Reverse logistics presents unique challenges and opportunities. To meet these challenges and take advantage of these opportunities, .

Ikea, a company , is facing the enigma of reverse logistics head on. As part of the company’s sustainability strategy, Ikea is challenging the perception that its products are disposable by creating opportunities to recycle and reuse products.

In a recent , Chief Sustainability Officer outlined several of the company’s initiatives. They include programs that allow consumers to return plastics, batteries, furniture, compact fluorescent light bulbs, mattress, and textiles to the store. These items are then sold “as-is” or recycled.

These programs have proven successful. For example, in just a few months, over 6 tons of batteries were collected in Moscow, and 25 tons of used textiles were collected in Norwegian stores last year.

Ikea is looking at other ways it can provide end-to-end supply chain solutions. One idea is to take returned products and recycle them into other products. In his interview with Fast Company, Howard shares: “We would basically be taking old bookshelves, old furniture, or an old door that’s finished its first life and sending it into new products. You’ll have a kitchen that used to be a bookshelf, without seeing any visible difference in them. It’s not a revolution, but you have to actually fundamentally change your supply chain to do that.”

Ikea has recognized that old, broken, and unwanted products are an opportunity. Through these innovative reverse logistics initiatives, Ikea is not only acting in a more sustainable manner and reducing the company’s environmental footprint, it is also increasing engagement with consumers and creating positive economic opportunities for the company. 

Editor’s Contribution: IKEA Leading the Way in the Circular Supply Chain

IKEA reverse logistics

5 Things to Aid in Setting up A Circular Supply Chain

If you recall from our blog post yesterday where we explained the evolution of the supply chain from a linear supply chain to a circular supply chain, we touted the benefits of a circular supply chain. We also shared a great infographic from and the to aid in setting up a circular supply chain:

  1. Outputs become inputs because your goods don’t end their life with their customers, but become an input in your supply chain. This means your accounts payable and accounts receivable processes will form a loop instead of a straight line.
  2. Without a digital supply chain, it will be almost impossible to coordinate all the moving parts a circular supply chain requires in real time.
  3. Assess your suppliers and work with the top tier for a common vision and goals towards a circular supply chain and ensure your CSR standards are met as you assess reuse opportunities.
  4. Figure out the cash flow demands of a circular supply chain, compared to a linear one. Your margins might improve, but your suppliers’ need for cash may change.
  5. Make a plan to manage the components like the evidence, materials, production information and components for the entire lifecycle.

Given the changing consumer, business, and government attitudes toward consumption and the environment, the circular economy looks poised to make businesses operate smarter and more collaboratively – while discovering new sources of profit and a competitive advantage by redesigning supply chains.


Editor’s Note: This guest contribution the Thomasholmes blog comes from our friends over at an inbound and content marketing company who specializes in marketing for companies with a keen value adding business model for those in the supply chain and logistics industries. We loved this post because as we get towards the end of the year many companies are conducting supply chain planning for 2016 (did I just type that?! where has the time gone!). For our readers, who are in the supply chain and manufacturing space, we want to share information that helps you stay strategic. A huge part of effective strategy in any business function is planning. We will include as well an Infographic below which visualizes the S.M.A.R.T. technique we referenced in our logistics KPIs series. 

We will also include a bonus portion of the post to include what is the outlook for the freight marketplace in 2016 and what to consider as you start to plan for better transportation management in 2016. 

Supply Chain Planning Starts with Looking Back

As the new year approaches, don’t overlook the valuable information you can glean from conducting a year-end review to kick start your supply chain planning.

Don’t start the new year without asking these 4 essential questions.

What were my biggest accomplishments this year?

Twelve months can seem like a long time when you consider everything that happened over the course of the last 365 days. Setting aside some time to review successful projects, notes of thanks from clients, or a particularly positive performance review reminds us what we’re capable of achieving and gives us a renewed sense of accomplishment.

Try this: Designate a file folder near your workspace to collect any materials or notes related to your successes as they occur. Doing so will make it easier for you to recall your accomplishments and provide quick access to a list of your achievements – helpful for a  or last-minute performance reviews.

How satisfied are you with the past year?

Were you successful in meeting the majority of your goals? Do you feel that you worked to your highest potential? Would you have done something differently? What about missed opportunities? Examining what went right and identifying areas for growth and opportunity are powerful exercises that both prevent the recurrence of negative behaviors and reinforce our commitment to priorities.

Try this: Thinking about your experiences of the past year in sum, try to assign a value to your entire year. How would you rate your year on a scale from 1 to 10? 1 to 100? Why? Adding some context to your experiences presents a more accurate picture of your year by tempering unusual highs and lows.

Is my current daily routine structured to make time for my priorities?

It’s easy to fall victim to time suckers, especially when they become ingrained into your routine. Has your daily 15-minute coffee break gradually morphed into 25 minutes? Are your 10-minute “headline scans” now closer to 30 minutes? These small, seemingly innocent extensions can snowball into major time loss, causing unnecessary panic as you scramble to meet deadlines.

Try this: The start of a new year is a great time to reset (or rethink) our daily routines. Build activities into your day. If you’d like to continue your now-daily 25-minute coffee break, think about extending your work day by 25 minutes. Feeling like you can’t absorb everything news-worthy in less than 30 minutes? Set your morning alarm 30 minutes earlier so you can arrive to work having already . By taking a hard look at where your time is actually going and then spending a few minutes realigning your daily routine with your priorities, you’re intentionally and consciously assigning time to the things you find the most important.

What is it that I want to achieve next year?

Each new year brings with it a renewed energy to  selves. In order to get started, we need to define our priorities and what our success will look like. Setting , or goals that are specific, measurable, achievablerealistic, and timely, keeps us moving forward by providing accountability.

Try this: After reviewing your past year, set aside some time to consider what you’ll set out to achieve this year. Create a detailed roadmap to successful completion of your goals.

BONUS: Freight and Transportation Costs Must be Considered in Supply Chain Planning

Looking forward is a big part of your supply chain planning. In the supply chain, you must also consider one of the largest portions of your supply chain budget: freight and transportation costs. ATA economist, Bob Costello, says the U.S. economy will remain strong through 2016, only negative is the driver shortage.

Freight volumes should start to climb again by the end of the year. Costello said current softness in freight is not due to any underlying economic drivers. Rather concerns over truck capacity constraints earlier this year pushed manufacturers and retailers to build up higher than normal inventories. As they work through that inventory, there will be “a healthy rebound” in freight volumes.

By the end of the year, the industry will be short 48,000 drivers, he said. By comparison during the last major driver shortage in 2005, trucking had 20,000 open jobs. Overall the driver shortage is forecast to hit 175,000 by 2024, “and that will slow down the U.S. economy,” Costello said.

“There’s no one cause [for the shortage], and no one solution,” he told the ATA membership. “We’ve seen pay rise in the low double digits these last few years, and that will continue.” More time at home, allowing younger drivers in interstate operations, and better treatment of drivers by everyone in the supply chain will also be part of solving the driver shortfall, according to Costello.

“This [shortage] is far from over, and we have our work cut out for us,” he concluded.

So what does that mean for your supply chain planning and your estimates on freight and transportation costs? It means you may want to expect to spend a little more in 2016 as the driver shortage, an improving economy, as inventories get lower, and we start seeing rate increases from LTL carriers looking to recoup a less than healthy 2015. 

Here 5 top tips to help you combat rising freight and transportation costs:

  1. Consolidate Your Carriers
  2. Try and Avoid Rush Shipments
  3. Minding Freight Bill Audits
  4. Controlling Incoming or Inbound Freight
  5. Try and Avoid Rush Shipments
  6. Work with a focused 3PL savvy with transportation management who can offer both technology and services

Use this infographic to help you set, and achieve your SMART goals.

How was your year in review as you tackle the massive project of Supply Chain planning? What were your biggest accomplishments? Are there any goals that you’ll carry over into the new year? Do you regularly set aside time at the close of a year to reflect? We’d love to hear what you do to reset for a new year.

Fronetics Strategic Advisors is a leading management consulting firm. Our firm works with companies to identify and execute strategies for growth and value creation.

We advise and work with companies on their most critical issues and opportunities: , , ,, , and .

Editor’s Note: This is a guest post, republished with permission, from the . Fronetics is an specializing in the supply chain and logistics verticals. We have enjoyed engaging with Fronetics and their team in social media for quite some time and are avid readers of their blog. Recently, they started a series featuring , and this post really stood out to us as Thomasholmes is a 3PL service provider focused on Transportation Management. 

is a former fifth-grade teacher turned business professional.  His experience includes content marketing in the IT industry and operations management for United Parcel Service.  He will complete his MBA from the University of New Hampshire in 2015.  He enjoys long walks along the conveyor belt and Ben and Jerry’s ice cream.  He lives with his wife, Betsy, in Dover, New Hampshire and they are expecting their first child in June.

4 questions to ask when determining if a 3PL Service Provider is right for your company

Third-party logistics, or 3PL, is an industry on the rise thanks to the constant innovations in complementary industries like telecommunications, data analytics, and cloud technologies. To avoid confusion, let’s call 3PL what it is: outsourcing. But it’s not the kind of outsourcing that typically comes to mind when you hear the term. Rather, it’s a specific type of outsourcing related to the operations side of a company in areas like order fulfillment, inventory and warehouse management, or transportation of finished goods. As many companies, and perhaps your competitors, begin to employ some form of 3PL service provider, you may be tempted to follow suit. But before you hand over the keys, consider whether or not 3PL is a good fit for your company by answering these four questions:

Question 1: What are your company’s core values?

Why do you exist as a company?  What service or product do you provide that you believe is better than all others like it?  And what are the core values that your company adheres to in good times and bad, for better or for worse?  Core values make you who you are.  They are the DNA of the company.  , for example, produces a variety of yogurts from their New Hampshire-based facility.  One of their core values is that they use only organic ingredients, sourced from family-owned organic farms in their products.  No ifs, ands, or buts.  That’s a core value.  It won’t change, during either boom or recession.  And everything they do as a company must align with that.  Your company’s strategic alignment stems from identification of its core values, and each decision you make as a company should work seamlessly with your strategic alignment.

Action step: Identify your core values.  If a 3PL service provider conflicts with any core values, you should avoid forcing its implementation, even if there are cost savings to be gained.

Question 2: What are your company’s core competencies?

What are the things that your company does well?  The Company’s core competencies lie within their research and development and the chemists they employ.  Their specialized skills and olfactory expertise drive the creation of precisely scented candles that make you say, “I know I smell a pumpkin pie, but I can’t find it anywhere!”  Their competencies help them stand apart from the competition.  You would be remiss to give over your core competency to someone else.  If your expertise lies in local delivery and timely service, why outsource it to the guys with the brown trucks?

Action step: Identify your core competencies.  If a 3PL service provider takes the place of any part of your core competencies, you could be weakening the overall value proposition of your company.

Question 3: Will using a 3PL service provider allow you to enhance your core competencies to meet your company’s goals?

The purpose of debating whether or not to employ 3PLservice providers should not focus so much on reduced costs, which can be one of the foremost benefits, but rather whether or not it can enhance your core competencies and stimulate growth for your company.  Is your goal to reach broader markets, but you lack the expertise to make it happen?  Perhaps an e-commerce fulfillment provider could help you reach those markets.  Do you have an outstanding product, but can only sell it to those within a small radius of your operations?  Maybe this would be the appropriate time to call on the guys with the brown trucks.

Action step: Draw parallels between the service you wish to outsource and the goal it will meet.

Question 4: What is the cost to your company?

It’s the question that always needs to be considered.  But don’t take this question at face value: we’re not just talking about how choosing a 3PL service provider will affect the bottom line.  Of course, there will be monetary costs associated with hiring another company, and there is even a tipping point when using a 3PL may be cost ineffective.  So after a careful cost/benefit analysis, consider the other costs associated with handing over part of your value chain to a third party:

Time costs: Does outsourcing add lead times or delivery times to orders?  Decide whether possible time costs take away from your value proposition or enable your company to meet larger goals.

Control costs:  Are you willing to hand over direct control of part of your value chain to someone else?  Keep in mind that it’s possible no one cares about your business quite as much as you do.  Can you trust someone else to make the same kind of decisions you would make in respect to your company and its customers?

Reputation costs: What happens if a 3PL provider does not perform as anticipated?  Will it put a blemish on your company’s image?  If a farm outsources its delivery to a local trucking company, and the refrigeration in the trucks falters and causes food to spoil, will the customer assume that the trucking was bad, or do they just assume that the quality of the produce from the farm is questionable?  It takes a long time to build up a reputation, and only a short time to dismantle it.  Don’t risk it on a provider you can’t trust.

Action step: Vet your possible 3PL service provider options to see whose values closely align with yours.  It may prove to be a critical step in choosing the right provider as opposed to the cheapest one.

Third party logistics companies provide an avenue for companies to scale to capabilities they may never have had the ability to reach.  Expanded consumer markets, faster delivery times, and more efficient inventory management are some of the benefits to be had.  But before you get drawn towards the soft glow of higher revenues and wider margins through outsourcing, be careful to make sure that your choice to engage a 3PL service provider aligns with your company’s strategic plans.  And if you do choose to outsource, take your time to find the right provider who can add the most value to your business, not just the least amount of digits on the balance sheet.


Editor’s Note: This is a guest blog from Fronetics, one of the premier digital and content marketing agencies who focus on the industrial, supply chain, and logistics sectors as their client base. Fronetics approach of educational information for manufacturers and those industries related to the supply chain perfectly aligns with Thomasholmes’s approach to educate the same industries on best practices, trends, and tips that allow them to have a more efficient business process. Whether it’s tips around how to master LTL Freight, business, manufacturing news, or just marketing advice, we want our readers to come away feeling that they got value out of each blog post and learned something that helps them! We hope you enjoy this short and awesome post that will make you better at LinkedIn to gain visibility (and maybe a few leads) for your business. 

There are more than 300 million users.  There are over 3 million company pages.  Every two seconds someone new joins    LinkedIn is the largest professional network and is a virtual treasure chest of riches for companies in the supply chain industry.  If your company is not active on LinkedIn you are missing out on opportunities- and revenue.

A 7 Step Process to Increase your B2B Visibility for your Manufacturing, Supply Chain, Logistics, and Industrial Company

Here is how to maximize LinkedIn:

1. Create a compelling company page

People and businesses turn to LinkedIn to learn more about your company.  Make sure that your company can not only be found, but also presents itself in a compelling manner.  Present your company as an industry leader.

Linkedin Manufacturing

2. Be active In LinkedIn Groups

Conversations about your industry (and possibility your company) are taking place within LinkedIn’s groups on a daily basis.  Becoming an active participant in LinkedIn groups will enable you to:

  1. Provide you with business and market intelligence;
  2. Introduce you to new, interesting, and relevant topics;
  3. Enable you to raise awareness about your company; and
  4. Position your company as a leader within the industry.

Linkedin Manufacturing group

3. Content distribution

; however, it doesn’t go far (it actually goes nowhere) without .  Use your LinkedIn company page to distribute your own content as well as curated content.  Also consider sharing relevant content within your LinkedIn groups.

Content distribution via LinkedIn serves to increase brand awareness and position your company as a knowledge and industry leader.

4. Include your employees

Encourage your employees to be active in LinkedIn groups and to, essentially, serve as your company’s brand ambassadors.  Additionally, empower your employees to use their LinkedIn network to share job openings, and to identify great talent.

5. Prospect for leads

LinkedIn can be used to prospect for leads and to build your sales pipeline.  Look not only within groups, but also within your vast network.  Also, use LinkedIn to research target companies and industries.

Linkedin Manufacturing search

6. Optimize your profile

You are a reflection of your company.  Take the time to .

7. Don’t be annoying

No one likes spam.  If you take to LinkedIn with a “me, me, me” attitude you will fail.  To truly maximize LinkedIn it is essential that your company does not use LinkedIn solely to self-promote.  .  If you take this approach you will close doors and lose out on opportunities. Try using open ended questions related to the industry, such as in the screen shot below and notice the number of comments (327) and how Steve’s profile is the TOP profile, visible to all members who visit the group:

A recent found that companies within the supply chain and logistics industry believe LinkedIn to have a positive impact on their business.  Respondents were asked to rate social networks used by their company on their business impact.  58 percent of respondents rated LinkedIn as “very impactful,” and 37 percent rated LinkedIn as “somewhat impactful.”   If your company is not yet taking advantage of LinkedIn, it’s time to start.

How are you using LinkedIn to raise your company’s profile? Let us know in the comments below!

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