The federal government came under heavy fire for what was seen as a slow response to help victims of Hurricane Katrina, the worst natural disaster to occur on U.S. soil. Fortunately, the same can't be said of the corporate world, which rushed to deliver relief supplies to the devastated Gulf Coast region even as the contributors themselves faced losses. "This …hurricane has had such an overwhelming impact on just about the whole country," says David Ross, a supply chain specialist with Intentia Americas. "Across the board there are just all kinds of issues."
But none of those issues was big enough to deter logistics and distribution companies, which responded with a rush of cash and in-kind donations. "I'm not going to suggest that our members are any more patriotic or charitable than anyone else, but there has just been a massive private-sector outpouring from both corporations and individuals with respect to equipment and supplies needed in the relief effort," says Dirk Van Dongen, president of the National Association of Wholesaler-Distributors.
After Katrina hit in late August, help came from far and wide and from companies both large and small. Donors ranged from billion dollar corporations like UPS, FedEx, DHL and Bridgestone-Firestone, to smaller independent firms like The Shippers Group Warehouse, a Dallas-based third-party logistics service company (3PL). As this issue went to press, Mark Strickland, president of Shippers Group Warehouse, was doing his best to fill requests from some of his New Orleans-area customers for pallets of emergency supplies even as he worried about other New Orleans clients. A full week after Katrina hit, Strickland had yet to hear from a number of his customers in the area.
3PLs answer the call
Shippers Group Warehouse wasn't the only 3PL to join the relief effort. Paul Verst, president of Verst Group Logistics, a third-party provider based in Walton, Ky., reports that two company trucks loaded with relief supplies left for the region within a week of the tragedy. Verst Group was transporting food, clothing, personal hygiene items, toys, water and other goods supplied by Kroger, Procter & Gamble, Chiquita Brands and others. Verst Group's drivers volunteered their time for the two-day-plus trip, and the company donated the fuel and equipment needed. It should be noted that Chiquita mobilized its resources to help other victims at a time when the company itself was coping with hurricane-related property damage. The importer reported that its DC in Gulfport, Miss., which handled about 25 percent of its banana imports to the United States last year, was too damaged to receive shipments.
"I'm amazed at how many local companies have sent truckload after truckload of goods," says Verst, who anticipated running more trucks on the 11-hour route to Louisiana. "I am so proud of the way our teammates responded to the urgent need."
The Verst Group story is typical of what may well be thousands of similar stories that unfolded at small businesses across the country in the days following Katrina's deadly strike. Another example is that of Brian Collins, president and CEO of Commonwealth Inc. Warehousing and Distribution, who assisted his local church by providing a truck, forklift, pallet jack, pallets, stretch wrap and tape for the loading of relief trucks going to Mississippi.
Commonwealth has also donated supplies via several of its customers. "It was amazing to watch car after car coming in. Everybody had cases of bottled water and people were going to the stores and buying the materials they need down there," says Collins. "It was heart warming."
In fact, Collins' contribution to the relief effort went much further than helping his church pack trucks with relief supplies. At press time, Collins and his family had agreed to house a displaced New Orleans family in one of their rental homes, which will be furnished and supplied by their church's congregation. Collins plans to provide a job for one family member at Commonwealth's Cincinnati distribution center.
Aside from the shortage of relief supplies, the biggest issue relief workers faced was actually finding ways to get food and bottled water into the hardest-hit areas. That's where carriers and some private companies came in. Bridgestone-Firestone, for example, offered its enormous private fleet of trucks to the relief effort, and employees filled trailers with essential supplies, not tires, for delivery to the area.
DHL donated up to $500,000 of in-kind shipping services toward immediate relief efforts for Katrina's victims in Alabama,Mississippi, Louisiana and the Florida panhandle. The transportation aid will include immediate air and ground logistics and transportation support for the American Red Cross and other organizations active in both relief efforts and long-term rebuilding activities. DHL was transporting urgently needed food, water, clothing, personal care supplies, communications equipment and other essential items.
DHL has also pledged to continue its philanthropic efforts as the aid effort shifts from immediate relief to reconstruction. "We will leverage our resources and logistics expertise in support of immediate disaster relief and long-term reconstruction efforts along the Gulf Coast," says John Mullen, joint chief executive officer for DHL Express. "By harnessing our logistics expertise, our local presence, and our transportation network, we can make a difference."
DHL rivals UPS and FedEx also implemented programs intended to ease the pain from Katrina. FedEx announced that it was limiting its standard fuel surcharge in order to benefit customers hit by extremely volatile fuel prices in Katrina's aftermath. The company's fuel surcharge, which is updated weekly, will not exceed the most current prehurricane levels until the first week of October."In our industry, the fuel surcharge is designed to manage normal supply and demand market [fluctuations], not temporary spikes caused by disasters," says Douglas G. Duncan, president and CEO of FedEx Freight.
UPS pledged personnel and the use of its transport services, and had helped move more than four million pounds, or 2,000 tons, of supplies for the relief effort just a week after the hurricane struck. In Louisiana, where Gov. Kathleen Babineaux Blanco organized a team to help direct the state's emergency relief effort, UPS stepped in to support that team's distribution and logistics activities.
In consultation with Gov. Blanco and Mississippi Gov. Haley Barbour, UPS placed individual liaison officers at the command of the state governments. Two hurricane relief officers have been assigned to each of the two states and will remain accessible at all times to ensure that any emergency movement of food or supplies is handled as promptly as possible.
Filling the tanks
One of the keys to providing relief and restoring a severely snarled supply chain was getting fuel to the heavily hit areas along the Gulf Coast. Acting on a request from the Federal Emergency Management Agency (FEMA), the U.S. Department of Transportation and the U.S. Navy, Schneider National took on the task of creating a critical diesel supply chain needed to fuel emergency vehicles and generators being used for hurricane rescue and relief efforts in the greater New Orleans area.
Diesel is essential for running emergency vehicles, heavy-duty trucks and the generators that are providing power to command posts, hospitals and nursing homes. Three Schneider National bulk tanker trucks were part of a police-led caravan to the Port of New Orleans, where a U.S. tanker containing diesel fuel is docked. Crews are siphoning diesel fuel from the freighter, then transporting loads to nine to 12 base camps in and around the greater New Orleans area. The government asked Schneider to provide drivers, supervision and dispatch for this effort for 30 days, with possible extensions.
The operation is unique for Schneider, which doesn't typically transport fuel. According to company representative Janet Bonkowski, 75 percent of the company's bulk volume is classified as non-hazardous. "It's safe to say we have not done anything like this in recent memory, including some of the more recent (9-11, Hurricane Ivan) disaster efforts we've been involved in," she says. "The magnitude of this disaster and desire to do what we can to support rescue and relief efforts motivated our associates to figure out how we could logistically do this and then made it happen."
Six Schneider National bulk haulers from the hurricane-ravaged area are participating in the effort, along with several members of the company's Reserve, La., and Houston, Texas, Operating Center leadership teams.
"The donation of supplies has been huge," says Connie Harvey, a representative of the American Red Cross. "The outpouring of corporate donations has been extremely large and important to our ability to put food on tables and hand out water and other supplies to the people who need it. In-kind donations are a huge part of our operations." Harvey also noted that companies that donated employees to the cause—from truck drivers to executive logisticians—made a huge difference. "We're a largely volunteer-based organization," she says. "We do have logistics and transportation people on staff but we also have volunteers who play a critical role in assuring that our logistics and transportation operations are successful."