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Genco Shifts Leadership for 2019

Genco Shifts Leadership for 2019

Captain Robert Hughes will officially take the role as Chief Operations Officer for Genco Shipping & Trading Limited as of January 22, 2019, according to a release from the company. The timing in the leadership shift will ultimately shape the course of 2019 results and logistics for the company.

“Genco has built a strong reputation in the industry, and I am delighted to join the Company during such an exciting time,” said Captain Hughes. “Genco has taken important steps to enhance its industry leadership and I look forward to working with the team to continue to meet the highest operational standards for our customers.”

Captain Hughes brings with him over 20 years of experience with drybulk and shipping, inclusive of leadership and operations roles within the industries. His most recent role was with Cargill Ocean Transportation as Americas Operations and Global Technical Manager.

“Robert has deep knowledge of the drybulk industry and brings significant operational and leadership experience to Genco. Over the past year and a half, we have transformed our commercial platform, providing a full-scale, 24-hour logistics solution to leading charterers and cargo providers,” Chief Executive Officer John C. Wobensmith said. “With the addition of Robert to our global team of drybulk professionals in New York, Singapore and Copenhagen, we have further strengthened our platform and ability to meet the exacting needs of our customers.”

Source: EIN Presswire

UPS Offers Strategy Initiatives for Success

Global shipping company UPS offers three strategic tips to remember when re-evaluating changes and improvements needed for warehouse and distribution efforts. The first is to “Break the Inertia” through an open-minded look into the current state of operations. Just because operations are running up to par does not mean there isn’t room for improvement and efficiencies. Again, they warn to proceed with caution. It’s a fine balance between evaluating what’s not working and applying a new strategy and not going idle.

“Very often we see companies overhaul their operations in response to some kind of catalyst,” said Nancy Pagely, UPS development director. “But making changes without a clear strategy increases the chances of taking a costly wrong turn.”

The second strategy offered focuses on the importance of the customer and providing a sense of “ease, convenience and flexibility.”

Bhadra states that, “It’s really critical that operators set aside the knowledge they’ve amassed on customers in order to get a fresh look at what’s going on out there. It takes unconventional thinking and a broader set of collaborators to make smart changes.”

The final piece of advice is taking an honest assessment of your company and don’t let the fear of failure determine your company’s next steps.

“Understanding where you want to be can reduce the number of doors to look behind before making decisions and investments,” explains UPS Customer Solutions consultant Mark Modesti. “As long as you plant a flag and build a dynamic roadmap that lets you adapt as needed, you’ll be ahead of the game.”

 

Source: UPS

A Look Into 2019 Retail Trends

A recent report from CB Insights provides critical information on 2019 trends within the retail sector that industry players should keep into consideration as they finalize strategic initiatives for the upcoming year.

In the report, private retailers are the spotlight of the report findings as 2019 trends. It is estimated that private label retailers will increase their expansion efforts, in spite of a minimal margins to work with. The report details that the rise in private label has been the topic of conversation for the last five years and the industry will see it coming to fruition in 2019.

Retail stores are now providing more than just a product by offering an experience and sense of culture within the shopping confines customers experience, turning the shopping trips into “destination” stores, according to the report. Apple was one of the brand focus in the report, as the company now offers in-store workshops and courses that create an interactive environment beyond a purchase, ultimately creating a “community.”

It’s also no surprise that technology-driven solutions are on the rise for supply chain management efforts. For the duration of 2018, global trade, supply chain management and logistics news was saturated with automation and technology-driven solutions providing an increased level of transparency while minimizing risks and creating an overall decrease in inefficiencies. For 2019, technology will undoubtedly step it up for industry competitors.

These are just a few of the top trends to look out for in 2019, but it’s safe to say that these are some of the most important in terms of supply chain and logistics management.

Source: CB Insights

 

How Smaller Businesses Are Impacted By The New Tariffs

The US Government announced higher tariffs on certain goods imported from China in May 2018. One of the stated objectives was to assist the aluminum and steel industries that had been hit hard by cheaper Chinese imports and facilitate an increase in domestic production. Bloomberg has recently reported that as a result of the tariffs, US companies paid an additional $1 billion on technology products in October than the year earlier.  Not surprisingly, there has been a significant reaction to the increased costs resulting from the tariffs. The primary focus of experts has been the tariffs’ impact on larger businesses, such as Caterpillar, Harley Davison and the auto industry; however, smaller businesses that account for a significant amount of commercial transactions have also been impacted. It is essential to understand the impact of the tariffs on these smaller businesses.

We spoke with several small to medium-size businesses who’s supply ranges from retail to construction, providing home goods, pet supplies, and plumbing to name a few, many of which are being hit by the tariffs.  Note that none of them deal with wholly steel or aluminum goods, but are hit indirectly through parts, that play a large part in the goods they manufacture and/or distribute.

One of the most consistent comments from these businesses was the lack of notice in regards to timing and costs. The majority of the businesses had goods on the water when the tariffs were imposed; often these Items were being shipped to complete fixed-price purchase orders. Overnight these companies were hit with a 10% incremental cost, which could not be recovered through price increases.  Because goods had to be released from port for shipment, these companies could not take the risk of delay and therefore had to pay the increased price. Many of these businesses had a tight gross profit margin, and the unanticipated cost increases resulted in a declination in their gross profit margins.

So how much of the tariff was passed onto the customer? We were expecting to hear that the large retailers would refuse to accept price increases, or perhaps begin working with other suppliers.  Surprisingly, the majority of these companies have been strongly supported by their customers; many of whom have had long relationships with their customers; however one must not forget that alternative suppliers may be willing to undercut the products’ price points to gain market share. Because retail has its own struggles, their customers may find alternative sourcing at reduced price points enticing.

Startup businesses are struggling the most because typically they have little-negotiating power and desperately need sales to sustain themselves.  One company, a start-up, advised that it is actively looking for US vendors to produce their products to avoid the price increases that have had a devastating effect on their business.  Whether or not they can effectuate price hikes, their gross profit margins will be reduced. Overall, as expected, the consumer will take the fall.

Many companies have taken steps to secure their products from alternative countries, which has proven to be difficult and expensive. Additional costs included multiple trips, to find the right supplier who can duplicate the Chinese manufacturers’ attention to detail. And since so many competitors are seeking alternative sources of supply, factories can closely vet new customers. Larger businesses are attempting to identify alternative supply sources and the smaller firms, are winning this battle.  Larger businesses are placing larger orders and don’t have the need for separate packing requirements. Small businesses feel more effort is being made, and higher costs are being realized to develop alternative sources for the production of their product. Establishing these new relationships are eating into profits.

Currently, Indonesia, Vietnam, Cambodia, and Thailand are the “go to” locations. Many manufacturers in these countries offer less expensive products than China, but have longer lead times and a lack of skilled labor resulting in quality control issues. Manufacturers in these countries cannot produce at the same speed, and quality as China with many commenting that although final assembly is being diverted, the source of raw materials is likely from China, especially in the apparel industry.

To add more concerns, logistic infrastructures of these countries struggle in contrast to the Chinese.. Ports cannot cope with the expected increase in freight shipments and the extended fulfillment time frames increase the cash cycle timeline.

We asked those we spoke with, “what keeps you awake at night?” to which many responded that it is the fear of the unknown. While many companies remain optimistic, they cannot sit back and wait to see how the trade imbroglio unfolds as it is their livelihood.  If a treaty between the US and China is not consummated and more tariffs are imposed, some companies will have no choice but to close their businesses. And the imposition of, or changes relating to tariffs can change quickly and not always for the better.

The reduction in orders and the inability to purchase inventory is affecting workloads, margins and eventually on staffing.  Some of these businesses cannot sustain their employment levels and may have to make staff reductions.  We know that nobody wants to lay off staff, but to a small business, the pain of doing this gets personal, especially in companies with few employees.

While the future is a bit unknown in regards to how tariffs will impact small and medium-sized businesses many companies are adjusting and making hard decisions that can seem to change day-by-day.

Tom Novembrino and Mark Polinsky are Principals at Gateway Trade Funding specializing purchase order/trade finance for small and medium-sized businesses, typically by providing letters of credit to domestic and international suppliers (or paying against documents), so our clients can fulfill large orders from creditworthy customers. Tom can be reach at (714) 671-0999 or email
tom@gatewaytradefunding.com and Mark can be reached at (847) 612-9817 or email mpolinsky@gatewaytradefunding.com.

 

Industry Leaders Share Tips for Streamlining Logistics

Keeping the books clean requires visibility and awareness of dollars coming and going out. Once again, in the theme of digital solutions, if you want that granular level of transparency, leveraging technology solutions in 2019 is imperative, especially for large-scale businesses. Supply chain management and financing logistics are two of the most important factors when considering logistics planning. Blume Global CEO Pervinder Johar explains why:

“In 2019 the most agile and resilient supply chains are the ones that are going to be the most successful. Natural disasters, economic flux, and rising tariffs are going to remain a concern for the supply chain industry and therefore the C-suite may reconsider its current manufacturing strategies and its global operations. To help inform these decisions, companies should combine external and internal data. Predictive analytics uses historical data and machine learning to identify and anticipate certain outcomes that become increasingly valuable as the volume of data increases. When properly analyzed, this data is helpful for identifying patterns and areas for optimization, to fuel better planning and resource utilization.”

Consider implementing a seamless management system that your business can rely on to eliminate risks such as invoice and vendor fraud, inventory stockpiling and increased inefficiencies. In doing so, companies can track products, customer purchases and deliveries all while monitoring and maintaining their supply chain.

“Predictive analytics will become highly useful to optimize resources within the supply chain in 2019. In late 2018, Gartner identified eight strategic technology trends for the supply chain and how they can provide a competitive advantage. Combined with AI and machine learning, data is the driver for predictive capabilities — with it, future performance can be optimized based on historical results,” Johar said. “This data is powerful and has the potential to positively impact every aspect of the supply chain, from sourcing and compliance to production and quality control. Embracing the value of technologies such as predictive analytics is essential for a strong foundation, upon which to build a digital supply chain.”

3 Common Invoicing Scams and How to Avoid Them

Invoicing and payments fraud can take a variety of forms: invoices from fictitious companies, invoices for products that were never delivered, for unusually high amounts, or as part of a phishing scheme. As your business grows and your vendor list gets larger, how do you stay on top of the validity of each invoice? Below are some common invoice fraud schemes and how you can prevent them.

CEO Impersonation

Imagine you’re an accountant and you receive an email from your CEO with a request for an urgent payment. He or she is finalizing the acquisition of another company and need you to wire money immediately in order to close the deal. You receive a follow-up phone call from a third party with the wiring instructions and authorize the payment as instructed. Only later do you find out that the email wasn’t really from the CEO and both the email and the phone call were an orchestrated scam.

This type of fraud, known as “business email compromise,” “CEO fraud,” or “CEO impersonation” was responsible for over $675 million in losses last year alone, according to the 2017 FBI Internet Crime Report. Using a spoofed email address (a common method for phishing schemes), fraudsters specifically target individuals responsible for wire transfers or invoices within an organization and solicit payments from them. They thoroughly research a company’s recent activity and target companies that conduct a lot of foreign transactions via wire transfer, since those payments are difficult to reverse. The authority of the sender, the urgency of the request, and the spoofed email address create a very convincing hoax.

                              Vendor Impersonation

Fraudsters may impersonate trusted vendors as well. Using a spoofed email, they may send notice that they’ve recently changed addresses or ACH routing information along with a fake invoice. Similar to CEO impersonation, this type of fraud happens when someone impersonates a vendor you already conduct business with. Fraudsters specifically target an employee within accounts payable, hoping that the payment will go through long before anyone questions its validity.

Awareness is key to prevent CEO and vendor impersonation fraud from happening in your organization. If you receive an email that seems suspicious, pay attention to the tone of the email: Does it sound like something your CEO would send to you? Is it their usual tone, or is it overly formal? Another thing to consider: Is it unusual for you to receive a wire transfer or urgent payment request from your CEO or this particular vendor? If you’re unsure, just ask, especially for large amounts.

Shell Companies

The creation of a shell company is one of the easiest ways for an employee to perpetrate an invoicing fraud scheme. A shell company only exists on paper, provides no services, and produces nothing. This type of fraud is often an inside job; the employee might set up the entity in a friend’s or relative’s name and invoice their employer and collect the payments. Typically, the employee will have information on the way the invoices are processed (or may even be the one paying them), so they know exactly what threshold to stay under to avoid further approvals, potentially remaining undetected for years.

Shell companies can be difficult to distinguish from real companies, but there are a few red flags. Be wary of invoices that have vague or unspecified services – this doesn’t necessarily indicate fraud, but services never rendered are a lot harder to detect than products never delivered. Are the invoices you receive numbered in sequential order? This may be because they have no other customers, and you’re the only one receiving the invoices. If you suspect it’s a fake invoice from a shell company, keep an eye out for other red flags (typos, grammatical errors). If it’s from a vendor you don’t recognize, then be cautious. Look closely at the address, tax ID number, and phone numbers – one of these might match one of your employees.

 

Josephine McCann is a Senior Marketing Associate at AppZen,the world’s leading solution for automated expense report audits that leverages artificial intelligence to audit 100% of expense reports, invoices and contacts in seconds.

 

 

Industry Trends for 2019

GateHouse Logistics Company released information this week predicting changes to come for 2019 supply chain logistics in the form of increased automation and freight data usage, creating key optimizations within the supply chain sector. Through the sharing of information, businesses are more equipped to predict opportunities to strengthen their roles within the industry.

“The year 2019 will see the supply chain become much smarter and more efficient by embracing the freight data visibility era,” CEO Jesper Bennike said. “Increasing the flow of supply chain data through automation between shippers and carriers will become the norm and this will help shorten time to visibility.”

Along with increased automation, the theme of complete data transparency paired with a higher level of selection for supply chains were noted as  major game changers industry experts can anticipate for 2019. If this plays out, shippers will have real-time visibility tracking and ETA updates, minus the frustration previously experienced.

Bennike added, “A gamut of new Industry 4.0 technologies that interact, communicate and create lakes of vital freight information is now entering the supply chain and these will be instrumental in bringing about the smart supply chain.”

Technology and information demands will far surpass what is already in place as seen with temperature control and positioning, shifting into a granular level of information with details surrounding door sensor weight, tire pressure as well as predictive maintenance. Not mentioned is the impact this will have on risk management and the mitigation automation provides by eliminating the human error factor.

This prediction supports the goal of conducting business smarter, creating a higher level of supply chain management globally, inclusive of automation and blockchain technology. The result? Increased networking and partnerships enabled to break new ground.

Source: Gatehouse

 

Singapore Expanding Trade Relations

A recent Memorandum of Understanding signed between COSCO Shipping Ports and terminal operator PSA will increase strategy efforts, ultimately supporting the development of two new berths and substantiating  trade relations between Singapore and China, according to a joint release this week.

TEUs are estimated to increase by 2 million for a grand total of 5 million once the additional berths are successfully implemented.  Automated yard technology will provide efficiencies in operations, as currently seen with the three existing berths at the  Pasir Panjang Terminals.

“The COSCO-PSA Terminal is our major investment in S.E. Asia; with the continuous support from parent company and shipping alliance, volume of the terminal continues to grow. The addition of the two new berths will enable us to secure more volume from the parent company and shipping alliances by providing them with high efficiency services. As our major hub port for transhipment in S.E. Asia, the expansion in the terminal will facilitate us to capture more volume from the new global trade momentum in the region,” commented Vice Chairman and Managing Director of COSCO Shipping Ports Zhang Wei.

Beyond the substantial expansion of TEUs predicted through the agreement, overall support for the Port of Singapore and the global role it plays within the container and shipment hub sectors will be evaluated and increased opportunities for globalization provided.

“PSA is honoured by the trust that CSP has placed in us to serve as their main hub port for container transhipment in Southeast Asia. With their continued support and confidence in PSA, we will strive to augment their strategic presence in Singapore, and we look forward to the opportunities this brings to support global trade,” PSA International Regional CEO Southeast Asia Ong Kim Pong said.

Source: COSCO SHIPPING PORTS Limited

 

 

Another Airfreight Acquisition for 2018

Quick International Courier, known for its global role as a leader in time-intensive transportation and logistics in addition to generating 200 million annual net revenue, is officially supporting Kuehne + Nagel’s footprint extension strategy, according to a release this week.

“This acquisition is an important milestone in the implementation of our solutions strategy and a confirmation of our leading position in airfreight. With its unique expertise in time-critical shipments in the fields of aviation and pharma & healthcare – both key strategic focus and investment areas for Kuehne + Nagel – the company perfectly complements our existing global portfolio. Our customers will benefit from a much greater scope of services and capability for time-critical shipments, while Quick’s customers will get access to Kuehne + Nagel’s global network across more than 100 countries”, Yngve Ruud, Member of the Managing Board of Kuehne + Nagel said.

The announcement released this week accounts for the second acquisition for Kuehne + Nagel in a month. Back in October, the company announced the acquisition of Wira Logistics in an effort to support the warehousing distribution network in Indonesia.

“Kuehne + Nagel’s M&A strategy is focused on expanding our footprint, creating synergies and acquiring know how. The acquisition of Quick is another accelerator to drive network growth and to enhance our global customer solutions portfolio”,  Dr. Detlef Trefzger, CEO of Kuehne + Nagel International AG said.

With Q1 around the corner, industry experts continue making strides as seen with various acquisitions to maximize growth and extension opportunities on a global scale. With improved transportation of critical logistics intense materials, Kuehne + Nagel are now able to provide some of the most complex deliveries.

“We are looking forward to become part of the Kuehne + Nagel Group. Joining forces with one of the leading logistics providers offers us new growth perspectives within a worldwide operating network”, Dominique Bischoff-Brown, CEO of Quick International Courier said about the acquisition.

Source: Kuehne-Nagel

The “Deadly Dozen” and Human Behavior

Maritime safety and ensuring minimal risk impact is a topic that isn’t discussed enough. Human error is unpredictable, and until shippers evolve into a fully digitally integrated system, human hands are absolutely essential to keep business moving.

A report released  provides insight and tips to consider and leverage for improving procedures. Surprisingly enough, the majority of the high-risk behaviors analyzed are fairly common and are the determining factor between making or breaking business initiatives and successful processes.

Reducing risks while on the sea can greatly impact workers and business relationships beyond the numbers, creating satisfaction and a positive working environment. One of the most common themes in the trends highlighted boils down to simple communication: alerting, situational awareness and mindfulness of culture differences. Without effective communication, business is a shot in the dark.

Here are a few examples taken from the deadly dozen to consider:

Situational Awareness

This asks the obvious but extremely important question of, “What’s the situation?” If you can’t answer this, it’s a problem. The report advises effective communication and always leveraging your team for feedback. Remember to ask yourself WHIM: “What Have I Missed?

 Alerting

Make sure to speak up at all times. Encourage this within your team and don’t chastise an assertive or proactive approach to a potentially disastrous situation. Again, this is directly linked to effective communication. Alerts can save lives and prevent accidents.

 Communication

Understand that 30% of communication is actually verbal and different cultures have different approaches will not only reduce risks but also eliminate possible strife due to offense. The report advises implementing climate control internally and externally through considering these factors for success.

 Fatigue

Don’t overwork your crew – it doesn’t pay off and creates a toxic and risky environment. The report highlights this is an ever-present condition for workers on the sea and can create ill-health as well as present risky conditions.

Pressure

Cutting corners should never be an option. In doing so, details are overlooked, tension is caused and stress is multiplied. Ensure there’s a system of balance in place and there’s always someone keeping a finger on the pulse to verify the safety and wellness of the team. Healthy pressure can create productivity, but don’t push it.

These common-sense tips and approaches can become more difficult to implement the more demanding the market becomes. Maritime trade is one of the largest sectors the industry utilizes. Within this sector, the human element is the common denominator associated with accidents, incidents and errors.

To view the full report, visit: Human Element Guidance

 

Source: MGN 520