The document discusses emerging trends in logistics and retail management. It covers topics like China's special economic zones and export trade, factors to consider when shipping freight from China to the US, and challenges of e-tailing/online retail like high return rates and fulfilling orders. It emphasizes the importance of seamless order fulfillment systems, training employees, and harnessing technologies like the Internet of Things.

1. Running head: EMERGING TRENDS 1
EMERGING TRENDS
Robin J. Chao
TLMT 502, B001, Fall 2015
American Military University
Dr. Alister McLeod
November 22, 2015

2. EMERGING TRENDS 2
The Chinese Connection
Source: adapted from World Bank (2009) World Development Report 2009: Reshaping
Economic Geography.
The picture above depicts major logistical hubs in China. Rodrigue (2013)
concisely summarized China’s Special Economic Zones (SEZs) in his book’s (The
Geography of Transport) online topics and resources. The “Open Door Policy” started
China’s phenomenal economic growth in 1978.
Two years later four SEZs were established near Hong Kong, Macau, and
Taiwan. Throughout the next three decades, China increased its economic might
through its awesome export trade passing through 210 national development zones and
1,346 provincial development zones.

3. EMERGING TRENDS 3
As a side note, the grandfather and father of this paper’s author escaped China as
Communism seized control in the summer of 1949. The grandfather continued ties to the
old country through brokering import/export deals and greatly benefited from liberalized
trade following the Open Door Policy.
Some factors shipping managers must consider when moving freight from China
to the United States are environmental rules, size and weight standards, security, labeling,
and safety standards.
Additionally, Wang et al (2014) studied shipping routes from the South China
Sea. There are the many variables that determine what routes to take: threat of piracy,
seasonal considerations, politics, and wind patterns.
Another aspect of China’s exports is their quality. Recently heavy metals and
other toxins have been linked to Chinese pet food and cosmetics. Other cases involved
sick chickens and tainted produce (Mol, 2014). All products must be inspected prior,
during, and after shipment to ensure quality is maintained. Looking back a step, products
must be packaged, weighed, and labeled properly for consumer use.
E-tailing: New method, old challenges
Fernie and Sparks (2009) list three characteristics of online goods on Page 220 of
their book, Logistics and Retail Management: Emerging Issues and New Challenges in
the Retail Supply Chain.
1. They are generally supplied directly to the home from point of production or
central distribution center. Order often comprised of only one item. Large percentage of
orders channeled through hub-and-spoke networks.

4. EMERGING TRENDS 4
2. Individually packaged {Just for you (J4U)} shipments increase volume and
take up more space on vehicles in forward and reverse channels.
3. There is a large flow of returned products. 30 per cent of shipments are
returned versus 6-10 per cent for ‘brick and mortar’. Major reverse logistics operations
are required to retrieve, check, repackage, and redistribute returned merchandise.
Online customers can check product availability and adjust orders if desired items
are out of stock. Retailers that set up online operation in the existing stores can face the
problem of an online customer losing out to in-person shopper grabbing the last item.
Managers must decide whether it’s better to build additional facilities for online order
fulfilment or not.
Challenges can be overcome through-
1. Home access
2. Drop Boxes
3. Local collection point
4. Local agency
Each of these solutions have drawbacks in security, convenience, or out-sourcing
delivery to third parties. They do offer some benefit in reducing some of the opportunity
costs involved with having customers waiting around for deliveries.
“Bricks and Clicks” businesses are thriving in this contemporary e-tailing
environment by combining the established model with a modern flair. Mail order and
catalog orders have been around for centuries. The companies that already had
experience with these purchase methods adapted to e-tailing.

5. EMERGING TRENDS 5
Shipping managers must consider packaging, delivery schedules, order
fulfillment, customer service, return policies, shipping guarantees, more volume of
merchandise = more distribution centers, larger delivery area, diverse customer base, high
customer expectations for precise delivery windows, mass customization (Dell
computer), “order penetration point” = when order is placed from the home or business,
and security.
Conclusion
A holistic approach to these issues is the everyday business of a professional
logistician. One of the first steps, after locating suitable locations for warehouses is
finding the right software and hardware to manage order fulfillment and stock
replenishment. The system must be seamless, easy to query, and adjustable to changing
needs. Training warehouse associates is another important step and is an ongoing
process. Successful managers and companies prepare their employees for changes in
their operations. Upgrading skills on using new equipment or processes will be better for
all involved. Harnessing the power of the Internet of Things is the goal of every modern
business.

6. EMERGING TRENDS 6
References
Fernie, J. & Sparks, L. (2009). Logistics and Retail Management: Emerging Issues and
New Challenges in the Retail Supply Chain (3rd Edition). Kogan Page.
Mol, A. P. (2014). Governing China's food quality through transparency: A review. Food
Control, 43, 49-56.
Rodrigue, J-P. (2013). The geography of transport systems. 3rd Edition. Routledge: New
York
Wang, J., Li, M., Liu, Y., Zhang, H., Zou, W., & Cheng, L. (2014). Safety assessment of
shipping routes in the South China Sea based on the fuzzy analytic hierarchy
process. Safety science, 62, 46-57.