The shipping problems facing golf-cart maker E-Z-GO were too complex to be solved by transportation software alone. But when the company added a second application to the mix, the results were well above par.
James Cooke is a principal analyst with Nucleus Research in Boston, covering supply chain planning software. He was previously the editor of CSCMP?s Supply Chain Quarterly and a staff writer for DC Velocity.
Every year, while the rest of the country eagerly awaited the arrival of spring, golf-cart maker E-Z-GO braced for something decidedly less welcome: a seasonal spike in shipping costs.
At the heart of the problem was a simple imbalance in supply and demand. The Augusta, Ga.-based company uses special double-deck "golf car" trailers to ship its golf carts and utility vehicles. Those trailers, however, are in limited supply in North America—there are only about 1,000 of the units in the United States. For most of the year, the company is able to obtain all the capacity it needs from its dedicated contract carrier. But during April and May, its peak selling season, E-Z-GO has to hire additional for-hire carriers, and that's when things would get sticky.
To begin with, it was sometimes difficult for the golf-cart maker to find the extra double-deck trailer capacity it needed. More to the point, perhaps, it was often quite expensive. Although E-Z-GO's customers paid the shipping costs for their orders on a per-mile basis, that still left the problem of the return trip. If it didn't have a return load, E-Z-GO was often forced to pay for a round trip even though it was only moving products one way.
As a result, the company found itself losing money on shipping. "We could push out a thousand truckloads a month in peak season," says Cary G. Daniel, E-Z-GO's director of logistics and materials. "And we were bleeding red ink on transportation."
The logistics team's first thought was to invest in transportation management software. A transportation management system, or TMS, would help them identify opportunities to consolidate loads and locate backhauls. Trouble was, it wouldn't address some of the other problems E-Z-GO struggled with—like a lack of inventory visibility that created serious delays in truck loading. In the end, however, they found the answer they were seeking in a powerful integrated logistics management solution that combined a transportation management system (TMS) with a warehouse management system (WMS).
Special handling
A subsidiary of Textron Global, E-Z-GO earned slightly more than a half billion dollars in revenue last year. Among other items, the company makes golf carts, utility vehicles, warehouse vehicles, and so-called "personal vehicles"—lightweight vehicles that are fast becoming a fixture in retirement communities, where residents use them in place of cars for local transportation.
E-Z-GO manufactures its vehicles at two 800,000-squarefoot plants on a campus in Augusta, Ga., building most of its electric-powered vehicles to order. Its customers, which include golf courses, resorts, and factories, typically place orders through a dealer or distributor for delivery in about six weeks' time. Customers can choose their vehicles' paint colors and accessories, selecting from an array of 225 options—bag covers, windshields, tow bars, logos, and the like. Orders tend to be small, usually ranging from one to four vehicles.
The company ships its products through 12 service centers located throughout the United States. Those service centers handle much of the customization work on the vehicles. Once the vehicles are finished, a carrier delivers the golf carts directly to the customers.
Building better loads
E-Z-GO's goals going into the software project were modest. At the time, it was losing significant money on shipping, says Daniel, and it just wanted to break even.
Step one was the installation of the transportation management system. In January 2007, E-Z-GO installed a TMS supplied by Waukesha, Wis.-based RedPrairie. Six months later, the company added the WMS, which was also supplied by RedPrairie.
Once the TMS was in place, E-Z-GO could finally abandon its manual load-planning procedures. "We used to use spreadsheets and calculators to try and configure loads," says Daniel. The TMS now automates the load-planning process and optimizes the use of trailer space.
Along with optimizing trailer space, the TMS has helped E-Z-GO optimize shipments. The TMS consolidates orders so that E-Z-GO can minimize the number of trailers it uses for deliveries. (E-Z-GO can fit anywhere from 24 to 30 carts on a golf car trailer, depending on the trailer's configuration.) By pre-planning the shipments, the application has enabled the company to move six or seven loads in a single trip.
Perhaps best of all, the TMS can feed information on potential outbound loads to E-Z-GO's carriers to help them locate backhauls (which typically come from companies that ship all-terrain vehicles). "We work through the carrier base to get backhauls," Daniel says. Because it has a gain-sharing contract with carriers, E-Z-GO gets a percentage when the trucker finds a backhaul.
As a side benefit, E-Z-GO has found that the TMS allows it to provide better service to customers ordering replacement parts. Customer service personnel can use the TMS to determine an order's shipping cost prior to confirming the order. Customers pay the shipping costs, and they appreciate knowing the exact charges in advance, the company says.
Dynamic duo
For all the efficiencies it has achieved with its TMS, E-Z-GO believes that the real gains have come through the combination of the TMS and the WMS. For starters, the WMS allows E-Z-GO to track the precise whereabouts of its products, which has significantly reduced loading times. After production, the company stores its vehicles in a 10-acre open-air warehouse in Augusta. In the past, it wasn't always easy to locate specific vehicles when it came time to load the truck. "We used to have guys riding around looking for product," says Daniel.
Nowadays, things are different. The WMS allows the golf cart maker to slot product dynamically in spaces throughout the open-air facility. The WMS keeps track of each product's location down to the exact spot in a specific row, and is able to direct workers right to the vehicles they need.
On top of that, the WMS can supply the TMS with detailed dimensional information for specific vehicles. That information proves invaluable when it comes time for the TMS to build load plans.
Ultimately, the integrated WMS and TMS system will enable E-Z-GO to change its distribution strategy and reduce its reliance on the specialized double-deck trailers. The company plans to convert three of its 12 service centers— one in California, one in Ohio, and one in New York—into regional distribution centers. Once that's done, it will use regular trailers whenever possible to linehaul product to the regional DCs, where final assembly and customization will take place. It will only need the specialized units to deliver finished vehicles from the regional DCs to customers.
Serious savings
Based on its positive experience with the integrated TMS and WMS solution, E-Z-GO plans to invest in another RedPrairie application. Daniel says the company expects to add RedPrairie's visibility application to the TMS, which will allow it to schedule inbound loads as well as outbound movements.
But whatever it does in the future, there's no arguing with the savings E-Z-GO has achieved to date. The company has seen its distribution costs drop by 20 percent. "The solution has allowed us to make smarter decisions," Daniel says. "Since fuel [prices] have gone through the roof, I shudder to think where we would be without the tools we have purchased."
Nearly one-third of American consumers have increased their secondhand purchases in the past year, revealing a jump in “recommerce” according to a buyer survey from ShipStation, a provider of web-based shipping and order fulfillment solutions.
The number comes from a survey of 500 U.S. consumers showing that nearly one in four (23%) Americans lack confidence in making purchases over $200 in the next six months. Due to economic uncertainty, savvy shoppers are looking for ways to save money without sacrificing quality or style, the research found.
Younger shoppers are leading the charge in that trend, with 59% of Gen Z and 48% of Millennials buying pre-owned items weekly or monthly. That rate makes Gen Z nearly twice as likely to buy second hand compared to older generations.
The primary reason that shoppers say they have increased their recommerce habits is lower prices (74%), followed by the thrill of finding unique or rare items (38%) and getting higher quality for a lower price (28%). Only 14% of Americans cite environmental concerns as a primary reason they shop second-hand.
Despite the challenge of adjusting to the new pattern, recommerce represents a strategic opportunity for businesses to capture today’s budget-minded shoppers and foster long-term loyalty, Austin, Texas-based ShipStation said.
For example, retailers don’t have to sell used goods to capitalize on the secondhand boom. Instead, they can offer trade-in programs swapping discounts or store credit for shoppers’ old items. And they can improve product discoverability to help customers—particularly older generations—find what they’re looking for.
Other ways for retailers to connect with recommerce shoppers are to improve shipping practices. According to ShipStation:
70% of shoppers won’t return to a brand if shipping is too expensive.
51% of consumers are turned off by late deliveries
40% of shoppers won’t return to a retailer again if the packaging is bad.
The “CMA CGM Startup Awards”—created in collaboration with BFM Business and La Tribune—will identify the best innovations to accelerate its transformation, the French company said.
Specifically, the company will select the best startup among the applicants, with clear industry transformation objectives focused on environmental performance, competitiveness, and quality of life at work in each of the three areas:
Shipping: Enabling safer, more efficient, and sustainable navigation through innovative technological solutions.
Logistics: Reinventing the global supply chain with smart and sustainable logistics solutions.
Media: Transform content creation, and customer engagement with innovative media technologies and strategies.
Three winners will be selected during a final event organized on November 15 at the Orange Vélodrome Stadium in Marseille, during the 2nd Artificial Intelligence Marseille (AIM) forum organized by La Tribune and BFM Business. The selection will be made by a jury chaired by Rodolphe Saadé, Chairman and CEO of the Group, and including members of the executive committee representing the various sectors of CMA CGM.
The global air cargo market’s hot summer of double-digit demand growth continued in August with average spot rates showing their largest year-on-year jump with a 24% increase, according to the latest weekly analysis by Xeneta.
Xeneta cited two reasons to explain the increase. First, Global average air cargo spot rates reached $2.68 per kg in August due to continuing supply and demand imbalance. That came as August's global cargo supply grew at its slowest ratio in 2024 to-date at 2% year-on-year, while global cargo demand continued its double-digit growth, rising +11%.
The second reason for higher rates was an ocean-to-air shift in freight volumes due to Red Sea disruptions and e-commerce demand.
Those factors could soon be amplified as e-commerce shows continued strong growth approaching the hotly anticipated winter peak season. E-commerce and low-value goods exports from China in the first seven months of 2024 increased 30% year-on-year, including shipments to Europe and the US rising 38% and 30% growth respectively, Xeneta said.
“Typically, air cargo market performance in August tends to follow the July trend. But another month of double-digit demand growth and the strongest rate growths of the year means there was definitely no summer slack season in 2024,” Niall van de Wouw, Xeneta’s chief airfreight officer, said in a release.
“Rates we saw bottoming out in late July started picking up again in mid-August. This is too short a period to call a season. This has been a busy summer, and now we’re at the threshold of Q4, it will be interesting to see what will happen and if all the anticipation of a red-hot peak season materializes,” van de Wouw said.
The report cites data showing that there are approximately 1.7 million workers missing from the post-pandemic workforce and that 38% of small firms are unable to fill open positions. At the same time, the “skills gap” in the workforce is accelerating as automation and AI create significant shifts in how work is performed.
That information comes from the “2024 Labor Day Report” released by Littler’s Workplace Policy Institute (WPI), the firm’s government relations and public policy arm.
“We continue to see a labor shortage and an urgent need to upskill the current workforce to adapt to the new world of work,” said Michael Lotito, Littler shareholder and co-chair of WPI. “As corporate executives and business leaders look to the future, they are focused on realizing the many benefits of AI to streamline operations and guide strategic decision-making, while cultivating a talent pipeline that can support this growth.”
But while the need is clear, solutions may be complicated by public policy changes such as the upcoming U.S. general election and the proliferation of employment-related legislation at the state and local levels amid Congressional gridlock.
“We are heading into a contentious election that has already proven to be unpredictable and is poised to create even more uncertainty for employers, no matter the outcome,” Shannon Meade, WPI’s executive director, said in a release. “At the same time, the growing patchwork of state and local requirements across the U.S. is exacerbating compliance challenges for companies. That, coupled with looming changes following several Supreme Court decisions that have the potential to upend rulemaking, gives C-suite executives much to contend with in planning their workforce-related strategies.”
Stax Engineering, the venture-backed startup that provides smokestack emissions reduction services for maritime ships, will service all vessels from Toyota Motor North America Inc. visiting the Toyota Berth at the Port of Long Beach, according to a new five-year deal announced today.
Beginning in 2025 to coincide with new California Air Resources Board (CARB) standards, STAX will become the first and only emissions control provider to service roll-on/roll-off (ro-ros) vessels in the state of California, the company said.
Stax has rapidly grown since its launch in the first quarter of this year, supported in part by a $40 million funding round from investors, announced in July. It now holds exclusive service agreements at California ports including Los Angeles, Long Beach, Hueneme, Benicia, Richmond, and Oakland. The firm has also partnered with individual companies like NYK Line, Hyundai GLOVIS, Equilon Enterprises LLC d/b/a Shell Oil Products US (Shell), and now Toyota.
Stax says it offers an alternative to shore power with land- and barge-based, mobile emissions capture and control technology for shipping terminal and fleet operators without the need for retrofits.
In the case of this latest deal, the Toyota Long Beach Vehicle Distribution Center imports about 200,000 vehicles each year on ro-ro vessels. Stax will keep those ships green with its flexible exhaust capture system, which attaches to all vessel classes without modification to remove 99% of emitted particulate matter (PM) and 95% of emitted oxides of nitrogen (NOx). Over the lifetime of this new agreement with Toyota, Stax estimated the service will account for approximately 3,700 hours and more than 47 tons of emissions controlled.
“We set out to provide an emissions capture and control solution that was reliable, easily accessible, and cost-effective. As we begin to service Toyota, we’re confident that we can meet the needs of the full breadth of the maritime industry, furthering our impact on the local air quality, public health, and environment,” Mike Walker, CEO of Stax, said in a release. “Continuing to establish strong partnerships will help build momentum for and trust in our technology as we expand beyond the state of California.”