China Ocean Shipping Group (Cosco) is planning to shift its ocean logistics path from Europe to Asia and back to take advantage of the opening of Arctic routes. Why? It saves two weeks of travel time compared to the old route through the Suez Canal and the Indian Ocean. In a recent article in the WSJ, the company explained the new route is economical even though it presents some challenges, like the occasional need to break ice.
There are additional reasons to make the change. One of the keys to Just-in-time (JIT) inventory is frequent, smaller shipments. Being able to get your products to and from market faster allows you to hold less inventory. The increased cash flow and reduced holding costs can accrue to millions of dollars in savings. One of my clients saw warehouse costs drop by over $6 million by using JIT techniques.
Speed is the big dial in the middle of the Executive Command Center®. Not only do you get great economies by using it, you provide better service to your customers through shorter lead times and shorter order cycle times. This flexibility can have a rocket ship effect on your growth and competitiveness. Speed is key to success.
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