The Friday Report: July 12th, 2019

Quick wrap up of a few hot topic newsworthy stories in the supply chain logistics industry

Bed Bath & Beyond in Free Fall

 The pressures of modern retailing have taken their toll on major retailer Bed Bath & Beyond.  The industry giant reported that sales decreased 6.6% during the last quarter at stores open at least one year.  Q1 2019 also saw losses.  Bed Bath & Beyond has lost nearly 90% of the value of its stock over the past five years and is in danger of dropping below $10 a share.  Shares recently dipped to a 20-year low.

The company recognizes that it needs a “fundamental change to their approach” and is searching for new leadership.  Bed Bath & Beyond has remodeled over 30 stores in different layouts.  Designed to give shoppers better views of merchandise, these new “lab” stores will be monitored to determine the success of new ideas.

In the crowded home goods industry, big box stores such as Walmart and Target have launched lower cost private label home brands.  Online retailer Wayfair has leaned heavily on advertising to familiarize consumers with its brand.  Home goods at Bed Bath & Beyond typically tend to be about 10 percent higher than similar items on Amazon and discounters TJ Maxx and HomeGoods have continued to magnify their presence.

Shopify Reveals Fulfillment Network and Digital Inventory Optimization Tool

Shopify is pumping up the volume with two new products.  Recently announced, Shopify revealed a new digital inventory optimization tool.  The tool identifies fulfillment centers in closest proximity as well as the optimal inventory quantities in each location.  This will help to ensure that consumer desires for fast, low cost delivery can be met.

In addition, the company launched Shopify Plus for fast growing retailers with larger scale operations.  This provides a unified view of all stores, enabling improved integration of operations.  Data-driven solutions can be game-changers in the complicated world of e-fulfillment.   Companies that rely on these types of technologies tend to lead industries and be more competitive.

Shopify also announced that it is utilizing machine learning technology to facilitate low cost, fast delivery.  With these new offerings, Shopify hopes to increase its appeal to small and medium sized businesses, the heart of its target market.

South Korea Poised to Invest $854 Million Per Year in Micro Chip Supply Chain

Amid all the hubbub of trade disputes and threatened tariffs, more changes are afoot globally.  As Japan tightened curbs on exports of high technology to South Korea, the country announced that it plans to  develop home-grown materials and equipment needed to produce micro-chips.

A recent dispute between Japan and South Korea regarding South Koreans who were forced to work for Japanese firms during World War II resulted in tighter regulations on Japanese materials exported  to South Korea.  The materials are used in the production of smartphone displays and chips.  The two chemicals targeted are essential and could restrict production by Samsung Electronics and SK Hynix.

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