Hinterland Logistics: Supply Network Dynamics in Real Time

Posted : 01/28/13 2:36 AM

The shipping traffic which transport terminals handle is directly related to the markets they service as these ports are transshipment points. The area over which these ports draw their business is considered to be the hinterland. Hinterland logistics deal with freight flows and involves timing, expediency, mode and frequency of services: the supply network dynamic. The performance of logistics networks determines the competitiveness of global supply chains considerably, as production, distribution and consumption is linked. As a result of mass customization in response to product and market segmentation of logistics networks, distribution systems is adapting and taking advantage of the flexibility of supply network dynamics with the decoupling of order and delivery regarding order fulfillment. Amazon and Wal-Mart, ‘Duking’ it Out with Aggressive Delivery Policies Taking advantage of the latest technology in hinterland logistics are some of the biggest retail firms on the planet. Wal-Mart and Amazon.com are in fierce competition through the end of the 2012 holiday season in ‘same day delivery wars’. Wal-Mart is unrivaled in its US retail dominance, but Amazon.com is running a close second as the e-commerce giant will hit some $70 billion in sales by year’s end. Amazon’s sales increased another 29% at the end of the 2012 second quarter and the driving factor other than its aggressive pricing is its aggressive delivery policies. Amazon is shipping orders to customers faster and at lower cost with a growing network of distribution centers; 18 additional DCs to come online by year’s end, says CFO Tom Szkutak. With the Amazon Prime service, customers can get two-day shipping on all orders for a one-time modest fee. Although it was rumored earlier this year that Amazon would roll out same-day delivery, CFO Tom Szkutak conceded that it was not possible on a broad scale. On that news, Wal-Mart quickly unveiled a same-day delivery pilot plan in the Minneapolis, Northern Virginia, and Philadelphia markets. With ‘Wal-Mart to go’, for a $10.00 delivery fee, customers will receive their goods the same day if they place an online order by noon. Wal-Mart is pushing their pilot same-day delivery service through the end of the 2012 holiday season. EBay and Target are also jumping into the market for customer response quick delivery. ‘EBay Now’ is eBay’s roll-out pilot same-day service in San Francisco while Target is putting QR barcodes on 20 of its best selling toys. Customers are rewarded with free shipping for in-store scanning of the QR barcodes with their Smartphones. As 2012 comes to an end, it’s a fierce run to the line for these retail contenders in the e-commerce market.