2 5 2011 Retail Cpg Industry Report2011

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Shippers Warehouse, Inc. is a provider of supply chain services (3rd party logistics or 3PL). The Company operates over 4.5 million square feet in 8 facilities in the Dallas/Ft. Worth area and 500,000 …

Shippers Warehouse, Inc. is a provider of supply chain services (3rd party logistics or 3PL). The Company operates over 4.5 million square feet in 8 facilities in the Dallas/Ft. Worth area and 500,000 square feet in Atlanta, Georgia.
The Georgia facility packaging operations ships out over 3 billion bags per year. Shippers Warehouse is one of the largest co-packers in the Southeast. Shippers operate 9 packaging lines with a ready room that is a showcase for reducing any type of foreign matter. The facility handles a variety of food products, is a leader in recycling, & distribution of products.
Shippers Warehouse, Inc. also has the distinction of having all of its locations ISO 9001:2008 certified. (ISO 9001:2008 certified by Management Certification of North America, an ANAB-accredited certification body.)

Regards,

Bill Stankiewicz
Vice President & General Manager
Shippers Warehouse
Office: 678.364.3475
williams@shipperswarehouse.com
www.shipperswarehouse.com

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  • 1. Retail and Consumer Products Supply Chain Report A brief analysis of eyefortransport’s recent survey 2010 Co-Sponsored by:For further details, please contact:Chris SaynorCEO, eyefortransportWorld phone: +44 (0)207 375 7529US Toll Free: 1 800 814 3459 Ext. 7529Canada Toll Free: 1 866 996 1235 Ext. 7529csaynor@eft.com
  • 2. Retail and Consumer Products Supply Chain Report 2010Table of ContentsI. Introduction ............................................................................................. 4II. Methodology and Approach ............................................................... 5III. Profile of Respondents ......................................................................... 6IV. Expected Performance for Retail Sector ..................................... 8V. Logistics Strategies ........................................................................ 10VI. Garment on Hanger Logistics ..................................................... 13VII. Time Dedicated to Programs ..................................................... 15VIII. Supply Chain Executives ........................................................... 16IX. Supply Chain Concerns ............................................................... 18X. Supply Chain Objectives .............................................................. 28XI. Methods of Marketing to Retail or ConsumerProduct Manufacturers ...................................................................... 30XII. Conclusions .................................................................................. 31XIII. About Nygard 3PL............................................................................ 32XIV. About eyefortransport ................................................................ 33 www.eft.com 2
  • 3. Retail and Consumer Products Supply Chain Report 2010List of ChartsAnnual Revenue ($) .............................................................................. 6Geographic Region .............................................................................. 6Categories of Goods Sold/Produced ................................................. 7Expected Performance for Retail Sector ........................................ 8-9Taking Control of Inbound Transportation for Suppliers .................. 10Outsourcing to 3PLs ............................................................................ 10Plans to Increase 3PL Outsourcing .................................................... 11Changing Transportation Modes to Reduce Costs ........................ 12Forecasting Capabilities .................................................................... 12Need for Garment on Hanger (GOH) Logistics ............................... 13GOH as a Percentage of Logistics Needs ...................................... 13Use of Specialized GOH Facility ........................................................ 14Use of 3PLs for GOH Logistics ............................................................. 14Time Dedicated to Programs ............................................................ 15Position of Supply Chain Executive ................................................... 16Position that Supply Chain Executives Report to ............................ 17Use of Chief Supply Chain Officer or Chief Logistics Officer .......... 17Supply Chain Concerns ................................................................... 18-27Supply Chain Objectives ................................................................ 28-29Methods of Marketing to Retail or ConsumerProduct Manufacturers ...................................................................... 30 www.eft.com 3
  • 4. Retail and Consumer Products Supply Chain Report 2010I. IntroductionThe retail and consumer product goods sector is arguably the mostimportant market segmant in the World. The sector was severelyaffected by the recession which began in 2008, and which may still beongoing.The unfavourable personal economic situation of consumers, coupledwith supplier failures and fluctuating demand trends have all putdifferent stresses on to both retailers and consumer productmanufacturers supply chains. This survey aimed to take a snapshot ofsome of the major decisions and issues that supply chain executivesface today. We also looked at how the role of the ‘Chief Supply ChainOfficer’ is currently being recognized within a company’smanagement structure. www.eft.com 4
  • 5. Retail and Consumer Products Supply Chain Report 2010II. Methodology and ApproachThis survey was conducted in May/June 2010 with responses solicitedby targeted e-mail lists, select trade association memberships, variousrelated-industry databases and other targeted methods. The surveylooked at a range of issues affecting retailers and consumer productsmanufacturers. No individual responses were analyzed, but rather allresponses were consolidated. www.eft.com 5
  • 6. Retail and Consumer Products Supply Chain Report 2010III. Profile of RespondentsOver 650 professionals responded to the survey, a large percentage ofwhom (33%) represented companies whose annual revenue exceeds$1 billion.The majority of respondents were either based in Europe (31%), AsiaPacific (30%), or North America (29%). Only a small minority werebased in the Middle East & Africa (7%), and Central or South America(3%). www.eft.com 6
  • 7. Retail and Consumer Products Supply Chain Report 2010Of the respondents representing retailers or consumer productsmanufacturers, 20% of respondents sold or produced grocery goods,18% sold or produced fashion goods, while 74% sold or produced non-food goods (respondents could choose more than one category, sothe figures total more than 100%) www.eft.com 7
  • 8. Retail and Consumer Products Supply Chain Report 2010IV. Expected Performance for Retail SectorAll respondents were asked how they expect the retail sector toperform in the next year. The overall results were generally positive,with the majority of respondents (65%) expecting to see slow growth,and a notable percentage (21%) expecting fast growth. Only a smallminority (3%) expect the retail sector to decline over the next year.When looked at by region, the overwhelming majority of respondentsfrom North America and Europe expect slow growth for the retailsector over the next year, while a far greater percentage expect tosee fast growth in Central or South America, Asia Pacific, or the MiddleEast & Africa. www.eft.com 8
  • 9. Retail and Consumer Products Supply Chain Report 2010When looked at by the industries represented, there seemed a fairdegree of consensus. One notable point was the majority ofrespondents expecting a decline in the retail sector, or no growth,were respondents representing press/associations/academics. www.eft.com 9
  • 10. Retail and Consumer Products Supply Chain Report 2010V. Logistics StrategiesThe next few chapters of this report focus on questions that were aimedonly to respondents representing retailers or consumer productsmanufacturers.Walmart have recently announced that they are going to take controlof the inbound transportation of their suppliers. In light of this,respondents were asked to identify their stance on taking control ofinbound transportation for suppliers. The majority (58%) are currentlymanaging some of their suppliers inbound transportation, though morethan a quarter still have no plans to do so.The majority of respondents outsource the majority of their logisticsneeds to 3PLs. 41% outsource over 75% of their needs, while 20%outsource between 50% and 75%. Only 11% do not outsource theirlogistics needs to 3PLs. www.eft.com 10
  • 11. Retail and Consumer Products Supply Chain Report 2010The majority of respondents expect to increase the amount theyoutsource to 3PLs over the next 2 years, with 21% expecting asignificant increase and 34% expecting a small increase. A notablenumber do not expect to increase their levels of outsourcing, while ahigher number of respondents already outsource 100% of theirrequirements compared to respondents expecting to reduce theirlevels of outsourcing.When viewed by industry, the number of retailers expecting anincrease or no change in their logistics outsourcing levels was verysimilar to the expectations of consumer products manufacturers. Ahigher number of retailers expected to reduce their outsourcing levels,while conversely, a higher number of consumer productsmanufacturers already outsource 100% of their requirements. www.eft.com 11
  • 12. Retail and Consumer Products Supply Chain Report 2010Respondents were also asked if they have moved more transportationto slower/cheaper modes such as Rail or Ocean to reduce costs, as aresult of the recession. Opinion was divided on this strategy, with 46%having changed transportation mode and 54% having not.Forecasting is an area where most respondents still feel that they haveroom for improvement. Only 22% of retail and consumer product supplychain execs rated their forecasting capabilties as either good orexcellent. Indeed, 30% rated their forecasting as less than satisfactoryor very poor. Or, put it another way and one can report that 78% ofrespondents would not rate their forecasting capabilties as anythingbetter that satisfactory. www.eft.com 12
  • 13. Retail and Consumer Products Supply Chain Report 2010VI. Garment on Hanger LogisticsWe asked those resondents who retail or manufacturer fashion goods anumber of specific questions about Garment on Hanger Logistics. Halfof these respondents identified a specific need for garment on hanger(GOH) logistics.GOH logistics is only a small percentage (less than 10%)of the totallogistics needs for the vast majority (80%)of respondents. Norespondents to the survey had more than 75% of their logistics needsrequiring garments on hangers. www.eft.com 13
  • 14. Retail and Consumer Products Supply Chain Report 2010A sizeable 38% of respondents have their own specialized garment onhanger facility, while 71% do not currently use 3PLs for their garment onhanger requirements. www.eft.com 14
  • 15. Retail and Consumer Products Supply Chain Report 2010VII. Time Dedicated to ProgramsThe report also looked at a series of supply chain programs, and theamount of time that retailers and consumer products manufacturersare dedicating to them. Overall, a greater amount of time wasdedicated to product safety initiatives, than was dedicated to securityregulations and environmental compliance, whilst labor regulationshad the lowest priority. www.eft.com 15
  • 16. Retail and Consumer Products Supply Chain Report 2010VIII. The Seniority of Supply Chain ExecutivesThe next part of the report looked at the roles of supply chainexecutives. Firstly, respondents were asked if their top supply chainexecutive is on their company management board. Overall, themajority (61%) had their top supply chain executive on their companymanagement board, though, when viewed by region, this situationwas far more prevalent in Europe, Central or South America, and AsiaPacific, than in North America and the Middle East & Africa. www.eft.com 16
  • 17. Retail and Consumer Products Supply Chain Report 2010Respondents were also asked to identify whom their top supply chainexecutive reports to. Exactly half of the respondents said that their topsupply chain executive reports to their CEO/President, while only 8%said their top supply chain executive reports to a senior executivebelow board level.Opinion was divided on the use of a Chief Supply Chain Officer or aChief Logistics Officer. Slightly more than half of the respondents (52%)reported that their company does have either a Chief Supply ChainOfficer or a Chief Logistics Officer. www.eft.com 17
  • 18. Retail and Consumer Products Supply Chain Report 2010IX. Supply Chain ConcernsThis chapter focuses on respondents’ biggest concerns for the next 12months, though results were not included for the Middle East & Africa,as the sample size was too small for meaningful observations.Respondents were asked to pick only their top 3 concerns. Overall,increased transportation rates were the biggest concern, closelyfollowed by tight transportation capacity and the fear of a suddenweakening in demand. Supplier failures, increased governmentregulations, currency fluctuations, and volatile energy prices were alsonotable sources of concern, though respondents were less worriedabout the prospects of new environmental compliances or disruptioncaused by natural disasters. www.eft.com 18
  • 19. Retail and Consumer Products Supply Chain Report 2010The level of concern for increased transportation rates was remarkablyuniform (generally around 50%) across all regions and industry sectors. www.eft.com 19
  • 20. Retail and Consumer Products Supply Chain Report 2010The level of concern for tight transportation capacity was alsomarkedly similar (again, generally around 50%) across all regions,though a slightly larger number of consumer products manufacturersexpressed concern, in comparison to retailers. www.eft.com 20
  • 21. Retail and Consumer Products Supply Chain Report 2010The level of concern for a sudden weakening of demand was muchmore keenly felt in North America and Europe than in Central or SouthAmerica and Asia Pacific. On this topic, greater concern wasexpressed by retailers than by consumer products manufacturers. www.eft.com 21
  • 22. Retail and Consumer Products Supply Chain Report 2010When it came to supplier failures, Central or South America was themost notable source of concern, whilst least worry was felt in NorthAmerica. On this occasion, a greater degree of consensus was seenbetween the responses from retailers and consumer productsmanufacturers. www.eft.com 22
  • 23. Retail and Consumer Products Supply Chain Report 2010The greatest amount of concern for increased government regulationswas seen from North American respondents, though notable numberswere also seen in other regions. Again, a fair degree of consensus wasseen between the responses from retailers and consumer productsmanufacturers. www.eft.com 23
  • 24. Retail and Consumer Products Supply Chain Report 2010Currency fluctuations were not suprisingly a lesser concern for NorthAmerican respondents, while it was a more notable problem in otherregions. Slightly greater concern came from consumer productsmanufacturers than from retailers on this issue. www.eft.com 24
  • 25. Retail and Consumer Products Supply Chain Report 2010Volatile energy prices were a notable concern for respondents inEurope and Asia Pacific, but only a lesser one for respondents fromNorth America. None of the respondents from Central or SouthAmerica expressed a concern for this issue (small sample size in theseregions). 28% of retailers and 27% of consumer products manufacturerswere concerned by volatile energy prices. www.eft.com 25
  • 26. Retail and Consumer Products Supply Chain Report 2010Concern for new environmental compliance was only a minor concernfor most respondents, though it was most keenly felt by respondents inNorth America, and worried about the least by respondents in Centralor South America. This time, less than 20% of retailers and consumerproducts manufacturers were concerned. www.eft.com 26
  • 27. Retail and Consumer Products Supply Chain Report 2010When it came to concern about disruption caused by natural disasters,this was more keenly felt by respondents from Central or South Americaand Asia Pacific, and by consumer products manufacturers rather thanretailers. www.eft.com 27
  • 28. Retail and Consumer Products Supply Chain Report 2010X. Supply Chain ObjectivesThe final section of the report aimed at retailers and consumerproducts manufacturers looks at the biggest supply chain objectives inthe next 12 months. Lowering overall supply chain costs and aligningsupply chain & business strategy were the most notable objectives,though distribution network optimisation, reducing logistics/transportcosts, efficient planning and forecasting tools, reducing waste andinefficiencies, and reducing inventory were also popular choices. www.eft.com 28
  • 29. Retail and Consumer Products Supply Chain Report 2010When looked at by industry, little correlation was seen between theanswers from retailers and those from consumer productsmanufacturers. On the whole, consumer products manufacturers hadmore objectives than retailers, with lowering overall supply chain costsand reducing logistics/transport costs being particularly notable in thisregard. The main exceptions to this trend came with warehousingoptimisation and lowering procurement costs, which were morepopular with retailers than with consumer products manufacturers. www.eft.com 29
  • 30. Retail and Consumer Products Supply Chain Report 2010XI. Methods of Marketing to Retail or Consumer ProductManufacturersThe final question asked of respondents was answered by thosecompanies who market products/services to retailers and consumerproduct manufacturers, and looked at which methods of marketingthey utilize. Travelling to one-on-one sales meetings was the mostnotable response, though speaking at conferences, lead generationcampaigns, attending industry events as a delegate, brand awarenesscampaigns, research and publishing white papers, and hosting internalnetworking events were also popular choices. One of the moreinteresting points was the slight increase in popularity for onlineadvertising as compared to print advertising. www.eft.com 30
  • 31. Retail and Consumer Products Supply Chain Report 2010XII. ConclusionsThe retail and consumer products industry is not thriving in 2010, but it issurviving in both Europe and North America whilst there are indicatorsof strong growth in Asia-Pacific, Africa and South America.In terms of the supply chain, lowering cost is not suprisingly the numberone objective of executives. The use of 3PLs is widespread, and stillgrowing; but there are still gaps that 3PLs can fill, especially bybroadening their product offering and sales efforts towards mediumand small enterprises. The garments on hanger sector is also grosslyunder-represented by the use of 3PLs.An encouraging sign is the fact that half of all respondents stated thatthey have either a Chief Supply Chain Officer or Chief Logistics Officerin their organizations. And with 60% of respondents reporting that themost senior supply chain executive in their company is on themanagement board (although North America is lagging behindEurope and other regions with a figure of around 40%) we canconfidently report that the supply chain function is now very wellrecognized and respected in the retail and consumer productsindustry. www.eft.com 31
  • 32. Retail and Consumer Products Supply Chain Report 2010XIII. About Nygard 3PLNygard 3PL (aka N3PL) serves the "Fashion Industry".Leverage our technology and supply chain expertiseNygard’s “Fashion Industry” logistics leadership spans 40 years:Immediate N3PL benefits:  Fast To Market Delivery  Reduction in Overhead, Freight and Handling  Higher Gross Margin / ROI  Market Introductions  Expertise and Experience in Supply Chain  Management  Sourcing  Logistics  Technology  Proven Technology for Logistics – NR5X IT System  TMS & WMS Functionality  Direct to Store Capability  Full Visibility – Glass Warehouse  Infrastructure  Buildings Configured for GOH and Cartonized Product  Lower fixed cost structure3PL Services:  Logistics  Receiving  Pick/Ship GOH  Cross Dock/Consolidation  Shipping  Inventory Management  Value Added Services (Re-ticketing, Changing Hangers…)  Fully Integrated IT Solution with Client visibility  Supply Chain Management  Order Planning  Manufacturing Plan  Warehousing  Full Inventory managementFor more information visit our website at http://3PL.nygard.com www.eft.com 32
  • 33. Retail and Consumer Products Supply Chain Report 2010XIV. About eyefortransportEstablished in 1998, eyefortransport has become one of the leadingproviders of business intelligence, independent research, news andexecutive level events for the supply chain & logisticsindustries. eyefortransport has two primary focuses.1) To provide executive networking opportunities in the supply chain &logistics industries via the more than 15 events we annually organizeand host in North America, Europe and Asia and online via the tens ofthousands of users of www.eft.com. The events are designed tocompliment and enhance the business connections available throughour online network, and bring together the industry elite. Regularlyattended by CEOs and senior management from the transport andlogistics industry and Heads of Supply Chain of major companies, theevents focus on current developments and latest trends, and areenhanced by high level, exclusive networking opportunities.2) To deliver industry education through dozens of industry reports,surveys, newsletters, webinars and senior-level presentations at leadingevents.For the list of current research, news and events we produce pleasevisit www.eft.comIf you are interested in receiving more information about the upcomingRetail and Consumer Products Supply Chain Summits in London, NewYork or Chicago and Hong Kong in 2011 then please contact ChrisSaynor on csaynor@eyefortransport.com www.eft.com 33
  • 34. Want more?At eyefortransport’s Retail and CPG Supply Chain Summit – June 20-21, 2011London - hear expert speakers share their success stories and strategies forimproving their supply chain and logistics operations in 2010.Make sure your knowledge is at the forefront of industry thinking and that yourcompany leads the way to the retail and CPG supply chain of the future.Give your company the competitive edge in an increasingly competitive market, andprepare your supply chain to serve the Consumer of the Future.Complimentary Passes with Accommodation (worth £2500) are available to SupplyChain and Logistics Executives from Retailers and CPG manufacturers.Visit the website today to save one of these LIMITED PLACES:http://events.eyefortransport.com/retail/index.shtml2011 Key Topics:  Supplying the Future Consumer - From technology to the economy, the way that consumers shop has changed dramatically in recent years – forcing huge supply chain adjustments to keep pace. Hear which trends and changes supply chain executives should prepare for - and which tools and technologies will lead the way.  The ‘customer obsession’- how retailers can keep up with an increasingly demand-driven environment.  New Channels- As the supply chain faces a massive shake up, how will relationships with suppliers change? How to manage a new selling arena.  Battling against a fragmented supply chain- how achieving an integrated supply chain can cut costs and lead times.  Sustainability- meeting legislative requirements and cutting costs in the process.  Horizontal Collaboration- is this the way forward for companies wishing to reduce transportation costs in the retail & CPG sectors?  Forecasting, S&OP & Flexibility - how suppliers and retailers can work together to produce accurate forecasting and operational excellence in an industry where promoted demand is prevalent.Visit the website to register or learn more: www.eyefortransport.com/retailLEARN MORE: Retail and CPG Supply Chain Summit,June 20-21, 2010 – London www.eyefortransport.com/retailOr call Sarah Reynolds - Tel: + 44 (0)207 375 7243