In this episode, guest Tim Pajak discusses a new initiative from the Council of Supply Chain Management Professionals (CSCMP). Pajak serves as the organization's member engagement manager and shares about the new worldwide partnership between CSCMP and Junior Achievement to bring information to young people about the role of supply chains in our lives. One primary goal is to encourage these young people to consider supply chain careers.
The Covid-19 pandemic has greatly disrupted the retail sector and new reports show that many of the changes in shopping habits are here to stay. We talk about the lasting impacts and how some retailers are adapting operations to keep up with changing consumer demands.
And new figures show just how tight warehouse availability is. The rise of e-commerce and a push for faster deliveries in urban areas are expected to keep warehouse capacity tight for the foreseeable future.
Articles and resources mentioned in this episode:
Podcast sponsored byAptean
Other links
In this episode, guest Tim Pajak discusses a new initiative from the Council of Supply Chain Management Professionals (CSCMP). Pajak serves as the organization's member engagement manager and shares about the new worldwide partnership between CSCMP and Junior Achievement to bring information to young people about the role of supply chains in our lives. One primary goal is to encourage these young people to consider supply chain careers.
The Covid-19 pandemic has greatly disrupted the retail sector and new reports show that many of the changes in shopping habits are here to stay. We talk about the lasting impacts and how some retailers are adapting operations to keep up with changing consumer demands.
And new figures show just how tight warehouse availability is. The rise of e-commerce and a push for faster deliveries in urban areas are expected to keep warehouse capacity tight for the foreseeable future.
Articles and resources mentioned in this episode:
Podcast sponsored byAptean
Other links
David Maloney, Editorial Director, DC Velocity 00:00
What will be the lasting impacts of the Covid pandemic on retailers? New numbers are out on the nation's demand for warehouse space. And what does Junior Achievement have to do with supply chain?
Pull up a chair and join us as the editors of DC Velocity discuss these stories, as well as news and supply chain trends, on this week's Logistics Matters podcast. Hi, I'm Dave Maloney. I'm the editorial director at DC Velocity. Welcome.
Logistics Matters is sponsored by Aptean. Aptean is a global provider of mission-critical, industry-specific logistics and transportation management solutions. Aptean routing and scheduling delivers the most advanced transportation management systems to world-leading brands, helping to drive operational success, reduce transportation costs by up to 30%, while optimizing delivery routes to meet rising customer expectations. For more information, visit Aptean.com.
As usual, our DC Velocity senior editors Ben Ames and Victoria Kickham will be along to provide their insight into the top stories of this week. But to begin: how can supply chain professionals inspire young people? To answer that, I spoke with Tim Pajak, the membership engagement manager for the Council of Supply Chain Management Professionals, also known as CSCMP. Here's our conversation from yesterday.
Welcome, Tim. Thanks for being with us today.
Tim Pajak, Membership Engagement Manager, CSCMP 01:32
Hi, Dave. Thanks for having me on the podcast.
David Maloney, Editorial Director, DC Velocity 01:35
Tim, for listeners who are not familiar with the Council Supply Chain Management Professionals—CSCMP—can you explain what your organization's role is within our industry?
Tim Pajak, Membership Engagement Manager, CSCMP 01:45
Sure, sure. So, CSCMP has been around since 1963. We are an evolution of a couple of different organizations, but, you know, the main deal is that we are an unbiased, impartial authority in the supply chain industry. We have access to subject matter experts, really in all areas of supply chain management. We say "end-to-end." We provide networking, career development, educational opportunities for the logistics and supply chain community. Our primary objective is really to connect, develop, and educate the world's logistics and supply chain management professionals throughout their entire careers. So, everyone from students on up to senior executive. So, we offer both individual and corporate membership. We have an annual conference each year called Edge, which is attended by between 3- and 4,000 of the world's leading supply chain professionals, and we have about 75 local chapters, which we call roundtables, across the globe.
David Maloney, Editorial Director, DC Velocity 02:53
Tim, CSCMP announced this past week that they're teaming up with Junior Achievement. What are you hoping to achieve through that partnership with them?
Tim Pajak, Membership Engagement Manager, CSCMP 03:02
Simply put, we're hoping to help build out early interest in supply chain among youth, while also giving our members an opportunity to volunteer in the community. For those who are not familiar with JA—Junior Achievement—they are one of the world's largest youth-serving NGOs. They deliver experiential learning on topics like financial literacy, work readiness, and entrepreneurship for young people to help them prepare for today's global economy. So, it makes sense that supply chain topics would be a part of that preparation. I myself remember many years ago sitting in a fifth- or sixth-grade classroom and having some folks from Junior Achievement come in and talk about a pen, how the different parts are sourced—you know, the rubber, the plastic, the the metal of the ink—how they're sourced to the manufacturer, how they are, the final product is transported to retail, and how the pen is marketed and sold. It was fascinating then, and it surprisingly has stuck with me all these years. A little backstory on the engagement with Junior Achievement: My boss at CSCMP is Nichole Mumford. She's the vice president of marketing engagement and education. Early on in her career at CSCMP, she had met some contacts at Junior Achievement, and last fall just had a discussion about their volunteer engagement and training opportunities, and Junior Achievement expressed an interest in partnering with CSCMP to try to incorporate supply chain in their lineup of career pathways. They had noticed a gap in some of the content that they had been providing, and so they sought out a partnership to help curate volunteers to help fulfill those content, those content needs. So really, we're—our objective, really is to help them identify supply chain professionals who can do two things: one either beam into classrooms, virtually, for just short 15-minute sessions, or record brief five-minute videos as subject-matter experts on topics that relate to the kind of content that Junior Achievement provides. So, we're excited to help identify some of our members that are willing to help inspire young people, and we're excited that we've already had about 30 people, just within the first couple weeks of this, jump on board.
David Maloney, Editorial Director, DC Velocity 05:32
You mentioned those videos. Would those be available through the Junior Achievement website? Or would they be marketed in other ways?
Tim Pajak, Membership Engagement Manager, CSCMP 05:39
So primarily, the, the beam-ins would just be sort of one-off sessions with, you know, very specific classrooms. So, it might be you know, a sixth-grade classroom in, you know, New York City, as a one-off. That wouldn't necessarily be available online, but the five minute videos, we're looking to develop those, with the subject matter experts, looking to develop those as something that would be housed on the Junior Achievement site, and perhaps on our own site as well.
David Maloney, Editorial Director, DC Velocity 06:12
Once the pandemic ends, are there plans to get together physically with some of these students?
Tim Pajak, Membership Engagement Manager, CSCMP 06:18
We have not gone that far with it, in terms of, you know, planning in-person. Right now, it's a virtual opportunity, but you raise a good point. If this goes well, I could definitely see that being, you know, something that, you know, bear some fruit in the coming period of time, however long that might be before we can do the in-person thing again.
David Maloney, Editorial Director, DC Velocity 06:43
CSCMP, of course, is an international organization. Will this effort also be international, or is it just exclusively to the United States?
Tim Pajak, Membership Engagement Manager, CSCMP 06:52
It is international. Junior Achievement serves about 10 million people worldwide, so they have chapters all over. We've had interest from some of our members in Europe, already. There may be other locations. I just—I haven't looked at the full list yet, but I know that we've had some folks overseas take interest in it too, so we'll be serving the whole globe.
David Maloney, Editorial Director, DC Velocity 07:15
Why is volunteerism important for our professionals and members of CSCMP.
Tim Pajak, Membership Engagement Manager, CSCMP 07:21
Well, like those in other industries, supply chain professionals enjoy, not only the networking opportunities and educational opportunities that come from being engaged in their local communities as a volunteer, or in their profession, but, you know, volunteering beyond their immediate supply chain world provides an opportunity to groom future supply chain leaders and introduce them to this industry. You'll see supply chain professionals involved, not only in CSCMP as a volunteer with a local chapter—we call them roundtables—or a CSCMP committee, but in a myriad of other ways as well, for example, getting involved with an organization called the American Logistics Aid Network, which provides supply chain assistance to disaster-relief organizations. Supply chain professionals get involved not only for their own altruistic reasons, but because they know that the best way to advance the supply chain profession is just to introduce others to it in unique ways, tell them about it. We believe that this engagement with Junior Achievement has that amount of potential.
David Maloney, Editorial Director, DC Velocity 08:36
What do you think that the volunteers will get out of it themselves?
Tim Pajak, Membership Engagement Manager, CSCMP 08:40
Yeah, that's a great question. I would say, you know, aside from the joy that comes from making an impact on the lives of youth, CSCMP's going to recognize their involvement in a variety of ways. So, for example, awards and swag for the most active participation from our local chapters, or from individual members. But as this is a new offering from CSCMP, some details do remain to be completed. I don't want to ruin any surprises, but suffice it to say that, you know, folks that participate will be recognized for that participation.
David Maloney, Editorial Director, DC Velocity 09:20
You mentioned earlier in this conversation that you're hoping that this initiative will help to foster careers in supply chain for for these individuals, these young people who have—are now going to become more aware of it. Do you think that that will happen?
Tim Pajak, Membership Engagement Manager, CSCMP 09:35
Yes, absolutely. The supply chain profession has garnered significant media attention throughout the pandemic. We believe a unique opportunity exists here to educate the world's K through 12 youth on supply chain topics, and at the same time, serve our mission of educating and connecting the world's supply chain professionals. Helping to bridge that gap between K through 12 youth and, say, undergraduate academic institutions, there's a unique fit and a unique opportunity. I think it's a case of a snowball coming down the hill. It's going to be effective.
David Maloney, Editorial Director, DC Velocity 10:17
If one of our listeners wanted to volunteer for this Junior Achievement partnership, how could they get started?
Tim Pajak, Membership Engagement Manager, CSCMP 10:23
Absolutely, I could be a point of contact for them. They can reach out directly to me via email. I'm working closely with my colleague, Ede Crittle, who also manages this program. She works with our local chapters. So, they could contact either one of us. I'm happy to leave my email address, and folks can reach out to me directly. So that's T-P-A-J-A-K at CSCMP dot org. At the moment, we've been communicating directly with with members, so we started with folks who are already engaged as volunteers with their local chapters, and now we're building off from that to folks, whenever they join as a new member, whenever they renew their membership, there's a[n] email message that communicates this effort that that they get at that point in time.
David Maloney, Editorial Director, DC Velocity 11:24
So obviously, they get additional information, as well, through the chapters.
Tim Pajak, Membership Engagement Manager, CSCMP 11:28
Absolutely. Yep.
David Maloney, Editorial Director, DC Velocity 11:30
Thanks, Tim. We really appreciate your time today, and we wish you well in this endeavor.
Tim Pajak, Membership Engagement Manager, CSCMP 11:35
Thank you, Dave, I appreciate the opportunity to chat with you today.
David Maloney, Editorial Director, DC Velocity 11:40
Now, let's take a look at some of the other supply chain news from the week. Ben, you wrote this week about some of the changes that may be here to stay in retail after the pandemic ends. What did you find out?
Ben Ames, Senior News Editor, DC Velocity 11:52
That's right, Dave. We learned a little bit more this week about what some of the impacts might be in the short term and the long term trends. Companies in nearly every sector, of course, have seen a large shift from brick-and-mortar buying to e-commerce and online, as shoppers all stayed home during the pandemic, most regions. That affected everything, of course, from retail store operations to the trucking and the warehousing that enabled that. But now the nation is beginning to roll out the first doses of the Covid vaccine, and so, both logistics providers and retailers are trying to measure which of those changes are here to stay. I talked this week with SAP, the large German software vendor, and in a recent survey, they found that the e-commerce boom will probably cool off a little bit, but they noticed a change in how that will play out by different ages. So, the new online shopping habits will probably decrease more for older cohorts, like baby boomers and Gen Xers, than for younger demographics, like millennials and Gen Zers, who will maintain that higher level of shopping. But either way, those are single-digit drops, and some estimates have e-commerce up 30 to 40% over the past year, so much of that online increase is really locked in. Another change that looks permanent is that the mix of products in digital shopping baskets will also change, because consumers have begun to rely increasingly on the online shopping channels, both for essential and nonessential items as well. So, I spoke with an executive at Casey's, which some of our listeners might know as a large convenience store chain throughout the Midwest—they're in 16 states, I believe—and he shared some more details on that point. So, Casey's sells a bundle of goods that includes not only traditional convenience-store staples, like groceries and fuel, but they also make fresh pizza, made in onsite kitchens. The impact of the pandemic sent big ripples through the chain's catalog of inventory as consumers drove a 20% jump in annual pizza sales— they'd only ever seen single-digit rises in past—and they also, customers began buying larger servings of other foods. So, Casey's had to change some of their mix on the shelves from, say, single-serving bags of potato chips to family-size bags, or from 20-ounce soda bottles to case packs.
David Maloney, Editorial Director, DC Velocity 14:17
Did Casey's say how they're adapting to those changes?
Ben Ames, Senior News Editor, DC Velocity 14:21
They did, and it involved a term that we've heard a lot lately, which is "digital transformation." It can sort of make people's eyes glaze over sometimes, because it's not entirely sure where that sort of concept hits the the real operational performance in daily life, but Casey's shared some detail on that. So, Casey's had already begun the process of digital transformation at the beginning of 2020, but they accelerated it greatly when the pandemic arrived. So, they pulled their three-year roadmap into one year, so they could offer offerings like home delivery, curbside pickup, contactless shopping. To make that work, they built up their abilities to provide things like e-commerce websites, mobile apps on smartphones, an in-store order management system, and databases on consumers, for loyalty programs. They all use SAP software tools to make that kind of stuff work. Those are pretty common tools to hear for basic online, household-name retailers, but you don't usually hear about them with convenience-store chains. And another part of Casey's plan in that digital transformation was to create a store-employee enablement program. So, that part gave workers digital tools, like apps for in-store picking, shelf inventory management, and even communicating with customers by SMS, or text messages. So, the executives said, "We think of each store operating like a miniature fulfillment center, even though it's only 5,000 square feet." So, really interesting trends in there on to how we might see some stores operating differently in the future than they used to just a year ago.
David Maloney, Editorial Director, DC Velocity 16:02
I agree. The pandemic will have some—many—lasting effects on our supply chains for years to come. Thanks, Ben.
Ben Ames, Senior News Editor, DC Velocity 16:09
Yep.
David Maloney, Editorial Director, DC Velocity 16:10
And Victoria, you reported this week that those same demands from e -ommerce are having an effect on available warehouse space. What can you tell us?
Victoria Kickham, Senior Editor, DC Velocity 16:20
Yes, Dave, absolutely. So, strong demand for logistics real estate drove rents higher worldwide in 2020, and the trend is expected to continue this year as demand for modern space in close proximity to customers intensifies. And that's according to a couple of reports that we saw this week, and these deal with with rent increases and some other issues. First, logistics real estate firm Prologis released its, the Logistics Rent Index this week, and it revealed a nearly 3% increase in rents for industrial real estate globally last year. This came despite a mid-year dip due to the pandemic. Rents in the United States and Canada grew 3.2%, driven by strong demand for space as e-commerce and the need for last mile delivery accelerated, especially in the second half of the year. In a separate report, commercial real estate firm Jones Lang LaSalle released its Q4 Industrial Outlook, and that showed strong industrial leasing activity in the United States, and then it continued to set new records last year. They said leasing activity jumped nearly 27% in the quarter, compared to 2019, driven, again, by e-commerce acceleration, and that U.S. industrial rents increased more than 4% compared to 2019. So, both reports point to much of the same this year, as e-commerce adoption will continue to drive the need for more space closer to end customers, especially in urban areas. They also said, you know, pointed to rising inventory levels, and that will add to demand growth as well, along with the anticipated economic recovery. That's expected to add cyclical demand for space, especially in the second half of this year.
David Maloney, Editorial Director, DC Velocity 17:53
Victoria, did they talk at all about how activity shaped up in the first month of the new year?
Victoria Kickham, Senior Editor, DC Velocity 17:59
No. These reports were focused on 2020 performance, particularly, you know, the end of the year, but they did come on the heels of the January Logistics Managers' Index report, which we reported on earlier this week, and that pointed to strong industrial real estate trends as well, in the form of tightening warehouse capacity and rising inventory levels across the supply chain as this year got underway. They said—the LMI researchers, that is—said inventory levels continued to rise during January, as warehouse capacity tightened, making it difficult and more expensive for companies to find a place to put things, as they described it. They said inventory costs are the highest they've been in two years, and that the situation really demonstrates the tightness people across the supply chain are dealing with. The LMI researchers also said they expect the warehousing capacity crunch to continue this year. The group's future predictions index, for instance, calls for available warehousing to roughly mimic—I'm sorry—roughly maintain the status quo over the next year, so everyone's pretty much in agreement on how this how this is looking for 2021.
David Maloney, Editorial Director, DC Velocity 19:00
Yeah, something we'll continue to follow. Thank you, Victoria.
Victoria Kickham, Senior Editor, DC Velocity 19:04
You're welcome.
David Maloney, Editorial Director, DC Velocity 19:05
We encourage listeners to go to DCVelocity.com for more on these and other supply chain stories. And check out the podcast Notes section for some direct links on the topics that we discussed today. And thanks, Ben and Victoria, for sharing highlights of the news this week.
Ben Ames, Senior News Editor, DC Velocity 19:20
Thank you, Dave.
Victoria Kickham, Senior Editor, DC Velocity 19:22
Yeah, thank you. Great to be here.
David Maloney, Editorial Director, DC Velocity 19:24
And again, our thanks to Tim Pajak of the Council of Supply Chain Management Professionals for being with us today. We encourage your comments on this topic and our other stories. You can email us at podcast@dcvelocity.com.
We also encourage you to rate this podcast, if your podcast platform allows for that. We do appreciate your feedback.
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We'll be back again next week with another edition of Logistics Matters, when our guest will be Dwight Klappich of Gartner, who will discuss some newly released research on goods-to-person technologies, so be sure to join us. Until then, please stay safe and have a great week.