The container shipping industry has much to learn from the retail sector in terms of sharing data with suppliers — or transport partners, in the case of shipping — to realize larger operational benefits, according to 1010data CEO Inna Kuznetsova.
Both industries grapple with tight profit margins and a fragmented environment, but retailers have come to realize that sharing data with suppliers can have systemic benefits, Kuznetsova said in an interview on JOC Uncharted Wednesday.
Retail and the container shipping industry both operate with “big communities of suppliers and vendors and I think this is where shipping can probably take a page from the retailers and start monetizing data in a smart way that provides not just for the immediate value in monetary sales, but most importantly enables partners to do business better,” she said.
Kuznetsova joined 1010data, a data analytics provider to large retailers, in 2019 after four years in executive roles with the ocean freight platform INTTRA. Before that, she served as chief commercial officer at CEVA Logistics.
Container lines and forwarders should look at ways of “sharing data between the sales side and supplier side in form of regular reports and investing in systems to do it, and then recouping those investments through ongoing sales of data,” Kuznetsova added.
Data-sharing initiatives among large retailers and their consumer packaged goods (CPG) communities proved that such initiatives were “not just a good way to monetize the data, but it goes deeper into creating partnerships around keeping stocks up and minimizing stock outs,” she said.
Those lessons could translate into providers and consumers of ocean freight capacity figuring out ways to better share data to ensure demand and supply are kept in harmony. That issue has come to the fore in the first half of 2020, as container lines have rationalized capacity quickly to respond to production and demand troughs due to the ongoing COVID-19 pandemic.
Retailers coping with micro-demand curves
Kuznetsova is now on the frontlines of arming retailers with up-to-the-minute demand information, a key foundational data element that could help retailers and their suppliers better provide logistics and transportation providers with real-time supply forecasts.
She told JOC Uncharted that demand cycles were shrinking due to the pandemic, and that retailers needed to track demand changes on a granular basis, both in terms of geography and product category.
“What we've seen as an increase may not necessarily indicate a change in behavior, but just a temporary increase,” she said, adding that COVID-19 has induced a period of “changes in demand on steroids.”
Pointing to a chart of 1010data showing a spike of office supplies at the start of work-from-home orders, she said, “If you asked me to predict the trend when we were [in mid-March], then my guess will be very different than if you asked me to predict trends when we're [at the start of June, when demand had normalized].”
Kuznetsova has long been a believer that data could be an efficiency-driver, including efforts at INTTRA to push the development of decision-support dashboards for forwarders and container lines using that platform.
“The only way to cope is to invest in the tools that allow you to see the changes and plan your business well, and analyze those changes at the very granular local level,” she said.