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Global Shipping Trends: What to Expect in 2020

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Global Shipping Trends: What to Expect in 2020

Now that the fireworks are over and New Year’s resolutions are set, it’s time to prepare for global shipping in 2020. And that means looking at ongoing trends and changing regulations. One thing’s for sure, freight forwarding never has a dull moment.

Recapping 2019’s top global shipping disruptors

Before we jump into expectations for this year, let’s set the stage by looking at some of the top events in 2019 that may have affected global shipping strategies around the world.

Geopolitical uncertainties

From the ongoing Brexit discussion to the China-U.S. trade war and the trade conflict between Japan and Korea, these and other disruptions caused serious challenges to the transportation industry.

Preparation for International Maritime Organization (IMO) 2020

While the latest revisions didn’t go into effect until January 1, 2020, preparation for the changing IMO requirements was well underway in 2019. The requirement to reduce sulphur oxide emissions from 3.5% to 0.5% was a drastic change that will likely continue to affect shipping costs and capacity availability.

E-commerce expectations

With the growth of e-commerce and high-tech products flooding our markets, air freight is a go-to mode of transportation for many shippers—any time of year.

To best understand how these and other mode-specific changes will affect your 2020 shipping year, let’s break them down by service.

Ocean service in 2020

In the past, ocean shipping followed the basic law of supply and demand. When demand increased, rates went up. When demand decreased, rates dropped. This often occurred regardless of carrier profitability. But that is changing, which could reshape expectations for 2020.

Carriers controlling capacity

Today’s ocean carriers are quick to withdraw capacity when demand changes. By adjusting the amount of equipment available, ocean carriers are better able to ensure demand remains tight enough to protect their profits. This is a successful technique because there are fewer ocean carriers than in the past, allowing for a quicker reaction when supply and demand shifts.

Increasing carrier costs

While ocean carriers can control capacity to help ensure rates remain compensatory, we can still expect some level of imbalance due to the IMO 2020 mandate, which increases carrier costs.

Driver and drayage capacity shortages

California Assembly Bill 5 (AB-5) went in effect on January 1, 2020, which limits the use of classifying workers as independent contractors rather than employees by companies in the state. This may affect the availability of the number of dray carriers in the busiest ports. This, in turn, can drive drayage costs up.

Air service in 2020

Last July, we posted about ongoing uncertainty in the air freight market. The good news is that air freight service has stabilized a bit since then. While we’re predicting a somewhat stable air freight market for the year, this could obviously change if there is some catalyst that changes the speed products need to come to market.

Stable demand expectations

We expect demand for air freight to remain stable for the time being. Many organizations continue to focus on managing expenses and are looking for cost-effective, efficient options for delivering on short timelines without breaking the budget.

Capacity to hold steady

Capacity will also likely remain stable. Most new capacity is coming in the form of lower deck. Pure freighter capacity will continue to move based on market yields that make sense from a carrier standpoint. There may be some capacity growth in off-market locations, based on passenger demand.

Customs compliance in 2020

It’s always smart to have a customs compliance program that aligns with your business goals, which is especially true this year. Customs and Border Patrol (CBP) has several customs changes slated to take place in 2020, and now’s the time to prepare. If you haven’t reviewed your customs program recently, our customs compliance checklist may help.

CBP moving away from ITRAC data

According to CBP, they will be eliminating Importer Trade Activity (ITRAC) reports in favor of the Automated Commercial Environment (ACE) system. If you don’t already have an ACE portal account, now is the time to get one to ensure all your customs data is available to you when you need it most.

CBP’s continued focus on compliance and enforcement

CBP will continue to scrutinize tariff classification and valuation in an increasing post-summary environment. As the United States Trade Representative (USTR) continues to provide exclusions, many importers will depend on brokers to submit refund requests via post summary corrections (PSCs) or protests. CBP often requires additional data and/or documentation to ensure that tariff classifications and valuations are correct. It is imperative that you maintain a high degree of confidence in your compliance program and can substantiate any post summary claims with CBP.

Increasing Importer Security Filing (ISF) penalties

Throughout 2019 we saw CBP issuing more ISF penalties for inaccurate and/or untimely submissions. This will likely continue and could become a growing issue in 2020.

Disruptors affecting the industry in 2020

While certain trends and regulations only directly affect a single mode or service, there are still plenty that affect freight forwarding in general. Looking at 2020, it’s probably safe to say that the following disruptors will continue to affect the year ahead.

Broadening of sourcing locations

While there may be an end in sight to some of the trade war uncertainties, the initiative to broaden sourcing locations beyond China will likely continue. Southeast Asia has already seen clear benefits of this and will likely continue to see manufacturing growth in 2020.

Switching sourcing strategies can also bring risks, including capacity availability, infrastructure support, and geopolitical stability. While China will continue to be the largest exporter into the United States, we simply cannot deny the trends that continue to show volume shrinkage from China.

Accelerated evolution of technology

Significant investment in technology and transportation platforms continues to accelerate across the industry. Beyond private equity groups, well-respected and established providers like C.H. Robinson are making investments that will reshape logistics. These growing technological investments will continue to create value across the supply chain.

While this opens new options for shippers and carriers alike, you may likely need to spend more time researching which technology option is the best fit for your own organization. After all, the right technology offers tailored, market-leading solutions that work for supply chain professionals and drive supply chain outcomes.

Prepare for the year ahead

Overall, 2020 will be a great year for strategizing. Continuous improvement efforts—including a close look at service levels and mode choices—will help reach your short- and long-term supply chain goals.

Looking for a provider that can help in the coming year? C.H. Robinson has a global suite of services backed by technology and people you can rely on that will make 2020 preparations smooth and effective. Connect with an expert today.

pulp

U.S. Pulp Market – Exports to China Fell 9.4% in 2018, U.S Companies Lost $78M

IndexBox has just published a new report: ‘U.S. Pulp Market. Analysis And Forecast to 2025’. Here is a summary of the report’s key findings.

The revenue of the pulp market in the U.S. amounted to $4.8B in 2018, going up by 9% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). The market value increased at an average annual rate of +2.5% from 2013 to 2018; the trend pattern remained relatively stable, with somewhat noticeable fluctuations throughout the analyzed period. The pace of growth was the most pronounced in 2014 with an increase of 19% against the previous year. In that year, the pulp market attained its peak level of $5.1B. From 2015 to 2018, the growth of the pulp market remained at a lower figure.

Pulp Production in the U.S.

In value terms, pulp production totaled $7.2B in 2018. Overall, pulp production, however, continues to indicate a relatively flat trend pattern. The growth pace was the most rapid in 2014 with an increase of 8.9% year-to-year. In that year, pulp production reached its peak level of $7.7B. From 2015 to 2018, pulp production growth failed to regain its momentum.

Exports from the U.S.

In 2018, approx. 6M tonnes of pulp were exported from the U.S.; going down by -4.7% against the previous year. Over the period under review, pulp exports continue to indicate a mild shrinkage. The growth pace was the most rapid in 2015 with an increase of 3.1% against the previous year. Exports peaked at 6.4M tonnes in 2013; however, from 2014 to 2018, exports remained at a lower figure.

In value terms, pulp exports amounted to $4.5B (IndexBox estimates) in 2018. The total export value increased at an average annual rate of +1.7% from 2013 to 2018; the trend pattern remained relatively stable, with only minor fluctuations being observed over the period under review. The growth pace was the most rapid in 2018 when exports increased by 11% against the previous year. In that year, pulp exports reached their peak and are likely to continue its growth in the immediate term.

Exports by Country

China (1.6M tonnes) was the main destination for pulp exports from the U.S., with a 26% share of total exports. Moreover, pulp exports to China exceeded the volume sent to the second major destination, Japan (479K tonnes), threefold. The third position in this ranking was occupied by Italy (391K tonnes), with a 6.6% share.

From 2013 to 2018, the average annual rate of growth in terms of volume to China stood at -3.2%. Exports to the other major destinations recorded the following average annual rates of exports growth: Japan (+3.1% per year) and Italy (-3.4% per year).

In value terms, China ($1.2B) remains the key foreign market for pulp exports from the U.S., comprising 26% of total pulp exports. The second position in the ranking was occupied by Japan ($410M), with a 9.1% share of total exports. It was followed by Italy, with a 6.3% share.

From 2013 to 2018, the average annual growth rate of value to China amounted to +1.0%. Exports to the other major destinations recorded the following average annual rates of exports growth: Japan (+6.9% per year) and Italy (-1.5% per year).

Export Prices by Country

In 2018, the average pulp export price amounted to $759 per tonne, going up by 16% against the previous year. Over the period from 2013 to 2018, it increased at an average annual rate of +3.1%. The growth pace was the most rapid in 2018 an increase of 16% against the previous year. In that year, the average export prices for pulp reached their peak level and is likely to continue its growth in the immediate term.

Prices varied noticeably by the country of destination; the country with the highest price was Japan ($855 per tonne), while the average price for exports to Germany ($554 per tonne) was amongst the lowest.

From 2013 to 2018, the most notable rate of growth in terms of prices was recorded for supplies to South Korea, while the prices for the other major destinations experienced more modest paces of growth.

Imports into the U.S.

In 2018, the amount of pulp imported into the U.S. totaled 2.5M tonnes, increasing by 4.2% against the previous year. The total import volume increased at an average annual rate of +3.5% from 2013 to 2018; the trend pattern remained relatively stable, with somewhat noticeable fluctuations being recorded in certain years. The pace of growth appeared the most rapid in 2018 when imports increased by 4.2% year-to-year. In that year, pulp imports reached their peak and are likely to continue its growth in the immediate term.

In value terms, pulp imports totaled $1.5B (IndexBox estimates) in 2018. The total import value increased at an average annual rate of +4.8% over the period from 2013 to 2018; the trend pattern indicated some noticeable fluctuations being recorded throughout the analyzed period. The most prominent rate of growth was recorded in 2018 with an increase of 23% year-to-year. In that year, pulp imports attained their peak and are likely to continue its growth in the immediate term.

Imports by Country

In 2018, Brazil (2.1M tonnes) constituted the largest pulp supplier to the U.S., accounting for a 85% share of total imports. Moreover, pulp imports from Brazil exceeded the figures recorded by the second-largest supplier, Chile (248K tonnes), ninefold.

From 2013 to 2018, the average annual rate of growth in terms of volume from Brazil amounted to +1.7%. The remaining supplying countries recorded the following average annual rates of imports growth: Chile (+20.8% per year) and Sweden (+19.7% per year).

In value terms, Brazil ($1.4B) constituted the largest supplier of pulp to the U.S., comprising 90% of total pulp imports. The second position in the ranking was occupied by Chile ($75M), with a 4.8% share of total imports.

From 2013 to 2018, the average annual growth rate of value from Brazil totaled +4.0%. The remaining supplying countries recorded the following average annual rates of imports growth: Chile (+16.9% per year) and Sweden (+14.9% per year).

Import Prices by Country

The average pulp import price stood at $619 per tonne in 2018, growing by 18% against the previous year. Over the period from 2013 to 2018, it increased at an average annual rate of +1.2%. The pace of growth appeared the most rapid in 2018 an increase of 18% y-o-y. In that year, the average import prices for pulp reached their peak level and is likely to continue its growth in the immediate term.

There were significant differences in the average prices amongst the major supplying countries. In 2018, the country with the highest price was Brazil ($655 per tonne), while the price for Chile ($300 per tonne) was amongst the lowest.

From 2013 to 2018, the most notable rate of growth in terms of prices was attained by Brazil, while the prices for the other major suppliers experienced a decline.

Companies Mentioned in the Report

Profile Products, Domtar Industries, Georgia-Pacific Brewton, Woodland Pulp, Cascade Pacific Pulp, Northwest Capital Appreciation, Forest Resolute Products, American Paper Recycling, Cascades Tissue Group-Oregon, A Division of Cascades Holding US, Parsons & Whittemore, St Paper, Alabama River Cellulose, Buckeye Technologies, Brunswick Cellulose, Parsons & Whittemore Enterprises, Fibrek Inc., Port Townsend Holdings Company, Buckeye Mt. Holly, Lest Distributors, Southern Cellulose Products, DOMTAR A.W., Alabama River Group, GP Cellulose, Buckeye Florida Limited Partnership, Pratt Paper (ny), Fibrek Recycling U.S. , Cosmo Specialty Fibers, Ox Paperboard

Source: IndexBox AI Platform

2020

Dates You Don’t Want to Forget in 2020

Midwest Association of Rail Shippers (MARS) Winter Meeting

Jan. 14–16

Westin Lombard Yorktown Center, Lombard, Illinois

mwrailshippers.com

“Rail’s 2020 Crossroads: Market Share vs. Operating Ratio” is the theme as the impacts of the declining freight market are discussed.

National Retail Federation’s 2020 Vision

Jan. 12-14

Jacob K. Javits Convention Center, New York, New York

nrfbigshow.nrf.com

“Retail’s Big Show,” as it is known, includes more than 38,000 retailers, vendors and expert participants.

Nulogy Presents: xChange 19

Jan. 19-21

Westin Phoenix Downtown, Phoenix, Arizona

xchange.nulogy.com

This is the preeminent conference for consumer packaged goods (CPG) brands and co-pack suppliers.

Southern Motor Carriers’ Jump Start 20

Jan. 27-29

The Renaissance Atlanta Waverly, Atlanta, Georgia

smc3jumpstart.com

This event covers all things supply chain, such as industry disruption predictions, ethical AI, cross-border logistics, freight profitability analysis, blockchain strategies and much more.

Cargo Logistics Canada

Feb. 4-6

Vancouver Convention Centre West, Vancouver, Canada

cargologisticscanada.com

The global impacts of China’s $1 trillion One Belt One Road and the massive global e-commerce surge are among the expo topics.

17th Annual RLA Conference and Expo

Feb. 4-6

Mirage Hotel and Casino, Las Vegas, Nevada

rla.org

Reverse Logistics Magazine’s annual event focuses on solutions and technologies surrounding reverse logistics and the circular economy.

38th Annual Mississippi Valley Trade and Transport Conference

Feb. 19-20

Omni Royal Orleans, New Orleans, Louisiana

mvttc.com

One of the longest-running river-related logistics events features expert panelists speaking on a range of important topics, including river statistics, port updates and commodities.

Food Shippers of America 65th Annual Logistics Conference

Feb. 23-25

J.W. Marriott Grand Lakes, Orlando, Florida

foodshippersofamerica.org.

This invitation-only conference is aimed at the food shipment field.

LINK2020: The Retail Supply Chain Conference

February 23-26, 2020

Dallas, TX

Gaylord Texan

Rila.org/supplychain

RILA LINK2020: The Retail Supply Chain Conference is the best way to network, learn, and explore hot trends in retail supply chain management.  Hundreds of executives from the top retailers will gather at LINK2020 to discover new, innovative strategies, find new solutions to their challenges, and position themselves as leaders in the field.

Automotive Logistics Mexico

Feb. 25-27

Marquis Reforma, Mexico City, Mexico

automotivelogistics.media/automotive-logistics-mexico

C-Level execs, directors and managers responsible for all areas of logistics and supply chain strategy for vehicle makers, parts suppliers, government, LSPs, tech providers and start-ups gather to learn the latest industry developments.

3rd Cold Chain Global Forum West Coast .20

Feb. 25-27

San Diego Convention Center, San Diego, California

pharma-iq.com

Senior supply chain, logistics, transportation, packaging, quality and operations stakeholders from both large and small pharma West Coast-based companies get a holistic temperature-controlled blueprint that goes from clinical supply chain to commercial supply chain.

AFFI Con 2020

Feb. 29-March 3

Cosmopolitan, Las Vegas, Nevada

affi.com

This is the American Frozen Food Institute’s premier event for frozen food and beverage makers, industry suppliers and logistical partners.

82nd TCA Annual Convention

March 1-3

Gaylord Palms Resort & Convention Center, Kissimmee, Florida

Truckload.org

The premier networking and education event in the truckload industry features diverse speakers, workshops and an insightful keynote.

TPM 20

March 1-4

Long Beach Convention Center, Long Beach, California

joc-tpm.com

Among the largest logistics, business and transportation events includes a variety of industry roundtables, workshops and mixers.

Elevate Annual Users Conference

March 2-5

Orlando World Center Marriott, Orlando, Florida

elevate.highjump.com

A diverse group of HighJump users, experts and industry leaders and partners discuss Warehouse Management Systems (WMS), 3PL software and Direct Store Delivery (DSD).

MODEX 2020

March 9-12

Georgia World Congress Center, Atlanta, Georgia

modexshow.com

The possibilities are endless thanks to 950+ exhibits and 100+ education sessions tailored to help you discover equipment and system solutions for your material handling and supply chain needs. With keynotes, networking, education and product booths, MODEX is where manufacturing and supply chain innovation come to life.

How to Avoid Bottlenecks in Your Global Operations

You can’t just turn around a giant cargo ship. Even at some of the world’s best supply chains, redirecting chemicals and other products is a Herculean effort. And when shipping to volatile countries, it becomes even harder. For U.S. companies with global operations, one of the most effective ways to mitigate risk is to ship smarter.

In the current political climate, U.S. companies should be looking to partner with more stable countries where tariff changes aren’t expected. Take the Netherlands, for example. In 2017, the U.S. had a trade surplus of $24.5 billion.

I’ve been in supply chain management for more than a decade now. Supply chain flow has a lot of one-way check valves. Once cargo has shipped, there are no “backsies.” This is why supply chain managers are always stressing over demand forecasts — something that tops the list of most critical inventory management practices. And considering that our international tariff laws have been more dynamic in the past three years, shipping U.S. goods is more complex than it used to be.

Shipping Overseas

Anyone who has shipped freight by air or sea can attest to the fact that international shipping is complex — in no small part because of the rules and regulations around certain goods. Hazardous materials, obviously, can pose some problems. So can live cultures, a number of metals, and even telecommunication devices.

But it isn’t just international law that complicates matters. Everything from custom duties to cargo inspections can create bottlenecks within the supply chain. If even one item in a container is flagged, it could stop an entire ship’s worth of containers from making it past the terminal gates. It could then be held until a more thorough inspection can be made, which can come with an additional expense.

Complicating matters further, some countries will hold U.S. shipments for the sole reason that they’re coming from America. And in countries like Saudi Arabia, every container must go through inspection. Needless to say, these situations can add a significant amount of time to your shipment, creating inefficiencies in the supply chain that can sometimes be the equivalent of an additional tariff on your goods.

Being a former geo-marketing manager, I can tell you that a global view of operations can help you appreciate the people and logistics necessary to get goods from one location to another. It takes a great deal of coordination — and a great number of trucks, ships, and planes — to keep a supply chain running smoothly.

That’s why it’s so important to have some level of global operations knowledge as a U.S. supply chain professional. It can help you identify the potential “watering holes” of many products you need to buy for your operations. After all, the more you know about an item’s origin — and what it takes to get it to your warehouse — the easier it becomes to identify any middlemen that might be artificially elevating the price of goods.

This isn’t to say you should avoid international sources for goods. On the contrary, you should be exploring all your procurement options globally, nationally, and locally. Maybe you wouldn’t need to consider upheaving your operations and relocating your warehouse as a result of shifting trade patterns, like 48% of supply chain and transportation executives are doing now.

Getting a Global Perspective

The question then remains: What should U.S. manufacturers do to better understand global supply chain operations when exporting goods abroad? The following strategies should get you started:

Travel. To find the best prices for raw materials and the cheapest places to manufacture goods, the most logical answer is to travel. Knowing the origins of your raw materials can provide you with greater appreciation for the effort necessary to get an item to the production line. It also helps put the importance of quality in perspective. You understand why everything can’t be scrapped and reworked on a whim.

Study the local competition. Business is extremely competitive. The more you understand about local competitors, the easier it is to respond to changes. The U.S. e-commerce market has grown to $561 billion, making it the second-largest in the world. It didn’t take my first boss long to realize the value consumers place on U.S. brands, as they are willing to pay a premium for these goods — even over local ones.

Ask about tax reassessment and international ‘doing business as’ discounts.Many countries offer incentives for U.S. companies to do business in their lands. Free Trade Agreementsmake it much easier and cheaper to export goods to myriad foreign markets. The only problem: Most U.S. manufacturers never inquire about discounts on port duties or refunds for certain sales. Look at national government incentives for doing business in other countries.


Secure backup buyers. Regime changes, political turmoil, and bankruptcy are just a few events that can affect sales. In case your first buyer cannot purchase your goods, you need a backup buyer. Even at a price reduction, you salvage quarterly net income. To avoid tariffs on Chinese goods, companies bought all sorts of goods towards the end of last year. By February, all that changed. U.S. ocean imports fell 4.5%, and overall U.S. imports from China dropped 9.9%.

Chances are that the supply chain will become more central — and more global — to everything. In fact, activities associated with transportation and logistics account for anywhere between 10% and 12% of global GDP. As imports and exports ebb, it could disrupt not only the U.S. economy, but also the global one. But if you get to know the local competition, leverage business incentives from other countries, and take the time to formulate contingency plans for fluctuating demands, you’re more likely to weather the next storm.

___________________________________________________________

Ali Hasan R. is the co-founder and CEO of ThroughPut Inc., the artificial intelligence supply chain pioneer that enables companies to detect, prioritize, and alleviate dynamic operational bottlenecks. Ali’s unique experiences in onshore and offshore supply chain management in the United States, Russia, United Arab Emirates, Saudi Arabia, Pakistan, Bahrain, and Yemen have produced results for customers’ ongoing work, which is now featured at some of the world’s most recognized brands.

global pepper

Global Pepper Market Is Expected to Reach 840K Tonnes by 2025

IndexBox has just published a new report: ‘World – Pepper – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The global pepper market revenue in 2018 is estimated at $4.1B, a decrease of -1.7% y-o-y. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). In general, pepper consumption continues to indicate a strong expansion. The most prominent rate of growth was recorded in 2011 when the market value increased by 26% against the previous year. The global pepper consumption peaked at $4.2B in 2017, and then declined slightly in the following year.

Consumption By Country

The countries with the highest volumes of pepper consumption in 2018 were Viet Nam (166K tonnes), India (86K tonnes) and the U.S. (68K tonnes), with a combined 41% share of global consumption. These countries were followed by Bulgaria, Indonesia, China, Singapore, Malaysia, Sri Lanka, Germany, the United Arab Emirates and the UK, which together accounted for a further 33%.

In value terms, Viet Nam ($904M), India ($506M) and the U.S. ($374M) constituted the countries with the highest levels of market value in 2018, with a combined 43% share of the global market. These countries were followed by Indonesia, Singapore, China, Malaysia, Bulgaria, Sri Lanka, the United Arab Emirates, Germany and the UK, which together accounted for a further 33%.

The countries with the highest levels of pepper per capita consumption in 2018 were Bulgaria (7,641 kg per 1000 persons), Singapore (5,288 kg per 1000 persons) and Viet Nam (1,724 kg per 1000 persons).

Market Forecast 2019-2025

Driven by increasing demand for pepper worldwide, the market is expected to continue an upward consumption trend over the next seven-year period. Market performance is forecast to decelerate, expanding with an anticipated CAGR of +1.2% for the seven-year period from 2018 to 2025, which is projected to bring the market volume to 840K tonnes by the end of 2025.

Production 2007-2018

In 2018, the amount of pepper produced worldwide stood at 752K tonnes, jumping by 5.1% against the previous year. In general, the total output indicated a conspicuous expansion from 2007 to 2018: its volume increased at an average annual rate of +3.2% over the last eleven years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, pepper production increased by +55.4% against 2012 indices. The pace of growth was the most pronounced in 2016 with an increase of 11% against the previous year. Over the period under review, global pepper production reached its maximum volume in 2018 and is likely to continue its growth in the immediate term. The general positive trend in terms of pepper output was largely conditioned by a tangible increase of the harvested area and a resilient expansion in yield figures.

In value terms, pepper production totaled $3.8B in 2018 estimated in export prices. Over the period under review, pepper production continues to indicate a remarkable increase. The pace of growth appeared the most rapid in 2011 when production volume increased by 47% against the previous year. The global pepper production peaked at $4.6B in 2016; however, from 2017 to 2018, production remained at a lower figure.

Production By Country

The country with the largest volume of pepper production was Viet Nam (273K tonnes), comprising approx. 36% of total production. Moreover, pepper production in Viet Nam exceeded the figures recorded by the world’s second-largest producer, Indonesia (88K tonnes), threefold. The third position in this ranking was occupied by Brazil (80K tonnes), with a 11% share.

In Viet Nam, pepper production expanded at an average annual rate of +8.1% over the period from 2007-2018. In the other countries, the average annual rates were as follows: Indonesia (+0.8% per year) and Brazil (+0.2% per year).

Harvested Area 2007-2018

In 2018, approx. 570K ha of pepper were harvested worldwide; stabilizing at the previous year. Overall, the pepper harvested area, however, continues to indicate a relatively flat trend pattern. The most prominent rate of growth was recorded in 2009 when harvested area increased by 8% against the previous year. The global pepper harvested area peaked at 622K ha in 2007; however, from 2008 to 2018, harvested area failed to regain its momentum.

Yield 2007-2018

Global average pepper yield amounted to 1.3 tonne per ha in 2018, surging by 4.8% against the previous year. In general, the yield indicated prominent growth from 2007 to 2018: its figure increased at an average annual rate of +4.0% over the last eleven-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, pepper yield increased by +53.3% against 2012 indices. The pace of growth appeared the most rapid in 2013 with an increase of 22% y-o-y. Over the period under review, the average pepper yield attained its maximum level in 2018 and is likely to continue its growth in the immediate term.

Exports 2007-2018

Global exports totaled 392K tonnes in 2018, picking up by 6.5% against the previous year. The total export volume increased at an average annual rate of +2.1% from 2007 to 2018; the trend pattern remained relatively stable, with somewhat noticeable fluctuations being recorded in certain years. The most prominent rate of growth was recorded in 2015 with an increase of 7.9% y-o-y. Over the period under review, global pepper exports attained their maximum at 398K tonnes in 2016; however, from 2017 to 2018, exports stood at a somewhat lower figure.

In value terms, pepper exports stood at $2B (IndexBox estimates) in 2018. Over the period under review, pepper exports continue to indicate strong growth. The growth pace was the most rapid in 2011 with an increase of 43% against the previous year. Over the period under review, global pepper exports reached their peak figure at $3.4B in 2015; however, from 2016 to 2018, exports failed to regain their momentum.

Exports by Country

Viet Nam represented the largest exporter of pepper in the world, with the volume of exports finishing at 142K tonnes, which was approx. 36% of total exports in 2018. It was distantly followed by Brazil (73K tonnes) and Indonesia (36K tonnes), together achieving a 28% share of total exports. India (17K tonnes), Germany (16K tonnes), Sri Lanka (15K tonnes), Malaysia (12K tonnes), Mexico (8.4K tonnes), the Netherlands (7.5K tonnes), France (6.8K tonnes) and the U.S. (6.8K tonnes) took a minor share of total exports.

From 2007 to 2018, the most notable rate of growth in terms of exports, amongst the main exporting countries, was attained by France, while the other global leaders experienced more modest paces of growth.

In value terms, Viet Nam ($743M) remains the largest pepper supplier worldwide, comprising 36% of global exports. The second position in the ranking was occupied by Brazil ($243M), with a 12% share of global exports. It was followed by Indonesia, with a 9.9% share.

In Viet Nam, pepper exports increased at an average annual rate of +9.6% over the period from 2007-2018. In the other countries, the average annual rates were as follows: Brazil (+7.3% per year) and Indonesia (+2.9% per year).

Export Prices by Country

In 2018, the average pepper export price amounted to $5,214 per tonne, going down by -14.2% against the previous year. Over the period under review, the pepper export price, however, continues to indicate remarkable growth. The most prominent rate of growth was recorded in 2011 an increase of 51% y-o-y. The global export price peaked at $8,660 per tonne in 2015; however, from 2016 to 2018, export prices remained at a lower figure.

Prices varied noticeably by the country of origin; the country with the highest price was the Netherlands ($8,605 per tonne), while Mexico ($2,602 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was attained by India, while the other global leaders experienced more modest paces of growth.

Imports 2007-2018

Global imports totaled 414K tonnes in 2018, picking up by 8.6% against the previous year. The total import volume increased at an average annual rate of +2.9% over the period from 2007 to 2018; the trend pattern remained relatively stable, with somewhat noticeable fluctuations being observed in certain years. The most prominent rate of growth was recorded in 2013 when imports increased by 9.8% y-o-y. Over the period under review, global pepper imports attained their maximum in 2018 and are likely to see steady growth in the near future.

In value terms, pepper imports amounted to $2.1B (IndexBox estimates) in 2018. Overall, pepper imports continue to indicate a strong expansion. The pace of growth was the most pronounced in 2011 when imports increased by 41% year-to-year. The global imports peaked at $3.3B in 2015; however, from 2016 to 2018, imports stood at a somewhat lower figure.

Imports by Country

In 2018, the U.S. (75K tonnes), distantly followed by Viet Nam (35K tonnes), Germany (32K tonnes) and India (31K tonnes) were the major importers of pepper, together creating 42% of total imports. The following importers – the United Arab Emirates (16K tonnes), the UK (13K tonnes), France (11K tonnes), the Netherlands (11K tonnes), Spain (10K tonnes), Japan (9.5K tonnes), Pakistan (8.2K tonnes) and Russia (8K tonnes) – together made up 21% of total imports.

Imports into the U.S. increased at an average annual rate of +1.5% from 2007 to 2018. At the same time, Viet Nam (+21.5%), India (+8.8%), the UK (+5.4%), the United Arab Emirates (+3.9%), Spain (+2.9%), Russia (+2.6%) and France (+2.0%) displayed positive paces of growth. Moreover, Viet Nam emerged as the fastest-growing importer in the world, with a CAGR of +21.5% from 2007-2018. Pakistan, Japan and Germany experienced a relatively flat trend pattern. By contrast, the Netherlands (-2.7%) illustrated a downward trend over the same period. From 2007 to 2018, the share of Viet Nam, India and the U.S. increased by +7.5%, +4.5% and +2.7% percentage points, while the shares of the other countries remained relatively stable throughout the analyzed period.

In value terms, the U.S. ($391M) constitutes the largest market for imported pepper worldwide, comprising 18% of global imports. The second position in the ranking was occupied by Germany ($188M), with a 8.9% share of global imports. It was followed by India, with a 7.8% share.

In the U.S., pepper imports increased at an average annual rate of +5.5% over the period from 2007-2018. In the other countries, the average annual rates were as follows: Germany (+4.8% per year) and India (+14.1% per year).

Import Prices by Country

In 2018, the average pepper import price amounted to $5,122 per tonne, shrinking by -18.3% against the previous year. In general, the pepper import price, however, continues to indicate noticeable growth. The growth pace was the most rapid in 2011 an increase of 45% against the previous year. Over the period under review, the average import prices for pepper attained their peak figure at $8,550 per tonne in 2015; however, from 2016 to 2018, import prices remained at a lower figure.

Prices varied noticeably by the country of destination; the country with the highest price was the United Arab Emirates ($8,027 per tonne), while Viet Nam ($2,485 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was attained by the United Arab Emirates, while the other global leaders experienced more modest paces of growth.

Source: IndexBox AI Platform

trade

Holiday Gift-Giving in the Trade Spirit

FOR THE ROMANTIC

Tea Sampler:

Whether you favor green, black, oolong or white tea, all originate from the plant Camellia sinensis. It’s the soil, atmosphere and method of processing that confer different tastes, colors and scents. Tea traded globally is grown on large plantations in more than 30 countries. The four biggest producers are China, India, Kenya and Sri Lanka. This sampler of dissolvable “tea drops” includes citrus ginger, blueberry acai, rose earl grey, sweet peppermint, and matcha green tea made from teas sourced around the world but hand assembled by in Los Angeles, California.

FOR THE GOURMAND

Artisinal Chocolate Bars:

Cacao grows close to the equator in places like Brazil, Ecuador, Peru and Madagascar. Askinosie, a family-owned chocolatier in Springfield, Missouri offers dark chocolate bars sourced from women farmers in Tanzania. Harper Macaw of Washington, DC blends Brazilian cacao and Brazilian coffee beans roasted in Annapolis, Maryland to produce its milk chocolate Coffee Bar. Madecasse was founded by former American Peace Corps volunteers. It makes 92 percent pure dark bars in Madagascar from local cacao. Marou is truly small artisanal chocolate maker that works with small farmers to help Vietnam become the newest producer of cacao in the world.

Cashmere Sweater:

Your sweater begins as the coat of a cashmere goat. Named for their origin in the Himalayan region of Kashmir, cashmere-producing breeds also thrive in Australia and throughout China. Among the most famous are the Zalaa Ginst white goat of Mongolia and the Tibetan Plateau goat. Some $1.4 billion in cashmere garments are traded globally each year. Top manufacturers hail from Scotland and Italy, but these days you can find “cashmere-blends” on discount racks in U.S. fast fashion stores.

Homemade Hot Sauce:

If you’re going to try your hand at it, you’ll need two key ingredients – chili peppers and spices. Chili peppers grow in the United States but Capsicum annuum was originally domesticated in Mesoamerica, a region that extends from Central Mexico to Central America. After Spanish colonists returned with it to Europe, hot peppers traveled the globe swiftly on Portuguese trade routes to spice-loving India through the Portuguese-controlled port of Goa, and from there, over the Himalayas to Sichuan, China.

FOR THE PRAGMATIST

A Pair of Necessities:

Some people like receiving the essentials – from underwear to appliances. Many of our undergarments come to the United States from Sri Lanka, an island nation off the southern coast of India. Home to some 22 million people, Sri Lanka produces for major global brands like Victoria’s Secret, Gap, Nike, Tommy Hilfiger, H&M and more. The (still) popular Instant Pot is manufactured in China but was invented by Robert Wang, a former software engineer from Canada who applied his knowledge of microprocessors and sensors to the science of not burning dinner.

FOR THE TRENDY

A Small-Batch, Globe-Trotting Bourbon:

Why not support American whiskey, which has been hard hit in overseas markets by retaliatory tariffs. Jefferson’s Ocean is the brainchild of Jefferson’s, a Kentucky artisan distillery. Barrels of bourbon hitch a boat ride on a shark-tagging research vessel, crossing the equator four times, visiting over 30 ports on five continents. The temperature fluctuations, salt water air exposure, and constant motion of the ship during the journey renders a thick, dark bourbon with caramel flavors and a briny scent.

FOR THE RE-USER

Silicone Lunch Boxes and Nylon Bags:

We’ve written before about the silicon in sand which can be made into the tiny individual semiconductor chips that get embedded into our globally trade devices. Silicone, on the other hand, is a rubberlike plastic increasingly used in food storage, transportation and reheating, due to its low toxicity and high heat resistance. Food52 makes a colorful container with a silicone sleeve that is, according to the manufacturer, “just right for layering miso salmon and spinach over black rice.” No bag lunch for the modern hipster.

Baggu is a re-usable shopping bag made from lightweight ripstop nylon that comes in a variety of bold colors and prints. The synthetic polymer known as nylon was first produced in United States, born of the need to find alternatives to silk and hemp for parachutes in World War II. Today, China is the largest exporter of nylon.

FOR THE “VSCO GIRL”

If you’re not familiar with the term, you probably don’t have a teenager in your home. VSCO is a popular photo editing app that many social sharers use before posting on Instagram or other platforms. The term “VSCO girl” has been adopted to describe some of the latest teen fashion trends and must-haves for the middle and high school hallways.

Here are some of the essentials you might give the VSCO girl in your life, beginning with a Fjullraven Swedish backpack to put it all in. Add to it some Glossier Lip Balms if you care about transparency in the global supply chain of your makeup, a Hydroflask made of pro-grade 18/8 stainless steel (are there tariffs on that stainless steel?), some Pura Vida jewelry from Costa Rica, and an Instax camera from Japanese maker Fujifilm. Where do VSCO girls hang out when they aren’t in school? On TikTok, of course. There are some 422.4 million videos on Chinese app TikTok tagged #vscogirl.

Whatever you buy for the holidays this year, chances are, there’s a global trade aspect to your gift-gifting. As we like to say at TradeVistas, “see the trade in everything.” Happy holidays.

Note: Neither the author nor TradeVistas’ sponsor endorses the above-mentioned products. We merely seek to illustrate the global trade dimension in popular gifts this season.

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Andrea Durkin is the Editor-in-Chief of TradeVistas and Founder of Sparkplug, LLC. Ms. Durkin previously served as a U.S. Government trade negotiator and has proudly taught international trade policy and negotiations for the last fourteen years as an Adjunct Professor at Georgetown University’s Master of Science in Foreign Service program.

This article originally appeared on TradeVistas.org. Republished with permission.

airfeight

Airfreight vs. Sea Freight – Which Works Better?

Airfreight vs. sea freight has become a burning dilemma for all those in need of this type of services. While both solutions come with a set of advantages and disadvantages, the final choice one makes will depend on a variety of factors. We are willing to share our knowledge and findings with you so that you can make the best possible decision regarding your shipment in the given circumstances. 

Airfreight vs sea freight – the costs can be a decisive factor

Undeniably, the amount of financial means necessary to afford airfreight services is considerably higher than that of sea freight. Moreover, the appearance of the largest cargo aircraft in the world announces great changes and improvements in this field. The Antonov An-225 could cause a further rise of the airfreight costs, but it will also guarantee higher quality. On the other hand, sea freight is much more affordable and, consequently, the number one choice of a vast majority of clients. Opting for sea freight provides clients with acceptable service but at a significantly lower price.

Time matters greatly!

Most often, clients want their shipment delivered as soon as possible, which can cause problems for those offering sea freight services. Not seldom do customs issues or hold-ups at ports cause serious delays. However, we must admit that a giant step forward is evident in this field. Firstly, high-quality, modern ships are much faster now than it was the case in the past. Secondly, there are some canal upgrades that can eliminate tedious and tiring delays on some routes. Finally, sea freight forwarders can guarantee delivery times, which is vital for business owners when it comes to organization.

The type of cargo affects the final choice on airfreight vs. sea freight dilemma

The type of cargo is one of the most important factors influencing the choice in the airfreight vs. sea fright dilemma. In this case, we must admit that sea fright seems like a much better solution since it has no limitations you have to be aware of. One of the crucial pros of the maritime shipping is that you can ship even the bulkiest and extremely heavy goods. Conversely, airfreight is limited in this discipline. Before you opt for this type of goods transportation, it is advisable to make sure that the type of your cargo is acceptable. In addition, there is a very long list of the items which are prohibited and those listed as hazardous materials. Depending on your final destination, the rules and laws may differ. Yet, getting sufficient information on the subject must still be the first step in the process.

Safety of your cargo is the top priority

Understandably, the safety of cargo is always the top priority. It is important to emphasize that air cargo has to be dealt with the utmost attention and in accordance with the regulations which are very strict and clear. All the crucial elements, including handling and securing your cargo as well as the proper storage, are defined by airport regulations. This is a great benefit and a guarantee that the safety of your goods will be at the maximal level. On the other hand, we cannot say that sea freight is a bad alternative either. In this case, the goods are transported in containers, but the human factor is crucial. Proper packing strategies are essential in order to decrease any chances of potential damage during transport. If this is not conducted appropriately, the chances are some of your goods might get seriously damaged or even cause further problems on the ship.

Do not forget about the accessibility of your goods

If we analyze the accessibility of your goods as one of the criteria, airfreight is a more favorable option by all means. The procedures are clear, cargo is in smaller volumes and there are no unnecessary waitings to receive your goods. Using sea freight for your cargo often results in additional costs due to heavy congestions in seaports. If your goods are not delivered at the arranged time, you are required to pay for detention and demurrage costs, which may be a heavy burden on your budget. However, we must not forget to mention an advantage sea freight offers comparing to airfreight. The accessibility to markets is much higher in case of sea freight. The reason is very simple. When unloaded from ships, containers can move further inland by using the services of intermodal shippers

Eco-friendly practices 

Finally, let us not forget about the environment when choosing between airfreight vs sea freight. Applying eco-friendly practices is becoming increasingly important, so it does not surprise this is one of the factors shippers base their decision on. According to this particular criterion, sea freight is a more reasonable option since it has a significantly better carbon footprint. Quite the opposite, airplanes are serious polluters and require special attention and measures to reduce their carbon footprint to minimal values.

Final words on airfreight vs sea freight dilemma

The decisions and choices you make concerning airfreight vs sea freight dilemma will depend on miscellaneous factors. It is of key importance to weigh the pros and cons of each of these options and then make your decision final.  A serious effort is required to negotiate the best shipping terms and only then can you expect to ship your goods completely fuss-free.

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Susan Daniels is a passionate copywriter who loves exploring home improvement ideas and real estate market. Lately, she has gained considerable knowledge in the types of moving services and the qualities of respectable moving companies such as DA Moving NYC, for example. She enjoys giving advice on the best places to live and exciting places to visit. Traveling makes her happy as well as reading good books.

cereal germ

Italy’s Cereal Germ Market Rose 2.9% to Reach $61M in 2018

IndexBox has just published a new report: ‘Italy – Cereal Germ – Market Analysis, Forecast, Size, Trends And Insights’. Here is a summary of the report’s key findings.

The revenue of the cereal germ market in Italy amounted to $61M in 2018, rising by 2.9% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). In general, cereal germ consumption continues to indicate a relatively flat trend pattern. The pace of growth appeared the most rapid in 2011 with an increase of 96% y-o-y. In that year, the cereal germ market attained its peak level of $74M. From 2012 to 2018, the growth of the cereal germ market failed to regain its momentum.

Production in Italy

In 2018, the production of cereal germ in Italy amounted to 108K tonnes, rising by 2.6% against the previous year. Overall, cereal germ production, however, continues to indicate a temperate drop. The most prominent rate of growth was recorded in 2013 when production volume increased by 88% y-o-y. Over the period under review, cereal germ production attained its maximum volume at 138K tonnes in 2008; however, from 2009 to 2018, production stood at a somewhat lower figure.

In value terms, cereal germ production totaled $29M in 2018 estimated in export prices. Overall, cereal germ production, however, continues to indicate a significant reduction. The growth pace was the most rapid in 2011 with an increase of 143% year-to-year. Over the period under review, cereal germ production reached its maximum level at $50M in 2014; however, from 2015 to 2018, production remained at a lower figure.

Exports from Italy

In 2018, the amount of cereal germ exported from Italy stood at 668 tonnes, declining by -6.2% against the previous year. Overall, cereal germ exports continue to indicate a drastic curtailment. The most prominent rate of growth was recorded in 2014 with an increase of 93% against the previous year. Over the period under review, cereal germ exports attained their peak figure at 1.6K tonnes in 2007; however, from 2008 to 2018, exports remained at a lower figure.

In value terms, cereal germ exports totaled $548K (IndexBox estimates) in 2018. In general, cereal germ exports continue to indicate a drastic downturn. The most prominent rate of growth was recorded in 2014 with an increase of 54% y-o-y. Exports peaked at $1.2M in 2007; however, from 2008 to 2018, exports remained at a lower figure.

Exports by Country

Spain (144 tonnes) was the main destination for cereal germ exports from Italy, accounting for a 22% share of total exports. Moreover, cereal germ exports to Spain exceeded the volume sent to the second major destination, Poland (61 tonnes), twofold. The third position in this ranking was occupied by France (17 tonnes), with a 2.6% share.

From 2007 to 2018, the average annual rate of growth in terms of volume to Spain totaled +7.3%. Exports to the other major destinations recorded the following average annual rates of exports growth: Poland (+18.2% per year) and France (-20.6% per year).

In value terms, the largest markets for cereal germ exported from Italy were Poland ($78K), Spain ($40K) and the U.S. ($22K), with a combined 25% share of total exports.

Among the main countries of destination, Poland recorded the highest rates of growth with regard to exports, over the last eleven years, while the other leaders experienced a decline.

Export Prices by Country

In 2018, the average cereal germ export price amounted to $821 per tonne, surging by 5.9% against the previous year. Over the period under review, the cereal germ export price continues to indicate a relatively flat trend pattern. The pace of growth appeared the most rapid in 2011 when the average export price increased by 126% against the previous year. Over the period under review, the average export prices for cereal germ attained their maximum at $1,542 per tonne in 2013; however, from 2014 to 2018, export prices failed to regain their momentum.

Prices varied noticeably by the country of destination; the country with the highest price was India ($1,470 per tonne), while the average price for exports to Spain ($275 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was recorded for supplies to France, while the prices for the other major destinations experienced more modest paces of growth.

Imports into Italy

In 2018, the cereal germ imports into Italy amounted to 90K tonnes, growing by 11% against the previous year. The total import volume increased at an average annual rate of +3.8% over the period from 2007 to 2018; however, the trend pattern indicated some noticeable fluctuations being recorded in certain years. The pace of growth was the most pronounced in 2011 with an increase of 40% y-o-y. Imports peaked in 2018 and are expected to retain its growth in the immediate term.

In value terms, cereal germ imports amounted to $33M (IndexBox estimates) in 2018. Over the period under review, cereal germ imports continue to indicate tangible growth. The pace of growth appeared the most rapid in 2011 with an increase of 114% y-o-y. In that year, cereal germ imports attained their peak of $50M. From 2012 to 2018, the growth of cereal germ imports remained at a somewhat lower figure.

Imports by Country

Austria (29K tonnes), Hungary (27K tonnes) and Spain (12K tonnes) were the main suppliers of cereal germ imports to Italy, with a combined 75% share of total imports. Slovakia, France, Serbia and Slovenia lagged somewhat behind, together accounting for a further 23%.

From 2007 to 2018, the most notable rate of growth in terms of imports, amongst the main suppliers, was attained by Serbia, while the other leaders experienced more modest paces of growth.

In value terms, Austria ($8.6M), Hungary ($5.9M) and Spain ($3M) appeared to be the largest cereal germ suppliers to Italy, together accounting for 53% of total imports. These countries were followed by Slovakia, France, Slovenia and Serbia, which together accounted for a further 16%.

Serbia experienced the highest growth rate of imports, among the main suppliers over the last eleven years, while the other leaders experienced more modest paces of growth.

Import Prices by Country

The average cereal germ import price stood at $366 per tonne in 2018, going down by -6.8% against the previous year. Over the period under review, the cereal germ import price continues to indicate a relatively flat trend pattern. The pace of growth was the most pronounced in 2008 when the average import price increased by 76% year-to-year. In that year, the average import prices for cereal germ attained their peak level of $697 per tonne. From 2009 to 2018, the growth in terms of the average import prices for cereal germ remained at a somewhat lower figure.

There were significant differences in the average prices amongst the major supplying countries. In 2018, the country with the highest price was Slovakia ($323 per tonne), while the price for Serbia ($91 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was attained by Spain, while the prices for the other major suppliers experienced a decline.

Source: IndexBox AI Platform

commercial

How to Reduce Commercial Warehousing Costs

With an unpredictable market, erratic economy, and huge competition, it can be quite difficult to get a warehouse business running smoothly. Your goal is to maximize profit while cutting down on production and operation costs. Well, that is not always easy. One of the biggest issues that create setbacks is spending money on things you don’t need to keep a business running. My goal is to show you how to reduce commercial warehousing costs, and increase your earnings while keeping the quality of the service on a satisfying level.

The Primary Goal

The primary goal of every professional warehouse must be to reduce commercial warehousing costs. Since all items must be in buy-ready condition, and in their proper place, you must have enough funding to keep this well-oiled machinery running smoothly. If you wish to improve the efficiency, speed, and accuracy in your warehouse, this strategy is a must. Let’s see how to achieve that.

Optimize Your Storage by Reducing Space

Optimizing your warehouse space is crucial for peak performance of your facilities. If we think about expenses, one of the major contributors is land cost. Since the productivity rate of the warehouse depends on the speed of locating the item and loading it onto the truck, you must think of the best system.

Optimize your aisles by carefully calculating the necessary length and width. Learn the dimensions of forklifts, and reduce extra space by moving the racks closer. Furthermore, sorting the packages on the racks makes everything easier.

When we think about square footage, it is crucial to go narrow and tall. That is the best way to reduce warehouse space, without losing productivity and effectiveness. Nevertheless, it is important to factor in the safety requirements of your workers, and provide enough space for them to work without constrictions.

Protecting the Inventory

Every warehouse has its own financial problems. Damaged inventory is most certainly one of the biggest culprits for the loss of money. Smart inventory management helps you keep your inventory protected.

One of the first approaches to take is to tightly stick to the packing and storage procedures. Extensive employee training is imperative for a smoothly-operated business without many losses.

Furthermore, it is not just the damage to the inventory that causes loss of money. It happens many times that a package is lost. That not only dries out your budget, but it is also bad customer service. Implementing proper control systems like RFID, VDP or RF is the best solution.

Finally, increasing overall security by installing top-of-the-art security systems will prevent theft, which is also a huge issue in many warehouses.

Cross-Docking

Cutting out the middleman and transferring a package directly to the customer is a great way to reduce commercial warehousing costs. This system is called cross-docking, and while many are aware of it, not everyone is using it. It is a great way to save both money and time, and improve store management, shipping, delivery, labor costs, etc.

Energy Cost Reduction

Reducing your utility bills is a great way to simultaneously reduce commercial warehousing costs. Better insulation, automatic lighting system, and water consumption reduction are just some of the ways to achieve this.

The more windows you have, the more natural light enters the warehouse. If you install hands-free faucets or automatic flush toilets with low flow, you will see great results.

All these changes require funding, but it is a long-term investment that always pays out in the end.

Used Containers vs. New Containers

Buying new containers for your warehouse seems appealing. Everyone likes to have new things straight out of the factory. However, that can be a costly investment. Instead, you should turn your focus towards used containers. You can find plenty in good condition, at a lower cost.

Believe it or not, you can save up to 40% on the smart purchase of used containers. All vendors keep them in superb condition, and all the containers are cleaned and inspected before selling. With such great savings, it really isn’t that difficult to see the benefits of used containers over new ones.

Cutting Down Labor-Related Expenses

When we talk about cutting down labor-related expenses, we are not referring to reducing employees’ salaries. That is not the way to go about this. However, it is important to properly manage your employees. Having idle workers is only draining your budget.

A great solution is to put everything you have into employee retention. If you keep your employees satisfied and give them an opportunity to develop, they will stay with you. Over time, they will turn into experienced employees that really have no cost. That strategy is much more affordable than hiring and training new employees.

Furthermore, the automation of warehouses is also an option. Machines can run as long as you need them. However, do not forget to factor in the installation and maintenance costs. Nevertheless, it is the main strategy of the future to reduce commercial warehousing costs.

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Joshua Collins is a business owner with a degree in economics, with over 10 years of experience. In his spare time, he runs a blog about startups and writes articles for multiple companies, like ccmover.com and many others. He is offering his advice both to young entrepreneurs looking to find a way into the small business industry and to experienced business owners looking for ways to increase earnings. Furthermore, his vast knowledge of marketing strategies provides a great foundation for any business and helps in reducing costs and increasing effectiveness and productivity.

solutions

How Customized Shipping Solutions Benefit Your Supply Chain

Gone are the days when the one-size-fits-all approach to logistics is good enough to meet the exacting standards of every shipment. In fact, maybe those days were never really here.

Though they may seem like a good bargain, many of the out-of-the-box logistics services of today lack the flexibility to accommodate specialized loads like artwork, delicate medical equipment, and other sensitive or rush items. Seemingly innocuous errors with such shipments can cost thousands of dollars, or possibly more. 

SPECIALISTS IN FREIGHT FORWARD THINKING 

Today’s shippers and shipments demand more from their 3PL provider, but unfortunately, some providers still cannot rise to the challenge. Thankfully, there’s a solution for supply chains looking for individualized services. Nimble, more personalized 3PL’s operate with the specific goal of handling sensitive cargo. The Magnate Worldwide family of companies – comprised of TrumpCard and Masterpiece International – serves supply chains with a variety of customizable solutions for businesses big and small. They offer a boutique approach to logistics not possible with larger, more generic providers. 

Founded in 1995, TrumpCard specializes in domestic air and ground expedited shipments that are handling-sensitive and time-definite in nature – from medical equipment to aerospace parts to entertainment industry equipment. “We focus on domestic shipments routed by air and ground that have special handling requirements or rapid deadlines,” said Chris Zingrebe, President of TrumpCard, “The industries we serve typically have sensitive cargo that may require elevated service levels, such as White Glove or next day delivery.” TrumpCard offers a premier white-glove service for special deliveries into sensitive environments like hospitals or data centers. The company’s expertise in this type of mission-critical shipment has made them masters of proactive communication and efficiency when it comes to handling sensitive shipments and time-definite services. 

Founded in 1989, Masterpiece International specializes in logistics, freight forwarding, and customs brokerage of fine art for museums, galleries, and art fairs as well as offering services to private clients, and the entertainment and events industry. “Masterpiece has a rich history in providing premier logistics services to the fine art industry,” said Thomas Gilgen, President of Masterpiece, “…we’ve taken that and expanded across many other industries with specialized requirements.” Over the years, Masterpiece has developed an International Logistics Solutions Division which focuses on shipments for technology, life sciences, energy, marine, aerospace, retail, trade show, and household goods industries. Due to the highly specialized nature of their shipments, Masterpiece International has developed expertise in handling sensitive shipments and provides that high level of service across all cargo, whether they’re shipping priceless works of art, mission-critical aerospace equipment, concert, and event cargo, or temperature-controlled life sciences materials.

MINIMIZING RISK, MAKING DEADLINES, AND ADDING VALUE 

No matter what the cargo is, shippers are inherently taking a risk when transporting goods. Unfortunately, that risk only increases as the value of the cargo increases. Not only are you risking merchandise becoming lost or damaged, even the risk of delay can throw off an entire supply chain. The key to eliminating risk and guaranteeing a successful delivery is working with a 3PL partner that you trust to get your shipment where it needs to go, when it needs to be there. But nobody has a crystal ball, so how do you know you can trust your 3PL? It pays to do your homework. 

In logistics, time is money, especially when one delay can cost thousands of dollars and set off a domino effect of even more problems. That’s why it pays to select a provider that has the expertise to get your shipment where it needs to go on time, every time. When selecting a 3PL, a provider’s on-time rate is an excellent indicator of what you can expect for your own merchandise deliveries. TrumpCard, for example, boasts an impressive 99% on-time rate, in addition to a 24/7 team managing shipments. TrumpCard’s state-of-the-art tracking software ensures that all shipments are accounted for at all times, so there is no room for delay or loss, and you can always keep tabs on your merchandise no matter where it is in the supply chain. 

One optional service a business may want to consider is additional security measures for the supply chain. Though not necessary for all shipments, when shipping valuable or sensitive material, additional security services can offer peace of mind by minimizing security risks and blind spots. At Masterpiece International, teams specialize in minimizing risks when planning, routing and executing and have access to an in-house security and supervision team for protection of high-value goods. That team, the Masterpiece Security Group, is a licensed security organization with tarmac access at many major U.S. airports, their own dedicated vehicles, and a partner network of highly vetted agents and carriers. 

Ultimately, when it comes to selecting a logistics provider, added values like built-in security and customizable solutions only matter if your 3PL has the visibility and customer service skills to back them up. Both TrumpCard and Masterpiece believe that visibility and customer service are key from the moment they take possession of your merchandise to its final delivery at the end-user. Both companies offer online track and trace, shipment imaging, and supervision all designed to keep tabs on your merchandise and give you peace of mind. At Magnate, customer service is more than just a pleasantry, it means that experienced agents are problem solving, customizing solutions, and providing timely and important information to the client with a personalized touch that suits the individual needs of your business. 

In the end, a combination of many factors create value, not just a big name or a low price. Customizable solutions with additional features like an excellent on-time rate, added security, transparency, and expertise in sensitive and high-value shipments are all part of what adds value to a specialized supply chain. TrumpCard and Masterpiece International have been trusted to handle sensitive, mission-critical, and high-value shipments for over 50 years of combined service – continuously getting the job done right for your business.