Black Friday planning by Inovys Logistic

What is Black Friday?

Black Friday is an event that originated in the US and takes place every year on the first Friday after Thanksgiving. This is the date when, according to a tradition consolidated in the 1960s, American stores offer special discounts to encourage shopping and kickstart Christmas purchases. The following Monday is known as Cyber Monday and involves consumer electronics products. Cyber Monday 2017 was the most profitable shopping day ever in the US. Online transactions generated over $6.5 billion, an increase of 16.8% over the previous year. Along with other traditions, Black Friday and Cyber Monday have taken place in Italy for some years. Logistics shares significant responsibility for the success of these two major occasions of unbridled shopping (with on average 30% more purchases in various sectors). In fact, most purchases are now made with a simple click, without the need to leave home to visit the various stores. Online purchases for Black Friday exceeded €1 billion, a 35% increase on 2017. Once the order has been sent, the customer – happy to have obtained a product at a greatly discounted price – expects to receive it quickly.  Alfred Ndou, Warehouse Manager at Inovys Logistic, talks about how he handled the planning together with his team from the very beginning to ensure a successful Black Friday. Ndou: ‘The whole logistics chain must function perfectly, starting with the picking. Mistakes or delays can turn the opportunity of Black Friday into a black moment.

How is Black Friday planned in terms of logistics?

Before Black Friday

Black Friday required long preparation, which began about 6 months before the day itself. The starting point was recruiting additional personnel to handle the significant increase in orders. During the selection phase, preference was given to personnel with experience in the logistics sector to enable faster learning, given the tight deadlines involved. Later on, they underwent both theoretical training (delivery and explanation of the procedures) and practical training (shadowing an expert operator) so as to always guarantee the quality of the service. Immediately after this, the physical spaces for e-commerce were reorganized in view of the physical space limits and the impossibility of adding new workstations for such a short period, while processes were optimized to increase productivity. During the Black Friday preparation phase, stress tests were carried out which consisted in accumulating orders made during the weekend to simulate the possible situation encountered. These tests provided an understanding of where to take action to improve the packing and picking processes.    

During Black Friday

Periodic meetings were held at the beginning of each shift to keep the feeling of unity alive and the following were shared with the whole team:

Post-Black Friday considerations

Thanks to close collaboration and sharing objectives, the Black Friday planning paid off. This reinforced the importance of planning in logistics and successfully fulfilling all the orders that arrive around Black Friday.  

Strategic logistics outsourcing

Outsourcing is when a company entrusts operations involving its goods to a logistics partner, rather than carrying them out directly. There are different outsourcing options. One consists of full delegation to a logistics provider with its own spaces and manpower, while the other consists in entrusting only part of the logistics process to third parties, for example road transport, while the other activities remain the responsibility of the client company. Relying on a partner to outsource logistics services has various benefits. First of all, greater operational flexibility and the ability to focus on your core business. L’outsourcing strategico della logistica Another key aspect is cost reduction. Outsourcing reduces staff, storage and transport costs. There is thus no longer a need to invest capital in buildings, plants and personnel. The decision to outsource your logistics entails choices with a significant and complex impact on the company. First, it is necessary to conduct a feasibility study and entrust the role to a partner who can guarantee an excellent service by defining all the technical, performance and contractual aspects. Objectives will subsequently be established with a view to common growth. An outsourced logistics system must be able to function in compliance with the methods and timings dictated by the customer.

Strategic logistics outsourcing

The supply chain is the beating heart of the industrial sector. Properly managed incoming and outgoing flows have become a competitive advantage that companies have not to underestimate. The fourth industrial revolution is underway in all sectors that need digitisation, networking, cloud computing and data security. In recent years, companies have made huge strides in optimizing supply chains and logistics, significantly reducing costs and increasing efficiency. For operators in the logistics sector, this translates into the goal of minimizing the daily fixed costs of activities, fuel consumption, maintenance and hourly cost of resources. In particular, the rules that define the processes for shipping, truck loading, deliveries, etc. must be optimized. L’outsourcing strategico della logistica The first step is to collect data and information for processing and seek the best solutions to ensure effective operation. Clearly, logistics optimization models will be successful if employees follow the optimized plan. Effective solutions in a reasonable time. All this technology, however, requires people to have the necessary skills to manage and use data, models and software. Automation solutions can’t simply provide information to a single warehouse, but must bring benefits to the entire supply chain. Improved efficiency and new business models offer new opportunities to create value. Digitisation gives logistics the opportunity to offer new services and create new business models.

How e-commerce impacts on logistics

The e-commerce boom is destined to drive the growth and development of the logistics sector in Italy too. There has been a real explosion in recent years, with disruptive effects on the logistics chain ranging from transport organization to warehouse management to city deliveries. E-commerce is affecting the entire supply chain by changing logistics centers, which must quickly equip themselves to satisfy all company requests. Come impatta l’ecommerce sulla logistica Ordered today, delivered tomorrow. One of the elements most closely tied to the satisfaction of online customers, as we know, is the delivery process. They can count on ever faster and more customized deliveries. This makes online shopping a fast and convenient choice. Not forgetting that delivery is also part of the ‘emotional’ user experience. Companies that deal with logistics, however, know it’s not all that simple. The goods must be delivered, but the right of withdrawal gives the consumer the opportunity to behave as in the store. Online too, they can buy more items, try them on and return what they don’t like or isn’t the right size. These operations obviously impact on management costs. And if we think that one of the main reasons for buying online is free shipping, it’s a no-brainer. Companies who offer efficient and rapid delivery and collection services will see a major increase in the coming years. A qualitative leap that was unthinkable until a few years ago.

The sharing economy is the new frontier of freight transport

For some years now, we’ve been hearing about the ‘sharing economy’ – but what exactly is it?

It refers to a new economic model based on consumers’ real needs. The millennial generation of consumers (those born between the early 1980s and the mid-1990s) is most actively engaged in the sharing economy. La sharing economy e la nuova frontiera del trasporto merci To respond to this latest trend, many companies have adopted the principles of reuse and sharing by using technologies for a lower environmental impact. The most active countries in the sharing economy are those of northern Europe, which have always been more sensitive to the issue of environmental protection. The results are already visible: in the first quarter of 2018, CO₂ emissions fell by about 200,000 tonnes. In Italy, due in part to its geographical form and the islands, road freight transport is favored (especially with the growth of e-commerce). According to the Confcommercio report ‘Analysis and forecasts for freight transport in Italy’, since 2015 there has been an unequivocal upturn in freight traffic in line with economic recovery. According to forecasts, e-commerce could see a further 20% increase worldwide within the next decade. Transport and deliveries are becoming increasingly indispensable. From this perspective, the sharing economy is destined to increasingly revolutionize the logistics sector by seeking the best technologies and most effective solutions to unite and optimize the production, trade and consumption of goods and services.

How is this achieved?

For example, by giving customers the opportunity to share space on a truck, so that vehicles always travel full. This guarantees savings and a reduced environmental impact.  Logistics concerns not only transport, but also material storage. In this case, the sharing economy impacts on sharing storage spaces and making the most of private spaces. As Mario Zini, Country Manager Italy of DHL Global Forwarding, says: ‘Logistics suppliers can benefit from sharing their resources, but also take advantage of these developments through more convenient use of warehouse space, transport methods and more efficient delivery methods or flexible working models.’