Everything Related to U.S. Imports and Exports
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Everything Related to U.S. Imports and Exports
From supply chain management to the latest trends in international trade, we'll highlight what's new in the world of U.S. imports and exports.
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Supply Chain 2050 - Logistics Viewpoints: A Blog for Logistics, Supply Chain, and 3PL Executives

Supply Chain 2050 - Logistics Viewpoints: A Blog for Logistics, Supply Chain, and 3PL Executives | Everything Related to U.S. Imports and Exports | Scoop.it

An interesting and useful exercise for logistics executives to do at their annual strategic planning meeting is to ask, What are the megatrends that will change the face of logistics in five years? Ten years? Twenty years? And even forty years?

For me, the three biggest megatrends are robotics in logistics (both for the warehouse as well as driverless cars/trucks, and maybe even drones), omni-channel fulfillment, and the need to develop new distribution models to address the bottom of the economic pyramid.

We have written a fair bit about the first two trends, but not so much about the third trend – “consumers” at the bottom of the economic pyramid. Florian Güldner at ARC wrote a strategic report called “The Structure of Manufacturing in 2050” (available to ARC clients only) that provides some good coverage of the third megatrend. Here’s an excerpt:

“Economists typically use a pyramid to represent the global distribution of wealth. The ‘bottom of the pyramid’ refers to the four billion poorest people in the world, in particular the segment of around 1.5 billion people living on from $2.50 to $7.50 per day. While much attention has been paid to the growing middle class in emerging economies, business with the lowest income class has been neglected for a long time.”

Many Western multinational firms understand that growth will largely come from developing countries. Procter & Gamble, for example, has a goal to acquire 1 billion new customers. This goal is not reachable by just focusing on an emerging middle class. Unilever seeks to sell Lifebuoy soap by educating 1 billion poor Asians and Africans about the health benefits of handwashing.

 

The logistics challenges include the need to deliver goods packaged in small handling units to a large number of extremely small footprint store fronts; making deliveries in both crowded, congestion-choked metropolises as well as remote villages; and terrible infrastructure. The size of the goods delivered can range from very small – “Danone sells a small, 50-gram pouch of drinkable yogurt in Senegal that doesn’t require refrigeration for roughly 10 cents” — to low cost bulk goods like bags of rice.

Local sourcing can also help consumer goods companies be perceived as good corporate citizens while improving the buying power of small farmers. But the farm-to-fork supply chain is blemished by very high spoilage.

And when you deal with small, unsophisticated retail outlets, engaging in a robust forecasting process is difficult, although this problem is not insurmountable (see “How a Large CPG Company Runs an Efficient Supply Chain in Developing Countries”).

The cool chain, transporting temperature-sensitive food products, is obviously more challenging. Further, the need for developing a cool chain for the developing world is increasing because of new innovations allowing storefronts to carry more of these products. “A craftsman in Gujarat, India created a $40 terracotta refrigerator using the natural cooling of clay to work without electricity. It can store water, fruits, and vegetables for eight days and milk for one day.”

For large multinationals, this is the last untapped market that can help to drive robust growth. The easy route would be to hand the job over to distributors. But distributors often won’t have an interest in supplying the goods of just one manufacturer. For large multinationals, the challenge is to accept the job of distributing to very small retailers, or alternatively, to use their supply chain expertise as an additional value add that will make the distributors view the manufacturer as a preferred partner.

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Seymour Trade Group's curator insight, November 18, 2014 4:46 AM

This is the future of logistics

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Japan Aims to Join Trans-Pacific Partnership Talks

Japan Aims to Join Trans-Pacific Partnership Talks | Everything Related to U.S. Imports and Exports | Scoop.it
Prime Minister Shinzo Abe portrayed the Trans-Pacific Partnership as Japan’s “last chance” to remain an economic power in Asia.
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Best Practices for a Successful 3PL Relationship  |   blog.gopenske.com

Best Practices for a Successful 3PL Relationship  |   blog.gopenske.com | Everything Related to U.S. Imports and Exports | Scoop.it
To increase the value of 3PL partnerships, shippers and logistics providers can work together to foster a long-term relationship that results in sustainable gains and efficiencies.
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China and Brazil sign $30bn currency swap deal — RT Business

China and Brazil sign $30bn currency swap deal — RT Business | Everything Related to U.S. Imports and Exports | Scoop.it

A $30 billion currency swap deal between Brazil and China is expected to smooth trade between the two countries despite changing global financial conditions and future crises.

 

The agreement was signed on the sidelines of the BRICS summit in South Africa. Plans for the currency swap were first announced last year at the Rio+20 environmental summit. The idea is that the central banks of the two trading partners are to swap local currency worth up to 190 billion yuan or 60 billion reais ($30 billion) in case turmoil hits the global financial system. 


"If there were shocks to the global financial market, with credit running short, we'd have credit from our biggest international partner, so there would be no interruption of trade," said Guido Mantega, Brazil's Economy Minister as quoted by BBC.

 

Over the past few years trade between China and Brazil has boosted significantly reaching $75 billion in 2012. China, the world’s second-largest economy, demonstrated stronger interest in ...


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Corn exports rose last week, soybeans dip

Corn exports rose last week, soybeans dip | Everything Related to U.S. Imports and Exports | Scoop.it
After several weeks of sluggish activity, U.S. corn exports showed some strength last week, rising 11 percent from the previous week and 24 percent from the prior 4-week average, the ...
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