Flexport, a digital-focused freight-forwarding company, is set to rival Amazon in the fulfillment services sector after purchasing Shopify’s logistics business. The acquisition includes the Deliverr technology platform and numerous warehouses and sorting centers. With this move, Flexport aims to target retailers more directly and establish itself as a key player in fulfilling online orders for merchants.
Flexport On Expansion Mode
The transaction positions Flexport as a potential competitor to Amazon, which currently dominates the fulfillment services market. Flexport’s CEO, Dave Clark, previously served as an executive at Amazon and played a pivotal role in expanding the company’s logistics network.
On the other hand, Shopify is shifting its focus away from building its logistics operation. The sale of Deliverr and warehouse robotics company 6 River Systems to U.K.-based online grocer Ocado signifies Shopify’s strategic decision to exit the logistics sector.
Partnering with Flexport allows merchants to handle imports and last-mile delivery seamlessly through a single platform. Additionally, they can fulfill orders directly from their websites and physical stores.
The acquisition of Shopify’s logistics business by Flexport aligns with the company’s vision of providing end-to-end logistics solutions for e-commerce merchants. By integrating Deliverr’s technology platform and leveraging its extensive network of warehouses and sorting centers, Flexport aims to streamline and optimize the fulfillment process for its customers.
The move highlights the growing importance of e-commerce fulfillment in the rapidly evolving retail landscape. As more consumers turn to online shopping, merchants must ensure efficient and reliable order fulfillment to meet customer expectations. Flexport’s acquisition of Shopify’s logistics business positions the company as a significant player in this space, offering merchants a comprehensive solution for managing their supply chain from importation to last-mile delivery.
A win-win for online retailers
With Dave Clark’s expertise and experience from his tenure at Amazon, Flexport is well-positioned to leverage its logistics service and provide merchants with innovative and competitive solutions. The integration of import handling, last-mile delivery, and website/store fulfillment through a single platform simplifies logistics management for merchants, potentially enhancing their operational efficiency and customer satisfaction.
Flexport’s acquisition of Shopify’s logistics business strengthens its position as a formidable contender in the e-commerce fulfillment industry. By combining their technological capabilities and expanding their network of warehouses, Flexport aims to offer merchants a comprehensive solution that rivals Amazon’s fulfillment services. This strategic move underscores the growing significance of efficient and streamlined logistics operations in the e-commerce secto
For the first time since March 2020, the private sector activity recorded improvements in June. This has been due to ease in restrictions that had been initially imposed due to the COVID-19 pandemic. Though there has been a tentative rise in work orders, a reduced workforce is being done due to the pandemic. According to the latest Purchasing Manager Index (PMI) issued by the research firm-IHS, Markit, “Confidence about the business outlook continued to improve, reaching the highest since March.”
Hopeful signs with June scores
David Owen, an economist with the IHS Markit, has stated, “The latest survey data offered hopeful signs for the Dubai non-oil private sector.”
The IHS Markit numbers show the immediate beneficiaries to be the construction sector, wholesale, and retail sectors for the first time since March as they have shown significant “activity growth.” These sectors have benefitted from the ease of restrictions, while the travel and tourism industry did not show a positive note.
Another significant point that cannot be missed is that though more orders keep coming in, severely hit firm had laid off staff due to the pressure to lower costs. Since March, the drop in employment has been sharp and broadly in line with the average. This led to a record low in April, thereby showing that the business expectations were much weaker than before the onset of the COVID-19 pandemic.
Owen reaffirmed, “Firms direly need a boost to cash flow, as many have been left struggling with low revenues and high-cost burdens in June.”
Comparatively, June’s 50 scores showed significant improvement on May’s 46 reading. A score below 50 signifies an economy and business activity in contraction mode.
It’s easier than anywhere else in the Middle East and North Africa (MENA) to set up a business in the United Arab Emirates (UAE). According to the World Bank’s Ease of Doing Business 2019 report, UAE ranks 11th and is far ahead of its neighbours in terms of infrastructure. Along with its strategic location, tax benefits and low import duties, a business can be set up in 2 days. With liberal new business licensing for foreign investors and a modern judiciary system, business setup in the UAE has attracted companies from all over the world.
UAE’s strategic location makes it the centre of some of the world’s most important trade and commercial routes from ancient times to even today. Having a foothold on UAE soil assures you of access to the markets of Asia, Africa, Southern and Eastern Europe and the Middle East. With state-of-the-art facilities and infrastructure to facilitate international trade, UAE is the ideal location for businesses looking for new markets.
BENEFITS OF BUSINESS SET-UP IN THE NORTHERN EMIRATES
UAE is dotted with free zones across all its emirates, from Dubai to Abu Dhabi to the northern emirates of Ajman, Sharjah, Um Al Quwain and Ras Al Khaimah. But the high cost of living and business set up, rents and other overhead expenses can be a deterrent for companies to start businesses in Dubai and Abu Dhabi.
The northern emirates of UAE like Sharjah, Ras al Khaimah, Fujairah, Umm al Quwain and Ajman have much lower rentals and living and business expenses. With cheaper labour forces and warehousing costs, your business overheads can be brought down drastically thereby increasing your profit margins.
ADVANTAGE SHARJAH
Sharjah, the third-largest Emirate is also known as the cultural capital of the UAE. From the Hamiriyah Free Zone to Sharjah Airport Free Zone, Sharjah Publishing Free Zone and Sharjah Media City, these free zones provide the same infrastructural benefits but at the fraction of the cost when compared to Dubai.
Centrally located between Europe and East Asia, with convenient access to major international airports and ports on both the Arabian Gulf and the Indian Ocean, Sharjah is a strategic investment destination. A highly diversified economy, Sharjah is the cultural hub, industrial and a centre of educational excellence. With huge earning potential, tax exemptions, and liberal government policies, company set up in Sharjah free zones is streamlined but requires considerable planning and proper execution.
Sharjah’s free zones provide cheaper warehousing options than the other more popular destinations. Warehousing and storage can be a costly business expense, with varying benefits depending on where you are in the UAE.
SAIF ZONE OR SHARJAH AIRPORT FREE ZONE
SAIF zone or Sharjah Airport Free zone is a premier business destination with easy access to the Sharjah International Airport and the seaports. With advantages like custom-made offices/spaces, warehousing, cheaper energy, human resources and accommodation and IT services, SAIF is an entrepreneur’s dream destination.
The free zones in the Northern Emirates like Ras Al Khaimah Economic Zone UAQ FTZ – Umm Al Quwain Free Trade Zone, Fujairah Free Zone Authority (FFZA), Hamriyah Free zone Authority (HFZA), Sharjah Media City (SHAMS), Creative City Fujairah can provide the facilities available in the logistics hub like Dubai at more economical costs for companies looking for cost-cutting to bring down their annual warehousing expenditure.
ABOUT CSS KINGSTON LOGISTICS
CSS Kingston Logistics FZE offers 3PL facilities, a first-of-its-kind in Sharjah Airport International Free Zone (SAIF). A joint venture formed between the CSS Group, the leading logistics solution provider in the Middle East/South Asia, and Kingston Holdings, CSS Kingston has a variety of 3PL activities to enhance the business environment in the region.
CSS Kingston Logistics has been fully operational from 1st of June 2020 and is part of our expanding network across the Middle East and South Asia regions. The newly operational office cum warehouse is situated within the Hamriyah Free Zone and is yet another milestone for CSS Group portfolio.
CSS Kingston Logistics FZE in SAIF zone boasts high-quality warehousing space and infrastructure, fully integrated supply chain processes, reverse logistics and 3PL facilities. It also offers full-service warehousing and distribution services. The CSS Kingston network spans across six continents.
Our logistics solutions cover a broad range of businesses and industries, providing customized and efficient logistics for each client including Non-Vessel Operating Common Carrier (NVOCC), Ocean Freight Management, Air Freight Management, Land Transportation Management, Industrial Packing, Crating & Lashing, Multi-modal Operations, Container Freight Station (CFS), Yacht & Marine Logistics and more.
With most 3 PL providers located at Jebel Ali, Dubai, CSS Kingston can service the requirement of a wide range of industry verticals from automobiles, electronics, auto spare part, lubricant, marine, to construction, manufacturing, food, hotel industry and more.
The repercussions of the coronavirus spread are felt across the commercial world. Due to the extremely connected global economy, the effect is going to be widespread and will last for a long period of time. In the wake of the pandemic, supply chains will need to undergo a radical transformation. Most countries are slowly coming out of the lockdowns that were imposed to contain the virus spread. With governments unlocking economies, every organization needs to assess their exposure and plan how they can support their key stakeholders, employees and customers.
Resilient relationships with suppliers
Disruptions can be kept at a minimum by developing collaborative and resilient relationships with critical suppliers. Spot opportunities in the face of challenges and then reset the current working models. Companies who are able to adapt their supply chains according to their Covid-19 exposure will emerge resilient and will be able to withstand other contingencies they might have to face.
The key areas that need attention are:
Safety of the people: the HR department should ensure the physical and emotional health of the employees with the apt advice for those placed in impacted areas. Practice corporate social responsibility (CSR) regarding employee stability, environment, wider society and economy, and pursuing ways to support response efforts.
Strategic team formations: Form a special team to maintain constant flow of the right information between key stakeholders; this will help in sustaining stakeholder confidence and customers about the impact. Establish a team to focus on supply-chain assessment and risk management to assess global and regional supply-chain flows, utilising alternative modes of transportation and conducting trade-offs according to the needs, cost, service and risk scenario analysis.
Review capital and business processes: It’s time to review your review your cash flow, working capital management and inventory forecasts along with the supply and demand predictions. The days ahead are bound to be financially strained due to further stock market declines and restricted access to funding. Strategic business planning needs to be synchronized across all business processes. Businesses with data rich environments can harness capabilities in procurement, operations and research and development (R&D), using advanced simulations to identify optimum performance trade-offs.
Micro supply chains: The chief focus of the supply chains of today is cost reduction and spurred the creation of large, integrated, global networks which have grown in proportion with outsourced manufacturing to emerging economies, backed by long-term contracts. Covid-19 has raised many a question, whether this is the way ahead. Shifting to micro supply chains can prove to be efficient and effective in the long run.
Improved supplier relationships: Now is the time to build collaborations with crucial suppliers based on trust and transparency.
Warehousing industry in India is one of the prominent market segments in total Logistic Sector. Implementation of GST & various E commerce as the two important factors that have created significant growth prospects for the warehousing sector in India. Experts claim a total of approximately 43,000 Crore rupees investment scope by 2020 in this sector.
There are various factors which helps warehousing sector to boost to its peak in Indian market.
1. Growing manufacturing activity under “MAKE IN INDIA” campaign driven by current government
2. Rising domestic consumption
3. Increasing International trade
4. Increasing in Organic harvesting
5. Growing investment of Indian & foreign in warehousing infrastructure
6. Ease of Government rules is last but not the least
In present scenario the warehousing industry is approximately 560,000 crore rupees excluding inventory carrying cost which amount to another 4340 thousand crore rupees with a minimum growth of 10% annually. The industry although is facing a lot of difficulties due to improper cargo flows, improper infrastructure, limited capability of carrying capacity so on and so forth.
Industrial / retail warehousing is major contributor in total warehousing industry with its 55% of total market share followed by 14% – 15 % Share by CFS/ICD, Agri warehousing & Cold store.
Industrial Warehousing is approximately 310 thousand crore rupees market with a basic growth of 10-12% in recent past. Some major players in Industrial warehousing are DHL, Safeexpress, Continental warehousing, Indo Arya, All Cargo etc.
Agri warehousing accounts 15% of total market share with an annual growth of 9-10 % in past few years mainly due to growing annual agriculture production, standardized warehousing operations as per Warehousing development & regulation act, subsidy scheme & Tax Incentive. Key players in Agri warehousing are Food Corporation of India (FCI) and Central Warehousing Corporation (CWC). Although 30 % of Agri Warehousing is still operated by unorganized small warehouse owners.
Cold stores accounts of almost 16 % of total warehousing industry and it expected to grow at 15% per annum on a sustained basis over the next 5 years with the organized market growth at a faster pace of 20%. Some significant players are Snowman, Gati Kausar, Cold Star, ColdEx, Kelvin Cold Chain etc.
Last but not the least is Container handling & storage. ICD/ CFS accounts almost 14% of total warehousing market in India and in past 3 years it has grown 10-15 % with almost 90,000 crore rupees market value. Government initiatives, faster container rail transport & secure cargo movement is the main reason for sudden growth rate in containerized movement of Cargo. The government run CONCOR (Container Corporation of India Ltd) continues to be the largest player operating 48 terminals which handles EXIM Cargo while 14 others handle domestic traffic only.
In today’s scenario Warehousing is not only for storage and transport service it is fast emerging as strategic end to end solutions that improves efficiencies with organized & skilled professional services. The fast growth in retail, automotive, manufacturing, pharmacy and agriculture along with GST in India is expected to give a proper thrust in Warehousing & Logistic business.
GST, an abbreviation of Goods and Service Tax has been finally implemented in India effective 1st July 2017. It is very early to judge after effect of GST ON Shipping & Logistic Business but in short Terms review we find some positive & negative impact of GST. First we will see in short which seems to be Negative Impact of GST …
The worst affected are local traders now a days after GST Implementation , who from last so many years doing the business on CASH and not giving Tax to Government as desired. The Export & Import Trading business in India is very low now a days because of this problem reducing down the volume by approx 19%
The small export house are also affected as the RAW material has been priced hiked due to implementation of 18 % GST. Also due to GST implementation STAR EXPORT HOUSES and small / middle scale export house are now in same platform keeping competition a mammoth task for them
The Custom is still not clear regarding the impact of GST and no proper Guidelines made available to Custom and trade persons to tackle GST , which un necessary slowing the process of Custom clearance in Indian Ports.
Now, we must see the Brighter Side of GST, Al though it is not feasible to foresee the changes within 30 days of implementation of it, because nothing will change abruptly and it is a slow process which will finally become beneficial for Country…
As per Road and Transport Ministry the distance travelled by trucks per day has increased by at least 30% post the rollout of goods and services tax (GST), according to a document prepared by the road transport ministry on the impact of GST on logistics sector. Trucks are covering 300-325 km a day on an average against about 225 km a day before GST, it said.
The implementation of GST helped Star Export house to reduce their price in Export commodities as they do not have to pay VAT, STATE TAX and various other tax when they purchase RAW MATERIAL.
One Nation and one Tax this is the prime moto of GST and it replaces several State & Central Tax implications on everybody on Logistic Field also.
As per planned if everybody get the Reverse CENVAT TAX Credit then everybody will see the Huge impact on Export & Import business.
Let’s Hope for the best , indeed it is a very brave & great step to implement GST provided everything goes at planned.
How long will it take to stabilize the economy? On 8th November 2016 India makes another abrupt history when Indian Prime Minister Mr. Narendra Modi announced Demonetization of High denomination Notes with immediate effects. The step has been taken into consideration to stop Black Money, Fake Currency Note, Inflation & fight against terrorism. To some extent the Demonetization abolishes Terrorism, Black Money in India but Growth of any Country depends upon its Export Import Trade and indeed it is very crucial for India too. After demonetization however Exports have slowed down due to currency crunch. The Trading Market almost demolished due to the fact that this market operates in Currency Notes only. True to its core that instability in the Exports leads to inflation and that in turn leads to an uncertainty of internal purchasing power and unstable economy. The Foreign Trade industry is suffering in the aftershocks and shall continue to suffer for a further period, though for limited time as per Trade Experts. Government’s decision to ban use of old Rs 1,000 and Rs 500 currency notes is expected to impact adversely the growth of export-import (EXIM) trade, shipping giant Maersk Line said in a report. “Trade wise, Maersk Line expects India’s EXIM growth in the fourth quarter (October-December) to be slower than third, as a result of the demonetization exercise undertaken by the government in November this year,”…. the global containerised division of the Maersk Group said in a statement. However the influx of money from the black market shall certainly improve to be beneficial in the long run for Export Import Trade. The fact lies at the moment that plunge in money supply with overflowing bank deposits ring an alarm in consumption demands, means decline in imports. The Indian Government has always paid incentives and promoted Export with easy policies. Nonetheless the Exports market is taking a toll at the moment. “ Make in India” projects need easy flow of currency for manufacturing, hence the Import and Export both trade have got their bottlenecks as of now and nobody is sure how much time it requires to be back on business… Demonetization is indeed a great move by Government to fight against corruption, fake money, black money, terror financing and long term economic gains and for a greater cause it is inevitable that for a few months Indian’s Export trade will be slow but as per experts considered it is a bold step taken by Indian Government to strengthen our GDP the future of Indian Export Import trade looks promising for coming 2017.
The logistics industry in India is growing slowly but steadily, with introduction of E- commerce , Economic reformation by proposed GST , Initiative like “ MAKE IN INDIA”. Today we will see what positive & negative impacts can happen in Logistics Market for Modi Government’s proposed GST which will be implemented from 2017 calendar year…. Logistic Industry in India is primarily categorized into warehousing, land/road transportation, freight forwarding & value added service in which transportation contributes almost 60% on whole logistics part in India followed by almost 25% on warehousing, 10% on freight forwarding & rest 5% on value added services. Currently Logistic Industry is suffering from various issues like (a) Complex Tax structure within states in India ( b) Poor Infrastructure (c) Poor / strict Custom efficiency and procedure of Customs , thus being a lower cost service proving country actually logistics cost in India is higher than many countries compared to European Countries. Positive impacts what we can expect for implementation of GST… 1. Indian Road/ Rail transport will be highly beneficial due to removal of multiple/ combined taxes like State entrance Tax/ Chungi/ Octroi/ Exise Duty/ Countervailing duty/ Service Tax, Value added tax/ luxury tax etc. Currently if we combine Centre & State tax for most of the goods it works out to be 26.5 %( Cenvat 14% & VAT 12.5%), whereas post GST implementation the same is expected to reduce to standard rate of about 18-21% which will be levied on most goods and all services. 2. Due to trade barriers such as Entry Tax/Local Body Tax/OCTROI and other hurdles trucks lie idle for 30-40% as per schedule , whereas post GST this will be phased out and logistics time will be improved resulting in improvement in operational efficiency through quicker and increased number of deliveries along with reduction in logistic cost during the transit. 3. Inter-state TAX in India forced corporate to create & maintain warehouses in each state, as per a recent study currently there are around 20-30 warehouses per company, one in every state resulting supply chain must longer & Cost inefficient, but after implementation of GST logistics costs are expected to be decreased at least by 2% which can result immense scope of improvement in India’s Supply Chain management industry. Small but short term negative impacts of GST Implementation. 1. Importers in India will face a hard time which they import goods from Outside India due to Implementation of GST, because after GST the current Educational & Excise Tax of 15% on Import Duty will be charged between 18-21 % resulting increase of overall Custom duty which will result in increased cost in Imported materials. 2. Currently India is not fully IT oriented country , still there are a large number of Trade players who are not organized, they will face major challenges as Logistics Industry is highly competitive which leaves little headroom for margin improvement. CONCLUSION: Implementation of GST in INDIA is an overall welcome initiative by the Indian Government for the collective growth of the country, the rollout of GST, in India would dissolve the existing various indirect tax structure, i.e. multiple taxes that is being split between center & state governments leading to reduction of about 20% of current logistics costs. Due to high Import duty after implementation of GST, Indian manufacturing industry will look out for Indian sources for RAW MATERIAL, instead of importing, which will actually strengthening the Rupees in World market. Deliberating on holistic view the implementation of GST would help the entire Logistic industry in improving the operational efficiency thus cutting the logistics cost & expanding the business prospect through consolidation of logistic players.
Having run and managed many massive warehouse facilities with some of the most complicated supply chains for leading brands in almost all verticals in the past two and half decades, can summarize some of the main ground rules as below. You’d think that the place that holds (typically) more than 80% of a company’s inventory, and sometimes accounts for more than half of its working capital, would get plenty of attention. But only a few companies seem to really pay attention to their stockroom or warehouse, or the five processes that affect it. (Receiving, put-away, picking, shipping and maintenance, where “maintenance” represents the combination of cycle counting, consolidation, and other processes that maintain the stockroom in good operating order) In my opinion, this is short-sighted. You can’t create a truly lean manufacturing process if you don’t have effective processes to supply materials to the floor. Time and motion study, six sigma through process re–engineering with mapping and having re layouts done can significantly boost productivity. And if it takes a week or more for inbound shipments to move from the receiving dock to warehouse shelves and then out to the production line, you’re robbing other functions (R&D, marketing, even IT) of capital that could make them more effective. That lack of attention represents an opportunity for individuals, to make a difference at their companies or clients. So… here’s my New Year’s gift to anyone who wants to help their company’s supply chain become more capable. (Or… if you are visiting one of your EMS or logistics partners, this might help you to get a better idea of how well they are managing your inventory) These are broad guidelines that are generally valid, in my experience – but there can be exceptions, especially in operations that are very focused. (A stockroom that only holds materials for New Product Introduction will look very different from a manufacturing warehouse for a television or large appliance factory!) But more frequently I’ve found that the disconnects I’ve observed were due to not making necessary investments. (Focused investments in materials handling operations can have considerable ROI. Improving receiving and warehouse performance can enable you to take multiple days out of inventory.) Whether it’s big or small, whether it handles small parts, large items, or a mix, a well-run warehouse will have the following characteristics:
Items will be stored according to a strategy that accounts for the physical size of each item and the frequency with which it is picked.
Items will be managed to make efficient use of available space.
Items will be stored in a way that will keep them safe and in good condition – and will not pose a danger to warehouse workers.
Items will be managed to make safe and efficient use of manpower.
Items will be managed in a way to provide high performance to the warehouse’s “customer” – the manufacturing floor or shipping dock.
Items will be managed in a way to minimize handling.
Problems and issues will be physically separated and handled expeditiously.
Performance and diagnostic metrics will be collected & published.
There are trade-offs between these, especially when resources are limited. If space is limited, a well-run warehouse may decide to pack some of its slow-moving parts into a small space. This make picking those parts less efficient, but it will also increase the amount of space (and decrease handling time) for the frequently picked / fast-moving parts. If automation (forklifts, conveyors, etc.) is limited, the stockroom may use more floor storage. There are also differences in the way that a manufacturing stockroom will operate versus a finished goods warehouse. Outbound shipments tend to be larger, less frequent, and more predictable than inventory movements to the manufacturing floor. So you will usually see a lot more activity in a manufacturing stockroom. What you should see when walking through a stockroom and associated areas like receiving, staging, etc.: 1. Picking processes and storage strategies that are designed to minimize the amount of time and effort spent on the most frequently picked items while maintaining control of inventory. Examples of this include:
Putting the most frequently picked items along the main aisle, at ground level, or near the exit from the warehouse (to the manufacturing area). You might see, for instance, a set of shelves with commonly picked items along the wall by the doorway; or flow racks; or even pallets of materials staged for quick delivery.
A mix of storage methods: pallet racks for items that are received on pallets and are picked in large quantities, flow racks, shelves for small parts storage, etc.
Use of automated identification tools – bar code or RFID. Without auto-ID, workers have to manually keypunch transactions – which will lead to errors.
Guided picking processes, where stockroom workers using RF Barcode equipment are guided through the stockroom in an efficient manner, so that they pick one item, then move to the next shelf for another item, and so forth – instead of moving from one area to another, then back to the original area.
2. Cleanliness and good order – not to the point of obsession, but you should be able to easily see box labels, and items should be stacked neatly. There should be a clear distinction between each storage location. Usually that means a physical barrier (like a metal divider) or air – so it’s obvious which items are in each location. 3. Clearly visible bin (location) IDs on the shelves & racks, to identify each individual storage location. 4. Generally, one item stored per location. There can be temporary exceptions to this rule when a stockroom or warehouse is near or over capacity, but multiple part numbers in the same location will lead to picking and inventory errors if allowed to become normal practice. 5. Attention to safety and ergonomics, including adequate lighting. Workers shouldn’t have to spend their days kneeling on the floor, nor should they be asked to frequently pick up heavy boxes. At minimum, you should see manual conveyors, tables, and carts for workers to use while receiving and picking goods. If forklifts operate in the aisles, there should be obvious attention to safety requirements. 6. A small area holding received goods that can’t be processed, items in “quarantine” and other problem items. The items in this area shouldn’t have aged more than a week or two. (Yes, there are exceptions to this. But they should be true exceptions – you shouldn’t see lots of aged problem items.)