Emerging Needs in Supply-Chain Management

IRVINE, CA—Time in transit is always a key metric, but getting things in the right order and being able to forecast what's needed with regard to supply-chain management are critical, Cushman & Wakefield's Kevin Turner tells GlobeSt.com exclusively. As we reported recently, Turner has joined the firm's Orange County office here as executive director to focus on global logistics and supply-chain management as part of the firm's industrial brokerage team, and he has assumed a leadership role within its ports and intermodal specialty practice group. We spoke with Turner about his new role and the main issues involved with logistics and supply-chain management in the industrial realm.

GlobeSt.com: What are your goals in your new role at Cushman & Wakefield?

Turner: Quite frankly, it's to increase the bandwidth and amperage of what I'm doing right now through a global platform that is the right fit for both the left and right hand. I evaluated all of the major platforms locally, regionally, nationally and internationally—my reach goes beyond Orange County to include North America, Canada and Mexico. I was with a strong regional boutique firm, and it was a wonderful place to transact local business, but there were limited opportunities to maximize what I can offer.

So, I went back to school and took a deep dive into logistics and supply-chain management at Cal State Long Beach's Center for International Trade and Transportation. Their global-logistics and supply-chain management programs are recognized internationally as being at the forefront of developing best practices within the logistics industry. I went through the program, which went deep into logistics, motion transportation, maritime operations, port and terminal operations, financial issues and all the product-shipping issues internationally. I also studied regulatory bodies, customs, border protections, world trade and policies. It was a very encompassing program.

Now I'm through that process, and I'm now teaching how to evaluate and determine optimal location, formulate warehouse, payback and consolidation strategies, adaptive re-use, and it's forced me to stay on top of my game. It's been a little hectic, but I've enjoyed doing it. It's been a game-changing optic for me. For some of my clients, just revealing that there's a better way changes everything for them. Our goal is to reduce their warehouse square footage through better forecasting and other methods, and it's really opened up wonderful opportunities.

Cushman & Wakefield gives me the platform, format and resources to execute my plan. I want to broaden my reach, and a regional firm couldn't call on some of the Fortune 500 companies with which this really resonates. For some smaller companies, it's like drinking out of a firehose, but for those companies that are mature and identifying best practices, that's where our program comes in, and it's a huge benefit to their real estate and supply chain.

GlobeSt.com: It seems the goal of today's logistics and supply-chain management is getting the right merchandise into the consumers' hands faster. What is being done on the real estate side to foster this?

Turner: Time in transit is always a key metric, but it's also the right order and being able to forecast what is needed and where it's needed at the lowest possible cost. Speed to market is one small component of it, and what's being done is really that more science is going into the forecasting element. Having a reliable supplier network is critical if you're going to be in omni-channel distribution format, with catalog, Internet and designer showrooms, for example. You have to have transportation modalities figured out, and you need to be able to really forecast where that demand is coming from. The metrics have to be in the right order. You never want to have to stock out. You have to have available safety stock on hand, and you have to be able to fill the order accurately. The only way to do that is to have an efficient delivery system and to be able to pick that order efficiently and accurately.

The way to do that from a commercial real estate perspective is to move product in and out efficiently and effectively with the least amount of touches and disruption. We're seeing a lot more automation and power inside the warehouse, certainly for e-commerce fulfillment centers, and a more employee-intensive environment. We're seeing mezzanine warehouses for same-day/next-day small-package items. Amazon has been on the forefront of that enterprise. Fire suppression is also important, so you need proper fire and safety measures—thicker slabs, taller walls—and these buildings cost more. Also, when you're in those environments you have to be able to reach 30 million to 50 million people in a day's drive. And parking is critical. In Southern California, we're seeing more of a need for trailer storage. We're still not efficient in getting those containers from the ship off the dock and into a consolidated freight station or DC. We need to get the containers off more quickly and get them staged in the yard because you will be paying less of a penalty if it's in your yard than sitting in the dock.

GlobeSt.com: Is achieving these goals on a global level an issue?

Turner: That's really not a factor. What's becoming difficult is larger EEE: engineering, efficiency and economies of scale—offloading a ship that's over 12,000 TEUs with an incredible amount of volume when you don't have the on-dock capacity. Plus, the labor issues on the West Coast ports have become even more of a challenge. It's not only labor, but infrastructure and the larger super post-Panamax trains we need to pull containers off.