Aveneu Park, Starling, Australia

Objectives:To – How the industry has evolved

Objectives:To understand and appreciate the challenges faced by Third Party Logistics (3PLs) in supporting the global supply chain of the smartphone or personal computer (PC) business and new directions in this area  As a logistics service provider, to analyze and recommend solutions that could help the client organization sustain or improve its competitive position 3PL Industry BackgroundYou should cover areas such as:- The services offered in this business (do not limit to only warehousing, transportation and distribution) – Number of players and level of competitiveness in this industry- Types of customers – How the industry has evolved over the years etc. Description of 3PL organization and key characteristicsYou should provide information on the background of the 3PL organization as well as describe what characteristics and capabilities it has that differentiates it from other players in the industry. You may use SWOT analysis technique or Porter’s 5 forces.Fedex is a third-party logistics provider (3PL) that focuses on the core business and also has a deep understanding of the company and has the ability to provide solutions to their problems. FedEx Supply Chain, formerly GENCO, has been improving the logistics networks of companies.With their huge understanding of the industry, they have provided a large amount of network and solutions designed specifically for your industry, business and customers.FedEx Supply Chain develops an understanding of your products and the needs of your customers. They use their knowledge to design the best supply chain solutions for improving a business performance, exceeding customer expectations and unlocking new opportunities. FedEx will be investing $200 million in more than 200 global communities by 2020 just to create opportunities and deliver positive change around the world. They use their huge global network to deliver resources where they are needed especially in times of disaster and for special shipments.  FedEx is an American global courier delivery services company headquartered in Memphis, Tennessee in 1971 by Frederick Smith. FedEx  is an overnight courier service, they provide next day air services within the United States and time based international services. Their air, ground and sea networks cover more than 220 countries and territories, linking more than 99 percent of the world’s gross domestic product (GDP). FedEx carries more freight than any other airline compared to other 3PL. As businesses becomes more global and competitive, everyone ranging from entrepreneurs to big companies turn to them for flexible and innovative solutions.  In comparison with DHL and United Parcel Service (UPS). Fedex operates one of the largest civil aircraft fleets in the world and also carries more freight than any other airline. DHL  provides international express mail services.They have 5 airline subsidiaries, they are ranked first among other logistics companies. UPS Is one of the largest shipment and logistics companies in the world. UPS also operates its own airline and air cargo delivery service based in Louisville, Kentucky.   Problems and potential issues You should focus on existing or potential problems/issues in logistics and supply chain areas in the smartphone and personal computer business such as:-                Warehousing-                Transportation-                Order management  and fulfillment-                Collaborative planning forecasting and replenishment-                Distribution channel design and management-                Distribution network planning and management-                Inventory planning and management –                Warehouse/DC/Service Centre Location Analysis-                Service parts management-                Reverse logistics and returns requirements if any –   IT solutions & technology deployment etc.Order management and fulfillment 1. Since the suppliers of Xiaomi are from nearby countries, and each kind of components is usually from a single company. It will be a great threat for the supply chain once the suppliers could not fulfill the order in time. For example, the floods in Thailand in 2011 have created a huge negative impact on Xiaomi’s business.Besides, it is also risky when these suppliers are forced not to offer any components to Xiaomi by its competitors. Once unfortunate situation happen, if there is no alternative option, Xiaomi’s business model will eventually break down.2. As Xiaomi outsources its phone manufacturing and assembly process to foundry, it should pay attention in the quality of its products. As far as I know there are some quality problems in Xiaomi Phone, which seriously impact Xiaomi’s brand image in the market. From sustainable supply chain aspect, Xiaomi should make regulation and code of conduct to regulate foundry’s conduct, including highly standardized manufacturing process, no child labor, friendly working environment and so on. Therefore, strict monitoring of production is necessary for further business.3. Excessive use of Hunger Marketing will hurt customers’ loyalty to the company. Because of Xiaomi Hunger Marketing strategy, it leads to a relatively low Chinese smart phone market share. Since Xiaomi has established a good reputation in user experience, Xiaomi should take advantages of it, enhance its productivity, improve its product quality, and enjoy the benefit of economics of scale. At that time, Hunger Marketing is useful in increasing the net profit of sales, and establishing high-quality Brand Image.Inventory 4. Xiaomi manages a small inventory by releasing limited number of smartphones to the market per week, purchasing components and producing the phones only when customers place their orders. By doing this, they force customers who are interesting in purchasing their products online, wait for the next batch of phones to be available in the market before getting a hands on one. This results in Xiaomi’s sales not increasing because there will always be shortage of phones in the market, hence not meeting the high demand for its supply. This will make customers look to purchase other smartphone brands to eliminate the waiting time for the Xiaomi phone. This is one of the potential problems that Xiaomi will face if they continue on taking up this style of sales marketing.Before Xiaomi launches a new product into the market, they have to take into consideration the demands of the consumers before coming up with a feasibility plan. Every product that is launched does not always have the same marketing tactics. For smartphones, the way of selling and marketing is different from other products like the TV.   Distribution channel design and managementXiaomi’s troubles was its exclusive reliance on online sales, which left it unable to reach millions of less tech-savvy customers in China’s smaller cities and rural areas. Rivals Oppo and Vivo capitalized on Xiaomi’s absence by cementing sales partnerships with retailers in those areas.3PL’s solutions to client organization’s requirementsBased on the problems and potential issues you have identified earlier, you should describe how the 3PL can help the client manage these problems/issues and recommend strategies, tactics and improvements in potential problem areas such as those mentioned above. Your solutions should cover as many of these areas as possible. Key success factors This requires some analysis – you should explain what you think are the factors (internal, external etc.) that will ensure the success of the 3PL organizations going forward and allow them to remain competitive in this industry and meeting their customer needs.


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