• Share
  • Email
  • Embed
  • Like
  • Save
  • Private Content
Globalise the Outsourced Supply Chain, Jeremy Davidson, Deputy MD, NYK Logistics
 

Globalise the Outsourced Supply Chain, Jeremy Davidson, Deputy MD, NYK Logistics

on

  • 535 views

Presentations from eyefortransport’s 8th 3PL Summit & Chief Supply Chain Officer Forum in Brussels, November 2010. Visit www.3PLsummit.com/eu for further resources.

Presentations from eyefortransport’s 8th 3PL Summit & Chief Supply Chain Officer Forum in Brussels, November 2010. Visit www.3PLsummit.com/eu for further resources.

Statistics

Views

Total Views
535
Views on SlideShare
534
Embed Views
1

Actions

Likes
0
Downloads
2
Comments
0

1 Embed 1

http://pinterest.com 1

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Globalise the Outsourced Supply Chain, Jeremy Davidson, Deputy MD, NYK Logistics Globalise the Outsourced Supply Chain, Jeremy Davidson, Deputy MD, NYK Logistics Presentation Transcript

    • • Click to edit Master text styles • Second level the Outsourced Supply Chain Globalise • Third level Opportunities in Eastern Europe & Beyond • Fourth level Jeremy Davidson • Fifth level 25th November 2010Opportunities in Eastern Europe & Beyond Slide No. 1
    • Key Themes  Black Sea region is recovering from recession • Click to editgrowth in demand critical o Consumer-led Master text styles •  Second level Black Sea has considerable potential as a key Gateway for C & E Europe as • Third level well as Central Asia • Fourth level o Shipping FE Imports via N Europe no longer makes sense; direct shipment a viable and better alternative • Fifth level  W Europe retailers already dominant and changing logistics practices  Controlling logistics cost as important as in W EuropeOpportunities in Eastern Europe & Beyond Slide No. 2
    • Black Sea Region Overview GDP per capita • Click to edit Master text styles Pop (m) Per Capital GDP • Second level Russia 2009 142 in 2009 $15,176 Turkey 75 $13,952 • Third level Ukraine Romania 46 22 $6,873 $12,214 • Bulgaria 8 $12,296 Fourth level Average EU-27 $30,651 • Fifth level Average OECD $33,732  Per capital GDP & Consumption half of EU-27 average  Growth potential in consumption greater than EU  Large populations looking to improve standard of living  Increase in demand for FMCG & Consumer DurablesOpportunities in Eastern Europe & Beyond Slide No. 3
    • Recovery from Recession GDP Change in Black Sea Economies 2008 - 2011 10.0% 5.0% • Click to edit Master text Effect of 2008-09 Recession styles Major Economies 0.0% • Second level Russia Turkey Ukraine Romania Bulgaria 2008 2009 -5.0% % change GDP Exports Imports • 2010F -10.0% Third level Canada France -3.1 -3.2 -19.2 -15.0 -19.0 2011F -12.5 • -15.0% Fourth level Germany Italy -6.3 -6.5 -18.2 -23.9 -12.9 -19.0 -20.0% Japan -8.0 -32.1 -20.5 • Fifth level United Kingdom United States -5.9 -3.5 -13.3 -12.6 -16.7 -19.5  Decline in region similar to that Euro area -5.1 -17.8 -15.3 seen in leading economies OECD total -4.7 -15.7 -17.4  RU & TU expected to recover Russian Federation -9.7 -12.9 -35.1 strongly  RO & BG slower recovery forecast  Projected growth rates expected to be higher than in W EuropeOpportunities in Eastern Europe & Beyond Slide No. 4
    • Investment in BS Region • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level  Sharp decline in GDP  Fall off in foreign direct investment  Reduction in relative County Risk Scores vs EU-15  Fundamentals still soundOpportunities in Eastern Europe & Beyond Slide No. 5
    • Retail Logistics: Key Sector  Retail logistics spend >50% of total market in W Europe; probably even higher in BS Region •  Click to increasing imports from China & SE Asia BS countries edit Master text styles • Second levellabel & cheaper brands o Growth of own •  Most leading retailers are W European and often supply the BS Region ThirdNlevel ports and ship down (road/rail) through European • Fourth level o Critical mass/economic quantities •  Fifth level costsrepresent up to 50% of value of goods. Hence Often freight costs can reducing logistics critical o More centralisation o Direct shipment from countries of origin o For cheap footwear at €15/pai5, logistics can represent 15%  On-carriage from ports to RDC’s still problematic; poor road infrastructureOpportunities in Eastern Europe & Beyond Slide No. 6
    • The Black Sea as a Gateway  Black Sea (BS) strategically placed as Gateway to both West & East • Click to edit Master text styles  Imports from Far East can be landed in BS • Second level Ports and shipped inland • Third level  Infrastructure improving with rail an increasing option • Fourth level  Turkey a critical gateway to Iran, Iraq and • Fifth level Central Asia CONTAINER SHIPMENTS IN BLACK SEA - 2009 BULGARIA  Russia to develop BS ports as alternative GEORGIA UKRAINE to Baltics RUSSIA  Istanbul terminals effective for ROMANIA transshipment 1.9 M TEU forecast for 2010 vs 1.5 M TEU in 2009Opportunities in Eastern Europe & Beyond Slide No. 7
    • Leading Retailers in Region Romania Ukraine Turkey Bulgaria 1 Metro Fozzy Migros Kaufland •2 Click to edit Master text styles Carrefour Metro Bim Rewe •3 Second level Fursnet Selgros Carrefour CBA 4 Kaufland ASB Metro Picadilly •5 Third level Kishenya Billa Tesco Familia 6 Rewe Auchan BTT Carrefour •7 Fourth level Anastor Plus Teknosa Metro •8 Mega Fifth level Tayriya Kiler Fantastico 9 Auchan Eko Tespo c/c Billa 10 Dederman Rewe Carsi Europa  Region targetted by retail multiples from W Europe  Displacing traditional retailers and stimulating demand  Transferring retailing practices and approach to logistics  W European 3PL’s have followed – not always successfullyOpportunities in Eastern Europe & Beyond Slide No. 8
    • Black Sea Retailers & FE Imports • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level  Regional retail multiples source from the same FE vendors as in W Europe  Purchasing often remains centralised at Retailers’ HQ’s  Opportunities for local solutions esp logisticsOpportunities in Eastern Europe & Beyond Slide No. 9
    • Centralisation & Outsourcing  Centralisation of Logistics by leading retail multiples vary, on average 20% • Click to edit Master text styles mass’, supplier  Problems with ‘critical • Second level compliance, vehicle utilisation etc  Centralisation depends on efficient inbound • Third level collection & consolidation • Fourth level Outsourced Logistics in CEE • Fifth level Country  Direct store deliveries common Outsourced 2008 2012 Poland 23% 35%  Local produce and products still Hungary 22% 30% Czech Republic 23% 35% important Slovakia 13% 25% Romania 28% 35%  Shortage of suitable 3PL’s Bulgaria 18% 30% CEE Total 21% 32%  Level of outsourcing set to increase & 3PL W. Europe 50% + little change market will grow Source: Analytica & NYKOpportunities in Eastern Europe & Beyond Slide No. 10
    • Direct Shipment to Romania Nautical Miles Shanghai to Rotterdam 10,409 Shanghai to Constanta, RO 7,980 • Click to edit Master text styles Kg CO /ton 2 • Second level Rotterdam Sea via Rotterdam via Constanta 327.7 251.2 • Third level Road/rail Road Rail 167 0 0.3 6.1 Total 494.7 257.6 • Fourth level Constanta Reduction via Constanta 48% • Fifth level • A retailer importing 2,000 containers/year through Constanta can save €1.8 million & reduce CO2 footprint by 7,000 tOpportunities in Eastern Europe & Beyond Slide No. 11
    • © via donau 2006 Using the Danube • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level  Rail from Hamburg to Krems in Austria  Shipped by barge to Central Europe and Black Sea regions  Can be used in reverse for imports via Constanta  Significant cost & CO2 savingsOpportunities in Eastern Europe & Beyond Slide No. 12
    • Supply Chain Efficiencies END-TO-END LOGISTICS COSTS Delivered to store Cost per cbm • Click to edit€ Master text styles ex-China Sea Freight 78 € 51 € 81 Qtr 1 08 Qtr 2 09 Qtr 2 10 DELIVERY TO STORE & RETURNS 33% € 37 € 36 € 37 OCEAN FREIGHT Warehousing & ON-CARRIAGE • Second level168 €€142 €€176 € 54 55 58 Delivery to store 46% Total € • Third level € 1.40 Cost per pair of shoes € 1.18 € 1.47 WAREHOUSING 21% • Fourth level What if…. Savings Cost/pair € 0.03 Increase stock-turns by 30%  Average selling price of a pair of • Fifth level € 0.06 € 0.15 Increase drop size by 50% Increase container loading by 20% shoes lower in BS Region but Shipped direct from FE € 0.16 Did all this … € 0.40 logistics cost the same Savings of 27%  Even more critical to make supply chain more efficient  Shipping direct from FE easy to do and implementOpportunities in Eastern Europe & Beyond Slide No. 13
    • Streamline the Supply Chain V Retail RDC R Origin CFS • Click to edit Master text styles E N E T D A • Second level O R Mfr DC I L S • Third level Origin RDC DC Bypass  •Challenges faced by retailers in BS region no different to those in W Europe. Fourth level  •Opportunities to streamline & save money by: Fifth level o Shipping direct to RDC in region (€20-30/cbm) o Performing more operations in origin countries (eg Origin DC’s)  W Europe wages for warehouse worker € 25,000 pa vs €6,000 in RO and € 3,000 pa in China o Consolidating across product ranges & co-loading with competitors: better container fill & lower cost per cbm.Opportunities in Eastern Europe & Beyond Slide No. 14
    • Shipping can be risky ! • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth levelOpportunities in Eastern Europe & Beyond Slide No. 15
    • Piracy still a major threat Reported incidents each month during past 12 months • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth levelOpportunities in Eastern Europe & Beyond Slide No. 16
    • THE WORLD IS FOUR- • Click to edit Master text styles • FIFTHS WATER Second level • Third level THE REST IS THERE FOR • Fourth level • Fifth level MOORING PURPOSES !Opportunities in Eastern Europe & Beyond Slide No. 17