Taking the fat out of the supply chain

The global recession has taught the industry one of its most valuable lessons, in the view of ICM Group CEO Kiall Marsh – that there’s far too much fat in the supply chain. “Companies are trying to find ways of taking waste out of their systems,” says Marsh, “and one of the areas where there was a huge amount of fat was the fourth party logistics (4PL) arena. “We’ve seen a growing awareness of the value of dealing with someone who physically does the work on a 3PL basis but who also has the expertise to offer the 4PL-type of consultancy services and information.” By dealing with the people who physically do the work, you effectively eliminate a huge amount of waste out of the system, he said. “The recessionary climate is also forcing the 3PL companies to improve their service offerings. In fact it’s a wonderful way to shake the supply chain right.” And while the past year has been a challenging one for all, Marsh believes it has also offered wonderful opportunities – “and our business has grown as a result.” This despite the key challenges facing the logistics industry, not least of which was the recent Transnet strike. “And the challenge is not just the strike period but the ripple effect it sends to the market once the strike is over. Once vessels start to sail again, you alleviate the bottleneck at the port and that moves up the supply chain to the roads, rail, packing and up to the Reef. The industry continues to feel the effects several weeks down the line.”