Datex Fast Facts | Global Supply Chains and 3PL Warehouse Operations

Find out interesting facts about a wide variety of topics ranging from the global supply chain to 3PL warehouse operations.

Supply chain management and logistics are integral parts of a vast industry that encompasses shipping, packaging, distribution, and more. Over the past few decades, traditional supply chains and logistics business operations have undergone significant changes due to various advancements. Today, modern supply chains are essential to the global economy and play a vital role in how businesses move products around the world to meet customer demands and gain a competitive advantage.

In this Datex blog, we will explore incredible and interesting facts about the global supply chain that every professional in the supply chain logistics industry should know.

 

Fast Facts About the Global Supply Chain

Global supply chains are an integral part of the modern economy, connecting businesses and consumers across the world. However, these complex networks of organizations and resources can present significant challenges related to logistics, communication, and management. To navigate these challenges, it is essential to have a clear understanding of the facts and trends related to various types of supply chain logistics. In this section, we will explore some key facts and trends that businesses and policymakers need to know.

  • Reducing supply chain costs from 9% to 4% can double profits – Supply chains have a huge impact on company profits, so optimization and cost reduction are always valuable. This is especially true for industrial suppliers and material handling companies, where the average supply chain cost is 13.2%, while the best companies have managed to optimize this number to 7.9%. That’s a 40% savings.
  • 57% of companies believe that supply chain management gives them a competitive edge – 70% of companies believe that supply chains are a key driver of quality customer service, which is important for businesses to meet customer expectations. That means that a majority of companies are aware of how important supply chains are.
  • On average, U.S. retail operations have a supply chain accuracy of only 63%This can result in significant delays and re-stocking issues. For example, 34% of businesses have shipped an order late due to selling a product that wasn’t in stock.
  • Supply chains provide higher company growth through a wider selection of customized, reliable, sustainable, and quickly delivered products.

These factors play a key role in growth. Additionally, demand from each factor rose:

Wider selection (71%)

Customized (76%)

Reliable (73%)

Sustainable (69%)

Rapid delivery (76%)

  • The #1 cause of global supply chain disruptions is mergers and acquisitions at 66%. Other common causes of supply chain disruption include

Extreme weather (41%)

Factory fire (37%)

Business sales (33%)

 

  • The #1 cause of U.S. supply chain disruptions is unplanned IT outages at 68%. Other common causes of U.S. supply chain disruptions include:

Adverse weather (62%)

Loss of talent (51%)

Cyber-attacks (50%)

Fire (44%)

  • Supply Chains are Responsible for 90% of global environmental impactA business’s supply chain is responsible for 90% of its ecological footprint. That is because supply chains incorporate a wide variety of business processes, from the sourcing and procurement of raw materials to picking, packing, and shipping, to last-mile delivery. Additionally, the bulk of a business’s operations are likely tied up in some form of logistics operations. Therefore, it is imperative that supply chain managers and their business partners address supply chain sustainability initiatives to reduce environmental impact.
  • If Wal-Mart were a country, it would be the world’s 26th largest economy – In fact, Wal-Mart has a greater economic impact than many smaller countries due to the company’s vast supply chain and massive customer base. As of today, Wal-Mart has over 10,500 stores and clubs 24 countries.
  • According to Business Wire, the global supply chain management market size was estimated at USD 17.41 billion in 2021, USD 19.50 billion in 2022, and is projected to grow at a compound annual growth rate (CAGR) of 12.17% to reach USD 34.70 billion by 2027
  • According to Gartner, approximately 83% of businesses demand that supply chains enhance the customer experience as a component of their digital supply chain business strategy. 
  • From January 2021 through November 2021, $238 billion worth of cargo experienced “significant” delays outside of the ports of Los Angeles and Long Beach.
  • According to Bloomberg, in Q2 of 2022 it took an average of 100 days to receive production materials. This was the longest shipping delay since the statistic began being recorded in 1987.

Interesting Facts about 3PLs and Shippers

 

Third-party logistics providers and shippers play a critical role in the transportation and logistics industry. They are responsible for managing the movement of goods from point A to point B, ensuring that products are delivered on time and in good condition. In this section, we will explore some interesting facts about 3PLs and shippers and their impact on the global supply chain. From the rise of e-commerce to the increasing demand for resilient and sustainable supply chain logistics management, there are many trends shaping the industry and influencing the way these organizations operate. Let’s take a closer look at some of the most fascinating facts and trends related to 3PLs and shippers.

3PL Industry Statistics

  • 91% of 3PL users and 97% of 3PL providers report their relationships are successful and their work has positive results. Successful safety relationships are defined by openness, transparency. Also, it ensures effective communication between the two parties.
  • 97% of shippers feel alignment is most important to drive the effectiveness of big data initiatives. Also, 93% agree that data-driven decision-making is essential to the success of supply chain activities and order fulfillment processes.
  • 75% of shippers said the use of 3PL services has contributed to overall logistics shipping cost reductions.
  • 86% of shippers said the use of 3PLs has contributed to improved customer service.
  • 58% of shippers indicate they are increasing their use of outsourced logistics services this year.
  • The most frequently outsourced activities are domestic transportation (86%), warehousing (66%) and freight forwarding (44%).
  • 73% of shippers interact with their 3PL on a daily or hourly basis.
  • Cloud technologies used by 3PLs is addressing the top challenges faced by shippers:
    1. Reducing transportation costs
    2. Improving visibility
    3. Managing inventory
    4. Achieving regulatory compliance
  • 79% of 3PLs have reported improved profitability in the last year and 33% indicated high profitability growth of greater than 25%.
  • 3PLs are expected to reach US $2,144 billion by 2032, with a 7.6% compound annual growth rate (CAGR) from 2022 to 2032.
  • Armstrong & Associates indicates that 90% of domestic Fortune 500 companies use the services of a 3PL. 95% of Fortune 100 companies are utilizing some form of 3PL.
  • 88 percent of shippers in the United States think that communication, flexibility and openness are the best qualities in making a successful partnerships
  • While 40% of companies currently insource fulfillment, six percent are planning to switch to an outsourced model. Eighteen percent will likely outsource fulfillment entirely, while 48% will pursue a hybrid approach.

Fascinating Facts about Inflation and The Global Supply Chain

 

Inflation can have significant impacts on the global supply chain, affecting everything from raw material cost to shipping expenses. As prices rise, businesses must navigate the challenges of maintaining profitability while also keeping prices competitive for consumers. Understanding the facts and trends related to inflation in the global supply chain is crucial for businesses and policymakers alike. In this section, we will explore some key facts and trends related to inflation and its impact on the global supply chain.

  • Of the 183 countries analyzed by Investment Monitor, 70 had inflation rates more than 10%. Three of the ten highest rates are found in Africa, with Zimbabwe having the highest inflation rate in the world at 230%.
  • Argentina and Turkey are currently experiencing the highest inflation rates in the International Economic Cooperation, the Group of Twenty (G20.) In January 2023, Turkey’s rate was 57.7%
  • Argentina’s hyperinflation continues to persist and is on an upward spiral. In January 2023, prices were 98.8% higher than January 2022. Subsequently, Argentina is now the country with the highest inflation rate in the G20 by some margin.
  • Inflation in the US is on a downward trajectory. In June 2022, US inflation peaked to 9.1%. However, it has slowed in each month since. The drop comes after the Federal Reserve (Fed) increased interest rates from 4.25%-4.5% to 4.5%-4.75% in February 2023. So far, this is the Fed’s eighth hike since rates were raised in March 2022 from 0%-0.25%. Over time, the Fed wants to return inflation to its 2% target.

Top 10 Countries with the Lowest Inflation Rates (According to a report from Trading Economics Jan 2022)

  1. Rwanda— -2.0%
  2. Chad— -0.5%
  3. Maldives— -0.2%
  4. Gabon— 0.6% (tie)
  5. Japan— 0.6% (tie)
  6. Bahrain— 0.7%
  7. Fiji— 0.8%
  8. Vanuatu— 0.9% (tie)
  9. Bolivia— 0.9% (tie)
  10. Saudi Arabia— 1.1%

Incredible Facts About Transportation Logistics and Its Effect on The Global Supply Chain

Transportation logistics is a crucial component of global supply chains, ensuring that products and services are delivered efficiently and effectively to consumers around the world. However, the transportation and shipping industry faces a range of challenges related to infrastructure, technology, regulation, and social responsibility. Understanding the facts and trends related to transportation logistics can help businesses navigate these challenges and ensure the smooth operation of global supply chains. In this section, we will explore some key facts and trends related to transportation logistics.

  • The supply chain transportation sector is responsible for over 50% of nitrogen oxide (NOx) emissions in the U.S.

Over-the-road transportation and shipping account for a high level of greenhouse gas emissions. The Environmental Protection Agency (EPA) estimates that industrial truck use contributes to 50% of the NOx emission total for the entire United States. Additionally, 30% of the nation’s hazardous organic compounds and 20% of its particulate matter emissions come from road-based transport.

  • Global roadway emissions are 70% higher now than they were in 2005

Experts feel that this increase is due to the increase of semi-trucks and last-mile delivery vehicles. In addition, increased shipping through vendors like Amazon has also added to the emissions. In fact, the Amazon last-mile delivery model results in 35% more greenhouse gas emissions.

  • Nearly 4 million people are employed in transportation sector

According to the Bureau of Labor Statistics (BLS), the U.S. is home to nearly four million transportation employees. The BLS classifies transportation as “the transportation of passengers and cargo.”

  • For every truck of goods delivered to American supermarkets, 400 cars are needed to transport the goods to American homes.
  • By 2027, the same-day delivery market is expected to reach $20.36 billion

Fun Facts About Warehousing and Storage Operations

Warehousing is the process of storing goods which are to be distributed later. A warehouse is defined as any place which is used in the accumulation of goods. Warehouse logistics are an essential part of global supply chains, ensuring that goods are stored, organized, and shipped efficiently. From automated systems to cutting-edge technology, there are many intriguing facts about the functions of warehousing, warehouse solutions, and warehouse logistics operations. In this section, we will explore some facts and trends about warehousing logistics operations management and their impact on the global supply chain.

  • Only 22% of companies have a proactive supply chain network – Businesses with proactive supply chain management operations can address shifts in supply and demand before they become critical. During the pandemic it was found that less than 25% of businesses operate with proactive supply chain management strategies.
  • 43% of small businesses don’t track their inventory levels – Additionally, 21% report that they do not have inventory storage.
  • On average, U.S. retail operations have a supply chain accuracy of only 63% – This can result in significant delays and re-stocking issues. For example, 34% of businesses have shipped an order late due to selling a product that wasn’t in stock.
  • More than 80% of storage facilities and fulfillment warehouses around the world do not use automation as a warehousing solution However, since last decade approximately 15% of the warehouses are being mechanized, while only 5% are using sophisticated automation equipment, business tools, and warehouse solutions to make sure products are picked, packed, and shipped.
  • The average size of a warehouse today is more than 180,000 square feet, compared to 127,000 square feet between 2000 – 2006 – In addition, due to increased footprints, average warehouse renting rates increased by 28% between 2011 and 2015.
  • The first warehouses were invented in the Late Stone AgeThe process of storing dates all the way back to a period of time between 10,000 and 50,000 years in the past. The first warehouses (basically, stone storage pits) were designed to enable one of the greatest advantages of warehousing – storage – for seeds and food.
  • 9% of distribution centers and warehouses handle only full pallet orders. This is compared to 46% that handle a mixture of pallets, cases, split cases, and pieces – In the past, many fulfillment centers could operate by shipping only full pallet orders. The rise of e-commerce has brought a rise in split case orders and even single-unit shipments, which rely much more heavily on automation technologies to be efficient compared to full-pallet orders.
  • Walking and manually picking orders can account for more than 50% of the time associated with picking orders – By leveraging automation technologies like racking systems, conveyors, and sorters, time spent by human warehouse workers walking can be reduced by up to 40%. In addition, the decrease in walking can improve the occupational safety and health of warehouse workers.
  • Automated Storage and Retrieval Systems (AS/RS) have the potential to increase order accuracy levels to above 99.99% – By integrating directly into a warehouse management system, AS/RS removes a large percentage of human error associated with picking and shipping orders.
  • 4% of supply chain managers use Excel spreadsheets as a warehouse and storage management tool.
  • Pick-to-Light systems can improve pick rate productivity by 30-50%
  • Pick-to-Light, RFID, and Pick-to-Voice technologies reduce picking error rates by 67% compared to manual paper-and-pen methods
  • Amazon’s warehouses space has more square footage than 700 Madison Square Gardens and could hold more water than 10,000 Olympic Pools
  • Amazon has around 100,000 robots in use in their distribution centers across the world
  • Labor costs constitute, on average, 65% of most warehouse facilities’ operating budgets
  • The warehouse and transportation industry sees costs more than $84 billion per week due to serious, non-fatal injuries.
  • The NASA vehicle assembly building is so big (348,000 sq. feet), it has its own weather, even producing its own rain clouds.
  • Over the next 10 years, there will be too many jobs to fill in the manufacturing operations industry. With roughly 3.5 million new jobs created in the sector, nearly 2 million will go unfilled
  • Over the last 25 years, there has been a 400% spike in the amount of exported goods manufactured in the United States
  • At least 300,000 new jobs are created every year in the United States for the logistic industry
  • The Boeing Everett factory is not only the largest warehouse but the largest building in the world coming in at 3 million square feet.

 

Conclusion

This Datex Fast Facts blog covers a multitude of incredible and interesting facts and statistics regarding everything from warehouse management systems to the most effective supply chain management strategies. It also includes facts about supply chain leaders and the latest happenings with supply chain organizations. Many of these trends and facts point to supply chain transformations that have helped improve business logistics that are optimizing the supply chain. In addition, they point to investor relations resulting in increased supply chain risk management and environmental social governance that improve the ways supply chain operate.

Additionally, this Datex Fast Facts blog also contains a number of facts regarding the 3PL warehousing and transportation industries, and how they affect the global supply chain. Among the most pertinent facts are those that help us understand how the digital transformation of supply chains has adjusted how businesses store inventory, improved shipping solutions, as well as the safety and health of workers.

Many advanced technologies used in smart warehousing such as machine learning, artificial intelligence, cloud computing, digital twins, and other technology solutions have positively impacted supply chain performance and warehouse logistics. They have also contributed to the ways businesses reach their target market to gain a competitive advantage.

What Makes Datex Different?

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