Friday, December 11, 2009

Midwest's Services

For best-in-class logistics services, check us out at Midwest Warehouse and Distribution System. We provide a wide range of logistics offerings that are available as stand-alone services or bundled together as an full specturm solution. We understand your supply chain needs. With our friendly, experienced staff that puts people first, we are able to provide unbeatable service and deliver exceptional results that save time, money and stress.

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Thursday, November 12, 2009

Outsourcing and Respect

The idea of outsourcing often comes about when the CEO, controller, or another member of senior management reads an article—or has been speaking with a 3PL—about saving a minimum of 10 percent or more of their logistics costs by turning to a third party. However, I've found that these “savings opportunities” are often purely theoretical and are only supported by management due to their lack of logistics knowledge or their lack of confidence in the ability of its logistics team to efficiently manage its processes.


Of course, there are other times when the outsourcing conversation is sparked by the urgent need to reduce headcount.

The transportation teams that feel especially threatened are those that lack the experience, leadership, talent, knowledge, process excellence, and contingency strategies to guide their companies through today's global market. They often fail to anticipate and prepare themselves for tomorrow's challenges. And it often takes just one unpleasant and costly surprise to jumpstart the outsourcing movement in teams like these.

When I hear transportation leaders tell me that their companies keep reminding them that they're just another cost center, I tell them that it's their fault that management doesn't see them as a value-add to the organization. This tends to lead into the question: How do I get some respect?

The answer is simple. It's all about education and managing expectations—neither of which start in the middle of a crisis. Earning respect starts with your knowledge and command of the marketplace and your transportation governance, and it ends with programs that you have created to educate senior management and other organizations on a regular basis. As a quick reminder, I define transportation governance as “the direction and control associated with creation, administration, oversight, and enforcement of your company and supply chain's policies, regulations, and procedures related to the legal, safe, efficient, and service-effective movement of freight it controls either directly or indirectly.”

Transportation governance has both direct and indirect aspects. Direct governance includes: your carrier criteria and operating protocol/guidelines; selection and management of your carrier base; carrier due diligence evaluations, contract models and supporting documents; process with defined/flows/inputs-outputs; metrics and measures and dashboards; carrier performance reviews and process improvements; a carrier council to streamline processes and improve carrier and company productivity; greenfield projects and process improvements; and, of course, audits and benchmarking. Indirect governance, on the other hand, includes your command of the transportation industry including regulatory and political issues as well as a comparison of your approach to industry challenges versus that of your peers.

Read the rest of the logisticsmgmt.com article here.

Friday, October 16, 2009

New Study Highlights Role of Third-Party Logistics Providers in Helping Shippers Adapt to Economic Challenges

The fourteenth Annual Third Party Logistics (3PL) Study examining the current global market for logistics outsourcing was recently released. The study surveyed shippers and logistics service providers in North America, Europe, Asia Pacific and Latin America. Key findings included:

* The economic downturn has created significant challenges for both shippers and third-party logistics providers (3PLs) – 82% of shippers are employing cost-cutting tactics and 60% are rethinking their supply chains and relationships with 3PLs
* 88% of shippers feel that IT-based logistics services are important, but only 42% are satisfied with the capabilities of their provider – as a result of this IT capability gap, shipper respondents reported a lack of the key performance indicators, alerts and visibility required for an adaptive supply chain and 3PLs reported similar difficulties in getting the data and commitment they need from shippers
* There are significant differences between how 3PLs evaluate their role in the supply chain and how they are viewed by shippers – 59% of shippers feel their use of 3PLs has a positive effect on customer service compared to 88% of 3PL respondents
* Shipper respondents devote an average of between 47% (in North America) and 66% (in Europe) of their total logistics expenditures to outsourcing and this is expected to increase in the next five years.

“Shipper-3PL relationships are being impacted significantly by the prevailing uncertainty and economic volatility in global markets,” said Dr. C. John Langley Jr., Professor of Supply Chain Management, Georgia Institute of Technology. “It is very important for 3PLs to mitigate or reduce any financial risk or service level impact that this may cause.”

Economic uncertainty and the use of 3PLs
Economic volatility has challenged shippers and 3PLs alike to contend with factors such as unpredictable demand, instability in fuel costs and currency valuation, and excess inventory. In response, not only are shippers attempting to cut costs, 77% are also seeking to improve forecasting and inventory management.

Cost reduction and improved reliability in services are the main factors likely to increase shipper respondents’ use of 3PLs. This includes converting fixed to variable costs (59%), expanding to new markets or offering new products (56%), and restructuring the supply chain network to improve financial performance (48%).

Read the rest of the mhia.org article here.

Thursday, September 17, 2009

Midwest Warehouse - Northlake creates 50,000 Square Feet of Customs Bonded Space

Northlake, IL (August 1, 2009) – Due to customer demands Midwest Warehouse & Distribution is pleased to announce the creation of 50,000 square feet of customs bonded space in our Northlake, IL. facility. This value added service will no doubt grow due to the current economy and the location of the Northlake facility in relation to the Chicago rail ramps. Midwest Warehouse currently operates 4.5 million square feet of warehouse space in 18 facilities throughout the US with over 2.7 million square feet in the Chicago area.

Monday, August 17, 2009

Logistics and business manufacturing: Signs are positive but economic recovery needs time

While some economic indicators paint an optimistic picture for recovery, supply chain and freight transportation industry experts maintain it will be a while before the recession truly abates.


On the optimistic front are: the Bureau of Economic Analysis’s (BEA) recent release on the second quarter’s 1.0 percent GDP decline, ahead of the first quarter’s 6.4 percent loss; the BEA also reported that real exports of goods and services were down 7.0 percent on the second quarter, compared to 29.9 percent in the first quarter; the Institute of Supply Management’s PMI (formerly known as the Purchasing Managers Index) hit 48.9 in July, representing the seventh consecutive month of growth (an index of 50 or higher typically means the economy is not in decline); the Commerce Department’s report that orders for U.S. durable goods—except for automobiles and aircraft—were up 1.1 percent in June, the biggest gain in three months; and the Cass Information Systems Freight Index down 15.3 percent in July compared to 20 percent and 21.4 percent dips in June and May, respectively.


But despite these signs, there are other data points that suggest the economy is still stuck in neutral and remains at “the bottom.” Among these data points are: June truck tonnage down 13.6 percent year-over-year, according to the American Trucking Associations; cargo container volume decreases at the Ports of Long Beach and Los Angeles still hovering around 30 percent; and a recent report from the Federal Reserve’s “Beige Book,” indicating economic activity is weak heading into the summer, although the overall pace of decline has stabilized albeit at a low level.


“While some numbers are encouraging, I would not get too excited just yet,” said Eric Starks, president of freight transportation forecasting consultancy FTR Associates. “But they do tell us that economic conditions did not deteriorate at the same level in the second quarter as the first. It appears that the ‘bleeding’ has stopped or is coming to an end, and that the long healing process has begun.”


Starks noted that the current economic situation is not something many shippers have previously experienced, with shippers anxious for an uptick in demand heading into 2010 to chip away at excess inventories and subsequently force increased manufacturing output.


Other things to keep an eye on are rises in home starts and sales, according to Tim Feemster, senior vice president and director of global logistics at Grubb & Ellis Company. Feemster’s sentiment is supported by recent signs of stabilizing prices with a composite index of home prices in 20 major U.S. cities being flat, according to the Case-Shiller Price Index, compiled by Standard & Poor’s, which was reported by the New York Times, and followed reports that sales of existing home sales have been up for three straight months, with June being the largest percentage increase in eight years.


And Josh Green, CEO of Panjiva, an online search engine with detailed information on global suppliers and manufacturers, said the consensus regarding the economy seems to be that the bottom has been reached, but what happens from here is anyone’s guess.


“Whatever recovery we see is likely to be slow and steady, rather than a quick ramp up back to pre-recession levels,” said Green. “I think the thing nobody wants to talk about is that the fear that the growth we are seeing now is more of a hiccup and that there is risk of a further downturn. When [certain] indices come out, it does seem like we are moving in right direction, but we are still very vulnerable to any kind of external shocks to the system that could send things down and put the economy back on a downward stretch.”


Recent Panjiva data indicated that from June to July the number of global manufacturers shipping to the U.S. rose by 7 percent, which was consistent with the 6 percent gain seen during the same timeframe last year. Panjiva also reported that the 2008 increase preceded the freefall in global trade from July 2008 to February 2009. Even though the month-to-month increase was up 7 percent, Panjiva said that the overall number of companies currently shipping to the U.S. is down roughly 10 percent year-over-year.


From May to June, the number of global manufacturers shipping to the U.S. was flat, following increases of 2 percent from April to May, 8 percent from March to April, and 2 percent from February to March.


“We are basically following the seasonal path of last year, which is good news in this economic environment,” said Green. “It feels like the [economic momentum] is positive right now. At this time last year, it was a bit more uneasy and when things got worse the economy went into a tailspin. Now, it feels like it is going in the other direction, as we have seen some encouraging signs and may be regaining our footing. There is no question we are still vulnerable to additional shocks, though.”

Read the rest of the scmr.com article here.

Friday, July 17, 2009

Transportation/expedited cargo: Leading industry analyst predicts "muted" growth

It may not be the news expedited cargo shippers wanted to hear, but a noted supply chain expert reports that more time is needed for recovery.

The Colography Group, Inc. said in releasing a mid-year update to its annual projections for growth in the $101.2 billion U.S. expedited cargo market, that shippers will have to wait a bit longer to see a rebound.

“While we were disappointed with the findings, I can’t say we were really surprised," said Ted Scherck, president, The Colography Group. In an interview with LM, he said the economy is continuing to melt down.

“The nation’s economy has been victimized by a series of ‘bubbles,’” he said. “Reality has set in now, and the outlook is still pretty grim for our sector.”

Using its most-likely case scenario, The Colography Group estimates that just under 120 million new shipments will be added to U.S. expedited commerce in the coming year, with ground parcel and air export services accounting for virtually all new expedited shipping volume. Total 2010 U.S. expedited air cargo revenue is projected to be $7.1 billion, 1.5 percent above 2009 levels and roughly in line with consensus forecasts for total U.S. economic growth.

Scherk stressed that revenue data presented is y-o-y growth, not an absolute revenue number for any year.
Activity in the U.S. domestic air market will continue to suffer throughout 2010, with shipment volumes falling 1.1 percent from projected 2009 levels. The air export category, influenced by a different suite of demand drivers, will rebound during 2010, growing at a more “normal” 6.1 percent in total shipments, year-over-year.

Weakness in 2010 domestic air activity will continue to be most pronounced in the overnight delivery segment, with slight declines in package and freight shipments, and a significant year-over-year decline in overnight letter shipping. Further, overnight demand, perhaps the most critical (from a yield perspective) piece of U.S. expedited cargo demand, continues to be pressured by growth in e-mail usage and the migration of package and freight traffic to the ever-expanding service coverage of surface transport.

In a trend not seen for some time, non-integrated air carriers (forwarders, combination airlines, postal services and other intermediaries) will take share of the U.S. domestic air market from their integrated carrier rivals, the result of a lower rate of decline. Further, the non-integrated carriers will also gain share in U.S. air export shipment share in 2010.

“The secular factors driving traffic off airplanes and on to trucks will continue at least through 2010, exacerbated by a relentless need of shippers to lower costs in the face of a recession that lingers on,” said Scherck. “Businesses are increasingly reluctant to pay a premium for overnight air service and continue to build their inventory and distribution models around more economical, time-definite deliveries moving in ground parcel, LTL and TL (including renewed interest in private fleets). Further, intermodal carriers are responding by putting virtually all new investment of time and money into expanding their surface capabilities.”

Read the rest of the logisticsmgmt.com article here.

Thursday, June 11, 2009

Ocean cargo/global logistics: Obama administration moves to fill FMC seat

The Federal Maritime Commission may have a new commissioner this summer, bringing the agency closer to full strength.

Following the news released last week that Joseph E. Brennan had been designated Acting Chairman of the FMC by President Barack Obama, the administration announced that one of three vacant seats may be filled soon. Pending Congressional confirmation, the new commissioner will be Richard A. Lidinsky Jr.


“We did not anticipate this, but are relieved to see that the Commission is moving forward,” said Michael Berzon, chairman of ocean transport committee of the National Industrial Transportation League (NITL). “We’ll have a better idea of his (Lidinsky’s) qualifications in the coming weeks.’


As reported in LM and elsewhere in the trade press, Commissioner Harold J. Creel Jr. plans to retire at the end of June. That would leave the FMC with Brennan and Rebecca F. Dye as the only two on a five-seat forum. It has been over three years since the Commission was operating with a full bench.


FMC spokesmen were confident that Lidinsky will quick confirmation, telling LM that he is certainly no stranger to the commission. He was served in the FMC’s Office of General Counsel as legislative counsel from 1973 to 1975, and has since gone on to a distinguished career in seaport operations and maritime contracting.


He is currently an attorney and international trade consultant in private practice.


(source: www.logisticsmgmt.com

Thursday, May 14, 2009

Railroad shipping: AAR says volumes down for week ending May 9

WASHINGTON—The Association of American Railroads (AAR) said today that carload freight volumes and intermodal traffic volumes were down sharply on United States railroads for the week ending May 9 compared to the same week last year. 

Weekly carload freight, which does not include intermodal data, came in at 249,576 cars, down 25.8 percent from the same timeframe last year, said the AAR. And carload freight loadings were down 21.4 percent in the West and 31.7 percent in the East.

Intermodal loadings, which are not included in carload data, totaled 181,662 trailers or containers, down 21.0 percent compared to the same timeframe a year ago. Trailer volume was down 37.9 percent, and container volume decreased 16.4 percent.

Weekly railroad volume was estimated at 26.4 billion ton-miles by the AAR which was down 25.2 percent from a year ago.

And for the first 18 weeks of 2009, the AAR said U.S. railroads reported cumulative volume of 4,789,321 carloads, which is down 18.8 percent from the first 18 weeks of 2008. Trailers or containers at 3,343,134 were down 16.5 percent, and total volume at an estimated 508.4 billion ton-miles was off by 17.7 percent year-over-year.

Of the 19 commodity groups tracked by the AAR, none were up year-over-year. Lumber & wood products were off by 43.3 percent, and motor vehicles and equipment were down 49.5 percent.


Read the rest of the logisticsmgmt.com article here

Friday, April 17, 2009

Recession Watch: How To Position Yourself For The Recovery

- Interesting article from logisticsonline.com

Transport Intelligence is pleased to announce the publication of Recession Watch – March 2009, a critical market assessment of the global transport & logistics industry. The February edition of Recession Watch proved to be a valuable tool for the industry - providing detailed insight into rapidly changing market conditions.

Recession Watch provides comprehensive, timely market analysis and identifies the strategies adopted by the leading players as they ride out the global downturn. Crucially, Recession Watch enables swift response to volatile market conditions - to maximise opportunities and reduce risk.

This month includes a special feature reviewing the leading 3PL's operations and finances over the past quarter. It also includes an article by leading industry expert, Prof Alan Braithwaite, on how to ride the downturn whilst positioning your company for the recovery.

Recession Watch contains the up to date information you need to understand how the industry is being impacted by current market conditions - supporting strategic decision making.

This comprehensive monthly analysis of the transport and logistics market has 5 key components:

  • Ti's exclusive Monthly Confidence Index identifying the strongest and weakest logistics sectors
  • Vertical Sector Developments and their impact on the logistics industry
  • Special Focus: leading 3PL's operations and finances over the past quarter
  • Major Logistics/Express Developments: which companies are cutting jobs, hubs, restructuring networks etc
  • Monthly / Quarterly Indices: a round up of all the key logistics related indices
Read the rest of the article here.

Thursday, March 12, 2009

Logistics firm leases space in new Aurora building

Woodridge, IL (January 08, 2009) - Midwest Warehouse & Distribution System Inc. last month signed a six-month lease for 350,000 square feet in a new industrial building in Aurora. The lease starts Jan. 15 for the space at 4100 Ferry Road, the first building to be completed in the Butterfield East park near the intersection of Interstate 88 and State Route 59. Midwest is the first tenant in the building, which is about 550,000 square feet and was completed in October by Indianapolis-based Duke Realty Corp. Midwest President and CEO Ed Borkowski says the space is to accommodate some annual seasonal overflow from a longtime customer and that Midwest is in talks with other customers that might result in extending the lease. HSA Commercial represented Midwest Warehouse; Colliers Bennett & Kahnweiler Inc. represented Duke.

Midwest Warehouse provides best-in-class warehousing and distribution services to clients across the Midwest region and beyond. With more than 25 years of experience, 20 locations and more than 4.8 million square feet of warehouse space, we are able to meet even the most challenging logistical requirements.


Friday, February 13, 2009

About Midwest Warehousing

Midwest Warehouse & Distribution System (Midwest) is a full-service 3pl company with an outstanding reputation for quality and integrity. For more than 25 years, Midwest has served as the logistics provider of choice for clients who recognize us as trusted business partners invested in their success.  

Midwest Warehouse is headquartered in Woodridge, IL and has 20 convenient locations.  Specializing in cross dock services, pool distribution, paper converting machine company, and food distribution.  For further information about our services, please contact us.