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Supply Chain Technology Acquisitions on the Increase

Supply Chain Technology Acquisitions on the Increase

Today’s supply chains demand efficiency, transparency and real-time capabilities. Globalization and the growth of e-commerce have given rise to these needs and businesses are scrambling to make needed investments in their supply chains.

The ability to manage supply chains anytime and anywhere is growing thanks to the use of smartphones and other mobile devices. In addition, transparency is vital in today’s global environment in which there are more and more risks such as natural disasters, political and knowing your suppliers beyond the Tier ones; however, just knowing is half the equation, real-time capabilities that allow users to intervene as soon as possible to either redirect freight or replace a supplier is equally as important.

As such, the need for up-to-date supply chain technology is no longer a ‘nice-to-have’ but instead a requirement.

Inventory Management

To meet these supply chain needs, technology companies are acquiring niche providers. For example, the rise in e-commerce has created the need for better inventory management and visibility in transit, within the warehouse, within the physical store and elsewhere.

Earlier this year, E2Open acquired Terra Technology to meet this need. Terra Technology is a provider of demand sensing, inventory optimization and transportation forecasting solutions for various industries such as consumer products. According to E2open, the combined entity will “enable the creation of supply chain networks that dynamically sense market changes and synchronize operations from retailers through suppliers.”

In a similar move, Oracle announced that it has acquired LogFire, a provider of cloud-based warehouse management applications. LogFire has had a long relationship with Oracle, most recently having integrated its Warehouse Management System with Oracle Transportation Management. With the acquisition, LogFire will be integrated into Oracle’s Oracle Supply Chain Management Cloud solution. According to the announcement, the addition of LogFire will complement the logistics functionality of the Oracle SCM Cloud by adding cloud-based warehouse management capabilities.

Warehouse Automation

The warehouse itself is undergoing big changes to improve efficiencies in pick and pack, packaging, labeling and more all to deliver goods faster to the ultimate location whether it’s to a store, another business or to a consumer’s front door. The final destination is no longer just one set destination and the warehouse serves as a focus point and fast, but efficient, are needed.

Earlier this year, Honeywell signed an agreement to acquire privately held, supply chain and warehouse automation provider Intelligrated for $1.5 billion from a company backed by the Permira funds. Intelligrated estimated 2016 sales are about $900 million.

 

Intelligrated designs, manufactures, integrates and installs warehouse automation solutions, software and services. The company has grown at a CAGR of 13% over the past three years. Its customers includes manufacturers, logistics providers and 30 of the top 50 US retailers and 50 of the top 100 Internet retailers.

Transportation

Efficiency needs in transportation are also needed and technology is playing a role. An interesting acquisition that has recently been made is from GE Transportation.

GE Transportation acquired ShipXpress, a provider of cloud-based software solutions that enable transportation, industrial and commodities businesses to operate with supply chain partners. According to GE Transportation President and CEO, ”By combining ShipXpress’ innovative software products with GE’s sensing technology and industrial-strength platform Predix, we’ll deliver the industry’s most advanced, scalable cloud-based solution to accelerate the movement of goods and information, and enhance supply chain performance and customer service. Our combined capabilities will help short-line railroads better analyze their rail operations, car accounting and supply chain information and deliver a data-rich path to ongoing performance improvement, asset and operations optimization.”

Globalization

Despite what some folks may have you to believe, globalization is not going away anytime soon. It, like everything else is changing, based on needs and requirements of businesses and consumers.  To help facilitate with these changes, Descartes acquired Appterra Technology.  Appterra helps customers connect electronically, automate supply chain process and enhance collaboration and visibility among global trading partners. According to Descartes CEO, “By adding Appterra’s technology and services to our business, our customers will have access to broader data integration capabilities for standardizing and automating buy-side and sell-side processes.”

Outlook

Interest in supply chain technology will continue throughout 2017 with more acquisitions as supply chains continue to look for ways to improve efficiency, transparency and real-time capabilities. A number of solutions are available on the market so be sure to do your homework first.

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