Last-Mile Fulfilment in Retail Supply Chains: Optimising Networks, Forecasting, and Replenishment for Success

February 17, 2025

Last-Mile Fulfilment in Retail Supply Chains: Optimising Networks, Forecasting, and Replenishment for Success

The Growing Importance of Last-Mile Fulfilment

The final leg of a product's journey—last-mile fulfilment (LMF)—has become the most complex and expensive aspect of retail supply chains. In an era of e-commerce dominance, instant gratification, and rising customer expectations, retailers must ensure their last-mile networks operate seamlessly, cost-effectively, and sustainably.

However, last-mile fulfilment is not just about getting goods to consumers quickly. It requires a well-orchestrated supply chain where network optimisation, demand forecasting, and inventory replenishment are synchronised to balance service levels, cost efficiency, and working capital investment.

This article explores:

How retail networks must be designed to support efficient last-mile fulfilment
The role of forecasting and replenishment in balancing product availability and capital costs
How technology and automation can enhance last-mile efficiency

1. The Foundations of Last-Mile Fulfilment: Retail Supply Chain Networks

Retailers must reimagine their supply chain networks to support last-mile logistics effectively. A legacy distribution model—relying solely on centralised warehouses and long-haul transport—no longer meets the needs of modern omnichannel consumers.

Instead, retailers are investing in decentralised fulfilment strategies such as:

a) Micro-Fulfilment Centres (MFCs)

Retailers are increasingly leveraging micro-fulfilment centres—small, urban warehouses located closer to consumers. These MFCs:
✅ Reduce delivery times and transportation costs
✅ Improve inventory availability by replenishing local demand points faster
✅ Enhance same-day or next-day delivery capabilities

b) Store-Based Fulfilment Models

Many retailers are turning their stores into fulfilment hubs, utilising the existing footprint to enable ship-from-store and click-and-collect (BOPIS) models. This approach:
✅ Reduces the need for separate e-commerce warehouses
✅ Increases inventory turnover within physical stores
✅ Provides customers with ultra-convenient pickup or same-day delivery

c) Dark Stores and Urban Distribution Hubs

Dark stores (closed-to-public stores serving as fulfilment centres) and urban distribution hubs improve last-mile logistics by:
✅ Reducing dependency on centralised DCs
✅ Enhancing inventory availability within city limits
✅ Supporting high-speed delivery models (e.g., 10-minute groceries)

d) Strategic Partnerships with 3PLs and Crowdsourced Delivery

Retailers are increasingly outsourcing last-mile logistics to third-party logistics (3PL) providers or using crowdsourced delivery models (Uber-style networks). This allows:
✅ Scalability in peak demand periods
✅ Lower last-mile logistics costs
✅ Access to extensive delivery fleets without capital investment

2. Balancing Forecasting, Replenishment, and Working Capital in Last-Mile Fulfilment

Efficient last-mile logistics require more than just an optimised distribution network. Retailers must also balance inventory levels, minimise stockouts, and avoid overinvestment in working capital. This is where demand forecasting and replenishment play a critical role.

a) The Challenge: Availability vs. Working Capital Costs

Retailers often face a trade-off between:

Maximising availability (ensuring products are always in stock to meet demand)
Minimising working capital costs (avoiding overstocking that ties up cash in inventory)

If forecasting and replenishment aren’t optimised, retailers risk:
❌ Stockouts → Lost sales and disappointed customers
❌ Overstocking → Increased holding costs, markdowns, and wastage

b) The Role of AI-Powered Demand Forecasting

Retailers must adopt AI-driven forecasting models to predict demand accurately and adjust inventory placement across last-mile fulfilment nodes. AI-driven forecasting helps by:
✅ Analysing real-time sales data, weather trends, and external factors
✅ Reducing manual intervention in demand planning
✅ Adjusting replenishment dynamically based on localised demand fluctuations

c) Dynamic Replenishment Models for Last-Mile Success

Traditional replenishment models lack agility in fast-moving retail environments. Instead, retailers should implement:

✔ Just-in-Time (JIT) Replenishment → Ensures inventory is restocked as needed, reducing excess stock
✔ AI-Optimised Inventory Allocation → Dynamically shifts inventory between fulfilment nodes
✔ Real-Time Inventory Visibility → Improves response to demand spikes and prevents stock imbalances

d) Balancing Online and Offline Inventory Strategies

Retailers must ensure that inventory for e-commerce and physical stores is not siloed. Best practices include:

Implementing omnichannel inventory management systems
Using real-time stock synchronisation between warehouses, MFCs, and stores
Smart order routing → Allocating orders to the nearest fulfilment location to optimise costs

3. The Role of Technology and Automation in Enhancing Last-Mile Efficiency

Retailers leveraging AI, automation, and advanced analytics can optimise last-mile fulfilment while reducing operational costs.

a) AI and GenAI in Last-Mile Planning

AI-driven route optimisation and generative AI (GenAI) can improve delivery logistics by:
✔ Optimising delivery routes based on real-time traffic and weather data
✔ Predicting delays and suggesting alternative fulfilment strategies
✔ Reducing fuel costs and carbon emissions

b) Autonomous Vehicles and Drone Deliveries

Retailers are exploring unmanned delivery solutions such as:
✔ Drones → Faster, low-cost deliveries in urban and remote areas
✔ Autonomous delivery bots → Used for hyper-local deliveries in cities
✔ Electric last-mile fleets → Reducing logistics carbon footprint

c) Robotics in Micro-Fulfilment Centres

AI-powered robotics can enhance last-mile efficiency by:
✔ Automating order picking and packing in micro-fulfilment centres
✔ Speeding up fulfilment and reducing human errors
✔ Optimising warehouse layouts for last-mile delivery efficiency

4. Sustainability in Last-Mile Fulfilment

As consumer expectations for eco-friendly retail grow, retailers must prioritise sustainable last-mile fulfilment strategies. This includes:

✔ Electrification of Last-Mile Fleets → Reducing emissions via EV adoption
✔ Optimising Delivery Density → Consolidating deliveries to minimise trips
✔ Reusable Packaging & Circular Logistics → Minimising waste in last-mile supply chains

Retailers who invest in sustainable last-mile solutions gain a competitive edge, improve compliance with carbon reduction regulations, and enhance brand loyalty among eco-conscious consumers.

The Future of Last-Mile Fulfilment in Retail

Last-mile fulfilment is no longer just an operational challenge—it’s a competitive differentiator. Retailers who invest in:
✅ Network optimisation → Decentralised fulfilment and micro-hubs
✅ AI-driven forecasting & replenishment → Balancing stock availability and working capital
✅ Technology & automation → Enhancing efficiency and reducing costs
✅ Sustainable last-mile strategies → Meeting environmental expectations

…will not only reduce logistics costs but also improve customer satisfaction, profitability, and long-term competitiveness.

The question is—is your retail supply chain ready for the future of last-mile fulfilment?

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Strategy & Design

August 31, 2024

Future-Proof Your Supply Chain: Core Themes and Emerging Trends for 2025 and Beyond with Trace Consultants

Explore the key themes and emerging trends shaping the future of supply chain management from 2025 through 2027 and beyond. Learn how Trace Consultants can help your organisation navigate these changes and build a resilient, future-proof supply chain.

Navigating Core Themes and Emerging Trends in Supply Chain Management: A Strategic Guide for 2025 and Beyond

The supply chain landscape is evolving at an unprecedented pace, driven by technological advancements, changing consumer expectations, and the growing importance of sustainability. As we approach 2025 and 2026, and look further ahead to 2027 and beyond, supply chain leaders will need to focus on both immediate priorities and longer-term trends that will shape the future of their operations. This article explores six key themes and trends—three with a focus on 2025 and 2026 and three emerging over 2027 and beyond—that are expected to have a profound impact on supply chains across industries. Additionally, we will discuss how Trace Consultants can support organisations in navigating these changes, ensuring they remain competitive and resilient in the face of evolving challenges.

Core Themes: 2025 and 2026 Focus

ESG (Environmental, Social, and Governance)

Three years ago, ESG was often viewed as a "nice to have" rather than a critical business priority. Today, however, ESG has become a "must-have" for companies across all industries. Stakeholder demands, regulatory pressures, and a growing recognition of the importance of sustainability have elevated ESG to the top of the corporate agenda. For supply chain leaders, this means taking proactive steps to align their operations with ESG goals.

Key Actions:

Sustainable Sourcing: Companies must ensure that their supply chains are aligned with sustainable sourcing practices, including the use of renewable resources, ethical labour practices, and environmentally friendly production methods.
Transparency and Traceability: Enhancing transparency and traceability within the supply chain is critical for meeting ESG goals. This involves implementing systems that allow companies to track the origin of materials, monitor supplier practices, and report on ESG metrics.
Regulatory Compliance: As governments around the world introduce stricter regulations related to ESG, companies must stay ahead of these changes by ensuring compliance across their supply chains. This may involve revising supplier contracts, investing in new technologies, and adopting best practices.

How Trace Consultants Can Help:Trace Consultants offers expertise in ESG strategy development and implementation. By conducting thorough assessments of current supply chain practices and identifying areas for improvement, Trace Consultants helps organisations align their operations with ESG goals. This includes developing sustainable sourcing strategies, implementing transparency and traceability tools, and ensuring regulatory compliance.

Advanced Robotics and Automation

The days of fully manual supply chains are rapidly coming to an end. With advancements in robotics and automation, companies are increasingly turning to technology to optimise their operations. From robots that stack pallets and pick orders in warehouses to algorithms that optimise routing and scheduling, automation is transforming supply chains into highly efficient, agile systems.

Key Actions:

Warehouse Automation: Implementing robotic systems in warehouses can significantly improve efficiency by automating tasks such as picking, packing, and sorting. This reduces labour costs and increases throughput.
Predictive Maintenance: Utilising AI and machine learning to predict when equipment will need maintenance can prevent costly downtime and ensure continuous operations.
Automation of Repetitive Tasks: Beyond the warehouse, companies can use automation to streamline repetitive tasks across the supply chain, such as order processing and inventory management.

How Trace Consultants Can Help:Trace Consultants assists companies in identifying opportunities for automation and developing tailored strategies to implement advanced robotics across their supply chains. This includes evaluating the ROI of automation investments, selecting the right technologies, and managing the integration process to ensure a seamless transition.

Workforce of the Future

The integration of advanced robotics and automation into supply chains has sparked concerns about the future of the workforce. However, rather than replacing human workers, technology is increasingly being used to enhance human capabilities. The workforce of the future will see humans and robots working side by side, with humans taking on more strategic and value-adding roles.

Key Actions:

Reskilling and Upskilling: As automation takes over repetitive tasks, companies must invest in reskilling and upskilling their workforce to ensure employees are equipped to take on more complex, strategic roles.
Human-Robot Collaboration: Designing workflows that promote collaboration between humans and robots can lead to more efficient and effective operations. This includes rethinking the layout of workspaces and implementing technologies that facilitate communication between humans and machines.
Focus on Strategic Tasks: With robots handling manual tasks, human workers can focus on areas such as strategy development, customer relationship management, and process optimisation.

How Trace Consultants Can Help:Trace Consultants provides guidance on workforce transformation, helping companies develop strategies for reskilling and upskilling their employees. By designing human-robot collaboration frameworks and identifying areas where human workers can add the most value, Trace Consultants ensures that companies can fully leverage the benefits of automation.

Emerging Trends: 2027 and Beyond Focus

Distributed Ledger Technologies and Digital Money

Distributed ledger technologies (DLTs), such as blockchain, have primarily been associated with cryptocurrencies. However, their potential applications extend far beyond digital money. In the supply chain context, DLTs offer the promise of enhanced transparency, security, and efficiency by providing a single source of truth for all transactions. This can help mitigate risks, reduce fraud, and streamline processes across the global supply chain.

Key Actions:

Blockchain for Transparency: Implementing blockchain technology can provide end-to-end visibility across the supply chain, ensuring that all parties have access to accurate and up-to-date information.
Smart Contracts: Leveraging smart contracts—self-executing contracts with the terms of the agreement directly written into code—can automate processes such as payment and delivery verification, reducing the need for intermediaries and speeding up transactions.
Digital Payments: As digital currencies and payment systems become more prevalent, companies should explore integrating these technologies into their supply chains to facilitate faster and more secure transactions.

How Trace Consultants Can Help:Trace Consultants assists companies in exploring and implementing distributed ledger technologies and digital payment systems within their supply chains. By providing strategic guidance on blockchain adoption, smart contract implementation, and digital money integration, Trace Consultants helps organisations enhance transparency, security, and efficiency.

Sectoral Transformations

The years 2027 and beyond will see significant transformations across various sectors, driven by technological advancements, changing consumer expectations, and evolving regulatory landscapes. These transformations will directly impact supply chains, requiring companies to adapt their strategies to remain competitive.

Key Actions:

Healthcare and Life Sciences: The rise of precision medicine and personalised healthcare will require supply chains that can deliver complex, temperature-sensitive products quickly and reliably. Companies in this sector must invest in advanced logistics and tracking systems to meet these demands.
Retail and Distribution: The continued growth of e-commerce will necessitate a seamless, omnichannel supply chain that can deliver a consistent customer experience across all touchpoints. This will require integrating online and offline operations, optimising last-mile delivery, and leveraging data analytics to understand customer behaviour.
Aerospace and Defence: Geopolitical issues and the need for advanced technology in aerospace and defence will increase scrutiny on supply chains in these sectors. Companies must ensure that their supply chains are secure, resilient, and capable of supporting the development and deployment of cutting-edge technologies.

How Trace Consultants Can Help:Trace Consultants supports companies in navigating sector-specific transformations by providing tailored strategies that align with the unique demands of each industry. This includes developing supply chain solutions that meet the specific needs of healthcare, retail, aerospace, and other sectors, ensuring that companies remain competitive in a rapidly changing environment.

Metaverse

What was once considered a futuristic concept confined to gaming and entertainment is now being explored as a powerful tool for supply chain management. The metaverse—a virtual world where users can interact, work, and shop—offers new opportunities for supply chain leaders to enhance visibility, streamline operations, and engage with customers in innovative ways.

Key Actions:

Virtual Supply Chain Management: The metaverse can be used to create digital twins of supply chains, allowing companies to simulate and optimise their operations in a virtual environment. This can help identify inefficiencies, test new strategies, and improve decision-making.
Customer Engagement: Companies can leverage the metaverse to create immersive customer experiences, offering virtual showrooms, personalised shopping experiences, and interactive product demonstrations.
Real-Time Monitoring: The metaverse can provide real-time monitoring and management of supply chain operations, enabling companies to respond quickly to disruptions, track shipments, and ensure timely delivery.

How Trace Consultants Can Help:Trace Consultants helps companies explore the potential of the metaverse for supply chain management. By providing insights into how virtual environments can be leveraged to enhance operations, customer engagement, and real-time monitoring, Trace Consultants ensures that companies can stay ahead of the curve and fully capitalise on emerging technologies.

Preparing for the Future with Trace Consultants

As the supply chain landscape continues to evolve, companies must be proactive in addressing both immediate priorities and longer-term trends. By focusing on core themes for 2025 and 2026 such as ESG, advanced robotics, and workforce transformation, while also preparing for emerging trends like distributed ledger technologies, sectoral transformations, and the metaverse in 2027 and beyond, companies can build resilient, future-proof supply chains.

Trace Consultants offers the expertise and strategic guidance needed to navigate these changes, helping organisations develop and implement supply chain strategies that align with their business goals. Whether your company is looking to enhance sustainability, embrace automation, or explore new technologies, Trace Consultants can provide the support you need to succeed.

For more information on how Trace Consultants can assist your organisation in preparing for the future of supply chain management, reach out to their team of experts today.

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‍Contact us today, trace. your supply chain and procurement consulting partner.

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Strategy & Design

March 15, 2025

How Retailers Can Mitigate Operational Supply Chain Risks: Leveraging MS Power Apps for Order Fulfilment Controls

Explore how leveraging Microsoft Power Apps can significantly enhance control over retail supply chain operations, reducing risk and driving efficiency.

How Retailers Can Mitigate Operational Supply Chain Risks: Leveraging MS Power Apps for Order Fulfilment Controls

Retailers across Australia and New Zealand face unprecedented pressures within their supply chains. From rising consumer expectations to fluctuating demands and operational disruptions, the risks inherent in modern retail logistics require proactive management. Leveraging technology, particularly low-code solutions such as Microsoft Power Apps, can significantly mitigate operational risks, streamline processes, and enhance overall efficiency.

In this comprehensive article, we delve into the operational supply chain risks retailers encounter and how Microsoft Power Apps can serve as a powerful tool to implement effective controls within order fulfilment processes. We'll also explore how Trace Consultants can assist retailers in harnessing the power of digital solutions to enhance control and mitigate risks.

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Understanding Operational Supply Chain Risks in Retail

Retailers face a variety of operational supply chain risks, which can broadly fall into several key categories:

Inventory Management Risks

Poor visibility, inaccurate forecasts, and manual inventory processes lead to stockouts or excess inventory, directly impacting profitability and customer satisfaction.

Order Fulfilment Risks

Delays, picking and packing errors, and inefficient workflows can disrupt fulfilment operations, leading to customer dissatisfaction, revenue loss, and brand damage.

Supplier and Vendor Risks

Retailers heavily reliant on third-party vendors face risks around delivery timelines, product quality, compliance, and cost escalations.

Compliance and Regulatory Risks

From safety standards and packaging regulations to modern slavery and environmental considerations, non-compliance can lead to substantial fines, brand damage, and customer distrust.

The Need for Improved Order Fulfilment Controls

Ensuring smooth order fulfilment processes is crucial for maintaining customer satisfaction and operational efficiency. Common challenges retailers experience include:

Order inaccuracies
Delayed fulfilment times
Poor inventory tracking
Lack of real-time process visibility
Manual errors leading to inefficiencies

Proactively addressing these challenges is essential to maintain competitive advantage and customer trust.

The Role of MS Power Apps in Mitigating Operational Risks

Microsoft Power Apps is a powerful, low-code platform that enables retailers to rapidly create customised apps, adding layers of control and visibility into their order fulfilment processes.

Why Power Apps?

Power Apps offers retailers the agility, ease, and adaptability required in a fast-changing retail environment. Benefits include:

Rapid deployment and flexibility
Enhanced visibility across the supply chain
Improved collaboration and real-time decision-making
Reduced operational errors
Easy integration with existing systems

Enhanced Inventory Control

Retailers can utilise Power Apps to develop solutions that deliver real-time inventory tracking, reduce stockouts, and prevent overstocking. Apps can be designed to automate reorder processes, improve stock accuracy, and align inventory with demand forecasts.

Streamlined Order Fulfilment

Custom-built apps can streamline order fulfilment, ensuring every stage—from picking and packing to dispatch—is clearly monitored and managed. Real-time dashboards and alerts notify teams instantly about potential delays or errors, allowing immediate corrective action.

Improved Supplier Management

Power Apps enables retailers to create supplier performance monitoring tools that capture KPIs around delivery accuracy, product quality, and compliance metrics, ensuring suppliers adhere to agreed standards and timelines.

Regulatory and Compliance Management

Retailers can easily develop compliance-tracking applications to ensure all regulatory requirements, from packaging standards to modern slavery compliance, are continuously monitored and met, reducing the risk of costly breaches.

Practical Applications of Power Apps in Retail Order Fulfilment

Retailers can use Power Apps in multiple ways across their order fulfilment processes:

Real-Time Order Tracking

Implement apps that offer visibility into order statuses, from warehouse picking to customer delivery, reducing customer service issues and operational uncertainty.

Demand Forecasting Integration

Integrate Power Apps with advanced analytics tools to dynamically adjust forecasts based on real-time data, improving stock availability and reducing unnecessary inventory holding.

Automated Exception Reporting

Automate the detection and notification of fulfilment exceptions, such as delayed shipments or incomplete orders, allowing for rapid corrective action.

Streamlined Order Fulfilment Workflow

Create tailored apps that guide warehouse teams through step-by-step fulfilment processes, significantly reducing manual errors and improving overall efficiency.

Realising Immediate Benefits with MS Power Apps

Retailers implementing Power Apps typically see immediate improvements in operational controls, including:

Reduced operational errors
Lower inventory carrying costs
Increased fulfilment speed and accuracy
Enhanced supplier compliance and performance
Greater regulatory adherence

How Trace Consultants Can Help

At Trace Consultants, our experienced team works closely with retailers across Australia and New Zealand to leverage technology for tangible, sustainable improvements in supply chain risk management.

Expertise in Digital Transformation

Trace Consultants specialises in leveraging MS Power Apps to deliver tailored, practical solutions aligned to specific retail operational requirements. Our consultants assist from initial assessment and app design through to implementation, user training, and ongoing support.

Our Service Offering Includes:

Strategic Assessment

We begin by deeply understanding your current challenges, operational processes, and risks to define a clear roadmap for technology integration.

Solution Design and Implementation

Trace designs Power Apps tailored to your specific needs, ensuring seamless integration with your existing systems to enhance, rather than disrupt, operations.

Training and Change Management

Our team ensures seamless transition by providing comprehensive training and change management support, securing staff buy-in and effective adoption.

Ongoing Optimisation

Our continuous support approach ensures that your Power Apps evolve alongside your operational needs, maintaining high performance and control.

Why Partner with Trace Consultants?

Retail supply chains require specialists who understand the nuanced risks and operational pressures unique to FMCG and retail sectors. Trace Consultants combine extensive experience in supply chain management, technological expertise in Microsoft platforms, and a strong track record of delivering tangible, sustainable outcomes for retailers across Australia and New Zealand.

Our approach is practical and hands-on. We work alongside your internal teams, fostering knowledge transfer and ensuring your digital transformation initiatives translate into measurable results.

Retailers that proactively manage operational supply chain risks through digital solutions like Microsoft Power Apps can significantly enhance resilience, agility, and operational efficiency. By investing in customised, low-code applications, retailers not only reduce risk but also unlock new opportunities for operational improvement.

Trace Consultants are ready to partner with you, leveraging our expertise in supply chain strategy and MS Power Apps to ensure your organisation thrives in today's challenging retail environment.

Ready to transform your order fulfilment processes with greater control and fewer risks? Contact Trace Consultants today.

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Strategy & Design

February 18, 2023

What are the Attributes of a Great Management Consultant in Supply Chain?

Thinking of a career in supply chain consulting?

What are the Attributes of a Great Management Consultant in Supply Chain?

A great management consultant in supply chain can make a significant impact on a business by optimising the supply chain processes, reducing costs, improving efficiency, and maximising profits. However, finding the right management consultant can be a daunting task for businesses. This article will discuss the attributes that businesses should look for when hiring a management consultant for their supply chain operations.

Deep understanding of supply chain management

A great management consultant should have a deep understanding of supply chain management. They should be knowledgeable about the different supply chain models, inventory management, logistics, transportation, and procurement. This knowledge allows them to provide valuable insights into supply chain operations and recommend changes that can improve efficiency.

Excellent analytical and problem-solving skills

The ability to analyse data, identify problems and provide solutions is crucial for a management consultant. A great management consultant should be skilled in data analysis and have a deep understanding of supply chain data. They should also be able to identify patterns, trends, and insights from data to help businesses make informed decisions.

Strong communication and interpersonal skills

A management consultant should have excellent communication and interpersonal skills. They should be able to listen to the concerns of the business and communicate complex information in a clear and concise manner. Furthermore, they should be able to work well with people at all levels of the organisation and build strong relationships with clients.

Industry-specific knowledge and experience

A great management consultant should have industry-specific knowledge and experience. They should have worked with businesses in the same industry and have a deep understanding of industry-specific supply chain challenges. This knowledge enables them to provide tailored solutions to businesses that are specific to their industry.

Innovative and creative thinking

The ability to think outside the box and come up with innovative solutions is crucial for a management consultant. They should be able to identify opportunities for improvement and suggest new and creative ways of addressing supply chain challenges. This innovative thinking can help businesses stay ahead of their competition and achieve their goals.

Project management skills

A great management consultant should have strong project management skills. They should be able to develop project plans, set realistic goals and timelines, and manage project resources effectively. This skill ensures that projects are completed on time, within budget, and to the satisfaction of the client.

Flexibility and adaptability

The ability to adapt to changing circumstances and be flexible is crucial for a management consultant. They should be able to adjust their approach based on the unique needs of the business and be open to change. This flexibility enables them to work with businesses of all sizes, in different industries, and with varying degrees of complexity.

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‍Contact us today, trace. your supply chain consulting partner.

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