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What is the C-TPAT program and why should you care?

C-TPAT is a voluntary government-business initiative designed to guard against illegal smuggling of dangerous cargo by terrorists.

describe the imageIn the post 9-11 era, stepped-up inspections delay processing of imports from 1 to 2 weeks, slowing the importer’s supply chain and cash cycle. Importers that want to avoid these Customs delays and support efforts to secure the country’s borders are seeking certification under the C-TPAT program – the Customs-Trade Partnership Against Terrorism.

Weber has published a paper to help you understand the benefits to shippers of the C-TPAT program. Download the paper: C-TPAT Membership: Is it Right for You?

Following is a quick summary of these benefits. 

  • Secure the country’s borders.  Many C-TPAT members cite this as their primary motivation for becoming certified.
  • Speed your supply chain. C-TPAT shipments are 4-6 times less likely to undergo an examination than non-C-TPAT shipments.
  • Reduce costs. As an importer, you pay for Customs cargo examinations. C-TPAT program certification means fewer inspections, reducing these costs. Another cost, and one that is harder to quantify, is the cost of delayed shipments to retail customers. A lengthy delay on an out-of-stock product could jeopardize your relationship, even your business, with a retailer.
  • Gain favor with retailers. Increasingly, retailers are encouraging vendors to become C-TPAT compliant. While C-TPAT compliance is not the reason retailers seek out your products, it can tip the scales in your favor at the tail end of a vendor selection process.

If you are outsourcing any portion of your supply chain to third party logistics providers (3PLs), their security procedures come under just as much scrutiny as your own during C-TPAT evaluations. So, if you are considering the C-TPAT program, it helps to work with 3PLs, like Weber Logistics, that are well-versed in C-TPAT protocols. 

Download the Weber Logistics Insight:

  Is C-TPAT Right for You?

 

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

Connect with Weber Logistics on Google+

Comparing Price Quotes for Warehousing Services: Apples and Oranges

If you get competing carrier bids, rate comparisons are easier than those for warehousing. Trucking companies have published tariffs for services. As rates are requested, these carriers will ask about the commodity, the originating address, the destination address, and whether the product is palletized or floor loaded. With this information, carriers can reference their tariffs and quickly provide a quote.

It’s an apples to apples comparison.

warehouse pricing guideBut precise warehouse rates require a more detailed analysis. Companies often cannot provide all the data requested, so 3PLs have to make assumptions in order to complete the pricing profile. Different 3PLs make different assumptions, and these differences are reflected in different rates for the same exact volume and services. 

It’s an apples to oranges comparison that makes it difficult to fairly assess supplier pricing.

You can’t assume that, because you gave multiple providers the same input, that their pricing will be based on the same assumptions.  Let’s take the simple example of stackability. Without detail that pallets can be stacked on top of each other 3 high (taking up less floor space per pallet), the provider may assume it can’t be stacked and base the storage pricing on 30,000 sq. ft. instead of 10,000 sq. ft.

Other providers will do the opposite. They will assume a “best case” scenario in order to lowball rates and get the business. In three months, they’ll ask for an increase after showing you how the actual operations are very different from initial assumptions.

The best thing you can do is educate yourself about how 3PLs develop commercial warehouse pricing.  And, what do you know, we can help!  Weber Logistics recently published a Commercial Warehouse Pricing Guide that explains the basics of how rates are determined.  You can use your new-found pricing knowledge to save your company money.  Understanding how 3PLs determine warehouse rates will allow you to work with these partners to create the best, most efficient receiving, storage and fulfillment processes possible.

commerical warehouse pricing guide

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

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Manufacturing and Distribution Align Along the Border

manufacturing distribution us mexican boarderFor years China has been the country of choice for companies looking to establish lower-cost manufacturing operations overseas.  Today, the same firms are looking to move their manufacturing out of China. Why? Well, China is experiencing higher labor costs, high fuel prices, and an overall increase in transportation costs to get goods to the final consumer. These factors have led many companies to seek alternate manufacturing sites closer to home. 

China’s loss has become Mexico’s gain, with more companies relocating manufacturing there. Many CEOs are very happy to leave the 16 hour flights and midnight conference calls behind. Who wouldn’t?

The key factors triggering the journey across sea from Asia to Mexico include:

  • Cheap labor costs - The Chinese currency, the Yuan, has risen in value, making goods more expensive to export. One Yuan = $0.16 U.S. Dollar, while one Peso = $0.07 U.S. Dollar.
  • Easier ability to cross US borders with goods - Mexico and the United States are working to streamline the border crossing process. 
  • Shorter shipping times to Western United States – A 6-8 weeks wait period for product to get to market now shrinks to hours.

As an increasing number of U.S. companies start manufacturing in Mexico, the U.S. and Mexican governments will continue to work closely to streamline trade. This will allow companies who position their supply chain along the border to become more efficient than ever before. Since logistics operating costs are not labor intensive, they can be kept low in the U.S.

California itself has 6 ports of entry in Baja, California, including San Ysidro, Otay Mesa, Tecate, Calexico West, Calexico East, and Andrade.  Baja, California has become one of the key entry ports, making San Diego a key distribution center location to support cross-border activities. About $54 billion worth of goods move across the region’s border annually, according to the San Diego Association of Governments. A San Diego distribution center brings the following benefits:

  • Close proximity to Mexican manufacturing plants
  • Easy access to the largest port in America to retrieve raw materials
  • Distribution to the huge Western U.S. consumer market

Weber Logistics provides logistical services in San Diego. Weber’s San Diego warehouse is located 5 miles from the Mexico border with easy access to the San Ysidro, Mexico port of entry. Advantages of Weber’s San Diego logistical services include proximity to border crossings, rail siding, integrated warehousing/trucking services, and port services.   

Learn more about Weber Logistics services in San Diego and across the Western U.S.   

Contact Weber Logistics

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

Connect with Weber Logistics on Google+

The Latest on West Coast Port Labor Negotiations

port labor disputeThe contract between the Pacific Maritime Association and the International Longshore and Warehouse Union, which represents almost 20,000 longshore workers at 29 West Coast ports, expired on July 1. The union extended its previous six-year contract until this past Friday, July 11 and negotiations are now underway to complete a new deal. 

Port drivers and Teamsters have picketed selected terminals.  This is a separate issue from the ILWU and PMA negotiations.  Members of the Teamsters are organizing owner-operators and employee port drivers to protest what they believe to be unfair business practices at the port. This is leaving many Los Angeles drayage companies without a full staff of drivers to accommodate the huge demand for full container transactions.

Importers and exporters have slammed the ports with product, fearing a West Coast port labor disruption.  Volumes at U.S. container ports are expected to reach 1.5 million containers this month, up 4.3 percent from last year. This volume increase is way ahead of the normal holiday peak season and has come at a time when many ILWU members take their summer vacations.   Problems at the Ports of LA and Long Beach include:

  • Equipment shortages
  • Severe congestion
  • Chassis availability
  • Long waits for drivers

What Can We Do?

Be patient.  Extra capacity is non-existent right now.  Shippers can help by ensuring containers are cleared and made available in a timely manner. 

The good news is that, unlike the disruption in 2002, when the steamship lines locked out the ILWU for 10 days, current negotiations have gone smoothly and there is no indication of a deadlock in the talks, according to spokespeople from the union and the ports.  Once resolved, Southern California ports will continue to be the fastest, cheapest choice to move goods from Asia to the U.S. market. 

Learn more about Weber Logistics solutions:

Contact Weber Logistics

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

Connect with Weber Logistics on Google+

Panama Canal Expansion Delays – Money or Politics? Or both!

The deadline for completing the $5.25 billion Panama Canal expansion has already been delayed multiple times, with the original target date of October 2014 set back by a total of 16 months to early 2016.  The project has been beset by problems. 

panama canal delaysIn early May, Panamanian construction workers ended a two week strike that severely delayed construction.  Salary increases will be in place over the next four years in response to the work stoppage.  Earlier this year there began an ongoing financial dispute between the Canal Authority and GUPC, the consortium of European contractors responsible for completing the expansion.  In question is a $1.6 billion cost overrun that would bring the total price tag to around $7 billion for the expansion project.  The cost to build the entire canal in the early 1900’s was approximately $360 million, according to pancanal.com 

An arbitration process is now in place to decide who will pay what.  While financial measures have been taken to resume construction, what drama holds next for the remaining 25% of construction? 

According to an article posted on www.npr.org, Jan Kop, GUPC’s Deputy Project Director, says that the cost overruns are due to “surprises that we could not have foreseen such as rare soil conditions and higher than expected earthquake potential along the canal.”  He also states that the Panama Canal Authority “should have known about these things since 1914.”  On the other hand, Jorge Quijano, a US educated engineer and the head of the Panama Canal Authority says, “Even if their claims were fact, the amounts they are claiming are outrageous.”

The two parties agreed to pay an additional $100 million each to keep the project moving forward and the canal authority expects to recoup their funds upon the completion of the expansion. 

Canal Expansion Impact on Southern California Ports

They say that for every action, there is a reaction.  Many people wonder about the impact of the Panama Canal expansion on the ports of LA and Long Beach.

Weber believes that the impact will be less significant than many predict.  Read our Insight Paper: Panama Canal Expansion: Impact on the Volume of Imports to Southern California

Southern California’s already established infrastructure is designed to handle great volumes of import freight, while the Gulf and East Coast ports try to catch up.  Also, the additional costs of fuel and higher tolls on the Canal will more than likely increase costs, which will ultimately be passed on to the consumer.

Download this Weber Insight:

c-ptat membership

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

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New Commercial Warehouse Pricing Guide

commercial warehouse pricingEver wonder how third party logistics providers (3PLs) determine the warehousing rates that they quote to you?  
A new Commercial Warehouse Pricing Guide is now available that explains the basics of how rates are determined.  You can then use this knowledge to control your costs.

I know what you’re thinking...What could be more boring than a guide on warehouse pricing?  Well, we’ve got a question for you in return… How important is it for you to control your warehousing and logistics costs?   By getting smarter about the 3PL pricing process, buyers of warehousing services are in a much better position to impact how product is stored and handled and can actually reduce warehousing costs.  

How much savings are we talking about?   Well, according to the Department of Transportation, total logistics costs represent about 10% of a company’s revenue. Warehousing costs, not including inventory carrying costs, are around 9% of that logistics spend. For a billion dollar company that spends $9 million a year on warehousing, a 15% reduction in these costs adds $1.3 million to company profit. For a smaller, $50 million dollar company, a 15% reduction in warehousing costs translates to about a $68,000 profit increase − still nothing to sneeze at.  

Commercial Warehouse Pricing

The warehouse pricing guide looks at the three basic components of 3PL pricing for commercial warehouses:

1) Inbound Processing – receiving the goods into the warehouse
2) Storage – storing the product
3) Outbound Processing – picking and preparing orders for shipment
We examine the detailed data needed to determine an accurate rate.  And, for each of these areas, we provide examples of how a change in the storage or handling approach can reduce costs.  

Download the Commercial Warehouse Pricing Guide for free.  And let us know what you think!

commerical warehouse pricing guide

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

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Buying a Brown Suit is Like Choosing a 3PL Provider

Were brown suits ever in style?  Perhaps, but today they are typically not the first choice for fashionistas.  For those who don’t follow fashion trends, however, a brown suit might seem like a good option when sifting through the rack of 42 regulars at Men’s Wearhouse. 

3pl providerAt that point, the right advice is critical.  Does the salesperson make the quick sale because it’s what the customer asked for or does he dig a little deeper to determine the exact right style, size and material that will better fit the customer’s precise need?

So it is with 3PL providers.  Some will quote a price for the exact services requested, period.  But most 3PL companies will accompany, or substitute, that price quote with questions:

  • How does this service integrate with the entire supply chain process?
  • Are there better alternatives?

For the mid-tier manufacturer who lacks the budget to employ a large logistics team, using 3PL providers in an advisory role can be a huge asset.  They have experience across a wide range of customers and have likely come up against the sort of challenge you are facing. 

When choosing a logistics partner, seek out a reputable 3PL that will act as an extension of your company.  One that looks after all logistics, meets the service requirements of your customers, and proactively advises you on ways to keep your supply chain lean and productive.  Beware of providers that simply accept the information that you give them without delving into your supply chain needs and learning about:

  • Your objectives
  • Your specific distribution service requirements
  • Your pain points in cost or customer service

Mid-tier manufacturers can benefit from investing in their relationships with their 3PL provider to encourage more of a partnership that, in the end, delivers excellent value for money.  The alternative is a more tactical supplier that responds dutifully to your requests, but does not have the capability or the perceived authority to introduce different and better solutions.  

That brown suit may come cheap and fast, but it’s still a brown suit. 

Weber Logistics has been offering 3PL services for nearly a century.  If you are a mid-tier manufacturer that has a limited budget for supply chain requirements, contact us to learn more about our approach.  We won’t sell you a brown suit.  Instead, we will enhance your distribution network with a proven service that our customers have come to rely on.  Contact us at 855 GOWEBER (469-3237). 

Contact Weber Logistics

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

Connect with Weber Logistics on Google+

Logistics Customer Service - The Shift From Paying to End Customer

What is logistics customer service?  Well, traditionally it has meant logistics companies focused on providing great service to their paying customers.  But lately 3PL providers are taking a vested interest in the end customer – for consumer product companies, that would be the retailer  – to make sure all delivery compliance rules are met and to learn how to make the receiving process more efficient.

logistics customer serviceFor instance, in conversation with a 3PL, one retail chain asked if the following improvements could be made:

•    Punch holes in the sides of heavier boxes for easier maneuverability from dock to shelf.
•    Pick and pack orders according to category, with multiple products packed according to each aisle in the retail store.

Experienced 3PLs who deliver to retailers on behalf of their client are making sure that all expectations are met for their deliveries.  This includes shipments from manufacturers to the retailer’s distribution center and from the distribution center to the retail store. Feedback from the retailer at both levels is a critical factor to ensure good retailer scorecards and to reduce chargebacks for the shippers.  For information on how to reduce chargebacks, download our white paper on vendor compliance. 
How can 3PLs help the retailer?

It’s simple.  Meet face to face with the retailer to understand any idiosyncrasies involved when shipments are delivered to both the DC and the retail store.  Corporations are adopting a leaner logistics approach and sometimes there is a breakdown in the communication between manufacturer and retailer. 

3PLs have the know-how to bridge that gap and provide solutions where necessary.  Their experience comes from daily communication with the end customer as deliveries are made. 
What are the barriers to closer 3PL-retailer communication?

Well, some manufacturers may have concerns about what the 3PL will say.  Will they make a commitment on their behalf that may not be feasible?   Here are a few ways to overcome this concern:

•    Have a discussion between manufacturer and 3PL prior to any 3PL meetings with a retailer to establish ground rules. 
•    Have face to face visits between the 3PL and the retailer end with a report to the manufacturer before any promises are made.
•    Choose an experienced, reputable 3PL that you can rely on to represent your company’s interests.
•    Trust your 3PL to provide logistics customer service that will be an extension of your own logistics team.

At the end of the day, manufacturers want to be sure that their customers are happy with their entire supply chain, especially the final delivery.  Problems that recur without acknowledgment can fester over time.  Close 3PL communication with the end customer is the solution.

Weber Logistics has been providing 3PL company services since 1924.  Today, we offer nationwide supply chain services and we specialize in warehousing and distribution on the US West Coast.  To learn more about our full range of 3PL services, contact us at 855-GOWEBER (469-3237). 

Contact Weber Logistics:

Contact Weber Logistics

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

Connect with Weber Logistics on Google+

Are AIB Standards Adequate for Your Food Grade Warehouse?

AIB International works with companies to elevate their food safety and production processing capability.  If you look through the current AIB standards for food distribution centers, they seem quite comprehensive.  If your food-grade warehouse meets all or most of the standards, you will receive a relatively high score.  During inspections, each infraction will result in a 5 point reduction on your score.  So the question is, is it enough just to keep your superior rating with AIB?
AIB Internatioanal Superior RatingThe AIB Consolidated Standards for Inspection entail the following:

•    Operational Methods and Personnel Practices
•    Maintenance for Food Safety
•    Cleaning Practices
•    Integrated Pest Management
•    Adequacy of Prerequisite and Food Safety Programs

Routines to meet these standards are set on a weekly, monthly or quarterly basis to ensure compliance.  Records are maintained and are made available when the inspection is carried out.  

All food-grade warehouses would be pleased to achieve the highest AIB rating of ‘superior.’  But following a textbook approach to achieve a certain score isn’t enough.  There are things you need to do on a daily basis rather than waiting to meet a scheduled monthly maintenance mandate – a “check the box” kind of approach.

Neat and Tidy

Do people who keep a clean house refer to a manual?  No. If they see dirt or see something out of place, they clean it up.  It is the same with warehousing.  Staff must take the time each day to ensure the little things are taken care of such as:
•    Removing debris from the aisles, such as paper or wood
•    Cleaning surfaces after product is removed from a particular location
•    Mopping up spills that may linger and potentially cause contamination

The sanitation process should not be focused on passing an audit/inspection; rather, it should be engrained in the daily culture.
Hospital Clean

If you remember your last visit to a hospital, you may have taken note of the sanitary conditions in all departments.  A food warehouse shouldn’t be any different.  Food handling is a critical function and proper procedures and cleanliness are paramount to prevent cross contamination or even a food recall, which can cost millions of dollars and a lot of bad publicity.

What about an unexpected customer visit to your food grade warehouse?  If your warehouse associates are cleaning proactively, you needn’t fear a negative perception from your customer.  Plus, each day you are enhancing your progress for your weekly, monthly and quarterly mandates, as prescribed by the AIB.

Weber Logistics believes that putting processes in place that go beyond the AIB Consolidated Standards is just good business sense.  For nearly a century we have been operating food-grade warehouses in California, Nevada, Arizona and the US West Coast.  To learn more about our attention to detail, contact us at 855-GOWEBER (469-3237) for all of your 3PL needs.

food distribution 3pl

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

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Get Product Closer to Customers with Phoenix Warehouse

phoenix warehouseWhat’s the most populous state capital in the U.S.?  Many are surprised to learn that it’s Phoenix, AZ.  As of 2012, the population was nearly 1.5 million – up from 1 million in 1990.  With an average annual temperature of 72.6 degrees, it certainly attracts many new residents in search of a warmer, low-humidity climate.

As a result of its progressive growth, more and more companies have put their Southwest roots in Phoenix.  Major retailers include Wal-Mart and Costco, who each have established distribution centers in the area.  Population and commercial growth have made a Phoenix warehouse an ideal choice to store and deliver goods to this critical Southwest market.

3PL Choices for Phoenix Warehousing

Phoenix has not traditionally been used as a Southwest distribution hub, but that’s changing.  Here are some reasons to consider a Phoenix warehousing location for product distribution:
  • 34 million consumers within a half-day truck haul
  • Low cost operating environment with minimal regulation
  • Industrial lease rates 40% lower in 2014 than in 2012
  • Two trans-continental railroads and several intra-state railroads 
  • No inventory tax
  • Many 3PLs, such as Weber, operate multi-client distribution centers there, so shippers can very quickly initiate distribution from Phoenix with no capital investment
Weber’s Phoenix Warehouse

Weber Logistics’ Phoenix warehouse is actually located just west of Phoenix in Tolleson, AZ.  Some facility facts:
  • Temperature controlled, food grade warehouse that houses a number of confectionary and food products
  • Superior rated by the American Baking Institute (AIB)
  • Final-mile delivery services to retailers, including temperature controlled deliveries
  • Value added services include postponement activities such as club pack assembly, POP display assembly and kitting
Weber’s Phoenix warehouse for Southwest distribution complements our region-wide warehousing and freight network in the West. To learn more about our Phoenix operation, contact us on the web or call 855-GOWEBER (469-3237).  

Contact Weber Logistics

Weber Logistics is the leader in West Coast and California logistics, warehousing and trucking.

Connect with Weber Logistics on Google+
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