Article Analysis Essay on Global Logistics Renovation

Introduction

The article focuses on the Bassett Furniture Industries, a U.S. wood -furniture maker who imports their products from Asia due to cheap labor. As such, the company has made its American international logistics provider's crucial partners in controlling other funds they incur during manufacturing. The company owns 100 stores and 600 department stores on contracts with independent furniture retailers. The author believes that the company can style itself as home furnishings solution provider not only in the United States but also in Puerto Rico and Canada.

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Bassett offers many services such as upholstered products, wall art, window treatment, case goods, and other home furnishings. The company targets customers with over $100,000 worth of income. Besides, the company does not target a specific age group, rather, it seeks to market its products to the people in the medium to upper-medium price range.

Most businesses are looking for a means to get ahead of others in terms of competition. As such, Bassett outsources its logistics. Most of its logistical functions are under the responsibility of the American Global Logistics (AGL). The company provides logistics solutions that are unique and customizable through its proprietary cloud-based technology for the furniture business to succeed. It offers various services that encompass ocean and air export and import operations, customs brokerage, domestic transportation, purchase order management, compliance consultation, warehousing, and distribution.

These services are imperative to the Bassett, this is because AGL makes it easier to export and imports its products. For instance, 75% of Bassett exports are locally produced, while the rest is imported. Therefore, AGL plays an important role in ensuring the success of Bassett through importing and exporting its products. Bassett imports part of its products to remain competitive as goods from Asia are cheaper, which is as a result of the availability of cheap labor.

To find contract manufacturers in Asia, Bassett leadership made several trips to Asian countries such as China, Malaysia, Thailand, the Philippine, Taiwan, and Indonesia and met with probable furniture suppliers until the right relationships were forged. Therefore, this work of looking for suppliers was hard coupled with the task of comparing the rates of shipping the products to the U.S. Moreover, the company had no worker with experience in oversees customs compliance and transportation. Therefore, the company experienced problems in monitoring shipments from different countries until they partnered with AGL. Therefore, AGL took the burden of Bassett leaving them to focus on their core competences.

In this light, I think in the contemporary world of business companies should delegate some of their supply chain work to logistical companies. Bassett as a company experienced a lot of problems economically and logistically. However, partnering with AGL as their logistic provider of choice the company management was able to focus on the production, marketing, and opening of new markets. The company can now be able to maximize its production and expand its market throughout the U.S., Puerto Rico and Canada. Therefore, to remain competitive furniture companies' have to devise a way to smoothen their logistics, ensuring that goods arrive in time, reducing costs, and saving time. To achieve this they have to liaise with logistics providing companies that ensure that it deals with problems presented by the supply chain both domestically and globally. For instance, when the U.S. West Coast port workers strike disrupted the docks the AGL was able to transport Bassett products using an alternative route. Similarly, when the port of Tianjin was shut down due to fires and explosions AGL was able to find favorable routing for Bassett. Hence, logistics companies are flexible and improve their clients' supply chain and logistics experience through integrating technology to give faster and more reliable data to clients.

References

SupplyChainBrain. (2016, October 16). Global Logistics Renovation: How a U.S. Furniture Maker Rebuilt Its Supply Chain. Supply Chain Brain - Supply Chain News, Analysis, Videos, Podcasts. https://www.supplychainbrain.com/articles/28886-global-logistics-renovation-how-a-us-furniture-maker-rebuilt-its-supply-chain