Warehousing Trend: Use Trailers

Warehousing Trend: Use Trailers

February 26, 2019

Trailers seem to be the next trend in warehousing. It costs 50% less than brick-and-mortar to use trailers as storage space.  The issue is that trailers are only able to help with pallet inventory.

They’re not feasible for some businesses. E-commerce operations require larger brick-and-mortar footprints for picking operations.

Trailers do offer several benefits:  temporary storage to expand capacity, mobile operations as trailers can support inventory surges wherever needed, and utility in reverse logistics.

This post is based on the Supply Chain Dive article, Are trailers the next big warehousing trend?, by Gary Wollenhaupt, February 12, 2019. Image source: Prasit photo/Getty Images.

Discussion Questions:

1. How could a company determine the optimum number of trailers to own?

Guidance: Review the capacity cushion concept; this question can help to stimulate discussion about capacity cushion planning.  Students should recognize that the trailers are supplementary to brick-and-mortar operations.  Trailers could represent storage capacity cushion for a company.

2. What are the limitations to using trailers for reverse logistics?

Guidance: Possible limitations could include lack of space for a trailer at a retail location such as a mall, items that may require special handling for safety, Continue reading

Facebook
Twitter
Weather Stopped Beer Delivery With Super Bowl Looming

Weather Stopped Beer Delivery With Super Bowl Looming

February 11, 2019

Several beer distributors in the Milwaukee, Wisconsin area stopped delivery of their products on Wednesday, January 30, 2019.  With extremely cold weather in the area, many organizations shut-down for the day, including several beer distributors.  Many of the beer distributors decided that it was unsafe for their delivery drivers to be out in the extreme cold.  Additionally, their products don’t handle cold weather well.

Bad timing, with the Super Bowl only 4 days away, but winter weather shows no mercy for kickoffs.

This post is based on the Journal Sentinel article, No beer deliveries in Milwaukee today. Thanks a lot, Mother Nature, by Kathy Flanigan, January 30, 2019. Image source: Getty Images/iStockphoto.

Discussion Questions:

1. What operational problems does a shutdown present?

Guidance: Unexpected disruptions in the supply chain are difficult.  With the Super bowl approaching, beer distributors want to have the store shelves full of their product.  However, cancellations occurred in a relatively short time period.  If they had substantial warnings of the impending cold, distributors could have made extra or larger deliveries before the temperatures forced a shut-down.  Weather forecasts can be unpredictable, making it difficult to anticipate such Continue reading

Facebook
Twitter
US XPress Nixes US-Mexican Border Business

US XPress Nixes US-Mexican Border Business

February 9, 2019

U.S. Xpress is reducing its U.S.-Mexico cross-border investment. The move will improve consolidated operating margins.  According to the company, relationships with its former partners in Mexico will continue to enable cross-border service for customers “as a variable cost alternative”.

U.S. Xpress started the exit from its fixed cost investment in the cross-border business by selling off its Mexican entity to existing managers.

In the coming months of 2019, U.S. Xpress will close its trucking terminal in Laredo, Texas, and dispose of 700 dry van trailers. It will use network optimization to reposition 300 domestic tractors, which currently carry loads to and from the border, into more profitable routes.

This post is based on the SupplyChain247 article, U.S. Xpress announces exit move out of U.S.-Mexico cross-border business, by Jeff Berman, January 25, 2019. Image source: Dave Moyer.

Discussion Questions:

1. What are the driving forces behind the U.S. Xpress decision to exit its U.S.-Mexico cross-border business?

Guidance: The company has stated that the decision is to improve its consolidated operating margin by divesting low-return U.S.-Mexico operations. That will improve the company’s core U.S. operations, and provide higher cash flows and profits.

2. How does U.S. Xpress plan Continue reading

Facebook
Twitter