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This is the crisis!!

Nowadays, the economic environment is …gloomy! This is mainly for the car industry. But one manufacturer still has a 2 digits growth on its sector: Let’s have a look at the situation of Mazda in Russia. As a matter of fact, the Japanese manufacturer grows month after month in the Russian market where the demand is pretty large. Mazda wants to improve the car delivery in the country of Tsars, because the particularity of Mazda is that they entirely produce their car in ... Japan!

So now let’s see what we have for a situation:
- An island (Japan)
- A 9000 km wide country (Russia)
- 73 700 cars

… What could be used?

If I tell you the plane … you’re going to laugh out loud and trucks aren’t the ideal solution neither. So we definitively have three solutions left:
Japan has one of the biggest harbors in the world, so transportation per ship could be interesting. Moreover, as an island, they don’t really have a choice. The question is, where could the ships dock when the final destination is Moscow? As you may know, the main Russian harbors are Novorossiysk, Primorsk and Sankt-Petersburg. But except for Novorossiysk (113MT in 2007) all this harbors are either tiny or too far away from the economic centers.

- If the ship docks in Novorossiysk we have to transport the car over 1500km to reach Moscow and transit time will be longer than a month … not very interesting.

- - If the ship docks in Sankt-Petersburg 700km with good infrastructures … but transit time between Yokohama and Sankt-Petersburg is awful.

- - So we have a last solution (which was choosen). Use the old soviet installations, the Trans-Siberian Railway! The ship docks in Vladivostok and the cars use the trans-Siberian to Moscow. Transit time between Vladivostok and Moscow lasts 10 days! Mazda finally has its solution.

One other advantage of this transportation mean is that the cars are inside wagons, protected against weather and robbery.

Mazda case is a good example of how to have a new efficient Supply Chain through old infrastructures.

The Empire strikes back!!

Nowadays one of the inevitable check points for the goods transportation is the Suez Canal. The Horn of Africa is yet a hostile zone. Somali pirates are prowling along the coast and attacking the merchant ships approaching or just cruising along the shores.

Last year, more than a hundred merchant ships were accosted, hijacked and overpowered. The amount of the ransom reached more than 30 million Euros!

But now, exporting countries are not willing to accept this situation anymore. The first of them is China, one of the main exporters to the Aden Golf. During the year 2008, 7 Chinese merchant ships have been attacked. A task force was created in order to secure the area and to escort the Chinese merchant ships. This task force consists of two destroyers Haikou and Wuhan, a supply ship, 800 crew members and 70 Special Forces.
But this has a political aim. China, with this demonstration, shows to the other countries that they became a global player. Last time that the Chinese Navy shipped fare away from its shores was during the 15st century under the command of Admiral Zheng He. So it's pretty much an event in itself! The mission of this task force could last 3 month.

With what happened to the Sirius Star (3 million euro ransom plus 8 weeks of negotiations), we can imagine that other countries will adopt the same policy against the piracy.

Ecologistic and Supply Chain.

Climate changes!! And one of the reasons of the changes is the industrial pollution.
The logistic has a significant role to play in the amelioration of the situation.
In fact not only gas consumption could be reduced, but also packing and warehousing should be improved.

The "Green Logistic" or "Ecologistic" will be one of the top priorities of the companies in few years.
Managers will face the costs increase of energy and we can imagine that the road transportation will be taxed, as it is already the case since 01/01/2005 in Germany with the "Maut". This tax could increase the price of 0,14 euro per kilometer. e.g. for a transport between Paris and Berlin the tax could reach 90 euro for an 8 tires tandem axles truck.

New stakes concern the "reverse logistic". Products have to be ecological and wastes and trashes have to be recycled. But the matter is that it is not a "symmetrical" Supply Chain anymore. The reverse logistic includesa lot of administrative papers and accreditations because goods could be classified as hazardous for instance. So there are different agents for the transportation and the delivery. The transportation companies have to built recycling centers or outsource them. French companies are late compare to the German neighbor.

But the reason why we are behind in France is that the managers don't see the opportunity of making benefits. It is true that all those regulations need expenses, but a long term strategy is to be designed. New warehouses which are most efficient and new products with new packing and packaging.

But the Ecologistic could change the philosophy of the Supply Chain.
One of the golden rules of the SCM is "Just in Times" rule. But to achieve the just in time strategy, companies use a lot of small shipments. That means a lot of trucks in this case. With the Ecologistic and the rationalization, it's better to operate one truck than three.

Managers still have in mind the necessity of the Ecologistic, because they anticipate laws and regulations. But This new environmental policy will certainly radically change the way of carrying goods, especially with trucks.