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Trends Changing the Shape of Supply Chain Networks
Dr Andrew Palmer
Preston Solutions Ltd
IPIC 2019, London 10th July 2019
The Supply Chain Chronology
➢ 1970’s Oil crisis – proliferation of depots
➢ 1980’s Stock reduction
➢ 1990’s Customer service
➢ 2000’s Internet home shopping
➢ 2010’s Sustainability
Logistics Trends – 2000 onwards
Delivery Reliability and
Congestion
Vertical and Horizontal
Collaboration
Multi Modal
Multi Channel Retailing /
Home Delivery
Different Types of
Warehouses
Global Sourcing / Focused
Manufacturing
Product Line Proliferation
All Year Seasonal Produce
Rapid Replenishment
Reverse Logistics
Sustainability
City Logistics
Consumer needs – and the supply chain response
– produce fragmented and additional product flows
Source: Prof. Alan Waller, ELUPEG, 2012
What Causes Supply Chain Networks to Change
➢ Internal drivers such as:
• Cost reduction
• Customer demands
• Service level
• Increased differentiation
• Increased competition
• Increased regulation
• Reduce CO2
• Sustainability
What Causes Supply Chain Networks to Change
➢ External influences such as:
• Economic
• Environmental
• Social
• Political
• Technological
• Legislation
Sustainability
Zero emissions by 2050
7
Source: FT, 19th June 2019
Measures to achieve zero emissions
The SRF Roadmapping model
▪ CSRGT base data
▪ Predicted to 2050• Cost of fuel
• Carbon price (£/tCO2e)
• Annual kilometres
• New vehicle fleet improvement in fuel efficiency
• GDP/manufacturing output
▪ Vehicle and logistics measures with predicted fuel and kilometre savings and costs
▪ Predicted percentage take up of measures
▪ NPV and max CO2 scenarios
Measures needed to achieve zero emissions
Use trailer with sloping front roof (double deck/high cube vehicles) Reschedule deliveries to inter-peak periods and evening / night
Use tear-drop trailers Use of larger and heavier vehicles (long haul only)
Reduce engine idling Backhaul / Fronthaul
Switch from powered to fixed-deck trailers (for double-decks) Synchronised consolidation
Reduce vehicle tare weight Use of urban consolidation centres
Install cab roof fairing Restructuring of the supply chain network
Install body / trailer side panels Use of alternative transport modes
Install side skirts Extending delivery times/relaxation of JIT pressures
Install boat tails Platooning
Adopt automated manual vehicle transmission Circular economy
Set vehicle with slower speed Local manufacturing/on shoring
Reduce height of vehicle Freight exchanges/IFTS supporting the physical internet
More regular tyre inflation checks Slow logistics
Use low ‘rolling-resistance’ tyres
Fit super singles
Automatic tyre pressure adjustment
Use of fuel additives
Increase use of hybrid vehicles
Use of lubricants with lower viscosity
Give drivers training in fuel efficiency
Monitor and manage driver fuel performance (including use of telematics)
Autonomous vehicles
Use telematics to optimise vehicle routing
Increase use of electric vehicles
Increase use of biodiesel vehicles
Increase use of CNG vehicles
Increase use of dual-fuel vehicles (Diesel + CNG)
Increase use of LNG vehicles
Increase use of dual-fuel vehicles (Diesel + LNG)
Vehicle/Driver Measures Logistics measures
Take up percentage of electric vehicles
• Peak level of adoption: all rigids 74%, articulated 35%
• Year of peak: 2050
0%
10%
20%
30%
40%
50%
60%
70%
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90%
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Artic Large rigid Small rigid
Take up percentage of driver training & monitoring
• Peak level of adoption: 67%
• Year of peak: 2030
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010 2015 2020 2025 2030 2035 2040 2045 2050
Give drivers training in fuel efficiency Monitor and manage driver fuel performance (including use of telematics)
Aerodynamic vehicles and driver training
DfT 2016
Take up percentage of longer heavier vehicles
• Peak level of adoption: 50%
• Year of peak: 2043
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010 2015 2020 2025 2030 2035 2040 2045 2050
Use of larger and heavier vehicles
Double Deck Trailers
Longer Semi Trailers
Longer Heavier Vehicles(Mega Truck)
Larger Higher Capacity Vehicles
Optimising backhaul & fronthaul
• Peak level of adoption: 95%
• Year of peak: 2035
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010 2015 2020 2025 2030 2035 2040 2045 2050
Backhaul/Fronthaul
Longer & slower deliveries
• Peak level of adoption: 95%
• Year of peak: Rescheduling deliveries off-peak - 2024, extending delivery times & reducing JIT pressure -2043
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010 2015 2020 2025 2030 2035 2040 2045 2050
Reschedule deliveries to inter-peak periods and evening / night Extending delivery times/relaxation of JIT pressures
Measures with greatest impact:
Vehicle-level Measure CO2 Savings (%)
Urban Regional Long Haul
Electric vehicles 45% 35% 27.5%
LNG vehicles 15.5% 15.5% 15.5%
CNG vehicles 13% 13% 13%
Dual fuel vehicles (diesel + LNG/CNG) 10.5% 10.5% 10.5%
Driver training in fuel efficiency 4% 7% 9%
Monitoring driver fuel performance 4% 7% 9%
Logistics Measure Fuel Savings (%) Travel Savings (km %)
Longer heavier vehicles 14.3% 13.9%
Optimising backhaul & fronthaul 8.2% 7.9%
Reschedule deliveries off-peak 4.25% 4.25%
Extend delivery times & reduce JIT pressure
5% 3%
Results of roadmapping model
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
2010 2020 2030 2040 2050
Positive Net Present Value Scenario
Aerodynamics Tyre measures Alternative fuels
Driver performance Logistics measures Miscellaneous
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
2010 2020 2030 2040 2050
Maximum CO2 Saving Scenario
Aerodynamics Tyre measures Alternative fuels
Driver performance Logistics measures Miscellaneous
60% reduction in CO2
emissions over 1990 levels
78% reduction in CO2
emissions over 1990 levels
Opportunities for Sustainable Cost Effective Logistics
• Optimising supply chain networks
• Collaboration
• Supporting systems and telematics
• Vehicle types
Load capacity utilisation and empty running
Local sourcing
Road share of freight – modal split
• Driving style
• Aerodynamics and tyres
• Avoiding congestion (routing & scheduling, out of hours delivery)
Kms per litre of fuel –engine/energy
efficiency
• Fuel type (electric, biodiesel, biomethane, hybrid)
CO2 emissions per litre of fuel – carbon
content of fuel
Few
er
Km
sFriendlier
Km
s
Contributing to the Physical Internet
Thank You
Questions?
Trends Changing the Shape of Supply
Chain Networks
IPIC 2019, London 10th July 2019
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