Susan Lacefield has been working for supply chain publications since 1999. Before joining DC VELOCITY, she was an associate editor for Supply Chain Management Review and wrote for Logistics Management magazine. She holds a master's degree in English.
The Problem: In February 2010, the sixth-largest earthquake ever recorded shook Chile, causing an estimated $15 billion to $30 billion in damage. One of the businesses affected by the quake was the records management and storage company Iron Mountain, which maintains a number of storage facilities at its Lampa campus in the Santiago metro area. The high-density multilevel racks at several of its storage facilities collapsed during the earthquake, taking part of the building structure with them. In the end, Iron Mountain had to demolish seven warehouses and their associated racking systems due to earthquake-related damage.
As it went to rebuild its facilities, Iron Mountain resolved to find a better system. In particular, it wanted racking that could withstand future earthquakes but still provide safe storage for its clients' documents and allow easy access on a daily basis.
The Solution: Iron Mountain didn't have to look far for a solution. Amidst all the destruction, there was one facility on the Lampa campus that was not irreparably damaged by the quake. Just five months earlier, Iron Mountain had contracted with storage system specialist Interlake Mecalux to construct both storage racks and the building for its new "Warehouse 11." When the earthquake struck, the rack installation was half-finished, but it was undamaged by the shock. An outside structural engineering firm later inspected the racks and determined that they would have survived the earthquake even if they had been fully built and packed to capacity with cases of documents.
The Players
Customer: Iron Mountain Primary business: Records management and storage Headquarters: Boston
Supplier: Interlake Mecalux Solution: Customized selective pallet rack system
"At the time of the earthquake, there was only one Mecalux facility, and it stood the test of the earthquake," says Doug Berry, Iron Mountain's director of construction and facilities. Because the Interlake Mecalux racks in Warehouse 11 fared so well, Iron Mountain ended up contracting with the company to help it rebuild two warehouses that were damaged in the quake.
Why did Warehouse 11 and its racks remain standing while structures all around them collapsed? For one thing, they were seismically engineered. The layout for the building went through an extensive structural review, which not only took into account the local seismic regulations but also fire protection and electrical and security concerns. For another, the setup was also extensively vetted. Civil engineers reviewed the building's structural design, consulting engineers reviewed the storage system's structural design, and then a final group of reviewing engineers looked at both together.
Because Warehouse 11 was built on land classified as high risk for earthquake damage, the engineers determined they would need to reinforce the storage system. In this case, the reinforcing was custom-tailored to fit the Iron Mountain facility. Most warehouses and DCs expect to have a certain amount of inventory turnover and therefore, assume the rack's shelves or bays will be only 50 to 80 percent full at any given time. Iron Mountain, however, is storing boxes of paper archives, and these boxes rarely (if ever) move. For that reason, Iron Mountain designs its facilities with the expectation that they'll be at 100-percent capacity all of the time—which means it's critical that the company not waste storage space.
Ordinarily, Interlake Mecalux would seismically engineer racks by using longitudinal bracing across the back of the rack. Using this approach for Iron Mountain, however, would have reduced the amount of the storage space available and interfered with the sprinklers installed inside the rack to protect the files from fire. So instead, Interlake Mecalux created frames with connections between the beams and the reinforced columns. The connections were designed with a certain amount of elasticity to allow the frame to better absorb the seismic waves created by an earthquake. Interlake Mecalux also created thicker, more absorbent floor slabs to ensure that an earthquake would not cause the rack to topple over. The company says that this level of customization is typical for it, even if the customer's warehouse is not in an earthquake zone.
Iron Mountain's ability to continue operating after the earthquake and swiftly rebuild its damaged facilities proved to be a competitive advantage. After the earthquake, Iron Mountain picked up 100 new clients in Chile, including one of the country's largest banks, which had previously used its own storage facilities. "Our competition didn't have the robust racking or sprinkler systems that helped us survive the earthquake," Berry says.
The number of container ships waiting outside U.S. East and Gulf Coast ports has swelled from just three vessels on Sunday to 54 on Thursday as a dockworker strike has swiftly halted bustling container traffic at some of the nation’s business facilities, according to analysis by Everstream Analytics.
As of Thursday morning, the two ports with the biggest traffic jams are Savannah (15 ships) and New York (14), followed by single-digit numbers at Mobile, Charleston, Houston, Philadelphia, Norfolk, Baltimore, and Miami, Everstream said.
The impact of that clogged flow of goods will depend on how long the strike lasts, analysts with Moody’s said. The firm’s Moody’s Analytics division estimates the strike will cause a daily hit to the U.S. economy of at least $500 million in the coming days. But that impact will jump to $2 billion per day if the strike persists for several weeks.
The immediate cost of the strike can be seen in rising surcharges and rerouting delays, which can be absorbed by most enterprise-scale companies but hit small and medium-sized businesses particularly hard, a report from Container xChange says.
“The timing of this strike is especially challenging as we are in our traditional peak season. While many pulled forward shipments earlier this year to mitigate risks, stockpiled inventories will only cushion businesses for so long. If the strike continues for an extended period, we could see significant strain on container availability and shipping schedules,” Christian Roeloffs, cofounder and CEO of Container xChange, said in a release.
“For small and medium-sized container traders, this could result in skyrocketing logistics costs and delays, making it harder to secure containers. The longer the disruption lasts, the more difficult it will be for these businesses to keep pace with market demands,” Roeloffs said.
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
National nonprofit Wreaths Across America (WAA) kicked off its 2024 season this week with a call for volunteers. The group, which honors U.S. military veterans through a range of civic outreach programs, is seeking trucking companies and professional drivers to help deliver wreaths to cemeteries across the country for its annual wreath-laying ceremony, December 14.
“Wreaths Across America relies on the transportation industry to move the mission. The Honor Fleet, composed of dedicated carriers, professional drivers, and other transportation partners, guarantees the delivery of millions of sponsored veterans’ wreaths to their destination each year,” Courtney George, WAA’s director of trucking and industry relations, said in a statement Tuesday. “Transportation partners benefit from driver retention and recruitment, employee engagement, positive brand exposure, and the opportunity to give back to their community’s veterans and military families.”
WAA delivers wreaths to more than 4,500 locations nationwide, and as of this week had added more than 20 loads to be delivered this season. The wreaths are donated by sponsors from across the country, delivered by truckers, and laid at the graves of veterans by WAA volunteers.
Wreaths Across America
Transportation companies interested in joining the Honor Fleet can visit the WAA website to find an open lane or contact the WAA transportation team at trucking@wreathsacrossamerica.org for more information.