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Swisslog Customer Magazine: the Future of E-Commerce T H E F U T U R E INSPIRATION O F SWISSLOG WAREHOUSE AND DISTRIBUTION SOLUTIONS GLOBAL MAGAZINE ISSUE ONE E - C O M M E R C E P L U S : M U L T I C H A N N E L I N N O V A T I O N B E S T P R A C T I C E E N V I R O N M E N T INSPIRATION WELCOME // PAGE 3 WELCOME // PAGE 4 MARKET DATA // PAGE 6 MULTICHANNEL // PAGE 16 INNOVATION // PAGE 18 BEST PRACTICE // PAGE 20 OPINIONS // PAGE 22 ENVIRONMENT WELCOME Welcome to the first issue of Inspiration magazine For the uninitiated, Swisslog is a global provider of intralogistics automation. These services range from building complex warehouses and distribution centers to solutions for material handling and medication DESIGN management in hospitals. Our aim for Inspiration is to provide an insight into the latest industry trends, leadership thinking and general developments in the warehouse, DEVELOP distribution and automated logistics arena. For this issue we’re focusing on e-commerce, a key sector for our many retail customers and the area of much innovation and development. This is a fast-moving sector. So much so that terms like multichannel are already being described as "yesterday’s problem." Instead, DELIVER “Omni-Channel” is the new challenge of fully- integrated retailing from any source. We would love to hear what you think. We welcome your comments and suggestions for articles via our Twitter account @swisslogInspire or via email: [email protected] Joe Doering Division President Warehouse and Distribution Solutions 02 03 INSPIRATION WELCOME // PAGE 3 WELCOME // PAGE 4 MARKET DATA // PAGE 6 MULTICHANNEL // PAGE 16 INNOVATION // PAGE 18 BEST PRACTICE // PAGE 20 OPINIONS // PAGE 22 ENVIRONMENT WELCOME Welcome to the first issue of Inspiration magazine For the uninitiated, Swisslog is a global provider of intralogistics automation. These services range from building complex warehouses and distribution centers to solutions for material handling and medication DESIGN management in hospitals. Our aim for Inspiration is to provide an insight into the latest industry trends, leadership thinking and general developments in the warehouse, DEVELOP distribution and automated logistics arena. For this issue we’re focusing on e-commerce, a key sector for our many retail customers and the area of much innovation and development. This is a fast-moving sector. So much so that terms like multichannel are already being described as "yesterday’s problem." Instead, DELIVER “Omni-Channel” is the new challenge of fully- integrated retailing from any source. We would love to hear what you think. We welcome your comments and suggestions for articles via our Twitter account @swisslogInspire or via email: [email protected] Joe Doering Division President Warehouse and Distribution Solutions 02 03 INSPIRATION MARKET DATA GOING GLOBAL CHINA HOWHow THE theWORLD world IS REACTING is T Oreacting A NEW SUPPL Yto CHALLENGE a new supply challenge SHOPPING CHINA HAS LONG BEEN SEEN AS THE WORLD’S Books, Music Apparel & Videos LEADING MANUFACTURING BASE, BUT HOW WELL IS IT EMBRACING E-COMMERCE? 15% 14% Electronics Market Size expand. According to Datamonitor's Global 24% BUSD 435 s retailers integrate e-commerce Growth Online Retail 2011 Report, the global online 16% into their operations, employing retail sector had total revenues of BUSD 47% the right systems to dynamically Others A 434.6 in 2010, representing a compound process orders is of critical importance. he latest figures reveal some 2012, the total number of Chinese online (including B2C, C2C and online shopping annual growth rate (CAGR) of 16.3 percent interesting trends. A report in China purchases reached 280 million. Online platform) are Tmall, 360buy, Suning.com Global retail market segments: % share, by value, 2011 The vast majority of the world’s consumer for 2006 to 2010. 2010 alone had a growth Source: Datamonitor 2010 Logistics Equipment magazine in shopping transaction volume (B2C and and Amazon. Tmall is a platform where products have been distributed to retail rate of 17.8 percent. T Wulfraat believes an ageing population will 2012 listed four key points: 1. Booming C2C) reached 1.15 trillion RMB in 2012. both B2C and C2C business takes place. In stores in bulk, and the most efficient European Growth make it harder for warehouses to follow the Transactions: Transactions volume in 2012 3. Popularity of Fashion and Electronics: B2C online, 360buy holds a massive 50.2% method for handling this merchandise has European online retailing growth performed old style. Says Marc: “We firmly believe that reached 9.5 trillion RMB (over 1 billion Online shopping of apparel holds 26.8% of share of business, followed by Suning.com usually been pallet movement and full case even better, with a CAGR of 22.3 percent the North American market will increasingly Euro) and is expected to be 27.5 trillion total volume, 3C products (computers, 9.4% and Amazon 6.7%. selection. But now e-commerce is between 2006 and 2010. In 2010, Europe follow the European market by ramping up RMB in 2015. It is thought the annual cameras and cell phones) 18.2%, cosmetics fundamentally changing the nature of the accounted for 37.4 percent of total global adoption of automated material handling increase over the next 5 years will be 4.9%, media 3%, and others 42.8%. 4. Four retail supply chain. online retail sales, BUSD 162.6 in revenue. systems for the manufacturing and retail / around 35%. 2. Online purchases soar: In key players: Top online shopping players Rapid Increase “We have seen a lot of growth in Europe,” distribution sectors.” Due to the rapid increase in online sales, says Swisslog’s Innovation Manager, Mike many retailers are outgrowing the Hatrick, “as businesses focus on getting the China Spending In China the latest spending figures are traditional supply chain model. In addition maximum productivity out of their existing truly mind blowing [see opposite]. STANDING OUT to scheduled weekly or daily store deliveries infrastructure, as well as re-evaluating all “Companies in China recognize this is a of pallets and cases, retailers must now their future developments.” Meanwhile on SURVEY REVEALS E-COMMERCE CHALLENGES major driver of future growth,” says factor in split case picking and multi-line main street the trend towards smaller promotions. With many retailers seeing Swisslog’s Vicki Chen. “To move at this pace erman e-commerce expert, item sortation to fulfill fluctuating volumes formats, local shops with a reduced range, online sales as the key to future growth, is less of a challenge when you have come Intershop which counts HP, of online orders which frequently require has definitely continued, according to difference.” And if that wasn’t enough to the problems of standing out in a large this far in such a short space of time.” And BMW, Deutsche Telekom and delivery to consumers within 24 hours. How Richard Crompton, who teaches Retail get marketing managers thinking, the next G crowd have not been lost on the region’s with such resources at their fingertips, the Mexx amongst its customers, has released the challenges of these new demands are Logistics Strategic Supply Chain big challenge is already on the horizon. online retailers. rest of the world will surely take its latest findings in trends for online met across the world gives a fascinating Management at the University of “The smartphone is already changing the note. retailers in the Nordic countries. Key insight into local experiences and the Huddersfield, UK: “A reduced choice may “The bigger players can use their real world retail landscape; 87% of online retailers among the findings are the difficulties globalization of the supply chain. seem like a simpler logistics task,” says visitors to drive traffic to their websites,” believe that those who master mobile faced by retailers in creating genuine Richard, “but it presents other challenges.” says Swisslog’s Global Marketing Manager, commerce will prevail. For some, getting Recession Pressures [See page 10.] Some of those other differentiation in a crowded market - 85% During this current recession, many Cathrin Völz, “but that does not this right may be crucial to survival,” says challenges are also being saying they find this extremely European stores have struggled, while automatically set them apart. Great Völz. seen in the US where supply challenging, whilst two thirds say they online businesses have continued to customer service, a responsive website and chain consultant Marc struggle to create almost limitless accurate ordering processes make a real 04 05 INSPIRATION MARKET DATA GOING GLOBAL CHINA HOWHow THE theWORLD world IS REACTING is T Oreacting A NEW SUPPL Yto CHALLENGE a new supply challenge SHOPPING CHINA HAS LONG BEEN SEEN AS THE WORLD’S Books, Music Apparel & Videos LEADING MANUFACTURING BASE, BUT HOW WELL IS IT EMBRACING E-COMMERCE? 15% 14% Electronics Market Size expand. According to Datamonitor's Global 24% BUSD 435 s retailers integrate e-commerce Growth Online Retail 2011 Report, the global online 16% into their operations, employing retail sector had total revenues of BUSD 47% the right systems to dynamically Others A 434.6 in 2010, representing a compound process orders is of critical importance. he latest figures reveal some 2012, the total number of Chinese online (including B2C, C2C and online shopping annual growth rate (CAGR) of 16.3 percent interesting trends. A report in China purchases reached 280 million. Online platform) are Tmall, 360buy, Suning.com Global retail market segments: % share, by value, 2011 The vast majority of the world’s consumer for 2006 to 2010. 2010 alone had a growth Source: Datamonitor 2010 Logistics Equipment magazine in shopping transaction volume (B2C and and Amazon.
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