Posted on July 24, 2023
Aiming to provide relevant and up-to-date information to help you navigate your supply chain.
Ocean Updates
Pacific Northwest Highlights
There have been ongoing labor disruptions at the British Columbia ports of Vancouver and Prince Rupert this month. After a strike action from 1-13 July had concluded with a tentative agreement between the ILWU Canada and the BCMEA, disruptions resumed on 18 July when ILWU Canada released a statement that their caucus had voted down the Canadian federal mediator’s recommended terms of settlement. This resulted in cargo operation shutdowns at the ports 18-19 July.
A subsequent ruling by the Canada Industrial Relations Board (CIRB) resulted in labor’s return to work on 19 July, followed by ILWU Canada issuing a new 72-hour notice of strike action effective 22 July 2023. The union then issued a retraction of the 72-hour notice. At the time of this writing, Labor has returned to work. However, the tentative agreement must still be ratified by the ILWU Canada membership before it can be finalized.
While some progress had been made on processing the cargo that had built up during the work stoppages, a backlog still exists. The Port of Vancouver is implementing its recovery plan. The ports represent the two of the highest export dwelling locations by container volume in our network. Prince Rupert has one of our highest import dwelling locations. We will be working to ensure we have adequate capacity to service customer needs into the Pacific Northwest in the weeks to come as operations begin to normalize.
Pacific Southwest Highlights
Volumes continue to track with anticipated peak season in the Pacific Southwest. We have published service proforma changes on the Transpacific service schedule for both coasts. The changes will enhance the reliability of our services and reduce schedule gaps and slidings. Our revised network options will improve weekly coverage and allow for better supply chain planning.
Most US West Coast ports are clear and operating without delays, except for Oakland where we are seeing 2-3 days of vessel waiting time. The terminal is still recovering from disruptions experienced in early June.
East Coast Highlights
We are meeting Transpacific customer demand into the East Coast with service levels of increasing reliability. There continues to be reduced load capacity for vessels transiting the Panama Canal due to draft restrictions, however, the rains have returned to the region and the Panama Canal Authority postponed additional adjustments to authorized drafts in its most recent advisory to shipping. The current draft for the neopanamax locks is 44 ft. (13.41 m).
Transatlantic services into the East Coast are running near proforma schedules with Maersk achieving best-in-class in reliability ratings among the top-14 carriers according to Sea-Intelligence’s performance reporting. Unlike the Transpacific, the Transatlantic service into the East Coast is in a traditional lull season. Bookings windows have been extended from the normal three weeks to five to give European customers more time to prepare and plan during their summer holiday travel season. Transatlantic capacity is available to accept customer volumes as needed.
Capacity into the U.S. East Coast originating from our IMEA region (India, Middle East, and Africa) is available to accept customer volumes as needed. Service into the East Coast via the MECL, which originates in Jebel Ali with stops at Salalah and Algeciras before arriving in Newark, continues to lead in reliability. With its South Africa point of origin, the Maersk AMEX is experiencing peak reefer season that is expected to last another two months.
Most East Coast ports are clear and operating without delays except for Savannah, which is seeing congestion resulting from vessel bunching and berth construction projects that are anticipated to be complete in December. Class 2 vessel wait times have risen to four days and there are eight vessels at anchor. We expect to continue seeing vessel bunching and vessels at anchor until the first week of August.
Landside Updates – Transportation
Home Delivery World –
Top three customer questions on
“heavy, hard to handle” delivery logistics
Maersk representatives traveled to Philadelphia last month, joining thousands of logistics professionals for the annual Home Delivery World conference. The event provides a unique opportunity to learn about the latest developments in the supply chain that supports “heavy, hard to handle delivery” (H3D) goods – which includes everything from dishwashers to televisions, workout machines, and even patio furniture.
At this year’s event, Maersk personnel took to the stage and walked the aisles to share their views on creating a world-class delivery experience to a conference audience composed of the top names in retail. This year’s attendees were particularly focused on the pressures to contain costs, improving omnichannel models, and the ever-present need to enhance shipment visibility. The Maersk team shared these top-of-mind customer questions along with the answers below.
Q: What’s the best way to deal with increasing cost pressures for H3D?
A: Review cost effective service level options that may work for your customers.Years of high inflation have taken their toll. Costs have been increasing since the advent of the pandemic. Meanwhile, consumers have shifted purchasing behaviors from goods to services. To hold onto shrinking volumes, many competitors are lowering costs in a fiercely contested marketplace.
Retailers looking to manage costs should take a close look at H3D service levels. There are usually good options that can reduce costs while still meeting customer expectations. For example, one set of customers might accept nothing less than white glove service that delivers a big and bulky item to the room of choice for unpacking, set up, and debris removal. Another customer set might be satisfied with simply leaving a delivery in a safe area without signature. Each level of service represents a cost vs. service tradeoff, the value of which depends upon the nature of your cargo and your client’s expectations.
Q: What’s the optimal set up to deliver an omnichannel strategy?
A: A viable omnichannel strategy is one that integrates options and a great customer experience.Bricks and mortar retailers recognize that e-commerce penetration is expected to grow across all product categories, be it consumer electronics, home improvement, or home furnishings. Given this trend, businesses are reviewing options to integrate omnichannel delivery options into their business models. This could involve traditional shipments from a distribution center, direct shipments from vendors, or innovative back-of-store fulfillment strategies. The preferred option is the one that best aligns to the footprint of customers served in the most efficient manner possible, all while keeping margins within an acceptable range. However, the best option is the one that is both efficient and offers a superior delivery experience for the customer.
Quality of care is essential to ensure the products arrive at the customer’s home in the condition they were intended. No matter where your shipment is coming from, professional delivery teams must have the right process, procedures, and equipment on hand so that the shipment arrives damage-free and when promised.
Q: How can we maintain the highest levels of shipment visibility?
A: Choose partners that have a network expansive enough to cover your visibility needs.Today’s consumers have high delivery visibility expectations, particularly for H3D deliveries that tend to have higher values. For most deliveries into high population zones, visibility is routine and cost effective. The challenge begins with deliveries to remote area customers. In total, approximately 40 percent of deliveries are classified as “beyond,” which indicate destinations that are more than 100-miles from a shipping station. “Beyond” shipments may require a delivery-by-agents approach. Ask your service provider if beyond shipments represent any potential visibility blind spots.
can reduce exposure to blind spots by working with providers that have an expansive geographical footprint and their own controlled assets. Looking forward, choose delivery partners that are not only capable of servicing where your customers reside today, but where they will be tomorrow as well. Top performing delivery service providers are attuned to demographic shifts and committed to growing capability where it will be needed in the future.
For more information on heavy, hard to handle delivery logistics, visit delivers.maersk.com.
Air Update
Maersk expands its global air freight services with new Atlanta strategic air cargo hub
In its July announcement, Maersk shared the news of its new 123,000 square foot air freight gateway near Atlanta Hartsfield Jackson International Airport that offers direct planeside recovery with immediate transfers to the new facility.
The facility is ideal for local and regional distribution and is in close proximity to access commercial carrier capacity. The site will act as a forward staging facility for our Greenville, South Carolina, own controlled flight operations – from which we operate five B74F return Maersk flights per week to Hahn, Germany, and two B76F flights per week to Shenyang, China, with onward connection to Seoul, Korea.
The new facility has 39 dock doors, two oversized drive-up ramps, and is a Bonded Container Freight Station (CFS) with U.S. Customs. In addition, it operates as a U.S. Transportation Security Administration (TSA) Certified Cargo Screening Facility (CCSF) to ensure timely, secure handling of air freight. This enables priority handling of both import and export airline unit load devices.
The new Atlanta facility builds on several initiatives designed to bolster Maersk’s air freight services in North America, including a new Chicago air freight gateway facility and new air freight service with regular flights between South Carolina, Korea, and China.
PRODUCT SPOTLIGHT
Simplify your last-mile with Maersk E-Delivery
When your consumers range from metropolitan apartment dwellers to homeowners in the heartland, our E-Delivery parcel solutions can give you access to all the major carriers across the country to make sure that your last-mile delivery becomes easier and more economical.
Let your customers benefit from:
- Multi-carrier parcel optimization
- Our differentiated USPS relationship
- Reduced shipping costs through volume bundling
- Improved customer experience
- Full visibility through standardized tracking
- Central platform to manage home delivery
Visit Maersk.com to learn how to get closer to your destination with Maersk E-Commerce Logistics.
Topics, Trends & Insights
Discover supply chain innovation education
Enhance your knowledge of supply chain innovation at Maersk’s Global Innovation Center
The ability of a company to innovate supply chain tools, technologies, and processes is quite dependent upon the existence of a supportive culture. At Maersk, we believe that this not only requires an investment in employee education but also fostering a culture where innovation is a fundamental component of how we do business.
To meet our innovation goals, we have developed a specialized training program in partnership with the Massachusetts Institute of Technology. This program offers select Maersk leaders and subject matter experts a hands-on understanding of innovation ecosystems, state-of-the-art technologies, digital learning tools, and even good old-fashioned board games designed to get teams to think about supply chain challenges in new ways.
The impact of our education program is evident in the marked mindset shift among participants, leading to greater support for innovative practices and the expansion of personal innovation initiatives. Recognizing the power of education, Maersk now intends to share innovative session activities with customers, thus empowering them to foster innovation within their own organizations.
Maersk innovation students discuss supply chain modeling in MIT’s Computational and Visual Education (CAVE) Lab. The application can help customers explore the impact of changing their network design on cost and transit time.
With the inauguration of our new Global Supply Chain Innovation Center in Jersey City, NJ, we are now offering customers the opportunity to actively participate in the world of supply chain innovation. Through specialized sessions led by industry experts, customers can gain insights into the latest advancements, such as network simulations, robotics, and drone applications. By immersing themselves in this environment of innovation, customers can leverage these technologies and novel approaches to optimize their processes and thereby improve their customer experiences.
Our innovation center offers a collaborative space where academia, start-ups, and industry experts can interact. This offers our customers the chance to exchange ideas, explore possibilities, and find tailored solutions for their unique supply chain challenges. By combining Maersk’s expertise with customers’ firsthand knowledge, we aim to co-create innovative solutions that propel businesses forward.
Customers interested in joining us on our journey to revolutionize supply chain management should reach out to their Maersk representative to learn more. For more information about Maersk’s innovation center, please visit our website or read about the ribbon cutting ceremony held this past May.
