The New Year is quickly approaching, bringing with it new ideas, products, opportunities and changes to the manufacturing supply chain. Whether you’re shipping finished goods directly to consumers or providing parts to other suppliers, these 5 supply chain changes will likely affect you in 2018:
1. More suppliers will turn to E-commerce platforms to sell goods.
Whether through online marketplaces like Amazon or their own websites, companies are supplementing traditional sales with online options, if not converting to E-commerce completely. The reason why is clear: 96% of Americans with Internet access have made at least one online purchase in their lifetime, and more than half of Americans prefer to shop online, according to Big Commerce. If they’re making personal purchases online, why wouldn’t they also want to make business purchases the same way? Leveraging the Internet, suppliers and other manufacturing partners will be able to easily share data in real time to increase procurement efficiencies, in turn making it easier for manufacturers to shorten lead times.
2. Blockchain will make an entrance.
Blockchain is a digital ledger within a network (global or private) used to exchange information and keep a history of the transactions. In simple terms, it’s a Google Sheet. Anyone within the Blockchain network can view/update it, even if others are viewing or editing the document. In the manufacturing world, Blockchain will increase business intelligence and expand supplier networks globally, making the purchasing process a little easier and faster. It’s already being used by companies like Walmart and IBM to track the movement of goods and information. As it grows, Blockchain will only become more comprehensive and efficient.
3. Automation and the Internet of Things (IoT) will become more powerful.
More and more companies will turn to cloud-based warehouse management systems, and they’ll use sensors to gather data about worker productivity and machine health. Some will invest in automated storage and retrieval systems (AS/RS). Individually, these technologies will help suppliers streamline processes, reduce worker fatigue and free employees up to focus on higher-level tasks. But, the next step is to connect the individual systems to the Internet of Things (IoT) to automate data retrieval across an entire organization. This will make it immensely easier for company leaders to analyze the data and pinpoint inefficiencies or potential problems. Catching and resolving problems early will help suppliers and their customers stay as productive and cost-efficient as possible.
4. The shortage of transportation employees will push the use of driverless vehicles.
As automation makes manufacturing processes faster, the logistics demand grows. However, the transportation industry is facing a shortage of workers. To help close the talent gap, companies are testing the use of autonomous vehicles. With the introduction of several autonomous vehicles over the past few years, 2018 could be the year when many questions surrounding the feasibility of using driverless vehicles are answered.
5. Shipping rates are going up.
FedEx and UPS have both announced rate increases for 2018, which could affect your bottom line. Overall, both companies are increasing rates by 3%-5% depending on the specific service. The UPS rate changes will take effect on December 24, 2017 and the FedEx rate changes go into effect January 1, 2018.
Manufacturing supply chain changes for 2018 revolve around technological advances. For companies that have started to dabble in automation and robotics, 2018 will be the year to refine the use and purpose of those technologies. It will also be a great year for those companies that haven’t made the transition to do so. As the year progresses, we recommend you keep an eye on the autonomous vehicle story. It’s one that could change the supply chain world – and how you do business – very quickly.
Being aware of how the supply chain is evolving is one step toward a sustained competitive advantage. So is working with companies like MCL that are dedicated to providing true value in every situation, like that featured in How MCL Minimized A Customer’s Production Delays. Click the button below to get your free copy of this informative case study.
