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.
An ongoing complaint of shippers that their logistics service providers (LSPs) struggle
with being proactive and innovative in solving complex supply chain problems seems to be,
well, still ongoing.
According to the Outsourced
Distribution Report issued by the Tompkins Supply Chain Consortium, 37 percent of survey respondents were either
"dissatisfied" or "very dissatisfied" with their partners' ability to bring new solutions to the table and to do so without
any prompting from the customer. Nearly 26 percent of the respondents were neutral on the issue, according to the survey.
Only 37 percent said they were satisfied with the status quo.
The study was based on a survey of 95 companies by the Consortium, which provides data on supply chain benchmarking and best
practices. What the survey may have lacked in quantity of respondents, it made up in heft. More than half of the respondents
had annual revenue of $1 billion or more. Nearly 14 percent reported annual revenues of more than $25 billion.
The results again raise a long-standing problem in shipper-provider relationships. In the 2010 Third-Party Logistics Study
led by academic C. John Langley Jr. only 68 percent of shippers surveyed said their logistics partners were delivering new
and innovative solutions to improve logistics effectiveness. In contrast, 95 percent of providers said they were bringing
new ideas to shippers, according to the 2010 survey.
In response to the criticism that they are not innovative enough, logistics service providers contend their customers often exclude them from
strategic discussions. As a result, they can't obtain the business intelligence they need to be as proactive and
innovative as they and their customers would like. One of the most vocal proponents of this argument has
been Kane is Able Inc., a Scranton, Penn.-based third-party logistics provider. According to comments that Vice President
of Marketing and Sales Scott Moran made through a company spokesman, providers still find it difficult to crack the
customers' organizational code.
In a statement accompanying the Tompkins study, Chris Ferrell, director of the consortium, said more
frequent communications between shippers and providers "will go a long way toward improving the satisfaction
ratings in innovation and problem solving."
OVERALL SATISFACTION HIGH
Ironically, as with the 2010 study, the Tompkins survey reflects an overall level of satisfaction on
shippers' part towards their providers. For example, more than two-thirds of respondents said they were either
satisfied or very satisfied with their providers' productivity efforts. In addition, nearly 77 percent said they
were satisfied or very satisfied with their providers' flexibility to grow and adapt to their changing needs.
One area of potential concern is that only 55 percent were satisfied with their providers' ability to lower their
operating costs. Respondents said the need to achieve cost reductions is the top reason they outsource.
About 42.5 percent of companies surveyed will have conducted a bid for logistics services or rebid their existing
outsourcing agreements by the end of 2012, according to the survey. Most respondents said their 3PL contracts run more
than three years.
Ferrell said shippers' decisions to rebid their 3PL contracts are being driven more by a desire to obtain better lease
terms than by a general frustration with their providers' performance. "Leases that are expiring in the next 12 months are
likely to find a lot of substantially more favorable opportunities available," Ferrell said in an e-mail.
The Tompkins report said that despite a shaky economy, many shippers still need additional warehousing and DC capacity
supplied by their partners to support their existing network operations.
Ferrell said providers should look at the findings as an "opportunity... to increase their partnership status"
and as a way to "differentiate their service and make themselves more indispensible, rather than something that puts
them at-risk of getting fired."
Motion Industries Inc., a Birmingham, Alabama, distributor of maintenance, repair and operation (MRO) replacement parts and industrial technology solutions, has agreed to acquire International Conveyor and Rubber (ICR) for its seventh acquisition of the year, the firms said today.
ICR is a Blairsville, Pennsylvania-based company with 150 employees that offers sales, installation, repair, and maintenance of conveyor belts, as well as engineering and design services for custom solutions.
From its seven locations, ICR serves customers in the sectors of mining and aggregates, power generation, oil and gas, construction, steel, building materials manufacturing, package handling and distribution, wood/pulp/paper, cement and asphalt, recycling and marine terminals. In a statement, Kory Krinock, one of ICR’s owner-operators, said the deal would enhance the company’s services and customer value proposition while also contributing to Motion’s growth.
“ICR is highly complementary to Motion, adding seven strategic locations that expand our reach,” James Howe, president of Motion Industries, said in a release. “ICR introduces new customers and end markets, allowing us to broaden our offerings. We are thrilled to welcome the highly talented ICR employees to the Motion team, including Kory and the other owner-operators, who will continue to play an integral role in the business.”
Terms of the agreement were not disclosed. But the deal marks the latest expansion by Motion Industries, which has been on an acquisition roll during 2024, buying up: hydraulic provider Stoney Creek Hydraulics, industrial products distributor LSI Supply Inc., electrical and automation firm Allied Circuits, automotive supplier Motor Parts & Equipment Corporation (MPEC), and both Perfetto Manufacturing and SER Hydraulics.
The move delivers on its August announcement of a fleet renewal plan that will allow the company to proceed on its path to decarbonization, according to a statement from Anda Cristescu, Head of Chartering & Newbuilding at Maersk.
The first vessels will be delivered in 2028, and the last delivery will take place in 2030, enabling a total capacity to haul 300,000 twenty foot equivalent units (TEU) using lower emissions fuel. The new vessels will be built in sizes from 9,000 to 17,000 TEU each, allowing them to fill various roles and functions within the company’s future network.
In the meantime, the company will also proceed with its plan to charter a range of methanol and liquified gas dual-fuel vessels totaling 500,000 TEU capacity, replacing existing capacity. Maersk has now finalized these charter contracts across several tonnage providers, the company said.
The shipyards now contracted to build the vessels are: Yangzijiang Shipbuilding and New Times Shipbuilding—both in China—and Hanwha Ocean in South Korea.
Specifically, 48% of respondents identified rising tariffs and trade barriers as their top concern, followed by supply chain disruptions at 45% and geopolitical instability at 41%. Moreover, tariffs and trade barriers ranked as the priority issue regardless of company size, as respondents at companies with less than 250 employees, 251-500, 501-1,000, 1,001-50,000 and 50,000+ employees all cited it as the most significant issue they are currently facing.
“Evolving tariffs and trade policies are one of a number of complex issues requiring organizations to build more resilience into their supply chains through compliance, technology and strategic planning,” Jackson Wood, Director, Industry Strategy at Descartes, said in a release. “With the potential for the incoming U.S. administration to impose new and additional tariffs on a wide variety of goods and countries of origin, U.S. importers may need to significantly re-engineer their sourcing strategies to mitigate potentially higher costs.”
The New Hampshire-based cargo terminal orchestration technology vendor Lynxis LLC today said it has acquired Tedivo LLC, a provider of software to visualize and streamline vessel operations at marine terminals.
According to Lynxis, the deal strengthens its digitalization offerings for the global maritime industry, empowering shipping lines and terminal operators to drastically reduce vessel departure delays, mis-stowed containers and unsafe stowage conditions aboard cargo ships.
Terms of the deal were not disclosed.
More specifically, the move will enable key stakeholders to simplify stowage planning, improve data visualization, and optimize vessel operations to reduce costly delays, Lynxis CEO Larry Cuddy Jr. said in a release.
Cowan is a dedicated contract carrier that also provides brokerage, drayage, and warehousing services. The company operates approximately 1,800 trucks and 7,500 trailers across more than 40 locations throughout the Eastern and Mid-Atlantic regions, serving the retail and consumer goods, food and beverage products, industrials, and building materials sectors.
After the deal, Schneider will operate over 8,400 tractors in its dedicated arm – approximately 70% of its total Truckload fleet – cementing its place as one of the largest dedicated providers in the transportation industry, Green Bay, Wisconsin-based Schneider said.
The latest move follows earlier acquisitions by Schneider of the dedicated contract carriers Midwest Logistics Systems and M&M Transport Services LLC in 2023.