The Lego Group, the privately-held Danish makers of Lego, have recently announced that they taken steps have towards reducing their product’s carbon footprint.
According to a news report by the Curbed, Lego is investing $150 million in research and development over the next 15 years.
This article from RealtyToday.com provides more information,
In addition to establishing a new facility that’s dedicated to the cause, the company will be hiring a team of 100 employees to develop a new environmentally-friendly ‘recipe’ for the Lego toy, they would be seeking to hire a range of scientists for the project, including chemists, materials specialists, engineers, and parts designers
The company’s aim is to ultimately move away from the (acrylonitrile-butadiene-styrene) plastic materials that they have been using in their toys, and instead make its iconic plastic building blocks better for the environment. While Lego will remain plastic and still look the same after all of this is over, oil won’t be used to make them.
At present, according to news reported by the Cen Acs.Org, Lego currently uses 77,000 metric tons of raw materials to create more than 60 billion Lego.
Building Towards a Sustainable Tomorrow
Although Lego is only one brand that moving toward being more environmentally friendly, the cultural presence and thus its ability to influence other companies towards more eco-friendly manufacturing cannot be understated.
Lego have been around in their earliest incarnation since 1949. From pop culture franchise themed sets, museum housed art exhibits, to a Lego constructed fully-functional car, the famous plastic bricks have played a large role in capturing the imaginations and free time of millions of children and adults alike.
Just last year, Lego had a powerful impact on the cinema world with the runaway success with both critics and audience with their The Lego Movie. This means that no matter the cause, Lego will have a very visible impact in any venture it takes on.
Being Green Isn’t Just for the Small and Stackable
Lego isn’t the only company that is moving toward being as eco-friendly as they can be.
There are many advantages that are to be gained. According to an article on Chron, they are:
- Public Relations
- Cost Savings
- Healthier Workplace
- Tax Credits
- Consumer Demand
A quote by Roar Trangbaek, press officer for Lego Group, in a online publication by Atten.com, described the green move as a “logical” way to help improve the environment as a company.
“You could say that it’s a logical place for us to find a way of reducing our environmental footprint,” Trangbaek said. “If you look at our CO2 footprint as a company, the majority of our impact comes from offscreen activities—basically what happens before we receive any raw materials in our factory … We’re looking at every opportunity out there that’s more sustainable”.
As 2015’s “World’s most powerful brand”, Lego’s move toward greener bricks will hopefully be the building block necessary to encourage other popular manufacturers toward environmentally-friendly products.
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Social media and social networking are two key trends are reshaping how businesses conduct their affairs, communicate with vendors and customers, and even their organizational structure. However, the logistics industry has largely been slow in adopting these technologies and strategies, despite many studies indicating that supply chain managers acknowledge the importance of doing so.
In a 2013 study conducted by Adrian Gonzales, 45 percent of the supply chain professionals surveyed said that “social networks will make supply chain processes more efficient, responsive, and cost effective” over the next five years. Another 30 percent said that “social networks will transform supply chain processes (for the better) in ways we can’t imagine today”. A similar study conducted by Fronetics Strategic Advisors found that of its respondents, 68% reported that their company has realized benefits by participating in social media.
Although the positive attitude toward social networking is there, of the supply chain managers surveyed, 30% of the reported blocking access to social media sites. From the supply chain professionals that responded, 62% said that their companies hadn’t implemented a social networking solution yet, while another 27 percent didn’t know.
The study concludes that the cognitive disconnect between supply chain manager believing in social networking, and the action of moving towards greater adoption has to do with the inability for companies to quantify the business value of using social networking technologies.
There’s a similar finding in the Business Opportunities: Social Media 2013 paper which found that transport and storage companies are underutilizing these technologies the most, whereas other segments such as airline transportation make more extensive use of social media and count some interesting and innovative initiatives and projects in place.
Proactive or SMART use of Social Networking?
As mentioned, the biggest barrier at the moment to greater adoption of social networking is that it’s very difficult to quantify its business value.
There are two contradicting philosophies when it comes to this topic.
The first one, as described by the aforementioned study by Adrian Gonzales, is that trying to measure the direct ROI of something as ethereal as social networking technologies is the wrong approach all together.
It cites the example of GE, which took a proactive approach to social networking by creating a platform that they “can track usage, adoption, how people are using the system, and what their connections are”. What it doesn’t do, is create the direct correlations between usage and business numbers that are needed for ROI. And according to its CEO Ron Utterbeck, “Going and spending money on ROI would be, honestly, in my opinion, just a waste of money because your true value of this is people are coming back”.
The second philosophy is that of the SMART method which involves having specific, measureable, achievable, realistic, and timed goals as they relate to social media and social networking.
The Benefits of Expanding Social Networking Efforts
The research found in the Business Opportunities: Social Media 2013 paper lists a number of opportunities that logistics companies could benefit from if they used the tools for “expert collaborative communities”.
- Managing procurement and logistics using Social platforms, which allow instant communication between different parties on complex supply chains.
- Improving organizational performance by streamlining communications and enhancing collaboration, both internally within the enterprise and outside with contractors, partners and suppliers.
- Facilitating collaboration and co-creation, reducing the time spent in unnecessary in-person meetings, and helping share internal knowledge and best practices.
- Accelerating the integration of new staff, contractors and outside partners into teams.
If the logistics industry is to better adopt and grow its social media presence, it will, as an industry, need to change any misconceptions it has toward the key trend.
“Social networking is not really about socializing, but about facilitating people-to-people communication and collaboration” writes Adrian Gonzalez, “social media can – and should – play a central role in supply chain management”.
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Last week, Frost & Sullivan published the 2015 Supply Chain Foresight report which analyzed key megatrends impacting (or predicted to impact) industry stakeholders. More importantly, the survey
A key point of the survey was that the findings were based on how the industry leaders who participated felt about the impact (or possibility of impact) the emerging megatrends would have on their supply chains, businesses and industries.
3D/4D printing and copying was given a low ranking, whereas technology innovation, the rise of African and Asian economies, device connectivity and big data, e-commerce and robotics were cited as the most pressing megatrends.
In our view, the assessment and ranking of the emerging megatrends by the study’s participants isn’t incorrect. However, we feel that it lacks some imagination and that the full implications of this technology is not being fully appreciated from a supply chain and logistics perspective.
3D/4D Printing’s Effect on Manufacturing & Transportation
One of the many appeals of the potential of 3D/4D printing as a technology is that if it were to continue its drop in price, it would then be financially feasible to incorporate into a manufacturing facility in mass. Such an action could effectively localize the entire production process, affecting the transportation and manufacturing sectors in profound ways.
“While manufacturers benefit from the operational efficiencies 3D printing can bring, transportation providers may take a revenue hit if they aren’t fully prepared. Global commercial transportation lanes are particularly at risk since more products will be manufactured locally. A recent analysis found that as much as 41 percent of air cargo business and 37 percent of ocean container business may be affected. About 25 percent of over-the-road (OTR) trucking business is also at risk, due to the potential reduction in goods that start as air cargo or as containers on ships” says an article from Load Delivered (quoting statistics from Strategy&).
3D/4D Printing as it is today
Although it is likely that it’ll be several years before the potential for 3D/4D printing to be fully realized, the technology has however resulted in logistical innovations.
The militaries of Britain, America, and China have already started using 3D printing on the field to replace equipment parts, and to print out surgical instruments and protective masks directly in war zones.
NASA has also experimented with 3D printing as an economical alternative to sending tools and spare parts into space to fix delicate equipment. Rather than using the limited space in a shuttle to transport a wrench to use on the International Space Station, NASA can simply email and print the wench on the station itself.
Other Implications of 3D Printing
The problem with trying to list all the ways that this technology will affect the supply side logistics industry is that the far reaching implications, consequences, and innovations it affords is mostly uncharted territory as there’s nothing like it. It’s ability to collapse the space of manufacturing and transportation of goods is similar to the automobile and will potentially have just as great as an impact on the industry overall.
As mentioned, although the far reaching implications of this technology is murky at best, there are some implications that are generally agreed upon . According to an article on Manufacturing Global Magazine, they are the following:
- Easier prototyping
- Easier customisation
- Greater creativity and efficiency
- Improved consistency
- Reduced lead times
- Lower prices
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A little under two weeks ago, the Federal Aviation (FAA) granted approval to e-retailing giant Amazon.com to test-fly their new advanced drones, under certain provision, for potential delivery. This latest petition received quick approval from the FAA compared to past efforts this year, such as the six month delay in approving an earlier prototype for which the FAA received a lot of criticism.
“We’re pleased the FAA has granted our petition for this stage of R&D experimentation, and we look forward to working with the agency for permission to deliver Prime Air service to customers in the United States safely and soon,” said Paul Misener, Amazon vice president for global public policy.
The FAA said Amazon was one of 30 exemptions the agency granted a day earlier for commercial drones, bringing the total to 128 according to this RTT News article.
The article is one of many recent stories involving drones. An increasing number of industries outside of logistics and e-commerce are looking at drones as the technology of the future.
Danny Vogel of JUDSPURA Business Advisor outlined some examples from other industries that have already started to seriously consider utilizing drones:
- Law enforcement agencies have shown strong interest in using drones for surveillance and public safety while other government agencies have found drones useful in fighting fires, search-and-rescue missions or catastrophic events
- Construction companies have already begun using drones for mapping sites and monitoring progress, and mining companies have used drones to map the insides of mining tunnels
- Media companies have also begun testing drones for filming reports and news coverage
What it all means for logistics reliant businesses
Back in February of this year, a number of articles reported on Amazon’s inability at the time to get approval from the FAA to test their drones on American soil. At the same time, one of the company’s major international competitors, the Chinese online giant Alibaba, was ready to test their own drone delivery program by delivering tea to 450 of its Chinese customers in a trial run.
The reason why both companies’ drone delivery programs were so heavily compared to one another was because since Jeff Bezos, CEO of Amazon.com, publicly revealed the Prime Air program in late 2013, Amazon has been in the press as the main proponent of utilizing drones for commercial purposes. Although many companies since then have started their own drone testing, seeing a competitor such as Alibaba made the public all the more aware of how far drone delivery programs have come in two short years.
Many news articles, industry discussions, and blog posts related to logistics discussed how drones would be a hot item discussion in 2015. However, with each passing month it becomes more and more apparent that the discussion around the requirement for drones was settled even before the start of the calendar year. Instead, the real discussion is centering around which companies will come up with the best solution to the problem of possible collisions and best marketing strategy.
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Although it’s only February, there are already two global trends in the supply chain logistics industry that’ll play a big part moving forward into future years.
The first trend that has been taking shape in recent years is that next-tier economies (emerging countries that are not Brazil, Russia, India, China and South Africa, also known as BRICS) are having their markets currently experiencing an influx of what Agility’s press release for the 2015 Agility Emerging Markets Logistics Index calls “dynamism”. This is happening in a time when the global economy is experiencing a cool down.
The second trend, which has been ongoing for the better part of two decades, is the continuing evolution of the digital sphere. Specifically, in how Bitcoin has been gaining traction as a medium of exchange in many emerging markets (including ones in Agility’s Index) and what that could mean for even the most basic of financial transactions in those countries.
A closer look at Agility’s 2015 Index
Though the findings and highlights of the Index are interesting, what is important for the purposes of this post is the quote by Essa Al-Saleh, President and CEO of Agility Global Integrated Logistics concerning the trend:
“A year ago, there was talk of an emerging markets meltdown and of a new ‘fragile five’ based on concerns about weakness in South Africa, Brazil, India, Turkey and Indonesia. Emerging markets as a group turned out to be far more resilient – even vibrant – than expected despite continued sluggishness in the global economy” said Al-Saleh. “The factors driving growth are increases in population, size of the middle class, spending power and urbanization rates, along with steady progress in health, education and poverty reduction” he continued.
Bitcoins and their role in emerging markets
This upward trajectory ties into the rise of Bitcoins in emerging markets. For the purpose of brevity, we’ll forgo explaining how it works and instead recommend this Wall Street Journal article by Michael J. Casey and Paul Vigna which explains it, and the ways it’s not just a digital currency.
Although Bitcoins have had several confidence damaging scandals, it’s still seen as having high utility in developing economies as it offers faster, more transparent, and sometimes a more stable alternative to local currencies that are experiencing high volatility. Min-Si Wang’s article in Forbes on subject gives further detail about Bitcoin adoption in emerging markets (for example, the trading volume of Bitcoin in China grew from 0.4 percent in 2012 to 4.7 percent in 2014).
A more critical article in Euromoney gives more numbers
According to Jana, a mobile-payments company that serves as many as 2 billion people in emerging markets, some 58% of those surveyed, from Vietnam to Brazil, said they would feel comfortable investing in a virtual currency, rising to 75% in Kenya, home of the wildly popular M-Pesa mobile-money network. In fact, in some countries, as many as a fifth of respondents claimed that virtual-currency investments were a safer long-term bet than stocks and property.
What does it all mean?
At a fundamental level, Bitcoins offers a cheaper alternative to the financial transactions offered by those offered by banks and credit companies. If Bitcoin became a global standard, well…
… this model could slash trillions in financial fees; computerize much of the work done by payment processors, government property-title offices, lawyers and accountants; and create opportunities for billions of people who don’t currently have bank accounts” writes Casey and Vigna. “Great value will be created, but many jobs also will be rendered obsolete.
The non-BRICS emerging markets are set to have a heavy impact on global business trends in the near future as their economies and logistical networks continue to strengthen. As they do, so does the faith open-source systems and digital money. The future looks to be very interesting in the coming years.
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We hope everyone has had a great holiday and we would like to wish all of our readers a Happy New Year! To kick off the year, we have finished compiling our infographic on the top logistics and supply chain facts from the news that we’ve collected throughout last year. As there is a large number of news items spanning the many large topics in the logistics industry, we decided to create our Top 10 by focusing on categories:
- Drones
- Same-Day Deliver
- Supplier Diversity and Women
- Sustainability
- RFID
- World Bank Institute’s Private Sector Platform
- Automation
- Online Retail
- Truck Driver Shortage
- Logistics Slow Growth
Each of these topics have some pretty interesting facts and statistics that may have been missed in the hustle and bustle of fellow logistics professionals and enthusiasts. And while we haven’t covered all of the interesting facts from 2014; we felt that these topics helped changes the face of the logistics and supply chain industry in 2014 and serves a good snippet to review the year.
Top 10 Logistics and Supply Chain Facts of 2014
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If you were reading Forbes’ website last week, then you would’ve come across an interesting article concerning predicted trends for the logistics industry in 2015. Sarwant Singh, a Senior Partner in Frost & Sullivan lists a total of 15 likely trends to occur in 2015 with common threads between all of them being Information & Communication technology providing new avenues for production, solutions, and business models; and societal trends transforming the corporate, market, and personal landscapes.
The entire article is excellent and is a must read for anyone curious about the opportunities afforded by the evolving logistics industry. For this blog post, I would like to focus on three key trends listed in the article as, in my opinion; are the biggest deviations from the status quo in the logistics industry.
Moving toward Zero Latency
The world will prepare itself for faster processing speeds and faster response times. The next few years will see a move toward zero latency and human unnoticeable delays providing real-time experiences. This will increasingly be embedded into workflows and other processes.
The collapse in latency times in just the last few years has been astounding. The old expectation of same month delivery from traditional post service evolved to same week. This year saw same-day delivery become the standard for e-commerce companies such as Ebay, Amazon and even Google. However, even this hasn’t been quick enough with Amazon’s same-hour delivery service for its Prime members which it revealed last week.
The move toward zero latency is not only a massive drive for innovation in the logistics industry (such as Amazon’s delivery drones and DHL’s massive pledge of investment into creating more efficient supply chain networks in China), but also a key way in how many supply-side companies are marketing themselves to customers.
Transparency is the New Green
Increasingly pervasive analytics and collaborative platforms would make data and processes more transparent than ever before. Governments, corporations, organizations, communities, supply chains and even individuals will be more accountable and liable for policies, decisions and strategies.
Customer interactions with businesses of years past were very binary for the most part. A customer wanted or required a product, and a business provided it wholly formed. Questions such as where it came from, how it came to be weren’t asked and businesses weren’t forthcoming with the answers. The logistics industry was no different as the levels of supplier tiers, volume of oversee transactions, and technological limitations complicated the matter further for many companies in the industry.
The change in philosophy has been swift and pervasive in the last few years as large international companies such as Starbucks, Levi’s, and even McDonald’s and Amazon have embraced more open business models.
Our post last week focused on this trend, but suffice to say, greater transparency in the industry is good all-around as it offers customers more information, accountability, and ultimately better choices.
Women Focused Strategies
As the policymakers debate and implement policies increasing quota for women in boardrooms in 2015, we will see a lot more women focused strategies across companies in different sectors.
The industry of logistics has long been a “Gentleman’s Club”. As outlined in the Morai Logistics Infographic focusing on women in the logistics industry, compared to other industries women still have some room to catch up at all levels in the logistics and supply chain industry.
However, not only have more women been getting into the industry, but women focused strategies overall has been on the rise.
In a past article we wrote about how companies are realizing the benefits of supplier diversity go beyond the “social good.” We are now at an age where companies are starting to find that supplier diversity programs can be fiscally beneficial through ROI, and lead to bridge-building into the untapped force that is women-owned businesses.
All-in-all, 2015 will be an exciting year for the logistics industry.
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The press release states that information such as “where items were made, why each ingredient was included, where the ingredients were sourced and much more” will be offered to Amazon Prime members. Furthermore, each package obtained from this new service will contain a unique code that can be scanned through an Amazon shopping app to track its specific ingredients and their origins, its date and place of manufacture, date of delivery, and ‘best by’ date.
Bringing Light to Something that is Already Happening
On the surface, what Amazon Elements is offering isn’t new. Other supply chain dependent companies have been offering similar levels of transparency for years. For example, Switcher, a Swiss textile company, labels each of its products with a code so that its customers can enter at the website to retrieve information about every firm and factory along the supply chain while also looking at the environmental performance certificates.
There’s also the Massachusetts Institute of Technology’s supply chain-friendly tool Sourcemap which is described as “the social network for supply chains” offers a very similar service to Amazon Elements (except it isn’t locked to Prime members and it doesn’t only cover diapers and wipes) as it too offers customers the ability to see the complete supply chain for a product or company. It also has the added benefit to calculate the potential impacts on the entire supply chain in the event of natural disasters or political unrest.
So why then does Amazon’s announcement merit any press interest let alone any from anyone in the logistics industry?
The answer is that unlike the efforts of other companies which have transparency as a value-added part of production, the transparency is the product when it comes to Amazon Elements.
Although supply chain transparency is important as demonstrated in classic case of Upton Sinclair, or the more recent crisis of Lululemon, many companies are still luke-warm on the idea.
This is because historically, both customer and retailer largely didn’t care about the history of an item. They were content that it was reasonably priced for what it is. The production and supply chain behind it was effectively invisible. Even if a business wanted to be transparent with its supply chain, it was incredibly difficult outside of its immediate suppliers due to technological and resource limitations.
Going back to Amazon Elements, Amazon is testing what sort of ROI it will get by selling transparency. The actual diapers themselves are more expensive than those on offer by their competition. However, Amazon has seen the move by supply chains in recent years from invisibility to transparency and its ready see how much it can capitalize from this trend.
Steve New, a writer for The Harvard Business Review puts it best when he describes the opportunities available to firms that make the switch,
As customers take greater interest in the origins and authenticity of the things they buy, providing them with tools to track provenance will become an important part of the marketing mix and will give producers and retailers new ways to capitalize on brand value. A key consideration is how much data to make publicly available, and in what degree of detail. Many firms have made bold assertions about how seriously they manage their supply chains. Transparency, at a granular level, gives credibility to those claims.
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Although the experimental delivery program may still be a few years away, it is this sort of unorthodox business strategy that has led the company into having a hand in 20 percent of all e-commerce in North America. Other programs that Amazon has implemented over the past several years has also caused stirs in B2B markets, cloud technology, and those in 3PLs in general.
1 – Shifting from to B2C to B2B
Amazon has been selling millions of items annually to thousands of households for several years. However, since 2012, it has been targeting the lucrative wholesale and distribution market through AmazonSupply which itself grew out of years of experience operating Smallparts.com since it was acquired in 2005.
Whereas common items on Amazon’s main site include books, CDs, and Blu rays, many of AmazonSupply’s items are those that would otherwise only be obtained through specialist distributors such as centrifuges, micrometers and air cylinders. And unlike many other businesses that specialize in industrial B2B transaction, Amazon focuses its marketing through digital media assets such as videos, post downloadable, CAD drawings and user reviews.
Although AmazonSupply’s main competitor, the Chicago-based industrial supplies giant W.W Grainger, holds an estimated 6% of the entire B2B market according to a Forbes article. Despite this, AmazonSupply’s future is bright. It already has Grainger’s online inventory beat by almost twice the amount indicating that it may in fact be the major player in the B2B market rather than its current status as only a major player.
2 – The future is in the cloud
The computer infrastructure that Amazon has built for Amazon Web Services (AWS) is considerable. With it, the company has been able make itself felt in the e-commerce business world by dominating the cloud computing industry and “hosting customers from NASA to Pfizer PFE +0.89% and ringing up an estimated $3.2 billion in revenue last year” writes Claire O’Conner of Forbes.
With its control of the cloud computing industry, “Amazon might leverage its investment in cloud technology to become a clearinghouse for a steadily increasing share of e-commerce business” wrote Dr. Robert C.Lieb and Kristin J. Lieb in the Quarter 3 2014 report. As more and more 3PLs move into the digital world, that means that Amazon will continue to be a looming presence as it moves from customer to competitor.
3 – Customer or competitor?
There’s been some discussion as to whether Amazon is in the process of making a committed move into the 3PL market. The company already offers a range of services and benefits to its two millions vendors such as cheaper transporting services, order management, inventory control, delivery and billing–all of which put it into competition with other 3PLs.
Referring back to Lieb & Lieb study, they found “with the continued expansion of the company’s warehousing, distribution services, order fulfillment, and transportation services, Amazon might become a formidable competitor by offering shippers a broad range of services that 3PLs already provide”.
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We hope you have been enjoying this summer so far! As we are now in the latter half of the warmest and sunniest of seasons, we would like to take the time to focus on some summer-themed logistics and supply chain related news.
Nova Scotia Aims to Modernize Seafood Industry Trading
Mikel Budreski notes that the platform will help streamline the sales and marketing process for a wide range of seafood companies worldwide. Ocean Executive’s platform seeks to allows users, be it buyers or sellers, to connect directly to each other and their respective products and services in real-time via a an auction marketplace (a function that can be either public or private). This allows users to receive live pricing and market data for more efficient and transparent trading practices:
All players in the supply chain stand to benefit from true and fair market pricing, whether it’s fishermen, processors, wholesalers, distributors, traders, brokers, retailers or large restaurant chains.
– Mikel Budreski, President of Ocean Executive
Greg Phipps of Innovacorp notes that the seafood industry is still using outdated an inefficient processes to buy and sell products and that this technology being developed by Ocean Executive has the potential to modernize this dated trading system. This is indeed a trend that is happening with regards to the logistics and supply chain industry as a whole; combining technology and the Internet of Things (IoT) to help optimize the industry is indeed proving to be a strategy that is here to stay.
Coconut Water Affecting the Coconut Supply Chain
Tessa Riley of The Guardian gives the scoop on the coconut water craze and how it affect s the supply chain. This spur in popularity is largely facilitated by North America, now the biggest global market for coconut water. Originally seen as a useless byproduct by coconut farmers, and normally reserved for exotic holidays, the North American market has really taken coconut water to the next level. From the sales report of the top three most popular brands going from almost nothing in 2004 to a whopping $400 million dollar industry in just under a decade (i.e. 2013).
For a bit of history on coconut farming, traditionally coconuts were harvested for their ‘copra,’ or meat, which is then used to extract coconut oil. Coconut water is notorious for being hard to preserve as it starts decomposing as soon as the coconut water is cut. Thus, coconut farmers see it as a useless byproduct. Since the leap in demand though, initiatives have been taken to allow coconut farmers to consider the production of more diverse economic return like coconut water, which has a much higher return on investment per coconut for the farmers. Lack of technology and limited knowledge is the biggest wall for the coconut farmer though, despite the UN Food and Agricultural Organisation promoting best practices on small-scale production of bottled coconut water.
This gap between the coconut farmer and the consumer along the supply chain is growing and if the coconut water industry intends to stay sustainable, there needs to be some way to bridge the gap that would allow coconut farmers to leverage knowledge and technology to allow them to produce the great demand for coconut water.
Cashew Juice? Not Just a Nuts Idea
When extracting nuts from cashew plants farmers usually throw away the fruit attached to the nut. Known as the ‘cashew apple,’ this nut is full of Vitamin C as well as other essential nutrients. It also has many other potential uses such as: being another form of meat substitute, used for the production of alcohol, or animal feed.
PepsiCo has started work in India to collaborate with farmers to source cashew apples and use it to create the next iteration of specialty juices, along the same lines of coconut water, pomegranate juice, and hazelnut milk. This comes with a new set of logistics challenges though, mainly that of storage, transport, and shelf life. The fruits are fleshy and must be collected from the ground (not the trees), and must be processed within 24 hours (if the nut is removed before collection, then the time frame is shortened to a mere six hours). Temperature is also important; they must be stored in containers that do not get cooler than 5 degrees. Furthermore, the intended market for where Pepsi wants to sell is about 3000 km from the growers’ sourcing stores (i.e. Sao Paulo and Rio de Janeiro).
Testing it out in both the South American and Indian market to start, PepsiCo hopes to eventually expand it other markets across the globe.
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!