Canadian Shipper


“Choice overload” the new supply chain reality: Tompkins International

SAN ANTONIO, Tex.–In a keynote speech at the 2015 Tompkins Supply Chain Leadership Forum (Aug. 31-Sept. 2) Jim Tompkins, CEO, Tompkins International addressed the “new reality” of supply chain, Overcoming Choice Overload.

According to Tompkins, many people regard choices as a good thing. But, one must realize too few choices begets discomfort or unhappiness and too many choices leads to confusion, regret of alternatives not taken, and second guessing.  Today, the business world is more complex than it has ever been.  Adaptation to the marketplace is required in order to be successful.  Therefore, choices must be made.

Most companies are operating in an environment of choice overload.  The mega-choices businesses are making to operate their supply chain will create greater success, status quo, or fail.  Businesses must define what mega-choices need to be made, all involved must understand the choices being made, understand other businesses choices, and implement the choices correctly, he said.

Dr. Tompkins suggests businesses need to make supply chain choices regarding; crossborder, omnichannel, customer centricity, and final delivery. Alibaba, Amazon, and WalMart have made these choices and continue to do so.

Crossborder is important.  By the year 2020 the Asia-Pacific Region will have 48% of crossborder purchases leading the way.  Clothing and footwear will represent 39% of online crossborder purchases while electronics will represent 26%.  A wide selection is key.

Omnichannel is important and the data supports this.  February 2015, Ernst & Young, “88% of all retailers say they can no longer rely on traditional sales channels to drive growth.”

Customer centricity is important, there is no business if you have no customers.  Businesses must become customer driven.  Businesses should be focused on customer satisfaction, customer service, customer experience, and the customer’s journey. Businesses need to place high importance on the conversations they are having with their customers.  A reduction of customer friction leads to loyal customers.

Final delivery is important, the choices a business makes on final delivery will change their profit margin.  Costs for international goods, actually begin at the import hub, and extend to the ultimate destination. This has to do with how shipments are de-consolidated, carriers routed, and then actual delivery.  The costs for final delivery actually begin upstream, with the structure of the distribution network, the way in which consolidation / de-consolidation is conducted, and the efficiency of the modes and carriers in routing and scheduling from the import hub to the destination.  If the correct choices are made final delivery will improve a business’s supply chain.

Choices must be made with respect to crossborder, omnichannel, customer centricity, and final delivery.  Without making these choices businesses supply chains will flounder and fail.  Steps must be taken right away or risk falling behind your competition.