Tag Archives: logistics

Wing Drones Can Now Deliver Girl Scout Cookies

When you get a cookie craving do you go to the store? Poor you. If you lived in a Christiansburg, Virginia, a community that tests commercial delivery drones, you could get Girl Scout cookies delivered directly to your front lawn!

Christiansburg has been testing Wing drones since 2019. Wing is the drone subsidiary of Alphabet (Google’s parent company). The main delivered products are rather mundane, such as pastries, tacos, and coffee. But now – Wing will be delivering those tasty Thin Mints (my personal favorite) and more. Wing worked with the local Girl Scout troops who said they have had a harder time selling cookies during the pandemic. And, let’s face it, delivering cookies is an excellent way to garner public support for commercial drone services.

Wing’s drones can carry items up to 3.3 pounds that fit into a special aerodynamic package. The drones don’t actually land in your yard; drones hover over a designated delivery area and lower the package to the ground using a string. Customers then retrieve the package from the delivery area. The drones fly lower than 400 feet and cannot be near airports. Items range from foods, flowers, medicine, and more. In addition to the U.S. location, Wing is also delivering via drone in select locations in Australia and Finland.

Now, how many boxes of cookies do you want?

Group Activities and Discussion Questions:

  1. Poll students: Have them think of all the products that could be delivered by drones.
  2. In order to be successful, companies must be able to physically get a product into the hands of the customers. Discuss how a distribution channel works.
  3. For Girl Scout cookies, what distribution channels are used now?
  4. How can the channel be expanded? What approach could be used?
  5. Show videos of Girl Scout cookie delivery: https://youtu.be/DFfsepDkTkA
  6. What can a drone deliver? https://youtu.be/HVDZgTJ8JLA
  7. View Wing’s Website for additional information and videos: https://wing.com/
  8. How does drone delivery change the experience? Positive or negative?
  9. Finally, what types of companies will benefit from the use of drone deliveries?

Source: Associated Press; USA Today; other news sources

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Why Can’t Ketchup, well… Catchup?

It’s happened again – one minute consumers are buying in a predictable way, at the usual times, and in the usual patterns. Then, boom! Everything changes.

But this time, instead of earlier toilet paper shortages, the product causing big problems is ketchup! Especially those small packets that are loved by fast-food customers everywhere.

The culprit, once again, causing this supply chain saga is Covid-19. Yes, the pandemic appears to have influenced every facet of consumer behavior. The main shift was caused by closed restaurants that drove consumers to the fast-food drive-in restaurants and home cooking, rather than dine-in restaurant options. It also turned many former dine-in restaurants into takeout places, making ketchup a commodity included in more food orders.

Ketchup packet prices have risen 13% since last January and the market share of packets (sachets) has eclipsed that of tabletop bottles. Ketchup is the most consumed sauce at U.S. restaurants, and even more is eaten at home. The pandemic has increased overall retail ketchup sales in the U.S. by 15% to more than $1 billion. Kraft Heinz leads the market with nearly 70% of the total U.S. market.

Kraft is responding to the shortage and plans to open two new manufacturing lines and increase production by about 25%. It has also innovated a no-touch ketchup dispenser to use at restaurants to help meet safety concerns caused by Covid.

Pass the ketchup please.

Group Activities and Discussion Questions:

  1. Discuss the elements in the supply chain and marketing channel.
  2. Diagram the supply chain and marketing channel for toilet paper.
  3. Show a news video about the shortage: https://youtu.be/4A7ObtFfYrE
  4. Where are the stress points in the supply chain and marketing channel?
  5.  What can be done to better produce and manage products?
  6. Poll students: What are their predictions for the next shortage?

Source: New York Times; Reuters News; Wall Street Journal; other news sources

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Suez Canal Blockage: Big Impact on Global Supply Chains

Q: What is a marketing channel, and how important is it?

A: A marketing channel is how companies get products into the hands of consumers and the channel is absolutely critical to sales. No channel. No revenue.

But, before delving into the marketing channel, let’s back up a little and consider the enormous impacts on businesses from the full supply chain – not only moving the finished products to market, but also getting raw materials/semi-finished goods to manufacturers. If these materials don’t make it to companies on time, then there is no way to effectively keep the manufacturing operation at full-force or keep the marketing channel functioning.

Consider also that an effective supply chain is a global issue. An estimated 90 percent of global retail products move around the world in containers through oceans, seas, and canals. One of the most important of these is the Suez Canal – a 120-mile long channel in Egypt, running between the Mediterranean and Red Seas, linking shipping transportation between Africa and Asia. The Suez Canal provides a direct route between the seas and reduces the trip from the Arabian Sea to London by 5,500 miles (8 days). Eight days is a lot of time in today’s global economy, plus fuel costs for ships average $25,000/day! In 2020, more than 18,500 ships traveled the canal.

This March, a container ship named ‘Ever Given’ blocked the Suez Canal after it was knocked sideways by a strong southerly wind.  The ship, at more than one-quarter-mile long and a weight of 224,000-tons, held 20,000 containers worth $9 billion, and was stalled for nearly a week in the canal, holding up billions of dollars of international commerce! More than 400 ships were backed up to use the canal, with dozens of other vessels deciding to forego the canal and take the long way around the Horn of Africa. For those in line at the canal, it could take weeks to get all the ships clear and return to normal operations.

And, the work done to free the ship is a story unto itself. For six days tugboats and dredgers cleared away 30,000-cubic meters of sand and mud from around the ship’s bow and stern. Whew.

Supply chains are critical in marketing!

Group Activities and Discussion Questions:

  1. Discuss the importance of the supply chain and logistics in marketing.
  2. Show video of the Suez Canal blockage: https://youtu.be/8BSdmIhB9wc (Note: Make sure to look for more recent videos as the story gets updated.)
  3. What is the impact of the Suez Canal blockage on trade?
  4. Have students research how raw materials, semi-finished goods, and finished products move to market.
  5. What commodities and materials are shipped via container and the sea?
  6.  

Source:  Associated Press; CNN; New York Times; Wall Street Journal; other news sources

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