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.
The dust has settled from YRC Worldwide Inc.'s New Year's Eve brush with bankruptcy, and today the company is operating as a viable entity, albeit a fragile one.
In the background, however, sits a potential 800-pound gorilla: YRC's ability to meet pension obligations to its unionized employees come January.
As part of a series of mid-2009 concessions to help YRC conserve cash, its 35,000 employees who belong to the Teamsters union agreed to let the carrier suspend pension payments for 18 months. YRC is contractually obligated to resume contributions in January 2011. In 2011, it is expected to contribute slightly more than $300 per week—or about $15,000 a year—to the pension of each Teamster employee.
For a company struggling with hundreds of millions in losses, soft less-than-truckload (LTL) volumes, and a cut-throat pricing environment, coming up with $500 million or so to meet its 2011 pension commitments seems a tall order. YRC declined to comment other than issuing a statement through a spokeswoman that it is "contractually obligated to make the payments."
The Teamsters for a Democratic Union, a small but influential Teamsters dissident group often at odds with the mainstream leadership, doesn't think YRC can make it work. "It's a safe bet that come January, YRC will be pleading poverty and asking for an extension of the pension contribution freeze," the group said in a late February posting on its Web site.
Ken Paff, TDU's long-time president, was characteristically blunt-spoken about YRC's chances. "You want to bet the mortgage on that?" he asked in a phone interview with DC Velocity. "Because I'd hate to see you become homeless."
Others are equally skeptical. Calling it a "huge issue and potential problem," David G. Ross, analyst for Baltimore-based Stifel, Nicolaus & Co., said the Stifel analysts "don't see the company being able to make normal payments in 2011."
Charles W. Clowdis Jr., a long-time trucking executive who is today managing director, North America for the global trade and transport unit of consultancy IHS Global Insight, said YRC's pension challenges are a frequent topic of conversation with shippers across the nation. Clowdis said he doesn't know how YRC can generate the funds through its earnings power, and that it may have to resort to borrowing to raise the capital.
Should YRC need to restructure its pension payments, it will be up to Teamster leadership and the rank and file to agree to an extension of the freeze, allow YRC to gradually increase its contributions, or reject the carrier's request outright. At this writing, Teamster officials had not returned a written request for comment on the issue.
Pension overhaul sought
For his part, William D. Zollars, YRC's chairman, president, and CEO, has been actively pushing for an overhaul of the nation's multi-employer pension program, which is a pension arrangement between a trade union and a group of at least two employers in a single industry. Originally established to allow workers to change employers without losing their vesting privileges, the program required trucking companies to fund the pensions of workers and retirees from their companies and from competitors participating in the plan.
The scheme worked fine as long as there were numerous unionized trucking firms to spread the cost around. However, as company failures and consolidations over the past 30 years winnowed the ranks of unionized firms, the burden fell on those that remained to pick up an even larger portion of total retirement obligations, even for retirees who worked at bankrupt entities.
At this time, YRC and rival ABF Freight System employ most of the approximately 70,000 workers covered by the National Master Freight Agreement (NMFA), which governs labor relations between the Teamsters and trucking companies. Yet the two carriers are liable for the pension obligations of retirees who worked for competitors that have long since closed their doors and who were never employed at either YRC or ABF.
In 2007, UPS Inc., which is not part of the NMFA, paid $6.1 billion to remove 44,000 of its full-time employees from the Teamsters' Central States pension fund, one of the union's largest. UPS withdrew from the program because it wanted to avoid the future liabilities of paying into the Central States fund for its employees and for workers at other companies.
YRC and the Teamsters have thrown their support behind House legislation sponsored by Reps. Earl Pomeroy (D-N.D.) and Patrick Tiberi (R-Ohio) that would shift the pension liabilities of retirees from failed companies away from the Teamsters and to the Pension Benefit Guaranty Corp. (PBGC). The PBGC is a federal corporation that protects the pensions of more than 44 million American workers and retirees in more than 29,000 private single-employer and multi-employer defined benefit pension plans.
Donald Trump has been clear that he plans to hit the ground running after his inauguration on January 20, launching ambitious plans that could have significant repercussions for global supply chains.
As Mark Baxa, CSCMP president and CEO, says in the executive forward to the white paper, the incoming Trump Administration and a majority Republican congress are “poised to reshape trade policies, regulatory frameworks, and the very fabric of how we approach global commerce.”
The paper is written by import/export expert Thomas Cook, managing director for Blue Tiger International, a U.S.-based supply chain management consulting company that focuses on international trade. Cook is the former CEO of American River International in New York and Apex Global Logistics Supply Chain Operation in Los Angeles and has written 19 books on global trade.
In the paper, Cook, of course, takes a close look at tariff implications and new trade deals, emphasizing that Trump will seek revisions that will favor U.S. businesses and encourage manufacturing to return to the U.S. The paper, however, also looks beyond global trade to addresses topics such as Trump’s tougher stance on immigration and the possibility of mass deportations, greater support of Israel in the Middle East, proposals for increased energy production and mining, and intent to end the war in the Ukraine.
In general, Cook believes that many of the administration’s new policies will be beneficial to the overall economy. He does warn, however, that some policies will be disruptive and add risk and cost to global supply chains.
In light of those risks and possible disruptions, Cook’s paper offers 14 recommendations. Some of which include:
Create a team responsible for studying the changes Trump will introduce when he takes office;
Attend trade shows and make connections with vendors, suppliers, and service providers who can help you navigate those changes;
Consider becoming C-TPAT (Customs-Trade Partnership Against Terrorism) certified to help mitigate potential import/export issues;
Adopt a risk management mindset and shift from focusing on lowest cost to best value for your spend;
Increase collaboration with internal and external partners;
Expect warehousing costs to rise in the short term as companies look to bring in foreign-made goods ahead of tariffs;
Expect greater scrutiny from U.S. Customs and Border Patrol of origin statements for imports in recognition of attempts by some Chinese manufacturers to evade U.S. import policies;
Reduce dependency on China for sourcing; and
Consider manufacturing and/or sourcing in the United States.
Cook advises readers to expect a loosening up of regulations and a reduction in government under Trump. He warns that while some world leaders will look to work with Trump, others will take more of a defiant stance. As a result, companies should expect to see retaliatory tariffs and duties on exports.
Cook concludes by offering advice to the incoming administration, including being sensitive to the effect retaliatory tariffs can have on American exports, working on federal debt reduction, and considering promoting free trade zones. He also proposes an ambitious water works program through the Army Corps of Engineers.
ReposiTrak, a global food traceability network operator, will partner with Upshop, a provider of store operations technology for food retailers, to create an end-to-end grocery traceability solution that reaches from the supply chain to the retail store, the firms said today.
The partnership creates a data connection between suppliers and the retail store. It works by integrating Salt Lake City-based ReposiTrak’s network of thousands of suppliers and their traceability shipment data with Austin, Texas-based Upshop’s network of more than 450 retailers and their retail stores.
That accomplishment is important because it will allow food sector trading partners to meet the U.S. FDA’s Food Safety Modernization Act Section 204d (FSMA 204) requirements that they must create and store complete traceability records for certain foods.
And according to ReposiTrak and Upshop, the traceability solution may also unlock potential business benefits. It could do that by creating margin and growth opportunities in stores by connecting supply chain data with store data, thus allowing users to optimize inventory, labor, and customer experience management automation.
"Traceability requires data from the supply chain and – importantly – confirmation at the retail store that the proper and accurate lot code data from each shipment has been captured when the product is received. The missing piece for us has been the supply chain data. ReposiTrak is the leader in capturing and managing supply chain data, starting at the suppliers. Together, we can deliver a single, comprehensive traceability solution," Mark Hawthorne, chief innovation and strategy officer at Upshop, said in a release.
"Once the data is flowing the benefits are compounding. Traceability data can be used to improve food safety, reduce invoice discrepancies, and identify ways to reduce waste and improve efficiencies throughout the store,” Hawthorne said.
Under FSMA 204, retailers are required by law to track Key Data Elements (KDEs) to the store-level for every shipment containing high-risk food items from the Food Traceability List (FTL). ReposiTrak and Upshop say that major industry retailers have made public commitments to traceability, announcing programs that require more traceability data for all food product on a faster timeline. The efforts of those retailers have activated the industry, motivating others to institute traceability programs now, ahead of the FDA’s enforcement deadline of January 20, 2026.
Online grocery technology provider Instacart is rolling out its “Caper Cart” AI-powered smart shopping trollies to a wide range of grocer networks across North America through partnerships with two point-of-sale (POS) providers, the San Francisco company said Monday.
Instacart announced the deals with DUMAC Business Systems, a POS solutions provider for independent grocery and convenience stores, and TRUNO Retail Technology Solutions, a provider that powers over 13,000 retail locations.
Terms of the deal were not disclosed.
According to Instacart, its Caper Carts transform the in-store shopping experience by letting customers automatically scan items as they shop, track spending for budget management, and access discounts directly on the cart. DUMAC and TRUNO will now provide a turnkey service, including Caper Cart referrals, implementation, maintenance, and ongoing technical support – creating a streamlined path for grocers to bring smart carts to their stores.
That rollout follows other recent expansions of Caper Cart rollouts, including a pilot now underway by Coles Supermarkets, a food and beverage retailer with more than 1,800 grocery and liquor stores throughout Australia.
Instacart’s core business is its e-commerce grocery platform, which is linked with more than 85,000 stores across North America on the Instacart Marketplace. To enable that service, the company employs approximately 600,000 Instacart shoppers who earn money by picking, packing, and delivering orders on their own flexible schedules.
The new partnerships now make it easier for grocers of all sizes to partner with Instacart, unlocking a modern shopping experience for their customers, according to a statement from Nick Nickitas, General Manager of Local Independent Grocery at Instacart.
In addition, the move also opens up opportunities to bring additional Instacart Connected Stores technologies to independent retailers – including FoodStorm and Carrot Tags – continuing to power innovation and growth opportunities for retailers across the grocery ecosystem, he said.
The autonomous forklift vendor Cyngn has raised $33 million in funding to accelerate its growth and proliferate sales of its industrial autonomous vehicles, the Menlo Park, California-based firm said today.
As a publicly traded company, Cyngn raised the money by selling company shares through the financial firm Aegis Capital in three rounds occurring in December. According to forms filed with the U.S. Securities and Exchange Commission (SEC), the move also required moves to reduce corporate spending for three months, including layoffs that reduced staff from approximately 80 people to approximately 60 people, temporarily suspended certain non-essential operations, and reduced or eliminated all discretionary expenses.
In the company’s view, autonomous vehicles are playing a critical role in transforming industrial operations by enhancing productivity and safety.
“This capital infusion strengthens our ability to fund operations, drive commercialization, and continue investing in groundbreaking autonomous vehicle technologies,” Lior Tal, chairman and CEO of Cyngn, said in a release. “With increasing demand for automation solutions, especially in the automotive, heavy machinery and logistics industries, this funding allows us to build on recent momentum, including our upcoming autonomous forklift launch and other strategic advancements.”
Editor's note:This article was revised on January 14 to include information from Cyngn on its finances.
Inclusive procurement practices can fuel economic growth and create jobs worldwide through increased partnerships with small and diverse suppliers, according to a study from the Illinois firm Supplier.io.
The firm’s “2024 Supplier Diversity Economic Impact Report” found that $168 billion spent directly with those suppliers generated a total economic impact of $303 billion. That analysis can help supplier diversity managers and chief procurement officers implement programs that grow diversity spend, improve supply chain competitiveness, and increase brand value, the firm said.
The companies featured in Supplier.io’s report collectively supported more than 710,000 direct jobs and contributed $60 billion in direct wages through their investments in small and diverse suppliers. According to the analysis, those purchases created a ripple effect, supporting over 1.4 million jobs and driving $105 billion in total income when factoring in direct, indirect, and induced economic impacts.
“At Supplier.io, we believe that empowering businesses with advanced supplier intelligence not only enhances their operational resilience but also significantly mitigates risks,” Aylin Basom, CEO of Supplier.io, said in a release. “Our platform provides critical insights that drive efficiency and innovation, enabling companies to find and invest in small and diverse suppliers. This approach helps build stronger, more reliable supply chains.”