This Week in Logistics News (March 5-9, 2012)

Since many of us will be losing an hour this Sunday when Daylight Savings Time begins, let’s go straight to this week’s news so that we can get an early start to the weekend:

The consolidation trend continues in the service parts solutions market, with Servigistics acquiring MCA Solutions this week. Marlin Equity Partners has been the main force behind the roll up, acquiring Servigistics and Click Commerce (which had acquired Xelus) in 2009, and now MCA Solutions. According to the press release:

Servigistics will be integrating MCA’s offerings in Performance Management, Business Design, Demand Forecasting, Inventory Optimization, Supply Planning, Contract Management, Network Design, Lifecycle Management, Budget Management, and Supplier Management into its existing [Service Lifecycle Management] portfolio…MCA’s three deployment options – Enterprise, On-Demand, and Desktop – will also open up new markets for the combined company.

The usual footnotes apply with this acquisition: the combined company will have to figure out what to do with its overlapping solutions, they will have to reassure their customers that their existing applications will be supported for years to come, they will have to make a strong effort to retain important talent, and so on. As for the rest of the market, this deal leaves Baxter Planning Systems as the main best-of-breed competitor remaining, along with enterprise vendors Infor, Oracle, and SAP and a few other niche players. Considering the high degree of specialization and optimization IP associated with these solutions, it’s not an easy market for start-ups to break into, so this will remain a relatively tight competitive field moving forward…not counting, of course, third party logistics companies that specialize in service parts logistics.

(For related commentary on service parts management, see “Ford’s Service Parts Supply Chain”)

Ryder has invested in alternative-fuel vehicles that past few years, and the company is leveraging its website to help educate and promote the value of these new vehicle technologies to customers. This week Ryder announced that it has enhanced its alternative fuels website by including “an interactive Fuel Cost Savings Calculator that allows customers to compare fuel costs between diesel- and natural gas-powered commercial vehicles based on their business’ driving habits in real time,” and adding a searchable Refueling and Maintenance Station Locator function to help customers locate the closest refuelling and maintenance locations, along with new Instructional Training Videos for natural gas fueling.

Bottom line: As the price of diesel continues to rise, so will the interest in alternative-fuel vehicles.

Con-way Truckload announced this week that it will be installing, over the next six to eight months, Maptuit® NaviGo™ technology in all company trucks and Qualcomm-equipped owner-operator tractors. Here is a quote from the press release:

“This is a significant upgrade of our navigation and communication capabilities that will raise the overall quality and efficiency of our operations,” says Saul Gonzalez, chief operating officer, Con-way Truckload. “By installing NaviGo in our trucks, we hope to improve safety performance, making life a little easier for our drivers and, in return, for our customers.”

The press release provides details about the features and benefits of the NaviGo system. In short, just like manufacturers and retailers are investing in technology to improve the efficiency of their operations, so are trucking companies…at least those that can afford to do so. With upward pressure on fuel prices and driver pay, trucking companies have to find ways to offset these cost increases.

Speaking of transportation, “House of Representatives Speaker John Boehner, signaling a lack of Republican support for a stalled $260 billion transportation bill, said on Thursday he was ready to pursue a less ambitious version under consideration by the Democratic-controlled Senate,” as reported by Reuters. The article goes on to say that “the House version has faced difficulties from the start, alienating fiscally conservative Republicans over its price tag while Democrats and some Republicans have opposed a provision that would end dedicated funding for mass transit projects.”

When it comes to transportation funding, the story remains the same.

Okay, time’s up…Have a great, hour-shortened weekend!

(Note: Con-way, Descartes, Ryder, Oracle, and SAP are ARC clients).