Analysis

The role of partnering in peak planning: analysis

An indication that partnerships will play an increasing role in multichannel capabilities has come in the shape of two announcements within days of each other.

The first concerns Magna Park based Core Management Logistics, which will now be offering a returns service through ReBOUND, a division of TSB Supply Chain Ltd, that will allow shoppers to register, and pay for, returns online.

A second partnership announcement has come from JDA Software, which has signed up as a reseller of Centiro’s delivery management services. This is a global agreement that will put parcel management, via Centiro’s technology, on offer to JDA’s customers.

Niklas Hedin, CEO of Centiro, said: “Traditional supply chain systems have been based on product volume and a finite number of delivery locations. Now, customer preference is dictating that retailers must ship a wider variety of goods to an infinite number of locations, while at the same time be able to manage a growing number of returned goods.”

The question of how to avoid a repeat of 2014’s Black Friday headaches is a fundamental part of the 2015 dialogue for the retail logistics sector, as such partnerships are likely to be seen as one effective route to offering flexible solutions without punitive investments.

In the wake of 2014’s Black Friday and Cyber Monday peak, Yodel found itself with an additional 600,000 parcels to process and deliver. To handle that volume at its usual rates would have required an additional 5,000 staff – an unrealistic investment for anyone, regardless of whether or not finding 5,000 temporary staff at short notice is even feasible.

While automation will have a role to play in many warehouse management strategies, there are still significant investments required, along with the possibility that expensive facilities may lie idle during quieter periods, in order to be available during short peaks. Other last mile solutions to the problem of getting deliveries out to customers will need to be examined, such as alternative drop-off and collection facilities – from parcel shops to door-step boxes and lockers.

Partnering with companies that can offer access to such alternatives during busy times could start to see their wider adoption and acceptance among the public.

Similarly, the ability to maintain stock visibility and process high volumes of returns is likely to be a headache many in the industry will be happy to outsource – at least in the short term.