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By Tim Gundlach
The effects of the Covid-19 pandemic continue to be felt in the global supply chain. As a result of unpredictable sourcing and transit times, the reliability of traditional “Non-peak” and “Peak” seasons in logistics is no longer applied. The global supply chain shifted from “just in time” logistics and instead implemented “just in case” logistics. The end result is warehouses becoming choked with products in preparation of the upcoming holiday season.
Suddenly the world which could not move products fast enough just as quickly faces a dramatic drop off in global demand due to global inflation and recession concerns as well as concern of escalation of the conflict in Ukraine.
The most recent concern in the United States was the potential for longshoreman and rail strikes. This routed cargo away from the West Coast, sailing to alternative ports on the Gulf and East Coasts. This influx of containers created berthing delays and port congestion in those areas. As of this video, US rail and labor unions are threatening a strike as early as Nov 19th, 2022.
So what’s next?
The short answer is nobody knows for certain… and it depends on how issues shape up on topics like West Coast port labor fights, Gulf and East Coast port congestion and the geopolitical arena with regard to the world economy, energy shortages in Europe, and the state of conflict in Ukraine.
Overall, we are confident about a few things going into November: (1) Ocean and air rates should remain flat or decline in the next month (2) The US Govt cannot allow labor strikes to occur as it would be detrimental to the US Economy (3) Port congestion and chassis issues should improve in time. (fingers crossed)
As always, PGL remains available to discuss particular needs and-or concerns at any time, in our continuing effort to assist in mitigating risk to our partners.
Follow us on social media at @ShipPGL
Welcome to the PGL Video Newsletter, where we give you a brief recap of all of the activity from the prior month. October was full of activity, and here’s a peek at just some of the charitable events, big moves, process insights and more.
Through our partnership with PGL, we found efficiency we could not have managed ourselves, maintained record margins with minimum retailer penalties, and I could watch it all happen with the convenience of the Connect App.
Jason Mooneyham
Sr Director of Operations, Incipio
Complex problems require custom solutions. After trying multiple shipping and logistics providers, the right partner makes all the difference. PGL Connect Technology coupled with decades of experience lead Incipio merchandise to be on time and became more profitable.
THE PROBLEM
Incipio had engaged with other outsourced Logistics Departments before, each failing to maximize the opportunity, leading to use of the wrong mode of transportation and lost profit due to penalties. Providing a valued product is only part of the equation. Keeping retailers supplied is crucial, and PGL knows how to get this done.
THE SOLUTION
Beginning in 2017, PGL was able to augment Incipio infrastructure as well as find new efficiencies. Investigation into their processes revealed that their internal warehousing in Corona California was more a hindrance than help, and the move to use the PGL facility allowed both added capacity as needed, and faster Cross Dock Labeling, an important factor when dealing with retailers. Additionally, this allowed PGL to provide additional value and savings with an Duty
Draw Back program.
PGL SERVICES UTILIZED:
SHIPMENT MODES:
THE BENEFIT
Incipio was able to realize tangible benefit by reducing penalties from retailers, delivering on time according to their schedules with complete product inventory (On Time In Full) with a monthly savings of $20,000 per month. Making sure that Incipio was in-store on time for their peak season was the highest priority, leading to an astounding 96.5% improvement in OTIF from 28%.
VISIBILITY:
PEAK SEASON:
The Difference Makers:
What factors made the biggest impact for Incipio?
It has been a truly phenomenal experience to work with PGL as our preferred logistics provider from the very beginning. They have been able to signicantly reduce cost, cut numerous ineciencies out of our processes and raise the quality of our supply chain performance at the same time
A net savings of over $20,000 in the last 25 weeks of implementation. Average trans-load freight costs have been cut in half with PGL’s facility. PGL has moved over 27,000 CBMs year-to-date for Pier 1.
THE OPPORTUNITY
With their shipping costs expected to rise within the next year, retail home furnishings giant Pier 1 imports reached out to PGL to start a dialogue about creating a cost-containment strategy for both short and mid-term fluctuations in the market. Pier 1 identified financial advantages to outsourcing the bulk of the supply chain responsibilities to a logistics service provider and confirmed the efficiencies a strategic logistics partnership could create.
In the modern world of retail, efficiencies are everything. Flubbed product releases can create a lack of trust between store locations and the corporate office. Furthermore, without the staff and software to coordinate arrivals and breakdowns at their distribution centers, local freight carriers continued to fall behind, creating long wait times and additional container storage charges. Pier 1 imports needed a dedicated transportation specialist to alleviate the confusion and get their products to the shelves — on time, and in one piece.
THE EXECUTION
To gain a better picture of Pier 1’s transportation and logistics needs, PGL implemented a software and reporting protocol to survey the effectiveness of their current operations. What PGL found was that Pier 1 had been using a number of LTL (less than truckload) carriers as a preferred method of transportation. While this method works for individual pallets, it is often cost-prohibitive when moving large quantities of goods.
In the spirit of the partnership, PGL placed a highly experienced employee on-site at Pier 1, who understood their needs and could simultaneously match those needs with the core competencies of PGL. PGL saw the need for their own distribution center to aid Pier 1 in overflow issues within their DC network. To relieve inventory congestion, a 90,000 sq ft. warehouse was added under PGL to support the expanded footprint. Finally, all warehouse management and billing were consolidated under PGL’s supervision for greater transparency and more consistent Oversight.
THE OUTCOME
The fully integrated software led to substantial ease-of-use when planning Pier 1’s future inventory needs. Face-to-face interaction with PGL’s in-house logistics expert contributed to more immediate problem-solving. The separation of 27,000 CBMs from Pier 1 to a PGL distribution center relaxed that troublesome backup that accounted for late product releases in their previous mode of operation. The disconnect accounted for a significant number of detention charges. PGL created efficiencies for Pier 1’s operational network while also cutting their average transload freight costs in half!
PGL reduced Pier 1’s spend drastically in year 1 and has significantly improved in this performance since. Pier 1’s objective of reducing the bottleneck at their distribution facilities and creating overall efficiencies, while reducing spend, was achieved. The partnership between Pier 1 and PGL created a synergy where PGL has become part of Pier 1’s DNA and is viewed as Pier 1’s go-to for all their logistics needs.
Warriors Ethos Care is a Veteran non-profit that stood up in a short time, mostly by combat Veterans who have served in Iraq and Afghanistan. The humanitarian disaster is quickly unfolding on so many families who served alongside U.S. service members and in the capacity of the Afghan government (military, lawyers, judges, etc). This puts them and anyone related in dire risk. With over 550,000 refugees fleeing since January, tens of thousands have found themselves in temporary transitional locations such as Qatar, Kuwait, and European military bases. The U.S. military isn’t equipped or prepared to sustain so many refugees for prolonged periods of time. Warriors Ethos felt that they must and should do something.
“These are people who believed in the idea of Freedom; who took risks with us to try to see Afghanistan become something better. We couldn’t allow these poor people to be forgotten. Our Warrior Ethos as Veterans is to protect and care for those in need. It’s our responsibility to see beyond the color of their passport, and try to help those who helped us for so long.”
Warriors Ethos Care quickly worked to get much-needed supplies, yet faced challenges to deliver them. Companies like PGL, Hypori, and Intelligent Waves stopped what they were doing, without hesitation, to assist.
“Can you imagine trying to ship 12 pallets of materials into a Middle Eastern country, clear customs, deliver them to a military base, and get them distributed to those in need? We can’t do this alone; we need more companies like PGL to step up and help us make a difference!”
PGL and Warriors Ethos Care has successfully delivered 30,000 hygiene kits (containing toothpaste, toothbrushes, shampoo, soap, and lotion), 10,000 feminine hygiene pads, and 5,000 packs of baby wipes to Qatar Airbase.
PGL (Perimeter Global Logistics), is one of the world’s fastest-growing woman-owned logistics companies, providing customized, global solutions backed by advanced technology and a commitment to reliability—connecting businesses worldwide with seamless supply chain expertise.
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