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December 30, 2021 by Logistics

WHY ON EARTH WOULD YOU WANT TO SHIP TO THE EAST COAST?

Strategically located on the East Coast, Riverside Logistics is ready to help you with your supply chain.And if you decide to ship to the east coast here’s why Virginia may be the best destination port to use.

Here are some compelling reasons to consider changing how you route shipments originating in ASIA.

  • Ports in California have been making headlines because of unprecedented delays both on the water, and then thru and beyond the ports. During this same time frame the Port of Virginia has been running smoothly. It has also been performing better than other ports along the East Coast. The Ports in Virginia have different operating structures than others, especially those on the West Coast. Virginia Ports are run by one entity, the Virginia Port Authority. If one terminal starts backing up the VPA will switch traffic and unloading to another terminal to avoid costly delays and congestion. In addition, VPA also has sole authority and control over the trucking aspect. The west coast, by comparison, has 3 different truckers that they need to deal with. This gives Virginia another advantage in managing the flow of goods thru and beyond the port. Last, but not least, the VPA has automated stacking cranes. This means fewer shifts are necessary to unload containers. Adding this all up means that Virginia is clearly winning the port war and should be considered a strong option for freight originating in Asia.
  • So, let’s change gears a bit and talk about LABOR. The ILWU, International Longshore and Warehouse Union, has labor contract negotiations coming up in 2022 for its entire West Coast labor force. The last negotiation 6 years ago, produced severe disruptions. At that time, many shippers were caught flat-footed and had to divert to Gulf Coast and East Coast ports to compensate. This time around you don’t want to get caught off-guard and un-prepared. The ILW Union has already rejected an offer by the terminal operators to delay negotiations until 2023. The head of the union told its workers to “save up” as they prepare for negotiations, meaning that this time around it may be even more painful and take a “long time” to iron out. A really long time with lots of disruptions and down-time.
  • The West Coast is a logjam right now and into the foreseeable future. Ships and containers are stacking up like cordwood. The port has a significant backlog of ships waiting to be unloaded. Once they are finally unloaded then there are backups in getting the containers on trucks or railcars for movement to their final destinations. Overall transit times from ASIA have tripled. What used to take 30 days, now takes 90 days. That represents a lot of idle cash, sitting unused.

Time is money, if for example, your cost of capital is 3-4% and your carrying costs are 25%, then each day, each dollar of inventory sits for longer than it used to or should, then it ends up costing you $35 per $50,000 of in transit inventory value per day, more than it should. This adds up very quickly and turns into big dollars wasted. One container on the water for 60 extra days could cost $2100 more with the longer transit. If you ship 100 containers annually then that’s over $200K in additional cost to you each year. Safety Stock levels would be lower for a 30-day transit than for a 90-day transit pipeline. Safety stock is money sitting too, not being converted back to cash, not generating sales. These costs add up fast and are very un-productive.

  • Since the ultimate customer maybe closer from the east coast than the west coast, domestic transportation costs will be lower and transit times faster. More than 2/3rds of the US’s domestic population is within 2 days of the Virginia Ports. Unit costs (per carton, per lb., etc.) will be lower. Damage and loss risk is lower on the domestic pipeline when using east coast unloading vs west coast unloading. The longer the transit, the more opportunity exists for damage and loss. Damage and loss will create unhappy customers, and unhappy customers will create lower sales and less profits.

Now let’s look at Norfolk and Richmond as destination ports versus other east coast facilities.

  • Virginia serves 2/3rds of the US population within 2 days. Virginia is a crossroads to the west, the south and the northeast either by truck, intermodal or rail modes. Its central location makes it ideal as a distribution point for the entire East coast, Southeast and Midwest.
  • Warehouse rates for inventory are lower and more space is available in Virginia than anywhere on the east coast. Labor costs and insurance costs are extremely competitive.
  • Trucking rates outbound from Virginia are very competitive with other east coast ports. If you ship south from Virginia, vs more northern ports, you costs will be substantially lower. If you ship to the Midwest rates will be competitive.
  • The availability of transportation alternatives is very high in Virginia. The ratio of loads to trucks is balanced better here than at other east coast locations.

All in all, the east coast is an attractive alternative to the west coast as a destination port from Asia. Out of Europe it’s a no brainer, transit is substantially shorter and freight rates are much better. Virginia has some key advantages over other east coast ports, that will produce a competitive edge for shippers. Depending on the distribution of your customer base and its density in proximity to Virginia, you may have a real opportunity to advance your competitive position by shipping thru and stocking product In Virginia.

One last point. Although breaking up your inventory into east coast and west coast lots makes for a more difficult management process, it may allow for enhanced supply chain risk as well as increased leverage when dealing with warehouses, carriers, and vendors. Depending on your business model, you may decrease your inventory pipeline, lower your supply chain risk, enhance your competitive position, and provide a higher level of customer service. It’s worth looking into and Riverside Logistics will be happy to help you make a decision. Now is the time to be working on this before it is too late to make changes.

 

About the author

Jim Durfee
Vice President Business Transformation
Headquarters: Riverside Logistics, Inc. , 5160 Commerce Road, Richmond, VA 23234
Riverside Logistics is a full-service third-party logistics company (3PL), delivering world-class supply chain management solutions.

If you would like more information or have questions about this article,  please call Jim at 804- 474-7700 Option #4.

 

Filed Under: Third-Party Logistics (3PL), Transportation News, Virginia Port News Tagged With: 3PL Logistics, Logistics Companies in Richmond, Logistics Companies in Virginia, Riverside Logistics, Why use an East Coast Port?

April 2, 2018 by Logistics

Riverside Logistics is proud to announce the purchased 25 new 2018 Great Dane trailers.

Riverside Logistics New Trailers 18Riverside Logistics is proud to announce the addition of 25 new Great Dane trailers to its trailer pool. The trailers were purchased to provide extra capacity for our customers and expansion of new lanes with both new and existing customers. In addition, this extra capacity will provide equipment to help minimize the effect of the changes in driver regulations and electronic log devices (ELD). We are currently working on establishing new dedicated runs in Richmond and the Mid-Atlantic region. Call now! Our Brokerage team is ready to assist you with your transportation needs.

 

Filed Under: News & Events Tagged With: Electronic Log Devices (ELD), Great Dane Trailers, Logistics Companies in Richmond, Mid-Atlantic Region, Riverside Logistics, Transportation Brokers, Virginia

June 2, 2016 by Logistics

Riverside Logistics Wins Golden Pallet Award at the 2016 RVA LogistXGames

Riverside Logisitics LogistXGames

Riverside Logistics and six other teams from the region’s top logistics firms competed in the second annual RVA LogistXGames on Thursday May 19, 2016. Again this year, the competition was friendly but competitive incorporating events similar to those performed daily in the logistics work environment. Teamwork, speed, experience and talent was the difference for Riverside who won two of the four events, and won the overall competition by only one point! The award…a golden pallet to proudly display in the warehouse at Riverside! The team consisted of 3 men and two women who demonstrated impressive skills in events like the Pallet Puzzle Sprint, the Pallet Jack Relay, the Pick/Pack Hurdle and the Box Put.

Michael Kenny, Director of Warehouse Operations, oversees Riverside’s three warehouses near the Richmond Airport (RIC). The warehouse employees handle over 60,000 shipments annually which equals approximately 1.8 million cases. In response to his employee’s win at the LogistXGames, Mr. Kenny said, “I was really proud to see the team representing Riverside Logistics squeak out a win against stiff competition. This event gave us and other logistics companies the opportunity to compete and show how well we work together, as we all do on a daily basis to get the job done for our customers.

Sponsored by CBREI/Richmond, the Community College Workforce Alliance (CCWA) and the Virginia Port Authority, the event is designed to showcase the talents of employees in this business sector, as well as emphasize the importance of logistics and distribution to the region. The proceeds support workforce development programs available through the Community College Workforce Alliance.

Congratulations to the other teams who competed! We look forward to next year!

 

Riverside Logistics LogistXGames 2016

Filed Under: News & Events Tagged With: Golden Pallet Award, Logistics Companies in Richmond, Richmond Virginia, Riverside Logistics, RVA LogistXGames, Virginia, Warehouse Companies

May 12, 2015 by Logistics

What is a Third Party Logistics Provider (3PL)?

What is a 3PL??

By Rick Holden

 

A third-party logistics provider (abbreviated 3PL) is a firm that provides outsourced (or “third party”) logistics services for part of, or all of their supply chain management functions. Third party logistics providers typically specialize in integrated operations that include warehousing, transportation , and light assembly services. These services can be scaled and customized to customers’ needs based on market conditions. Often, these services go beyond logistics and include value-added services related to the production or procurement of goods.

 

There are many advantages to engaging a 3PL provider. These include;

 

  • Cost and time savings- A 3PL provider can meet the technical and equipment requirements in a faster and more cost efficient way than a manufacturer or distributor could do for itself. As logistics is the core competency of third party logistics providers they possess better know how and a greater expertise in providing supply chain solutions to their customers.

 

  • Low capital commitment- When contracting with a 3PL it is no longer necessary for the client to own its own warehouse facilities or transportation assets. This lowers the amount of capital required for the client’s business. This is particularly beneficial if a company has high variations in warehouse capacity utilization, because a bad capacity utilization ratio at equal fixed cost (for warehouse) will reduce a company’s profitability.

 

  • Focus- The outsourcing of logistics departments permits the company to focus even more on their core business. Manufacturers and distributors want to remain as competitive as possible. Allowing the focus of the organization to remain with the products it sells will enable the company who relies on a 3PL relationship to get more updated and relevant products to market faster and less expensively.

 

  • Flexibility- Third party logistics providers can provide a much higher level flexibility and scalability. When manufacturers and distributors contract with a 3PL it allows then to offer a much larger variety of services than the clients could provide for themselves.  In addition, the 3PL customer gets to utilize more flexible resources in labor, space and equipment. Essentially fixed costs are reduced and turned into variable costs.

 

As many companies would admit, logistics is not their core competency. These companies often do not have the time, resources or expertise to adapt their equipment and systems as quickly as necessary.   By contracting with a 3PL it allows these manufacturers and distributors a unique advantage over their competition as they are able to get the most efficient supply chain while still keeping the focus of the organization on what it does well.

 

Filed Under: News & Events Tagged With: Distributors in Richmond Virginia, Distributors near RIchmond Airport, Logistics Companies in Richmond, Logistics Companies on the East Coast, Richmond, Riverside Logistics, Transportation Companies in Virginia, Virginia, Warehouse on the East Coast in the U.S., Warehouses near the Airport, What is a 3 PL?, What is a Third Party Logistics Provider?

November 20, 2014 by Logistics

Riverside Logistics has selected Curtis & Company a marketing consulting firm to oversee its marketing as the company prepares for growth.

Riverside Logistics has selected Curtis & Company a marketing consulting firm to oversee its marketing as the company prepares for growth. Curtis & Company will help with strategic planning, web site development and sales growth initiatives.

Curtis Blackwell is the principal of the firm and has over 30 years of experience in the Richmond market. He is a former president of the Richmond Chapter of the American Marketing Association and has worked with many privately held firms in Richmond.

Riverside Logistics provides a full compliment of third party logistic services and total solutions. Whether you’re moving product within the states or around the world, we can help by combining our warehouse and transportation solutions to offer the best value in the industry. Riverside’s experience is both broad and deep, including work in a variety of industries such as medical products (including sterile surgical products), food and beverages (including dry and refrigerated ), building materials, retail and industrial packaging, metals, chemicals, fertilizers and minerals, automotive supply, timber and paper and products and a wide variety of consumer products including, non- durables and durables.

Filed Under: News & Events Tagged With: 3PL Companies, Curtis & Company, Logistics Companies in Richmond, Riverside Logistics, Third Party Logistics, Transportation, Virginia, Warehousing

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