Lisa Anderson was quoted in IE Business Daily recently on the state of the Inland Empire as a new year starts – will it be boom or bust? What’s in store for the industrial market in 2024? Anderson says you could be in for a bumpy ride.

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The days of a perpetually red-hot industrial market in the Inland Empire – record sales and leases, high vacancy rates, plenty of speculative development, and an endless absorption of open space – may be a thing of the past.

At the very least, with the start of a new year less than one month away, growth of the logistics manufacturing sector in Riverside and San Bernardino counties has been put on hold, and it might stay that way for a while.

The Inland Empire’s industrial market won’t be at full strength as it heads into 2024 if the most recent data is any indication.

To read the full article, click here.

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In this episode of Interlinks, I am joined by my colleagues from the Supply Chain Special Interest Group at the Society for the Advancement of Consulting:

• Lisa Anderson, President of LMA Consulting Group Inc. in the Los Angeles metro area in California
• Dr. Karen Y. Wilson-Starks, President and CEO of Transleadership Inc, in Colorado Springs

In this discussion we explore some of the challenges and remedies that companies across the sectors are encountering as they face into the post-COVID future and the challenge of a never normal world with ongoing supply chain disruptions, geopolitical tensions, and climate change.

Originally published on Interlinks, June 5, 2022 .

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Supply Chain networks that are not set up to support scalable, profitable growth have a high likelihood of negatively impacting your customers, impeding your growth and consuming far more resources than ever imagined to sustain.  Yet what is ideally mapped out one year is likely to change the next in today’s Amazonian marketplace.  Thus, assessing your supply chain network from your suppliers’ suppliers through your manufacturing and logistics networks to your customers’ customers with an eye to customers, cost and cash will undoubtedly yield results.  

So, what are some prompts to know it’s the ‘right’ time?

1. Renew your lease, buy or move? – As your lease comes due, it is a natural time to re-evaluate your supply chain network to make sure you are positioned ideally to support your customer base at maximum value to your customers and for you. 
2. Cost considerations– As you think about how to reduce your cost base, re-evaluating your supply chain network is a ‘must’.  Most likely, you can save a few pennies here or there but for substantial savings, you might need to review your infrastructure. 
3. Customer demands– In today’s Amazonian environment, customer demands are ever-increasing.  Is your supply chain network positioned to support your customers’ needs, delivery points and sales growth expectations?
4. Space constraints – As you start to think about space constraints, it might be an opportune time to re-evaluate your supply chain network.  First, do you know how much space is needed to support your growth plans (and where)?  Do you have the opportunity to maximize space?  Or should you re-position?
5. Insourcing/ outsourcing– As you think about whether you should insource, outsource (ex. 3PL) or utilize a combination of both, it is definitely the opportune time to evaluate your supply chain network and logistics infrastructure.
6. Supply chain partners – If you are re-evaluating key supply chain partners, it is likely a good time to do a quick assessment of your supply chain network.   

We have found that a supply chain network assessment can be valuable even if you decide not to change a thing.  Performing a quick review of customers, suppliers, operations and logistics infrastructure from a customer, cost and cash flow viewpoint can provide substantial benefit every so often.  Contact us if you’d like to discuss further. In addition, take our complimentary supply chain assessment to get a quick view of your capabilities and preparedness to optimize your supply chain.

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The Amazon Effect is creating elevated levels of stress in the warehousing and distribution world. The key question is how to provide immediate deliveries, customized service, easy returns, and more for a reduced cost – a very good question indeed!

A few considerations to ponder:

1. Storage capacity – what is your storage capacity?  How does that compare with your requirements?  And how can you maximize what you can store in your warehouse?
2. Flow – Are you running in circles around your warehouse to support your customers?  Similar to a manufacturing environment, flow can be an essential ingredient to warehousing success – or not.
3. Productivity – have you automated what makes sense and will increase your speed/ throughput? If it doesn’t improve speed (and accuracy) to your customers, is it really more productive?  Similarly, is outsourcing truly more productive?  
4. Equipment – what equipment is built into your warehousing strategy?  Would an upgrade provide a return on investment?  
5. Data – are you using predictive analytics and data analysis to make informed decisions to stay ahead of your competition?
6. WMS tools – whether “poor man’s” or sophisticated, do you have a way to pick, put away and sort efficiently?  

Inventory – don’t ever forget inventory.  Without having the right product in the right place at the right time at the lowest system-wide inventory (and potentially end-to-end supply chain network inventory), what else will matter?

We have yet to come across a warehousing or distribution client that didn’t have at least a 20% improvement opportunity.  Have you looked into your opportunities lately?  Most likely your competition is!  If you need help thinking through your warehousing and distribution strategy, contact us.

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Our clients are thinking about whether to move and call frequently with questions such as:

1. Should we renew our lease?
2. Should we move to a lower cost area?
3. Should we move to a lower cost state?
4. What considerations should we think about when evaluating our manufacturing and logistics network?
5. Should we outsource?

Thus, we thought it would be prudent to address some questions and themes that should be evaluated from a strategic point-of-view when discussing supply chain network assessments.  Let’s start by saying that our top clients begin THINKING about these topics several years in advance.  Similar to selling a business, it isn’t the best plan to evaluate whether to renew a lease at the last minute or to be forced into a particular partner or location because you started preparing “too late”.   Instead, why not think ahead….

1. Where are your customers?  – As much as we all want to reduce costs especially in today’s Amazonian environment, we also need to remember that customers expect rapid deliveries, change their mind frequently (and expect agility) and desire easy returns.  Thus, where are you located in comparison to your customers?
2. What are your customers’ expectations?  –Lead times. Personalized service.  Return policies. Vendor managed inventory.  Future forecasts. What will they expect a year from now?  Are you already planning for these needs?
3. Where are your suppliers?  – Similar to your customers, it is important to consider where your suppliers are located as well.  Do you receive product from the ports?  If so, what volume is related to the ports?
4. What access do you have to people? – We evaluated Nevada for one of our clients; however, when we talked with local contacts to estimate building / lease costs, we also discovered that as low as the overhead might be, freight aside, there were no people.  Tesla had absorbed them all, and there were requests to supply people from Southern CA to support current workloads.  People can certainly be relevant!
5. What type of freight partners/ rates are in place? –  No matter how close you might be to your customer, freight can add up – and, more importantly, delays to your customer are VERY costly (lost business, charge backs from customers such as Walmart, ill will and more).  Just because you have carriers with your current situation, it does NOT mean that will be true with your new situation.  Freight is tight and rates are going up!  And, remember last mile considerations are complex.  Last mile. Last minute!
6. What type of transportation network is required to support your business? – In addition to freight considerations, will you need to think about parcel, rail, ocean freight, and other modes of transportation?  Or should you be considering these options?  
7. What inventory levels are built into your network?  – Inventory = cash tied up.  

There is quite a bit more to think about than solely a cost cutting exercise.  Most clients call due to concerns about cost – as important as cost is, taking the strategic / high-level view can ensure your service, total cost (including hidden costs) and cash flow are maximized.  If you are interested in our newly upgraded service offering in response to the Amazon Effect of warehousing/ supply chain network assessments, contact us.

Lisa Anderson

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I participated on the Amazon Effect: Pass of Play at the Manufacturers’ Council of the Inland Empire’s Manufacturing Summit.  B.J. Patterson, Dan Vest and I had an interesting discussion about the technologies of disruption.  Certainly Amazon has led the way with several of these….  

For example, e-commerce directly correlates to Amazon.  Who doesn’t want to order 1 toothbrush or 1 can of carpet cleaner at a time and expects it to arrive within 24-48 hours?  It appears as though we all do!  Yet we don’t think about what it takes behind the scenes to make this happen.  

For example, the panel mentioned several challenges:

1. Short manufacturing lead times– since we need whatever the customer needs within a short period of time after the customer thinks of it, manufacturers are also impacted.  We must have quick lead times, customize on the fly and be on the lookout for changing customer expectations and perceptions.
2. Warehouses and 3PL’s– It is definitely different to ship 1 each instead of 1 pallet or even 1 case.  In fact, it is so different that warehouses that support both types of business typically need to set up two separate warehousing operations, whether in separate buildings or segregated in the same building.  There is also quite a bit of technology and automation needed to operate successfully.
3. Transportation cost– A tough one!  If a truck, train or plane delivers 1 each or 1 pallet, it still costs the same amount of gas, drivers, maintenance etc.  Since you cannot ship 1 each by itself, it takes up far more space per each when boxed up individually than that same each does in a pack, case or pallet.  Further, if you have enough freight going in the same direction, of course you can combine freight but with last-minute needs, it can prove quite the challenge outside of the metro areas.  
4. Last mile – Even in a metro area, how do you get to the last mile (to each consumer)?  This is where Amazon has partnered with people like the US postal service since they are “in the business of delivering the last mile”. 
5. E-commerce systems – Customers expect to be able to receive 24/7 service via interactive websites customized to them.  Sometimes, they also expect personal service to accompany the on-line tools.  What’s involved in getting your catalog on-line, pricing loaded and systems in place is far from a no-brainer.
6. Cost impacts – there was quite a bit of discussion on the panel about the margin pressures created by this Amazon Effect.  What can we do to counteract these margin pressures?  Dare we say we circle right back to innovation?  

And the list could go on and on…..  

Are you thinking about what seemingly unrelated topics like the Amazon Effect might mean for your business even if you don’t supply consumers?  The impacts can be far-reaching and significant.

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Lisa Anderson MBA, CSCP, CLTD and president of LMA Consulting Group, acted as a Roundtable Participant, providing input in the development of Material Handling & Logistics (MH&L) U.S. Roadmap 2.0. A collaborative business effort, The Roadmap’s purpose is to guide the industry through supply chain and logistical challenges—domestic and international–through 2030. Roadmap 2.0, which was released at ProMat 2017 in Chicago this month, focuses specifically on technology, consumers, workforce, and logistics infrastructure.

“Roadmap 2.0 is a comprehensive, well thought-out and insightful compilation of trends and technologies that will help provide a broad perspective of where supply chain is headed,” shares Lisa Anderson. “It should be required reading to keep the findings from these supply chain industry thought leaders in mind when setting strategy and considering future potential end-to-end supply chain disruptions. Undoubtedly, manufacturers and distributors will gain valuable takeaways from the Roadmap.”

Anderson was part of a community of nearly 200 strategic thinkers, including material handling and logistics practitioners, equipment and software suppliers, academia, associations and government. Participants sat in on roundtable events held August through November 2016 in Atlanta, Georgia; Trenton, New Jersey; Ontario, California; Tucson, Arizona; and Chicago, Illinois. After dividing into breakout sessions, attendees shared their insights on both recent and anticipated developments in the field. They also identified the core competencies that companies will have to develop within the next decade.

Industry members are encouraged to join the U.S. Roadmap for Material Handling & Logistics Group on LinkedIn and to follow @MHLRoadmap on Twitter.

About LMA Consulting Group – Lisa Anderson, MBA, CSCP

**MEDIA EXPERT: Supply Chain Management, Logistics, ERP, VMI, Social Networks for Business**

Lisa Anderson is a leading expert in selecting & implementing strategic priorities and ranked 16 most influential in supply chain by SAP. Anderson is Board approved in Supply Chain strategy by the Society for Advancement in Consulting, is an APICS Certified Supply Chain Professional (CSCP) and won the APICS Southwest District’s Milt Cook Award in 2011. Named a top 100 supply chain blogger on SupplyChainOpz, she has the unique ability to zero in on the critical strategic priorities and bridge the gap between strategy and execution to achieve dramatically improved service levels, accelerated cash flow and increased profits. With a keen focus on elevating business performance, Anderson is passionate about not only synthesizing strategic priorities that will deliver business results but also in designing an implementation approach that delivers rapid results.

Anderson, also known as The Manufacturing Business Transformer^SM, is currently working on a book entitled “The Amazon Effect” detailing a business roadmap to thriving in an ultra-competitive marketplace. A regular content contributor in topics including supply chain, ERP and SIOP, she has been interviewed for articles in publications like Industry Week, tED Magazine and the Wall Street Journal. She actively posts educational blogs three times weekly and has two newsletters, Profit through People^SM and “I’ve Been Thinking.”

Prior to founding LMA Consulting Group Inc., Anderson was the Vice President of Operations and Supply Chain of PaperPak, Inc. Her twelve-year tenure included transitions and promotions through the company transformation from a $100 million family-owned business, through a merger and acquisition of three businesses into one $350 million dollar global company, followed by a management leveraged buyout in combination with an investment banking group.

A sought-after writer and speaker, Anderson has spoken at the Global Supply Chain & Logistics Summit, the APICS International Conference and as a visiting lecturer at the University of Southern California’s Entrepreneurial Program. Anderson is the author of “Leverage Social Networks to Drive Business Results,” has published hundreds of articles and has been quoted in the media including The Wall Street Journal, ABC News and Industry Week.

With a blend of management, finance and operations, Lisa received her MBA with an emphasis in Finance from California State University Fullerton and her BSBA with an emphasis in Operations Management from the University of North Carolina at Chapel Hill.

She has traveled extensively throughout North America, Central America and Europe, including a summer in Oxford when attending the University of North Carolina. Lisa tries to make as many stops as possible at in New Orleans to enjoy a beignet at the Café de Monde. And, in recognition of her extraordinary tenacity to accomplish goals, her colleagues fondly refer to her as “pit terrier.”

Lisa Anderson
President
LMA Consulting Group, Inc.
Claremont, CA
909-630-3943

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One of those frequent and frustrating problems with growth can be space. Who has heard, “I’ve run out of space! What should we do?”. Unfortunately it is not uncommon.

The problem with this situation is that there are numerous causes and solutions – including this is exactly the problem I wanted to create. Recently I’ve been working with a few highly seasonal clients. Space can be a dilemma in planning for how to navigate these seasonal patterns. Additionally running out of space is always a concern for growing clients. So, what should we do?

Make it a part of your planning process. For example, planning for space is one of the outputs of a SIOP (sales, inventory and operations planning) process. When you implement this best practice process, it is absorbed into the monthly process flow and trade-offs are continually evaluated. To learn more about how to implement SIOP, read our book, SIOP (Sales Inventory Operations Planning): Creating Predictable Revenue and EBITDA Growth.

A few items to think about when space arises as a topic include:

• Warehouse space optimization with existing equipment – have you considered how to optimize the space you already have? I’ve yet to run across a company without an opportunity to maximize already-existing space utilizing already-existing equipment. Think about flow, layout, storage strategies, etc.
• Warehouse space utilization with value-add purchases – have you brought in an expert to review your warehouse layout to look for opportunities for additional racking and creative approaches to maximizing space? Can you add an aisle? How about store above the dock doors?
• Flow – at its simplest, think about whether you are storing high-volume items closest to the dock doors and lower volume items in the hard-to-reach, inconvenient places. There are many flow considerations beyond these but it’s a great place to start….
• Onmi-channel strategy – if you support more than one channel (such as retail/ e-commerce and distribution), it is likely you need multiple storage and handling strategies.
• Leveraging systems – have you optimized the use of your current system? Are you scanning? Utilizing WMS functionality? There are many potential solutions without investing significant resources. Often times, WMS light capabilities can be a dramatic boost to productivity.

It isn’t a bad idea to start with common sense. My best clients might not be warehousing gurus yet they think about this from a common sense perspective, ask questions and gain inputs from the entire team. Beyond common sense, a few simple yet effective warehouse strategies might be in order. Certainly, none of us wants warehouse space to be the limiting factor for growth!

The post Addressing Warehouse Space Challenges appeared first on LMA-Consulting Group, a supply chain consulting firm.

Published in American Journal of Transportation on June 24, 2015

“You have multiple channels going said Manufacturing and Supply Chain Expert, Lisa Anderson, MBA, CSCP, CLTD, president of LMA Consulting Group Inc.

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