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Following Walmart's announcement that it would take control of the inbound transportation of its suppliers, retailers and CPG companies were asked in an eyefortransport survey in May and June to identify their stance on taking such control in their enterprises. The majority (58 percent) are currently managing some of their suppliers' inbound transportation, though more than a quarter still have no plans to do so.
The majority of respondents outsource the majority of their logistics needs to 3PLs. Forty-one percent outsource over 75 percent of their needs, while 20 percent outsource between 50 percent and 75 percent. Only 11 percent do not outsource their logistics needs to 3PLs.
The information is contained in eyefortransport's Retail and Consumer Products Supply Chain Report 2010.
The majority of respondents expect to increase the amount they outsource to 3PLs over the next 2 years, with 21 percent expecting a significant increase and 34 percent expecting a small increase. A notable number do not expect to increase their levels of outsourcing, while a higher number of respondents already outsource 100 percent of their requirements compared to respondents expecting to reduce their levels of outsourcing.
When viewed by industry, the number of retailers expecting an increase or no change in their logistics outsourcing levels was very similar to the expectations of consumer products manufacturers. A higher number of retailers expected to reduce their outsourcing levels, while conversely, a higher number of consumer products manufacturers already outsource 100 percent of their requirements.
Respondents were also asked if they have moved more transportation to slower/cheaper modes such as rail or ocean to reduce costs, as a result of the recession. Opinion was divided on this strategy, with 46 percent having changed transportation mode and 54 percent having not.
Forecasting is an area where most respondents still feel that they have room for improvement. Only 22 percent of retail and consumer product supply chain execs rated their forecasting capabilities as either good or excellent. Indeed, 30 percent rated their forecasting as less than satisfactory or very poor. Or, put it another way and one can report that 78 percent of respondents would not rate their forecasting capabilities as anything better that satisfactory.
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