While it seems that every supply chain is global these days, many companies are struggling to "go global" effectively. Navigating language barriers, cultural differences, and brand consistency can be challenging for even the most globally minded companies.
One particularly troubling variable is making sure that the customer experience is consistent across all languages—and U.S. companies are not faring well in this aspect, finds new research from Forrester Consulting.
In fact, fewer than one-quarter of U.S. companies are able to offer a consistent online customer experience in multiple languages, the report shows.
Compared to European marketers, half as many American marketers say that their brand values are well represented in all their supported languages.
As a result, only 24 percent of U.S. marketers say that their customer experience is consistent across all languages, compared to 54 percent in Europe.
Overall, language and translation issues are cited by 37 percent of the survey's total respondents as the main barriers to effective global management. Another 35 percent list cultural differences as the top concern.
Considering these stumbling blocks, global commerce has become a double-edged sword for many U.S. companies, says Chris Boorman, chief marketing officer for SDL, a U.K.-based global information management firm that commissioned the study.
"The fact that so few U.S. companies have effectively managed their brands internationally—despite acknowledging foreign culture as such a big stumbling block—reveals real pessimism on the part of American business," he notes.
"U.S. enterprises accept the difficulties presented by foreign markets, but seem unwilling to make the strategic decisions that are imperative for global commerce success."
Though most of us only recently said goodbye to summer, the nation's major retailers are already thinking about the winter holidays. To protect against unforeseen supply chain disruptions and ensure their goods are on the shelves for the all-important holiday shopping season, retailers are preparing for the peak shipping climate earlier than ever.
As a result, traffic at the nation's major retail container ports is expected to top last year's record high for three months in a row beginning in August, according to the monthly Port Tracker report from the National Retail Federation (NRF) and consulting firm Global Insight.
August totals should exceed the record set last October; September will be slightly slower than August, but will still top last October; and this October will set another new record, Port Tracker predicts.
The report estimates the following cargo totals for the next three months: 1.56 million TEUs for August, up 5 percent from August 2006 and beating last October's record of 1.51 million TEUs; 1.52 million TEUs in September, up 2.1 percent from last September; and 1.57 million TEUs in October, traditionally the busiest month of the year, a 4.1-percent increase from one year ago and a new record.
"This pattern of new records being broken early shows that retailers are bringing holiday season merchandise into the country sooner than in the past," explains NRF Vice President and International Trade Counsel Erik Autor.
Despite the heavy volume, most retail ports are operating without congestion. U.S. ports covered by Port Tracker—Oakland, Tacoma, and Seattle on the West Coast; New York/New Jersey, Hampton Roads, Charleston, and Savannah on the East Coast, and Houston on the Gulf Coast—are all currently rated "low" for congestion.
Though Port Tracker recently rated the ports of Los Angeles and Long Beach as "moderate" because of a possible office clerical union strike, the threat has been resolved, and the ports have returned to their previous "low congestion" rating.
Think of hotspots for European contract logistics and Finland is not likely to be your first choice.
But surprisingly, the Nordic region boasted some of Western Europe's highest growth rates for contract logistics in 2006, according to European Transport and Logistics Markets 2007, a report from UK-based research organization Transport Intelligence.
Finland in particular benefited from increasing trade with Russia, and is positioning itself as a gateway to fast-growing markets in the East.
The United Kingdom also fared well in the contract logistics market last year. Its above-average showing was strongly influenced by positive international logistics activity, and domestic demand growth.
Growth in some of Western Europe's more developed nations, however, was slower.
In Germany, low domestic demand resulted in below-average growth despite buoyant imports and exports, while Spain experienced a reversal of the factors that had driven growth in its contract logistics market—strong domestic consumption made up for relatively low levels of international trade.
The Netherlands also suffered from weak domestic demand, but benefited from global trade due to its popularity as a location for European distribution centers, finds the report.
Overall, the contract logistics market in Western Europe grew 6.7 percent in 2006 to reach $66.7 billion.
"It was another strong year for the contract logistics industry in Europe," notes John Manners-Bell, chief analyst at Transport Intelligence. "Most countries experienced solid growth, with markets at the periphery of the region enjoying the most significant development, albeit from a smaller base."
One nation generating a lot of attention within the transportation world is the United Arab Emirates (UAE). The UAE—and the city of Dubai in particular—has become a leading marketing and trans-shipment hub for multinational companies serving the Middle East and North Africa.
Thanks to its location on the border of the Gulf of Oman, the Persian Gulf, Saudi Arabia, and Oman, the UAE is strategically placed as a regional hub and gateway between Europe and Asia.
U.S. imports into the UAE reflect this ideal location: imports grew nearly 41 percent from $8.5 billion in 2005 to $11.9 billion in 2006, making the UAE the top U.S. export destination in the Middle East, according to the National U.S.-Arab Chamber of Commerce.
As businesses increasingly export to the UAE or establish the country as a key link in their global supply chains, what are some trends and issues that companies should keep in mind to succeed in the region?
Len Casley, general manager of JPMorgan in Dubai, offers the following tips for incorporating the UAE into your global supply chain.
Educate key players on export controls. Nearly 25 percent of all goods imported into the UAE are then re-exported to regional markets. As a result, companies using the UAE as a transshipment hub may face high fines or penalties if goods are re-exported to countries or individuals that appear on international restricted party lists.
In the United States, fines to companies violating export regulations—unintentionally or otherwise—have reached the $100-million mark. Be sure the key supply chain players in your organization are aware of these fines.
Stay current on regional trade regulations. Because regional trade challenges, trends, and regulations change quickly, it is often challenging to remain up to date. One key is to obtain real-world insight into actual Middle East trade challenges and how other companies are addressing these issues.
Leverage free-trade agreements. The UAE is currently pursuing free-trade agreements (FTAs) with the European Union, Australia, New Zealand, and Japan; and is negotiating a bilateral FTA with the United States, bringing both challenges and opportunities to companies conducting business in the region.
The complexity associated with understanding and leveraging FTAs requires devoted expertise, resources, and technology. It is essential for companies to identify people within their organization who can focus on FTA issues and opportunities.
Choose the right supply chain partner. A local supply chain/logistics expert with regional knowledge can help companies navigate the UAE's economic landscape. Look for a partner possessing processes and systems that aid in employing state-of-the-art and regulatory-compliant trade operations.
In addition, finding a partner with regional expertise is key to understanding local rules and regulations; properly assessing appropriate trade lanes; selecting qualified service providers; and outlining activities that reduce risk, improve compliance, and streamline the flow of regional cross-border shipments.
Though nagging doubt about RFID's future persists among some naysayers, recent developments in the global RFID market suggest the technology isn't going anywhere.
And RFID's potential is particularly robust in China, according to new research from technology consulting firm IDTechEx.
For the first time, China has become the world's largest market for RFID by value. In 2007, East Asia's RFID spend will reach $2.7 billion, and the majority of this—$1.9 billion—will come from China, shows the RFID in China 2007-2017 report. China is spending the bulk of these funds on a 900-million-people national ID card system to be implemented prior to the 2008 Olympics.
The country is also spending $.25 billion on other RFID tags and systems, largely related to transport, cash replacement, and secure access cards.
Though China's spending on RFID will likely sink below the United States and Japan once it completes its ID-card program, predicted RFID growth in sectors such as supply chain applications, transportation, manufacturing, and the military will likely make up for this drop within 10 years, the report predicts.
Of RFID suppliers in China, the leading 12 companies account for $722 million of the Chinese RFID market size in 2007, finds IDTechEx. Many suppliers are involved in the ID card project, but China also is home to leading RFID suppliers to the semiconductor and chip design industries.
In addition, global companies are eyeing China's RFID growth for their own market potential—Texas Instruments, STMicroelectronics, lnfineon, EM Microelectronics, and Atmel, for example, are investing in China's RFID market.