Issue link: https://jocdigital.uberflip.com/i/1488405
110 Journal of Commerce | J anuar y 2, 2023 www.joc.com EXECUTIVE COMMENTARY ANNUAL REVIEW & OUTLOOK 2023 Logistics By the mid-2000s, laptops and desktop computers all came stan- dard with Ethernet capabilities, and those companies faded out. The evolution of visibility will make it ubiquitous, part of every supply chain planning and supply chain execution system. It will not exist as an independent product. It's the perfect storm for visibility, espe - cially because execution platforms and orchestration platforms can already provide visibility to begin with. Ten years from now, will we be talking about visibility the same way we are now? Probably not. Chances are it will already be built into all the technology used throughout supply chain and logistics processes. CBRE Blaine Kelley Executive Vice President cbre.com Despite softening economic conditions, the US indus- trial warehouse market con- tinues to perform well, posting record high rents, a robust develop- ment pipeline, and continued strong demand. In fact, supply is only now beginning to reach parity with demand after a steep, seven-quarter imbalance. One aspect of the current land- scape that deserves attention is the continued lack of visibility in the supply chain, especially in the form of real estate forecasting and labor cost data. Real estate cost data has historically been tied to market transactions or anecdotal evidence. Given the record run-up in pricing, companies have had to act under duress to meet inventory spikes and supply chain bottlenecks. Forward stocking prior to peak season has also accelerated the need for agility of warehouse occupancy. There has been a tendency to look at these costs as variable and commodi - ties and not as fixed events with embedded financial underwriting constraints. Going forward, use of predictive real estate cost analytics and "mark-to-market" technologies will provide the planning savvy and visibility currently missing in the process. Equally constrained, and espe - cially acute, have been the labor shortages experienced by logistics operations across the country. Ironi- cally, unemployment and industrial real estate vacancy currently both stand at approximately 3 percent. With labor representing as much as 30 percent of operating costs, what planning tools can be introduced to provide a better understanding of the competitive environment? Just as with facility cost data, the ability to forecast longevity and a location's resiliency to labor market risks needs to move from anecdotal to having a sophisticated modeling and forecasting culture. Looking forward to 2023, the stirring economic headwinds affecting supply chain real estate operations will bring modest relief to pricing and tight labor markets. Nevertheless, better visibility, fore- casting, and analytics will be critical for operational success. Fridenson Group Asaf Fridenson Senior VP, Group COO en.fridenson.co.il Digital trans- formation is changing the way we live and work. For the supply chain ecosys- tem, this change brings increased connectiv- ity and technology that enable innovative operations and, ulti- mately, save time and money. While many exciting innovations and digital solutions are now available for cargo owners, there are still pain points that have yet to be solved. Dunavant Chrissy Geibel Chief Operating Officer dunavant.com Across our industry, the imbalance between supply and demand has exposed weaknesses and opportunities within the supply chain. For logistics industry professionals, these chal - lenges are not new issues, but they have become increasingly prevalent. No mat- ter the dynamic situation or forecast, I believe two major plays will continue to consistently dictate success in our industry: people and technology. Our employees are the force behind our resilience and flexibility in this volatile industry. Given that busi - ness must evolve at a rapid pace — and the pressure to remain competitive is at an all-time high — having the best people is the key to success. Retaining or recruiting the brightest minds must remain a prior- ity. On the other hand, significant consumer demand created by e-commerce over the past decade and, more recently, the global pandemic, has exposed the inherent shortcomings of the supply chain at every level. The resulting national dialogue has forced our industry to focus on data-driven opportunities to make the supply chain work better, smarter, and faster in the future. Not only will reliable technology help optimize networks and longer supply chains, but it can also guide rates and provide real-time analysis and trans - parency for faster solutions. There is a whole new world unfolding with automation, autonomous vehicles, real time visibility, and dynamic plan - ning, to name a few. Data is another driving force to push business to the next level. Given a potential recession, it is difficult at best to predict consumer sentiment and its impact on demand throughout 2023. Therefore, anyone involved in the supply chain should be actively considering options to mitigate risk. How - ever, emphasis on foundational tools — people and data — is critical. "Significant consumer demand created by e-commerce over the past decade and, more recently, the global pandemic, has exposed the inherent shortcomings of the supply chain at every level." ◀ "Looking forward to 2023, the stirring economic headwinds affecting supply chain real estate operations will bring modest relief to pricing and tight labor markets." Blaine Kelley