Dr Patrick Dixon Chairman Global Change Ltd
Future of Supply Chain Management and Logistics
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Complexity and scale create risks
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Strategies often overtaken by
events !
World can change faster than you can hold a
board meeting
Every sudden event is opportunity and challenge
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85,000 combinations of door parts alone on a single model
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Agility also requires
Simplicity
Mexico Retail Growth
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Manufacturing in Mexico will grow for US market
Nearshoring Boom
11% wage inflaAon in China in 2013 -‐ expect similar in 2014
Bank of America
Impact of stronger Chinese currency and tougher polluAon controls
$3.4 trillion !
$2 trillion
WGP 1980-‐2013 (%,constant prices)
Diversity to seize global markets
US GDP 1980-‐2013 (%,constant prices)
EU GDP 1980-‐2013 (%,constant prices)
Vietnam GDP 1985-‐2011
>40% WDP by 2015
� IMF - adjusted for Purchasing Power Parity
300 million move to cities in China and!475 million to cities in Africa by 2030 !
!!!!!!!!
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Growth of Middle Class in Africa 250m people - $2 trillion by 2040
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Middle Class !
LaAn America -‐ 50 million more people in last 10 years !
Mexico: 44 million -‐ 39% populaAon !
Brazil: 113 million -‐ 56% populaAon !
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• Soriana, Cencosud, Casino (CBD, Exito), Carrefour and Wal-Mart
The future is aboutEMOTION
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Gold standard:10am orders for 3pm Delivery
Anywhere in same country
10am orders for 3pm Delivery
70m people online in Mexico (58%) 88m in Brazil (46%)
28m in ArgenAna (67%) 10m in Chile (59%) 10m in Peru (34%)
Most people in LaAn America are not BUYING online yet, BUT.... Global e-‐commerce $1.5 trillion in 2014 -‐ $100bn in LaAn America $6.2bn in Mexico led by tradiAonal retailers -‐ 40% growth in 2012 12% of all retail is online in UK
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Online Sales per user !
Latin America: $578 Mexico: $854 Brazil: $717 Argentina $380 !
!Pay-Pal survey
52% of online users in Mexico have bought with Pay-‐Pal
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Mobile 6m new mobile users in Mexico in 2014 28% populaAon -‐ highest in LaAn America
30m smartphones -‐ up 49% last year 60% of 25-‐34 year olds using smartphones
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Mobile Retail Mobile influenced $29bn of retail sales in UK in 2013 50% of all UK online sales are using mobile
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Online / physical worlds become one in
Brazil !
50% research online - buy in store 40% research in store - buy online
89% want digital information in store !
Buy online - deliver to store Buy in store - deliver at home
Over 4000 road hauliers in EU
1.3bn home delivered e-‐com items in UK a year (+12% pa)
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3000 Parcel Shops in UK in 12 months Chosen by up to 50% customers for
deliveries
Internet of Things
90% all global data generated in last 2 years
!Sales of canned food
in Mexico store = demand for more steel tins in China
Big Data
Global Warming -‐ facts Doing More with Less
150kms by road can cost more than 10,000kms by sea
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Rail up to 10 times energy efficient than road
$226bn on Mexico rail, road, ports since 2006 SUPER HUBS
>30% energy savings with green tech
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Tyres – 4.3% Streamlining – 12% 1.5 metres longer – 5% Hybrid engine – 30% Heat power air con ec – 5%
Shocks power – 4% Slow from 65 to 55mph -‐ 20%
SAVE ENERGY ON EVERY TRUCK !
30% EU trucks run empty
“We waste 25 million
miles a year driving empty
trucks” !
US major retailer
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Future Supply Chains in Mexico !
Uncertainty and complexity will mean shorter supply chains
China / Asia costs will rise fast Huge benefit for Mexico supplying US Future of retail will change in Mexico
E-commerce will impact supply chains Internet of Things and Big Data
Huge opportunities to save energy / cost !
!
Dr Patrick Dixon Chairman Global Change Ltd
Future of Supply Chain Management and Logistics
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!
Slides and Videos globalchange.com
