Saddle Creek study explores distribution network trends

Companies are looking to their distribution networks to help cope with recent economic challenges, according to a new study recently released by Saddle Creek Corp., a nationwide third-party logistics provider. The 2010 Distribution Network Trends Report explores current trends and changes in the design and management of distribution networks as the logistics industry weathers turbulent economic conditions.

The report draws upon online survey responses from more than 200 logistics industry decision makers with a diverse cross-response among market segments, including: manufacturers, retailers and distributors involved in executive management; supply chain, logistics, or distribution management; and operations management.

The study explores emerging trends in transportation, warehousing, operations, and regional challenges in distribution. It also looks at supply chain distribution network management trends and the near-term outlook for these areas. Research highlights include:

A significant number of companies are making changes to their supply chain distribution network design. In fact, two thirds of respondents confirmed that they had made changes. And nearly half plan to make additional changes in the next 12 to 18 months. Transportation and warehousing functions are significant driver enhancements in distribution networks. In the study, the top three areas of change for respondents overall included transportation-related changes (44.1 percent); warehouse size and/or configuration (33.8 percent); and consolidation of shipments from suppliers (24.8 percent).

Significant changes in the management of distribution networks are also happening in the industry. This study found that many companies have added or changed vendors (24.8 percent), changed the size of facilities (17.9 percent), increased or began outsourcing (12.4 percent) or, conversely, reduced outsourcing (10.3 percent).

Trends in the industry’s distribution network changes and redesign are also forcing added requirements upon third-party partners and overall outsourcing patterns. The research showed that those respondents who outsource are asking for new things from their third-party provider – particularly for information such as real-time tracking, statistical data, reporting capabilities, ASN’s, and the like.

These and other emerging trends are detailed and analyzed by company type, size, 3PL usage and more in the report.

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