MUNICH: Panalpina head of logistics Mike Wilson says the rise of circular supply chains is an opportunity for 3PLs to lead the way as the logistics industry adapts to meet the requirement of a new market estimated at US$1 trillion.
Speaking at a Sustainability conference organized by Swiss WorldCargo and Freightweek as part of Messe Munchen's 'transport logistic 2015', Wilson said companies are finding hard to keep up with the speed of change in supply chains as a result of new products and services enabled by predictive analysis, RFID, biomimicry, 3D printing and "The Internet of Everything".
He told the audience the need for manufacturers to change from a linear to circular economic model "is not optional" as many vital resources will be exhausted in the next 5-50 years.
Prompted by new technologies, together with shorter product life cycles and customer demands for personalized configuration, he predicted manufacturing processes will become more fragmented and distributed, with increasing focus on circular supply chains to redistribute, repair and recycle products before end-of-life management.
Wilson noted that most logistics companies have been reluctant to invest in R&D and take the lead in bringing innovation to supply chain management compared to the degree of innovation in other sectors.
However with a move to a circular business model, he said 3PLs are uniquely placed to take a leadership position in the supply chains of the future due to their global footprint, multiple product touch-points and access to vast amounts of data.
This, he claimed, would result in new market opportunities for 3PLs by enabling companies to distribute manufacturing processes closer to customer demand points; provide faster component value recovery; position new manufacturing technologies for last-minute personalization; combine transport flows and reduce over-packaging.
Messe Munchen said the number of visitors to its biennial event rose from 52,300 in 2013 to 55,000 this year from 124 countries. The top countries outside Germany were Austria, Netherlands, Italy, Poland, Czech Republic, Switzerland, France, Belgium, U.K. and Romania.
Aside from Germany the top 10 exhibitor countries were the Netherlands, Italy, Belgium, France, U.K., Austria, Spain, the Czech Republic, Switzerland and China.