebrand the Whole Foods Market chain.

Balancing the Pace of Technology and Consumer Demand

As more people go online to do their shopping, the e-commerce market will continue to grow. Alibaba and Amazon are in the process of developing developing new strategies. But because of the demand in ecommerce, new avenues need to be explored for the industry titans. This won’t mean either company will give up any ground online. Instead, each has its own plan to expand past the digital store.

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Morai-Logistics-Blog-infographic-nafta-23-years-later

The current structure of the North America Free Trade Agreement (NAFTA) is set to change later this year. The U.S led negotiations with Canada and Mexico will determine how NAFTA will look, or if it will even continue past next year.

It’s been 23 years since the treaty was signed. In that time, it’s built up quite the legacy. Let’s looks at how this historic treaty has shaped North American jobs and trade.

NAFTA’s future might be uncertain, but its importance in global politics, economics and world trade cannot be understated. The treaty has reshaped the political economic landscape of Canada, the U.S. and Mexico by tripling regional trade and cross-border investment. That’s not to say it isn’t without its critics. However, the world will be very different if NAFTA were to be replaced.

This is why this week, we thought we’d focus on re-exploring NAFTA. Check out our infographic below for some fast facts!

How Has NAFTA Affected North American Logistics & Supply Chain?

morai-logistics-nafta-23-years-later

That’s it for us this week! If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Morai-Logistics-Blog-cyber-threats

Relying on many moving parts and technology, today’s supply chains are especially vulnerable to cyber threats.

Just a couple of weeks ago, Ukraine was hit with vicious cyberattack severely damaging its computer infrastructure. Dubbed ‘NotPetya’, the computer worm responsible is also believed to have shut down ports, factories and offices across an estimated 60 countries.

The attack is just the latest in a growing number of international cyber attacks and data breaches. Several high-profile retailers and their supply chains are among that number.

Cyber attacks may be relatively new, but their impact on global supply chains keeps growing. A compromised system only negatively affected some individuals in the past. However, recent news reminds us that the scale is much bigger these days. An entire section of global commerce can be shut down or compromised with only a few computers. For that reason, we are dedicating this post to covering the impact cyber threats have on supply chains.

Short History but Big Impact

Although they have a large impact today, cyber threats are a relatively recent phenomenon. The first recognized attack according to NATO Review Magazine, was by the Morris worm in 1988. It spread across several US computers, gradually slowing them down until they were unusable.

Cyber attacks really started making international headlines during the early 2000s. Before then, such attacks were usually the result of one or a few individuals. During this timeframe, they became systematic attacks against large organizations and governments.

Some notable examples are:

  • Plans for new US space launch vehicles being stolen by foreign hackers (2006)
  • Spywares were found in the computers of classified departments and corporate leaders during a China Aerospace Science & Industry Corporation (CASIC) intranet network surveyed (2007)
  • The Canadian Finance Department and Treasury Board were forced to disconnect from the internet after a major cyber attack was conducted against the country’s Department of National Defence (2011)

The Cost of Unsecured Networks

Its been estimated that data breaches and cyber attacks currently cost the international community $2.1 trillion annually. That number is set to increase as technology improves and hackers become more resourceful.

Two recent examples of retailers suffering from costly breaches are:

  • Target (2013)—the data of 110 million customers and at least 40 million payment cards were stolen. The attackers got in by stealing the network credentials from one of its vendors.
  • Home Depot (2014)—like the Target attack the year before, the people responsible stole the credit card information of its customers. The weak point was also a third-party vendor.

In just about every case, businesses incur losses in terms of financial penalties, legal costs, loss of consumer confidence, and a decreased stock price. The worst effect is the hit to the organization’s reputation.

On average, a U.S business that suffers such a data breach can expect to lose around $6.5 million when all it said and done.

With cyber attacks being a threat to organizations big and small, everyone needs re-evaluate the security measures they have in place. Ignoring the problem is too costly and simply too dangerous for everyone. Reuter’s contributor Tom Miles explains:

The degree of interconnectivity of networks implies that anything and everything can be exposed, and everything from national critical infrastructure to our basic human rights can be compromised

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Morai-Logistics-Blog-supplier-diversity-google

Google’s Success with its recent Supplier Diversity Program provides a model for other to follow to fulfill its mission to make the world’s information useful and accessible for everyone, and emphasizes diverse perspectives from suppliers of all sizes.

Supplier diversity has been an issue for several large businesses, especially those involved in tech. While supplier diversity is an initiative that everyone agrees is important, how it should be implemented is less obvious.

Google’s innovative approach to supplier diversity is interesting. Although still ongoing, it’s program is structured in such a way to address what have been common barriers to other supplier diversity efforts by other companies.

Why Should We Care About Supplier Diversity

Although supplier diversity has ethical and moral benefits, it also results in a positive ROI when implemented well. According to CM Solutions, commitment to supplier diversity also benefits a company in the following ways:

  • Promotes innovation through the entrance of new products, services, and solutions
  • Provides multiple channels from which to procure goods and services
  • Drives competition (on price and service levels) between the company’s existing and potential vendors
  • Allows a company to take advantage of new opportunities for business expansion with the emergence of new consumer needs based upon shifting demographic realities
  • Displays an organization’s commitment to doing business, beyond consumerism, in diverse markets
  • Showcases the company’s interest in and commitment to the economic growth of all communities

Google’s Supplier Diversity Program

The genesis of Google’s Small Business Supplier Diversity Program is lengthy, but interesting. Its entire history as written by Adrianna Samaniego, Adam Gardner, Chris Genteel and Leonard Greenhalgh, can be read here.

Launched in late 2014, Google’s aim with the program is to:

  1. Connect more Google employees with diverse-owned small suppliers
  2. Connect those diverse businesses to opportunities within Google
  3. Help those suppliers grow on the web and improve their business skills, and finally
  4. To foster innovation at the supply-chain level.

Google has three criteria for participation; the business is U.S based, annual revenue is $15 million or less, and that the organization have 50 or fewer full-time employees.

Lessons Learned

Remove barriers—Unlike other supplier diversity programs, Google’s doesn’t require certification. It discovered that companies didn’t have the time to spend on completing applications and updating certifications.

“The [Google’s Supplier Diversity] application encourages all minority-owned, women-owned, LGBT-owned, disabled-owned and veteran-owned businesses, as long as they fit the other criteria” writes this Supply Chain Management Review article.

It takes work — Several high-level Google employees devoted 20% of their individual work weeks to build the program. Likewise, the Supplier Diversity team attended around 20 events across 20 states and cities in a single year to encourage and train participants.

Communication is key — Google promises suppliers that when they entered their information or queries into the relevant portals, that they’ll respond within two weeks. This included replies to tax information, and documentation.

Google also clearly lists the benefits of participation. It isn’t just the potential for business that these suppliers should expect. They also receive discounts on AdWords, faster payment from participating suppliers, and access to a course that improves their business skills.

Diversity is a benefit to everyone, but implementing programs that encourage it has been a problem for many. Google’s supplier diversity program is still ongoing, but it can still help others by acting as a road map.

As SupplyChain247 puts it:

[Diverse companies] are better able to win top talent and improve their customer orientation, employee satisfaction, and decision making, and all that leads to a virtuous cycle of increasing returns.

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Over the last decade, consumers, shareholders, investors and nonprofit’s have become increasingly concerned about supply chain sustainability. Several high-profile disasters and the acceleration of global climate change has made sustainability a priority for many.

National governments and international governing bodies are also showing their support. The United Nation’s (UN) 2013 Global Corporate Sustainability Report looked at the “actions taken by companies around the world to embed responsible practices into their strategies, operations and culture.” The largest effort to date is the Paris Agreement, or Paris Accord.

The UN agreement had 195 countries sign it in December 2015. Member countries agreed that global warming is a threat and pledged to stop global surface temperatures from rising 1.5 degrees Celsius. Experts warn that if temperatures go over 2 degrees Celsius, it would lead to catastrophic and irreversible consequences for the environment.

Unfortunately, the US pulled out of the agreement in 2017. The White House stating that such an agreement hurts their nation’s economy and sovereignty. While this action has been discouraging, many businesses have been doing their part to continue to further sustainability efforts.

In this e-book, we’ll be exploring sustainability best practices for two key areas of a supply chain, warehouse and distribution, and transportation.

Sustainable Supply Chain Best Practices

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A misconception among many businesses is that they need to be big to adopt a sustainable model. While its true companies like McDonald’s, L’Oréal and Apple are all spending millions to billions on green technology, that doesn’t mean everyone must.

Smaller supply chains can take gradual steps towards building a more socially, economically and environmentally aware supply chain. Beginning the process is as easy as mapping the existing supply network, identifying inefficiencies and eliminating them. A simple packaging change or better recycling process are examples. Every business has ways to run quicker, cleaner and better.
As Inc.com writer Gabrielle M. Blue put it:

Building a sustainable company is a task that must be taken on from all sides. The collective and collaborative efforts of the supply chain industry, with the support from the government, is crucial.

What happens to the environment affects everyone, which is why we all need to do our part to protect it.

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Team TPL - Race Finish - 01

Team True Patriot Love successfully completes Race Across America (RAAM) 2017, coming in second place and breaking the current Canadian record while raising over $120,000 for Canadian Veterans in support of the True Patriot Love Foundation.

Morai Logistics is proud to be the title sponsor of Team True Patriot Love (Team TPL), a team of eight Toronto cyclists that competed and successfully completed a race from coast-to-coast across the U.S. They competed in Race Across America, a grueling race that starts in Oceanside, California to Annapolis, Maryland.

Team TPL competed in order to raise money for True Patriot Love Foundation, a charity for veterans, military and their families. Not only did these amazing racers come in second place, they beat the current Canadian record. Team TPL completed the race, cycling 3070 miles, in 5 days, 17 hours, and 56 minutes. The previous record was 6 days, 2 hours, and 21 minutes.

The Logistics of Cycling from Coast-to-Coast Across America

As a third-party logistics provider, we understand transportation. Getting from one side of the United States to the other is no easy task. The riders from Team True Patriot Love, as mentioned in our previous post, has to endure various extreme conditions. It’s not surprising that Outside Magazine labels the RAAM as the “the toughest test of endurance in the world.”

Despite being a relay, the race is a grueling 24hr non-stop journey over multiple days. Climbing more than 50,000+ vertical metres while taking on the mountain ranges of Sierra Nevada, The Rockies and The Appalachians. They also have to endure temperature swings from 55+ degrees Celsius across the desert to -5 atop mountain passes.

But the more interesting for us logistics industry professionals is the way that this all must be managed for the crew of the cyclists. This is on top of the way the race demands protocol and process in and of itself.

Team TPL - Race Finish - 14

Managing Racers During Transitions is Its Own Supply Chain

The riders competed as two groups of four and had their own split of the total crew members. Eight racers were supported by a crew of 16 who handle the logistical aspects of supporting these riders across the entire journey, coupled with five support vehicles. This includes switching between riders, coordinating rest periods, and feeding both the riders and crew members over the ensuing week of non-stop racing.

We’ve collaborated with Team TPL to build a pre-race infographic to showcase some of the fun facts collected during training to achieve the impressive feat of beating the previous Canadian record. Check out their training facts below:

team-tpl-pre-race-infographic

No Better Time to Support Canadian Veterans

In line with Canada’s 150th Anniversary, the money raised from this race goes to the True Patriot Love Foundation. Their mission: to inspire every Canadian to contribute to the resilience and well-being of our military, Veterans and their families. The foundation works closely with the Canadian Armed Forces, Department of Veteran Affairs and local grassroots organizations. They work together to clearly identify the most urgent needs of Canadian military families on a national scale, while avoiding duplication of efforts between all other supporting organizations.

The entire Morai Logistics team is extremely proud to have supported these riders for their journey! We couldn’t have chosen a better group of riders to support, and they have gone above and beyond with their performance!

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3PL provider, check out our services. We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Morai-Logistics-Blog-Nintendo-Blue-Ocean-Approach

The final entry in a three-part series discussing why a Blue Ocean approach has led to Nintendo’s current supply chain predicament. For Part 1, click here to see our coverage on artificial scarcity, and for Part 2, click here to see our coverage on Nintendo’s Customer-Centric Philosophy.

In the first post of our series, we explored accusations of artificial scarcity leveled at Nintendo. It’s customer-centric ethos was covered next. For this final entry, we will be diving into how this ethos birthed its Blue Ocean strategy. A move that lead to its recent Switch supply controversy, and is responsible for the strength of its brand.

Blue Oceans and Big Waves

Nintendo is constantly trying to find previously unknown market spaces through innovation. This process is known as the Blue Ocean Strategy and it involves eight steps. According to BlueOceanStrategy.com, the key aspects of the strategy involve:

  1. Grounded in data
  2. Pursues differentiation and low cost
  3. Creates uncontested market space
  4. Empowers you through tools and frameworks
  5. Provides a step-by-step process
  6. Maximizes opportunity while minimizing risk
  7. Builds execution into strategy
  8. Shows you how to create a win-win outcome

From launching the hand-held market to saving the North American video game industry, Nintendo has built an empire on previous undiscovered or overseen markets. The best recent example is the Wii console, which launched in 2005. It managed to sell over 100 million units, outperforming Sony’s Playstation 3 and Microsoft’s Xbox 360 consoles. The Wii’s 20 million sale lead was despite it having outdated hardware, lack of third-party support and absent hardware features like Blu Ray and HD support. And of course, it was plagued by scarcity for the first two years of its life cycle.

A Console for More than the Average “Gamer”

The Wii sold well because it became inclusive to families and non-gamer friends through motion controls. For decades, both game mechanics and controllers had been getting more complex. This meant that only those with plenty of free time could keep up. Instead, Nintendo built the console around controls that were as easy to use as waving your hands, reintroducing gaming to the entire family. Its competitors tried to emulate the success by launching their own motion controls.

However, their products weren’t built from the ground up with motion controls in mind, leading to mixed results.
Sony and Microsoft sold their consoles at a huge loss to win a place in a home. Nintendo side-stepped this problem. It created a spot for itself as the secondary home console. By using older, but still effective technology, it managed to turn a profit with each unit sold.

New Markets Offer Little Guidance

Trying to create an entirely new market means that there’s no best practice to follow or improve on. How outside forces can affect the nascent market and supply chain is also limited. In the Switch’s case, the shortages seem to be because of Apple. Wall Street Journal writer Takashi Mochizuki points out:

Nintendo Co.’s biggest battle these days isn’t against other makers. It is against companies such as Apple Inc. that are gobbling up the same parts Nintendo needs to make its hit Switch machine.

Similar situations can be found throughout the company’s product launches. By being so focused on innovation, its ability to adapt is restricted. Factors such as competing industries for resources, port strikes and even excess demand have all proved too taxing for its supply chain.

Nintendo is notoriously conservative with its business practices. But if you look at the success of its products, this isn’t the problem. What needs updated is its approach to supply chains. The company needs better predictive models. Despite its setbacks however, Nintendo has built its brand on innovation. It’s why its products have become cultural icons in the first place.

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

morai-logistics-team-tpl-raam

Team True Patriot Love, the only 8 rider Canadian Cyclist Team is Racing Across America for Canadian Veterans with the support of Morai Logistics.

It’s official! Race Across America (RAAM) has begun. Morai Logistics is proud to announce its contribution as the Presenting Sponsor for Team True Patriot Love (#TeamTPL). Their dedication to helping their fellow Canadians and the ordeals they’ll be going through are an inspiration for the rest of us.

Some of the world’s greatest ultra-distance cyclists have gathered in Oceanside, California to compete in a punishing race across thousands of kilometers. Among those participating is Team True Patriot Love (Team TPL). They are the only Canadian 8-rider team who are committed to setting a new speed record for the race. Their first priority however, is to raise awareness and support for Canadian veterans and their families.

Racing for Canadian Veterans and Their Families

Team TPL’s goal of completing the race in record time is ambitious. But its their dedication to their fellow Canadians that’s truly admirable. They have decided to dedicate their ride in support of the True Patriot Love Foundation.

Morai-Team-TPL

The charity they represent honours the sacrifices of members of the Canadian Armed Forces, veterans and their families. They do this by funding programs and research aimed at family health and support, physical health and rehabilitation, mental health, and well-being. Over the last 8 years, True Patriot Love has raised more than $15.1 million. The money has gone to support military charities and research across Canada according to interviews with the team. Team TPL has managed to raise over $110,000 (as of today) of its $200,000 goal so far. The race begins this coming Saturday.

Canada is celebrating its 150th anniversary of confederation this year. While many of us will be marking the occasion with fire works, Team TPL will honouring it by competing in the RAAM. In doing so, they’ll be raising money for Canadian veterans and their families. Like those veterans, Team TPL will be enduring harsh conditions and grueling physical hardship for a better tomorrow for their fellow Canadians.

RAAM — A Race Like No Other

Dubbed, “the toughest test of endurance in the world” by Outside magazine, RAAM was started in 1982 by four individuals. They raced from the Santa Monica Pier in Los Angeles to the Empire State Building in NYC and ended up inspiring other to do the same. Since then, teams of 2, 4 and 8 people have gathered annually to compete against each other.

This year’s RAAM will have teams compete not just against each other, but also against harsh terrain and the elements. The record Team TPL will need to beat is 6 days, 2 hours and 21 minutes if want to achieve their goal. It won’t be easy.

“The Race Across America (RAAM) is a bicycle race like no other. Unlike its more famous cousin, the Tour de France, cyclists don’t race in stages spread across several weeks. RAAM is decidedly less glamorous and far more savage. Once the starting gun goes off in Oceanside, California, the clock does not stop until you cross the finish line in Annapolis, Maryland, some 4800+ kms later” writes Amy Synder in her book, Hell on Two Wheels.
Other difficulties the racers will face are:

  • The race being 24hr non-stop racing over multiple days
  • Climbing more than 50,000+ vertical metres taking on the mountain ranges of Sierra Nevada, The Rockies and The Appalachians
  • Temperature swings from 55+ degrees Celsius across the desert to -5 atop mountain passes

Morai Logistics is Cheering from Afar!

The entire Morai Logistics team is excited to watch the race from our office cheering Team True Patriot Love from afar. Our President, Kelli Saunders will be greeting the boys along with many other friends and family members to congratulate the them on their successful completion of the race!

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Morai-Logistics-Blog-Nintendo-Switch-Part-2

While modern companies focus on providing exceptional service, Nintendo continues to focus on extraordinary products with a Customer-Centric approach.

In our last post, we began exploring the reasons behind Nintendo’s history of not meeting consumer demand. Many of its gaming consoles, software, peripherals and promotional items in the last 20 years have seen instances of scarcity across its North American and European markets. Limited supply, inflated grey market prices, and angry consumers have been the result.

Nintendo’s latest console, the Switch, launched a few months ago with similar supply shortages. Some customers and press accused the company of intentionally limiting production to drive sales given the familiarity of the situation.

What’s behind the latest supply issues is the company’s customer-centric philosophy, not artificial scarcity.

Artificial Scarcity Isn’t the Problem

On the surface, Nintendo’s selling practices may seem to favour artificial scarcity to drive sales. The problem with this theory, is that artificial scarcity is only ever a short-term solution for luxury products. Artificial scarcity only generates demand because of perceived scarcity. The actual value of the product isn’t considered, meaning that the company doing it has little incentive to innovate the product. After a certain point, and despite a company’s attempts, there will be too much of a product in circulation for it to maintain its price.

Nintendo is a nearly 140-year-old multi-national company, iconic and influential in its industry. If it followed the same strategy as the former Beanie Baby empire, it would’ve folded decades ago.

The ‘problem’ with Nintendo’s management and supply chain strategies, is that they’re very customer-centric.

Customer-Centric: An Old but Effective Model for Nintendo

Newcomers like Amazon, Uber and PayPal have been disruptive to many industries. However, their biggest contribution is the latest trend of customer-focused strategies. Many companies are now trying to streamline their services to better improve the customer experience.

Ken Ramoutar of Avanade Insights, highlights what a customer-centric focus involves:

  • Anticipate your future needs looking at behavioural patterns, market trends, leveraging data from inside and outside the organization
  • A unique and memorable experience; seamless across your interaction channels
  • Analytics to inspect call logs and problem reports to feed changes in supply and production

None of these describe Nintendo’s business practices or product design philosophy. In fact, the company is notorious for being especially conservative in an industry that’s in constant flux.

Nintendo and Unique Gaming Experiences

Nintendo’s focus throughout its long history, is on creating products that provide a unique experience in and of themselves. Unlike its past (Sega) and current competitors (Sony and Microsoft), the company never bothered to chase the latest technological, marketing or business trends. This historically had both good and bad results for the company at different points in its history. However, it has allowed it to remain strong in the face of ever ballooning industry costs. Sony and Microsoft may have millions of dollars to throw behind their development and marketing strategies, but Nintendo has its Blue Ocean Strategy.

That’s it for this week’s post. In the final entry of this three-part series, we’ll describe how Nintendo’s Blue Ocean Strategy and customer-centric approach has led it to continue to be a dominating force within its industry.

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.