Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.
Airfreight users, who had been dealing most of the year with a tightening market for capacity, are now also coping with
what could be a late-peak season crush for airfreight services as disruptions at West Coast ports are pushing some businesses
to shift their goods from ocean to air.
Tensions between the International Longshoremen & Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) over
negotiations for a new collective bargaining agreement have been increasing over the past few weeks, and according to PMA, led
to ILWU-orchestrated slowdowns at the ports of Los Angeles, Long Beach, Seattle, and Tacoma. On Tuesday, the slowdowns spread
to the Port of Oakland, where dockworkers temporarily shut down a terminal operated by SSA Marine, a Seattle-based stevedoring,
marine terminal operations, and intermodal management firm. Mike Zampa, a spokesman for the Port of Oakland, said late yesterday
that workers have returned to their jobs and normal operations have resumed.
ILWU has declined comment on the PMA allegations of slowdowns, and both sides have spent most of the month hurling insults at
one another. The 13,600 ILWU members have been working without a contract since the prior six-year pact expired on July 1, and
until recently, the 29 West Coast ports covered under the agreement have operated normally.
The dispute has forced some businesses to shift goods that would normally move by ocean to higher-priced air to ensure they
enter U.S. commerce before the holiday shopping season begins. Ann Inc. (formerly Ann Taylor), a women's specialty apparel
retailer, will be hit by a double-whammy when it reports its fiscal third-quarter results later this month. The company said
in a mid-quarter update Nov. 6 that sales in the first half of the period were hurt by shipment delays due to labor-related
uncertainty at the ports. A shift to air freight mitigated the delivery issues, but at a cost of $8 million in air shipping
expenses, it said. Airfreight users, even if they've negotiated capacity agreements with airlines, are still subject to
peak-season surcharges if they want rush freight moved.
For airfreight forwarders, the turmoil at the ports throws another log on what has been a yearlong fire revolving around a
general tightening of international air capacity, especially in the eastbound trans-Pacific market. Carrier rates have been
driven up for much of the year by a pickup in demand, ongoing concerns over West Coast port congestion separate from the labor
issue, the simultaneous launches of two Apple Inc. iPhones, and a secular decline in the production and delivery of all-cargo
aircraft. "There are [marketplace] expectations that will compound the situation in the coming days, but we have seen the
airlines with large backlogs before the port slowdown hit," said Rich Zablocki, vice president, North American air freight, for
Dutch forwarder and third-party logistics provider Ceva Logistics.
In early October, DHL Global Forwarding, the world's largest air freight forwarder, launched a capacity management program
designed to secure all-cargo lift on key trade lanes from Asia to North America and into Latin America, as well as on certain
Asia-to-Europe routes. The forwarder is negotiating so-called blocked-space agreements with airlines that will guarantee
capacity for a certain amount of time in return for a specified amount of freight. Rates are generally kept constant for the
duration of the agreements.
Mathieu Floreani, CEO Americas for DHL Global Forwarding, said the move is in response to mounting customer and company
concerns over the availability of all-cargo equipment in the years ahead. The capacity situation is dire on certain trade
lanes, though it doesn't affect the global market, Floreani said in an October interview. Many of his customers, even those
that don't require main-deck lift and can manage with using below-deck aircraft space, have expressed worries over all-cargo
space and the rates they'll be forced to pay for it, he said.
Floreani declined comment on the amount of space the forwarder is attempting to procure. He said an agreement's duration would
depend on the trade lane involved. However, he expects most compacts to extend only beyond the end of 2015.
Demand for air freighters, especially newbuilds, is likely to diminish over the next two decades as a shift to regionalized
or local sourcing and production, a migration to lower-cost seafreight on certain lanes, and an abundance of passenger aircraft
with lower-holds priced as an inexpensive byproduct of passenger services make costly freighter purchases less appealing. In its
biennial global air cargo forecast released last month, Boeing Co. projects 840 new freighters to be delivered worldwide through
2033. In its prior report two years ago, the aircraft maker forecast 935 new freighters to be delivered from 2012 through 2031.
Boeing also scaled back its forecast for total freighter deliveries, which include aircraft converted from passenger
configuration. In this year's forecast, it forecast deliveries of 2,170 freighters through 2033. Two years ago, it projected
2,754 freighter deliveries through 2031.
Global airfreight activity in September grew by 5.2 percent from the 2013 period, the International Air Transport Association
(IATA), the global airline trade group, said earlier this month. Most world markets showed strong growth, IATA said. The exceptions
were Europe, which reported a year-over-year decline, and Latin America, which posted flat results.
In its 2014 forecast, Boeing projected a 4.7-percent annualized growth rate worldwide through 2033, which would result in a
doubling of global cargo activity by then.
Leaders at American ports are cheering the latest round of federal infrastructure funding announced today, which will bring almost $580 million in Port Infrastructure Development Program (PIDP) awards, funding 31 projects in 15 states and one territory.
“Modernizing America’s port infrastructure is essential to strengthening the multimodal network that supports our nation's supply chain,” Maritime Administrator Ann Phillips said in a release. “Approximately 2.3 billion short tons of goods move through U.S. waterways each year, and the benefits of developing port infrastructure extend far beyond the maritime sector. This funding enhances the flow and capacity of goods moved, bolstering supply chain resilience across all transportation modes, and addressing the environmental and health impacts on port communities.”
Even as the new awardees begin the necessary paperwork, industry group the American Association of Port Authorities (AAPA) said it continues to urge Congress to continue funding PIDP at the full authorized amount and get shovels in the ground faster by passing the bipartisan Permitting Optimization for Responsible Transportation (PORT) Act, which slashes red tape, streamlines outdated permitting, and makes the process more efficient and predictable.
"Our nation's ports sincerely thank our bipartisan Congressional leaders, as well as the USDOT for making these critical awards possible," Cary Davis, AAPA President and CEO, said in a release. "Now comes the hard part. AAPA ports will continue working closely with our Federal Government partners to get the money deployed and shovels in the ground as soon as possible so we can complete these port infrastructure upgrades and realize the benefits to our nation's supply chain and people faster."
Supply chains are poised for accelerated adoption of mobile robots and drones as those technologies mature and companies focus on implementing artificial intelligence (AI) and automation across their logistics operations.
That’s according to data from Gartner’s Hype Cycle for Mobile Robots and Drones, released this week. The report shows that several mobile robotics technologies will mature over the next two to five years, and also identifies breakthrough and rising technologies set to have an impact further out.
Gartner’s Hype Cycle is a graphical depiction of a common pattern that arises with each new technology or innovation through five phases of maturity and adoption. Chief supply chain officers can use the research to find robotic solutions that meet their needs, according to Gartner.
Gartner, Inc.
The mobile robotic technologies set to mature over the next two to five years are: collaborative in-aisle picking robots, light-cargo delivery robots, autonomous mobile robots (AMRs) for transport, mobile robotic goods-to-person systems, and robotic cube storage systems.
“As organizations look to further improve logistic operations, support automation and augment humans in various jobs, supply chain leaders have turned to mobile robots to support their strategy,” Dwight Klappich, VP analyst and Gartner fellow with the Gartner Supply Chain practice, said in a statement announcing the findings. “Mobile robots are continuing to evolve, becoming more powerful and practical, thus paving the way for continued technology innovation.”
Technologies that are on the rise include autonomous data collection and inspection technologies, which are expected to deliver benefits over the next five to 10 years. These include solutions like indoor-flying drones, which utilize AI-enabled vision or RFID to help with time-consuming inventory management, inspection, and surveillance tasks. The technology can also alleviate safety concerns that arise in warehouses, such as workers counting inventory in hard-to-reach places.
“Automating labor-intensive tasks can provide notable benefits,” Klappich said. “With AI capabilities increasingly embedded in mobile robots and drones, the potential to function unaided and adapt to environments will make it possible to support a growing number of use cases.”
Humanoid robots—which resemble the human body in shape—are among the technologies in the breakthrough stage, meaning that they are expected to have a transformational effect on supply chains, but their mainstream adoption could take 10 years or more.
“For supply chains with high-volume and predictable processes, humanoid robots have the potential to enhance or supplement the supply chain workforce,” Klappich also said. “However, while the pace of innovation is encouraging, the industry is years away from general-purpose humanoid robots being used in more complex retail and industrial environments.”
An eight-year veteran of the Georgia company, Hakala will begin his new role on January 1, when the current CEO, Tero Peltomäki, will retire after a long and noteworthy career, continuing as a member of the board of directors, Cimcorp said.
According to Hakala, automation is an inevitable course in Cimcorp’s core sectors, and the company’s end-to-end capabilities will be crucial for clients’ success. In the past, both the tire and grocery retail industries have automated individual machines and parts of their operations. In recent years, automation has spread throughout the facilities, as companies want to be able to see their entire operation with one look, utilize analytics, optimize processes, and lead with data.
“Cimcorp has always grown by starting small in the new business segments. We’ve created one solution first, and as we’ve gained more knowledge of our clients’ challenges, we have been able to expand,” Hakala said in a release. “In every phase, we aim to bring our experience to the table and even challenge the client’s initial perspective. We are interested in what our client does and how it could be done better and more efficiently.”
Although many shoppers will
return to physical stores this holiday season, online shopping remains a driving force behind peak-season shipping challenges, especially when it comes to the last mile. Consumers still want fast, free shipping if they can get it—without any delays or disruptions to their holiday deliveries.
One disruptor that gets a lot of headlines this time of year is package theft—committed by so-called “porch pirates.” These are thieves who snatch parcels from front stairs, side porches, and driveways in neighborhoods across the country. The problem adds up to billions of dollars in stolen merchandise each year—not to mention headaches for shippers, parcel delivery companies, and, of course, consumers.
Given the scope of the problem, it’s no wonder online shoppers are worried about it—especially during holiday season. In its annual report on package theft trends, released in October, the
security-focused research and product review firm Security.org found that:
17% of Americans had a package stolen in the past three months, with the typical stolen parcel worth about $50. Some 44% said they’d had a package taken at some point in their life.
Package thieves poached more than $8 billion in merchandise over the past year.
18% of adults said they’d had a package stolen that contained a gift for someone else.
Ahead of the holiday season, 88% of adults said they were worried about theft of online purchases, with more than a quarter saying they were “extremely” or “very” concerned.
But it doesn’t have to be that way. There are some low-tech steps consumers can take to help guard against porch piracy along with some high-tech logistics-focused innovations in the pipeline that can protect deliveries in the last mile. First, some common-sense advice on avoiding package theft from the Security.org research:
Install a doorbell camera, which is a relatively low-cost deterrent.
Bring packages inside promptly or arrange to have them delivered to a secure location if no one will be at home.
Consider using click-and-collect options when possible.
If the retailer allows you to specify delivery-time windows, consider doing so to avoid having packages sit outside for extended periods.
These steps may sound basic, but they are by no means a given: Fewer than half of Americans consider the timing of deliveries, less than a third have a doorbell camera, and nearly one-fifth take no precautions to prevent package theft, according to the research.
Tech vendors are stepping up to help. One example is
Arrive AI, which develops smart mailboxes for last-mile delivery and pickup. The company says its Mailbox-as-a-Service (MaaS) platform will revolutionize the last mile by building a network of parcel-storage boxes that can be accessed by people, drones, or robots. In a nutshell: Packages are placed into a weatherproof box via drone, robot, driverless carrier, or traditional delivery method—and no one other than the rightful owner can access it.
Although the platform is still in development, the company already offers solutions for business clients looking to secure high-value deliveries and sensitive shipments. The health-care industry is one example: Arrive AI offers secure drone delivery of medical supplies, prescriptions, lab samples, and the like to hospitals and other health-care facilities. The platform provides real-time tracking, chain-of-custody controls, and theft-prevention features. Arrive is conducting short-term deployments between logistics companies and health-care partners now, according to a company spokesperson.
The MaaS solution has a pretty high cool factor. And the common-sense best practices just seem like solid advice. Maybe combining both is the key to a more secure last mile—during peak shipping season and throughout the year as well.
The Boston-based enterprise software vendor Board has acquired the California company Prevedere, a provider of predictive planning technology, saying the move will integrate internal performance metrics with external economic intelligence.
According to Board, the combined technologies will integrate millions of external data points—ranging from macroeconomic indicators to AI-driven predictive models—to help companies build predictive models for critical planning needs, cutting costs by reducing inventory excess and optimizing logistics in response to global trade dynamics.
That is particularly valuable in today’s rapidly changing markets, where companies face evolving customer preferences and economic shifts, the company said. “Our customers spend significant time analyzing internal data but often lack visibility into how external factors might impact their planning,” Jeff Casale, CEO of Board, said in a release. “By integrating Prevedere, we eliminate those blind spots, equipping executives with a complete view of their operating environment. This empowers them to respond dynamically to market changes and make informed decisions that drive competitive advantage.”