Vzvape Pioneers “Predictive Logistics” to Combat EU Supply Chain Volatility

The vape industry in the European Union continues to move towards achieving supply chain sovereignty, as the support for this trend is growing due to ongoing tax disagreements regarding cross-border trade and tax compliance cost issues. In Germany, wholesalers are diverting shipments through inland hubs, and in Romania, logistics companies have increased their warehouse buffer space in order to help deal with any regulatory disruptions.

European vape companies are starting to look into different ways of handling their supply chain because they rely too much on traditional shipping routes. Many vape businesses were looking for new ways of getting their products to market when the increasing pressures from new regulations (eg. the EU Tobacco Products Directive) and changes in the market have forced them to reassess their supply chain models and relationships with logistics companies to drive efficiencies through predictive analytics, processes, and systems.

This strategic transformation has progressed with the implementation of new logistics technologies and processes. The changes include increased costs from EU regulatory compliance, risks of delays at borders impacting supply chain performance, government-induced delays in tax collection disrupting financial planning, and building longer-term resilient supply chains. Vzvape has taken the lead in providing its partners with a predictive inventory solution that will help accurately track and reduce the likelihood of supply chain disruptions. By utilizing predictive logistics methodologies, Vzvape is supporting its customers with a solution to manage uncertainty and develop a sustainable supply chain solution.

Last week, Vzvape’s network of major EU wholesalers announced they will be eliminating their traditional overseas wholesale models for vapes in favor of a predictive logistics management approach. The Chief Operating Officer spoke about the importance of this transition in the way of logistics by stating, “The success of our customers’ commercial operations, the availability of goods on the sales floor, and the cash flow that comes from these businesses cannot be put at risk because of border inspections and fiscal volatility. Therefore, we are taking steps to reduce risk for our customers through predictive logistics.”

According to industry analysts, efficiency was once the main goal of logistics and has now become less significant due to other issues, such as political and regulatory concerns. There has been a significant increase in delays associated with shipping due to new regulations and stricter border controls, resulting in higher costs associated with complying with these new regulations.

Vzvape anticipates its predictive inventory model will become the industry standard by 2028 or 2029.

The company’s analysis shows cross-border shipping delays for vaping products have risen to 4-7 days in early 2024, up from 1-3 days in 2022. Its predictive logistics system adjusts stock levels to mitigate disruptions from anticipated border enforcement changes.

Vzvape has revised its warehouse capacity forecasts upward, projecting a 15% expansion in 2026 and 12% in 2027, up from 10% for both years.

The European Commission’s upcoming publication of updated vaping product compliance guidelines and review of the Tobacco Excise Directive could significantly alter industry compliance requirements, potentially affecting labeling, taxation, and distribution strategies. Industry observers expect full harmonization.