Chaos, Confusion, and Volatility

Economic and Logistics Data and Statistics

Someone once said, “Economics runs the world.” Given today’s volatile times, I would update that to read, “Economics… and logistics run the world.” That better portrays the prominence of logistics in the business world.

What will you do when inflation prevails? What will you do during a recession? Is your business–and its supply chain–prepared for impending turbulent times?

In times of turbulence and transition, you need to be alert and vigilant. You need something extra to get through the coming complex and unexpected challenges.

Those challenges include disruption caused by the pandemic, unstable economic conditions, emerging technologies, and innovation. To cope with these disruptions, the logistics industry is transforming.

That’s why gaining a foothold and stabilizing your business is important. One way to do that is to deeply understand key economic data and logistics statistics. You’ll gain new insight to help thrive amid the industry’s transition.

A deeper understanding of these indicators will assist shippers and carriers. In this post, we’ll identify seven key indicators that can give you the insights you need to prosper.

They’ll help you manage the transition from pre-pandemic times to the New Normal. In particular, they’ll help improve supply chain responsiveness and your competitive edge.

Critical economic data and logistic statistics can aid you in making decisions about your current business situation. Below are a few examples.

  • Human Resources: Should you hire new employees? If so, how many? Should you supplement hiring with training or upskilling and re-training?
  • Capital Investment: Should you invest in plant & equipment/stockage (levels)/ technology/ sustainability?
  • Performance-oriented Customer Service & Support: Should you invest in reducing cycle times, shortening delivery times, increasing capacity availability?
  • Supply Chain Risk Management (SCRM): Should you enhance reliability through agility, speed, and resilience? If so, in what order of priority?
  • Global Trade: Should you increase/decrease trade with global trading partners and focus on regional trade and near-shoring/on-shoring?

Other considerations may apply based on your individual situation. However, these examples serve as a suitable starting point.

We won’t get into the status of each indicator here. Instead, we’ll highlight the frequency of the reporting of these indicators. We’ll also show you where you can access them yourself so that you can check on each one as necessary for your particular business.

In future posts, we’ll report the status of these indicators quarterly. And if there are any additional indicators you like us to report on, let us know.

Without further ado, let’s get into the seven key indicators.

Key Indicator #1: Gross Domestic Product (GDP)

You might wonder why we’ve included GDP. It’s well known, talked about by economic experts, your barber, and maybe yourself at cocktail parties.

That’s because GDP is a go-to economic indicator that measures the speed at which the economy grows.

You may have heard it referred to as the “mother of all economic indicators.” This key indicator covers data and information going back to 1929.

The Commerce Department’s Bureau of Economic Analysis (BEA) owns this macroeconomic indicator. You can use GDP to help you make your business and investment plans.

BEA defines GDP or value added as the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production. GDP is also equal to the sum of personal consumption expenditures, gross private domestic investment, net exports of goods and services, and government consumption expenditures and gross investment.

BEA releases this quarterly report in the last week of January, April, July, and October. Unique to this report is that it provides revised updates in the interim months. It also includes an annual revision at the end of July.

Why the many revisions?

Go to the table here to get an idea of the complexity of this report. You’ll see what it includes and how it’s calculated. It isn’t very easy. But the beauty of this macroeconomic indicator is in its aggregation of many key metrics, which simplifies all the supporting data into a single data point.

Again, this is a well-known and frequently reported macroeconomic indicator that forecasts the future movement and direction of the economy.

One of the components of the GDP is the Consumer Price Index, which we’ll look at next.

Key Indicator #2: Consumer Price Index or Inflation

Let’s start with inflation since that’s on everyone’s mind. A common definition of inflation is:

When there is too much money chasing too few goods.

The formal definition of the U.S. Bureau of Labor Statistics (BLS) is: “ a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services”.

For supply and demand, that means more dollars are floating around than the supply of goods and services.

That drives prices up, which results in inflation. Items included in the CPI are transportation, housing, and food, to name a few.

The BLS publishes the CPI monthly. You can find the most current CPI data on the U.S. Bureau of Labor Statistics website.

Next well, look at the flip side of inflation.

Key Indicator #3: Recession–Business Cycle Contraction

Recession as a key indicator is less straightforward than the CPI. The National Bureau of Economic Research (NBER) reports on recession. It defines a recession as two consecutive quarters of negative GDP growth. That’s six months of back-to-back decline in the GDP.

An article in the Washington Post reports no formula for a recession. Nonetheless, NBER’s definition serves as a guide to what you can expect concerning the business cycle.

The NBER has a Business Cycle Dating Committee (BCDC), which tracks the four stages of a business cycle and highlights economic peaks and valleys.

NBER does not report this according to a set frequency. Instead, this is an ad hoc, data-driven report. You can find the latest data on these peaks and valleys here.

Key Indicator #4: Employment or the National Employment Report

BLS defines employment based on the Current Population Survey (CPS), which classifies people as employed if, during the survey reference week, they meet any of the following criteria:

  • worked at least 1 hour as a paid employee
  • worked at least 1 hour in their own business, profession, trade, or farm.

The BLS also includes unemployment criteria to help clarify what’s not included it the definition of employment. Those criteria are:

  • volunteer work
  • unpaid internships
  • unpaid training programs
  • training programs not sponsored by an employer, even if the trainee receives a public assistance payment for attending
  • National Guard or Reserve duty (weekend or summer training)
  • ownership in a business or farm solely for investment purposes, with no participation in its management or operation
  • jury duty
  • workaround one’s home, such as cleaning, painting, repairing, or other housework or home improvement project.

The BLS reports this indicator monthly and calculates the employment rate as: (Unemployed/Labor Force) x 100.

You can get the data from the ADP two days before the government’s release.

Now we’ll focus on manufacturing, which consumers influence based on their aggregate demand.

Key Indicator #5: PMI-Manufacturing

The keeper of this key indicator is S&P Global. This is billed as “… one of the most closely watched indicators in the world.” This is genuinely a macroeconomic indicator.

According to S&P Global’s website:

Purchasing Managers’ Index™ (PMI™) data are compiled by IHS Markit for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment, and inventories. The PMI data are used by financial and corporate professionals to understand better where economies and markets are headed and to uncover opportunities.

You can find this monthly report on the U.S. Manufacturing PMI website.

Key Indicator #6: Global Supply Pressure Chain Index (GSCPI)

This macro or global indicator also tracks potential supply chain disruptions. The GCSPI is a new indicator created in May 2022. The NY Fed developed this indicator in response to getting the massive troubles that arose from the pandemic.

The owner of this key indicator is the Federal Reserve Bank of New York. It defines GSCPI as “a single measure of global supply chain pressures.”

This indicator is also not a clear and clean index or data point. In fact, the N.Y. Fed refers to it as a barometer made up of several other data points. It integrates transportation cost data and manufacturing data.

Although this is a new report, it provides data from 1997 to provide a historical perspective. There are some gaps in the historical data, so the N.Y. Fed has made estimates to cover those gaps.

The NY Fed reports this key indicator on the fourth business day of each month.

Now we’ll move on to a more traditional logistics statistic.

Key Indicator #7: Logistics Manger’s Index

Colorado State’s Dr. Zac Rogers publishes this report based on a survey of over 1000 industry professionals on eight key logistics metrics. These metrics track transportation, warehousing, and inventory leading economic indicators.

This indicator aims to predict the movement and direction of the U.S. economy based on specific logistics metrics. So, this represents a bottoms-up view.

This monthly logistics report offers insights into some of the criteria listed above. They can help inform your decision-making from human resources to global trade.

Dr. Rogers and collaborators from Arizona State, Rutgers, Rochester Institute of Technology, and the University of Reno, Nevada, aggregate, analyze, and report the results of these leading indicators on the first Tuesday of every month.

You can access the Logistics Managers’ Index here.

Next steps in transforming your business and supply chain

These economic indicators and logistics statistics will provide the insights you need to manage the industry transition to the New Normal.

They’ll help you meet your customers’ demands. They’ll help you maintain and sharpen your competitive edge. And they’ll help your business transform through turbulent and unpredictable times.

These aren’t the only indicators you should gain a deeper understanding of. That said, this is a useful starting point. The indicators you decide to track should reflect your business and supply chain.

At American Global Logistics, we always seek to give our customers a competitive edge. That’s why we track various economic data and logistics statistics relevant to our customers’ businesses. It’s part of our customer-focused risk management approach.

We don’t resist change; we embrace it. We have a proven track record in managing our customers’ supply chains.

Are you unsure of your next steps?

You can end the chaos, confusion, and volatility. Contact us today if you want to transform smoothly and painlessly during the industry’s transition.

We’re standing by, ready to answer your questions and help you transition to the New Normal.

Also, if you would like us to track and report other key metrics important to you, please let us know. We’ll include them in a quarterly post on economic and business activity from the most recent quarter.

Supply Chain Risk Management: Planning Smart

Smart Supply Chain Risk Management Planning

Supply chain risk management (SCRM) is an art and a science. Pursue risk mitigation as an art, and you’ll benefit. Pursue it as a science, and you’ll also benefit.

But when you pursue SCRM as an art and a science, you’ll benefit from their synergies.

So how would you do that?

For starters, pursuing SCRM as an art implies relying on anecdotal data/or historical data that may or may not truly reflect your business today. Trends change. They change faster than ever.

The face of globalization has changed. Geo-political factors weigh more heavily on business decisions. And the economy, the change in how we work, and the headlong rush to achieve sustainability can significantly alter your historical data.

That makes this type of approach less sound because your anecdotal or historical data don’t reflect what might be structural changes going forward.

Likewise, a scientific approach that relies only on numbers would also be lacking. Perhaps, you might consider this approach more robust because it is data-based; it may miss nuances. And those nuances may have a dramatic effect on your approach.

Take the idea that recession has set in. If that’s true, decisions based on that will affect your business plan. Although, strictly speaking, the criteria for a recession have been met (two-quarters of decline in the GDP (today’s recession looks different. At least that’s what the administration says.

The GDP dropped by 1 percent. Yet, Treasury Secretary Yellen says the U.S. is not in a recession. She cites strength in the jobs market of almost 4000,000 jobs per month as a case against concluding the economy is in decline.

She also cited the government efforts to reduce gas and prescription drug prices and other areas that will become clear in the long-term.

It should be clear this approach also falls short of providing an accurate and predictable outcome. The data here is mixed or not yet available. Drawing conclusions from unclear data leads to subjectivity. And in a political environment that can skew the outcome.

So a hybrid approach may offer the best way to assess and develop your SCRM plan.

For starters, let’s look at risks and opportunities, beginning with the results of a relevant survey.

Take a Systematic Approach to Reduce Your Risks

The Association of Supply Chain Management (ASCM) and Loyola University conducted a survey on the benefits of SCRM. In conducting the study, ASCM  asked respondents to rank their top concerns and their preparedness levels.

Here are the top 10 risks, from least prepared to most prepared, survey respondents listed:

1) Geopolitical Trade Wars; 2) Weather/Climate Change; 3) Human Resources; 4) Cyber Attacks/Data Breach; 5) Strategic/Competitor Risk; 6) Reputation/Brand; 7) Regulatory Compliance; 8) Internal Capacity; 9) Supplier Performance; and 10) Financial/Capital

This list provides an excellent place to start your SCRM planning. You can use this list or change it based on your organization’s needs. Either way, you have a useful template to start your planning. For this post, we’ll refer to the ASCM Survey list.

Now that you have a Top 10 list, you can determine the feasibility of mitigating those risks.

Sort Your Supply Chain Risks for Effectiveness and Efficiency

The next step you should take is to determine whether or not these risks are controllable. You

might find some of these don’t fall neatly into either category. Let’s use this list to identify controllable, uncontrollable, or both.

1)   Geopolitical Trade Wars–Controllable

2)   Weather/Climate Change–Uncontrollable

3)   Human Resources–Controllable

4)   Cyber Attacks/Data Breach–Controllable/Uncontrollable

5)   Strategic/Competitor Risk–Controllable

6)   Reputation/Brand–Controllable

7)   Regulatory Compliance–Controllable

8)   Internal Capacity–Controllable

9)   Supplier Performance–Controllable

10) Financial/Capital–Controllable

This is a subjective analysis, and yours may differ based on your capabilities and resources. Accepting this as a guideline, we have eight (8) controllable risks; one (1) uncontrollable risk; and one (1) risk that falls into both categories.

Next, you can classify them according to specific outcomes and priorities.

In laying out your strategy, taking this objective approach, you’ll lay out an effective and efficient SCRM plan. Now it’s time to address the subjective aspect of SCRM planning.

Simplify and Tailor Your SCRM Plan with a Hybrid Approach

Looking at this strategically, you’ll want to consider the feasibility of implementing your draft plan. You should consider cost, time to implement, and Return on Investment, to name a few.

  • Do you want to focus on increasing the speed of operations?
  • Do you want to achieve end-to-end visibility?
  • Do you want to enhance your agility?
  • Do you want to maximize resilience?
  • Or are you interested in achieving a combination of these?

There are more criteria to consider, such as improving customer service or sustainability. Whatever your criteria, they’ll serve as a filter to keep you focused. This will help you save time and money by applying your resources to what’s most important. Finally, this process will simplify and tailor your SCRM planning process.

As the information in this post asserts, you can achieve SCRM as an art and a science. Their combination leads to a robust SCRM plan that’s both defensive and offensive.

Most important, their synergy delivers more than the sum of their parts. This approach also demonstrates that one size does not fit all. Instead, a tailored approach will boost your benefits while securing and stabilizing your supply chain.

Next Steps to Consider

This hybrid approach is proactive because it is anticipatory, purposeful, and pragmatic. That helps maximize your opportunity for success while diminishing volatility and unpredictability.

At American Global Logistics, we’re diligent and disciplined in mitigating risk and maximizing opportunities. Our experience tells us there are no shortcuts to developing a sound SCRM plan.

We approach SCRM planning as an art and a science. We’ve spent years honing our craft, and everything we do reflects that. We strive to achieve agile, resilient, and seamless logistics flows.

At AGL, we’ll prepare and position your business for success. We’ll fine-tune your business processes. And we’ll give you peace of mind by reducing disruptions while diminishing volatility and unpredictability.

Contact us now if you want to experience the same peace of mind our customers do. We’ll be glad to advise you on how we can help you prepare and position your business for success.

Post-pandemic: The Value of Relationships in Repairing Logistics

The Value of Relationships in Repairing Logistics in a Post-pandemic world?

Industry alone cannot repair all that needs fixing. To address the gaps exposed by the panoramic industry has turned to technology with great expectations.

Certainly, technology can play a significant role in addressing many of the shortcomings. It can help optimize operations to get to a state of better, faster, and cheaper.

But reliance on technology alone won’t meet today’s demands.

Why not?

There are too many other variables that bear on achieving an end state that includes seamless flows of information, materiel/supplies, and money.

At a strategic level, logistics and supply chains operate within a system and work based on relationships. Those relationships are between:

  • suppliers and manufacturers
  • manufactures and wholesalers
  • wholesalers and retailers
  • retailer and customers
  • 3PLs/4PLs and shippers and their customers.

Looking at it strategically, the complexity of logistics and supply chain management becomes clear. It’s a wonder anything gets done.

This list highlights the significance of relationships in addressing the gaps exposed by the pandemic. They’re certainly essential, but they are only one way to address the gaps that exist.

Government and Industry as Strategic Partners

But there’s a greater issue that prevents logistics and supply chain management from realizing consumers’ expectations. As mentioned above, logistics and supply chains operate in a system. At the highest level, that includes the government.

In today’s world of trade wars, recent wars, inflation, policies, laws, regulations, and mandates. Governments affect logistics and supply chain management more than ever – domestically and globally. Think of sanctions, embargoes, taxes, tariffs, subsidies, and quotas.

In the post-pandemic world, the effects of government actions have wide-ranging consequences. In many cases, those consequences have detrimental rather than beneficial effects on logistics/SCM. Navigating this morass makes logistics/SCM seem like an impossible task.

But as we can see, the flow of information, goods, and money is happening despite these challenges, barriers, and roadblocks. Businesses work because of leadership, teamwork, innovation, partnerships, and technology.

But without a favorable system in which to operate, these fall short of their potential. What’s needed is a supportive government that engenders cooperation rather than conflict and chaos.

To answer the question at hand, the logistics/SCM gaps exposed by the pandemic can be fixed. One caveat is that besides the initiatives listed in the bullets above, a total fix is impossible without a supportive government.

The Need for an Integrated and Synchronized Strategic Ecosystem

Government must provide a strategic network or ecosystem that facilitates seamless flows of information, product, and money. Government’s laws, policies, regulations, and mandates must be clear, consistent, constructive, and cooperative.

According to Jim Tompkins of Tompkins Ventures, “The supply chain task at hand is not an enterprise problem; it is an end-to-end network problem involving multiple enterprises. The solution does not lie with fixing one link in the chain but in devising an ecosystem where all the links of the chain work together…”

Tompkins goes on to say that the answer to logistics woes lies in technology. We don’t disagree.

However, we believe a complete solution lies in achieving a strategic partnership with the government. Any solution requires a strategic foundation that provides an integrated and synchronized ecosystem.

The New Normal presents opportunities and challenges. To overcome the challenges, the industry must partner with the government to help create a cooperative climate within which to operate, nationally and internationally.

That’s probably the greatest challenge facing shippers, 3PLs/4PLs, and other stakeholders in fixing logistics/SCM.

That’s not to say you can’t achieve progress by pursuing some or all of the other initiatives discussed. You can.

However, the operating environment must provide a favorable operating environment.

Since the government’s role has expanded after the pandemic, it is more important to foster a cooperative strategic relationship between industry and government.

American Global Logistics stays ahead of changes in governmental trends and issues. Investing time in staying ahead of governmental trends and issues means compliance is not an issue.

Rather than be blindsided, we seek opportunities for changes in governmental direction. In doing that, we give our clients a competitive advantage.

Contact AGL today to find out how we can help you achieve a competitive advantage.

Why Strategic Partnerships Will Dominate the Future

Why Strategic Partnerships Will Dominate the Future

Strategic partnerships are essential to thriving in the new world of work. A lot has changed since the pandemic, and those changes are taking hold in the blink of an eye.

Supply chain transformation is not only ongoing; it’s happening rapidly. One critical element of today’s transforming supply chains is strategic partnerships.

To survive and thrive, businesses must develop new solutions because you can’t solve today’s problems with yesterday’s solutions.

The power of strategic partnerships

Strategic partnerships will set winners apart from losers. It’s that simple. That’s because it all boils down to the old adage: Two are better than one.”

As you look across your supply chain, you’ll find fifteen capabilities that work better with a strategic partnership than without one. Without further ado, let’s dive into those fifteen capabilities.

  1. Agility — Working with a partner will help you build an agile supply chain with sense and respond capabilities that can pivot on command. Supply chain management enables your business to respond proactively, not reactively, to unexpected events. Responding proactively saves time and money and helps to meet customer expectations.
  2. Capacity and pricing — A partner can leverage its expertise, experience, and network to help you get the capacity you need at the best price when you need it. A strategic partnership can help spread and therefore reduce costs equitably.

It can achieve that by optimizing your business processes. Optimized business processes can reduce costs from production to packaging to warehousing and transportation. A strategic partnership also improves supply chain performance that benefits your customers and your organization.

  1. Complexity The SCM landscape is becoming more complex with 24×7 operations, increased risk (Covid-19/pandemic, Ever Given, Colonial Pipeline, etc.), and technology. It’s a changing, globalized world that’s reorganizing its sourcing strategies.

Automating routine processes to mitigate labor shortages while meeting consumers’ expectations will drive automation and robotization of warehouses and e-Commerce functions. That will introduce another level of complexity into supply chains.

And that will require a more highly skilled labor force. Hence, your business will need to upskill, re-skill, and cross-train your workforce to overcome increased complexity. Engaging a strategic partner will ease this burden.

4. Compliance In today’s globalized world, change is the name of the game. A 3PL can help you maintain currency with the latest changes in regional, national and international shipping requirements.

A 3PL already has qualified regulatory and compliance analysts. So it makes sense to leverage existing capabilities of a partner rather than build those special skills in-house.

  1. Communication and Collaboration — Supply chains are all about communication and collaboration. Without them, supply chains just don’t work.

Seamless communications along your supply chain, from suppliers to your customers, foster collaboration. Working closely with a strategic partner will iron out the kinks you may have now in your communications channel.

Importantly, an adequately implemented effective communication and collaboration system will build trust, further providing for future performance efficiencies and cost savings. You can also expect innovation.

  1. Customer Responsiveness — Today, customer responsiveness has become the cornerstone of modern supply chains. Strategic planning has been turned on its head, putting the customer at the top and the business at the bottom.

That means the business exists to serve and support customers while generating profits has become secondary. Supply chain management and logistics services are key in addressing customer demand.

They achieve this by providing the right products/services in the right quantity/amount, condition, time, cost, and place to the right customer.

When your business can deliver on the 6 Rights, you will have achieved customer responsiveness. Keeping your customers happy by meeting their expectations will enhance your competitive advantage.

  1. Data Analytics — Businesses are turning to data-based decision-making in an increasingly complex and uncertain environment. Making decisions based on anecdotal evidence no longer passes muster. Today, decision-makers must make decisions informed by reliable, relevant, and real-time data for standard reporting and ad hoc analysis.

Historical data also play a role in achieving strategic insights into hidden patterns and trends regarding customers and business processes. Therefore, any successful organization must have a robust data analytics capability. Partnering with a 3PL that has a potent data analytics capability facilitates supply chain agility, resilience, and responsiveness.

8. Experience — There is no substitute for experience. Experience comes from prior history and involvement with managing supply chains. Those experiences are comprised of successful and unsuccessful activities. In fact, unsuccessful experiences often teach the best lessons.

By partnering with an experienced 3PL, you’ll avoid repeating mistakes based on your partner’s lessons. You’ll also avoid surprises that can ambush your operations.

9. Expertise — Expertise is an invaluable resource in the New Normal. Expertise is a prized asset because tomorrow’s problems are thornier than those of pre-pandemic times. They’re more complicated and more complex, and they engender greater risk.

Growing global competition, rapid adoption of technology, and rising customer expectations all demand expertise. Hence, partnering with a 3PL can give you the benefit of a firm that brings its supply expertise to bear on your problems.

10. Innovation — Generating new ideas is a key cornerstone for surviving and thriving in the future. Since no organization monopolizes new ideas, partnering with a 3PL to manage your supply chain makes sense.

Working in partnership, you’ll benefit from diverse ideas from different areas of expertise. Integrating those various ideas will lead to faster innovation and increased trust. It will become automatic, simplifying the resolution of your toughest challenges. When that happens, you’ll innovate consistently and often, helping you to sharpen your competitive edge.

11. Resilience —Your supply chain will be more resilient when you partner with a 3PL. Building resilience is a technical competency a competent 3PL can achieve in several ways. Three such ways are data analytics, SCRM, and visibility. See #7, #12, and #15 for an explanation of each one.

Partnering with a qualified 3PL that understands the value of building resilience in your supply chain will position your supply chain for success.

12. Supply Chain Risk Management (SCRM) — A 3PL partner can help you develop an SCRM plan that acts like armor, shielding your supply chain from disruptors. It’s an understatement to say that SCRM is critical to your success in the future.

You can’t address every contingency. Doing so would be cost-prohibitive. Therefore, you must analyze how you can best defend your supply chain, keeping it operational while mitigating disruptions and their related costs. You can do that by assessing the probability of expected and unexpected disruptions.

You can also build in a proactive component to your SCRM plan. This is where you can build agility, speed, and resilience into your supply chain. In doing that, you would be creating a more flexible organization—a responsive one that adjusts and adapts to changing conditions.

You can create your SCRM by yourself or make a plan with a strategic partner. Delegating SCRM to a professional 3PL does more than ease your workload. Having a professional 3PL create your SCRM plan ensures both supply chain vulnerabilities and opportunities are addressed.

13. Speed — Savvy consumers who have a fundamental understanding of the capabilities of new technologies make them relentless in their demand for speed. Thanks to the growth of e-commerce, consumers have increased their reliance on online shopping.

So, speed has become a paramount capability. Achieving speed works hand-in-hand with developing agility and resilience. Adaptive and responsive organizations ensure speedy delivery of products/services. Technology, discussed below, enables speedy operations that focus on meeting customers’ high expectations.

14. Technology — A partner can help you automate your supply chain to remove the burden of technology changes while optimizing your supply chain. But implementing technology solutions today is almost as important as selecting the technology you use.

Today’s solutions must present quick wins. They must apply directly to specific issues and concerns. And they must demonstrate an assured ROI.

  1. Visibility — Visibility or, more accurately, end-to-end visibility, is essential in the New

Normal. This capability gives your business a holistic view that permits you to curtail

issues before they become problems.

Combined with data analytics and a robust SCRM plan, visibility gives your business the edge you need to respond rather than react. And that will help your business stay ahead of the competition.

Strategic partnerships have mutual benefits.

In the New Normal, going it alone, at worst, will fail. At best, your business will struggle to survive in an environment of heightened competition, increased volatility, and greater uncertainty.

To combat these challenges, your business must become adept at operating in a dynamic marketplace. That entails dealing with risk, complexity, and chaos with steadiness.

If you’re looking for a reliable strategic partner to help you with your supply chain, you should look at American Global Logistics.

The future belongs to businesses that seek strategic partnerships.

You can contact us here to learn more about the benefits of forming a strategic partnership.

Ground Transport Trends: The Future of the Logistics Industry

Trucking Industry as Leading Indicator for Future Business Trends

Trucking industry trends show no relief in sight through 2022. The costs of shipping are at historical highs. Fuel, labor, and other transport costs have spiraled to highs not seen in decades.

What’s to blame?

The administration claims the Russo-Ukrainian war has caused inflation. However, the data show otherwise. Relevant data show that prices were on the rise well before the start of the war. Nonetheless, the war is a contributing factor.

Economic sanctions intended to pressure Russia are having a reverse effect, calling into question their viability. For example, Germany, the EU leader of the Green Movement, has resorted to burning coal to fill the gap created by sanctions against Russia.

The government shutdown of drilling on federal lands has had a chilling effect on oil production. Since the administration’s shutdown, the U.S. has shifted from being an energy exporter to an energy importer.

There’s more, but you get the gist. Inflation is global, and that puts pressure on consumers worldwide. Eventually, that may lead to a destruction of demand, but that’s not certain.

How much the Federal Reserve raises interest rates will determine whether inflation gets tamed, persists, or spins out of control. Currently, the Fed is walking a fine line between lowering inflation and avoiding recession.

Hence, you’re operating in an environment of increased risk and uncertainty.

All of the above affect businesses and consumers globally. As a shipper, a key concern is how these factors affect the trucking industry. In tracking the trucking industry, we’re tracking a leading economic indicator.

The value of tracking the health of the trucking industry

In zeroing in on the trucking industry, we’ll gain key insights into the health of the logistics industry. For example, in examining shipping prices, we’ll gain insights into the spot freight market. Other helpful indicators include the persistent driver shortage, container capacity, and technology innovations.

Tracking those and related indicators can provide a useful path in planning your supply chain for maximum efficiency. Understanding trucking industry forecasts can inform how you position your supply chain for success.

Shipping prices remain high through 2022

You’ll find yourself in a fiercer, more competitive environment as shipping costs rise.

Since transportation costs comprise 63 % of logistics costs, we’ll examine how spiraling costs shape industry trends.

In the first quarter of 2022, inflation hit shipping prices. As of May 2022, prices increased 21.3%, according to Logistics Management. One month later, in June, transaction prices increased by 34.4 %.

All trucking sectors increased by over 20 %, from local trucking to long-distance trucking to refrigerated trucking. Inflation left no sector unscathed.

Trucking companies increased their prices, reflecting existing market conditions.

  • As of May, the CPI was up a surprising 8.3 %.
  • Fuel prices also increased as the government halted drilling on federal lands.
  • Labor costs increased as trucking companies competed for a shrinking labor pool.
  • Economic sanctions against Russia expanded, which boomeranged and put upward pressure on prices in the EU and U.S.

Until some of these cost factors ease or get resolved, prices will remain high.

Persistent driver shortage easing

Data suggest that industry driver shortages are abating. Hiring is at an all-time high. Competition in the spot market has moderated. Contract rates are higher, but historically they lag price action in the post-market by about six months.

Citing Bureau of Labor Statistics (BLS) June Report, reported that “… trucking

companies added a record 62,400 workers to their payrolls, compared with 31,400 in the same period last year and 37,800 employees added from April through June 2020, when trucking began to bounce back from severe job losses during the early days of the pandemic.

This surge in hiring suggests a growing economy, not a recessionary one.

Also, from September 2021 to March 2022, the price of shipping a container declined by over 20 percent on average. The main reason cited for this decline is the availability of trucks. That suggests container capacity is increasing.

Another indicator is the significant reduction in the time required to unload cargo ships at the Port of Los Angeles. According to a Harvard Business Review article, the number of cargo ships waiting to be off-loaded in May 2022 was 39 compared to 103 in January 2021 at the Port of Los Angeles. That’s a sizable drop of 62 %.

The same article mentions that driver salaries have risen. As trucking companies compete for a limited driver pool, companies have raised salaries, attracting more truck drivers. So, the factors mentioned above combined are easing the persistent driver shortage.

The trucking industry outlook and what it means

The outlook for trucking industry costs shows a continued trend of high prices for the rest of 2022. Industry forecasts project a staggering annual inflation rate of 25.7 % through the end of the year. After that, in 2023, economists forecast a more moderate inflation rate of 3.3 %.

Not to be unduly optimistic, the trucking industry will face some bumps along the way. The transition to the post-pandemic marketplace has begun and will not be without some risk and uncertainty.

The challenge is getting from where your business is now to where you want it to be.

At American Global Logistics, we work with our customers to find a smooth, even-paved road. We track trends in ground transportation to minimize or avoid disruption to your supply chain.

Call American Global Logistics today to find out how we can help you get ahead of the trends. We can help you leverage your supply chain as a competitive advantage when you stay ahead of the trends.

June 2022: Quarterly Economic Update

Mixed Economic Trend: Growth or Recession

The most current economic data suggested inflation was not transitory. Instead, the data showed rising inflation. It suggested a continuation of volatility and uncertainty. And recession now seems likely.

The Russo-Ukrainian war remains a significant bogeyman. However, the war is moving closer to an outcome depending on how you interpret events.

Whether that outcome is positive or negative for the world remains to be seen. Regardless, you can take steps to avoid the worst of these events.


Economic indicators and data we’ll explore include:

Besides these indicators, tracking the Fed’s intent for raising, lowering, or maintaining interest rates is essential. That’s usually a guessing game until the Fed announces its decision.

Currently, the Fed is telegraphing an aggressive rate hike of 0.75 percent, according to the Cleveland Fed President Loretta Mester. Fighting inflation is the Fed’s main priority. But in fighting inflation, the Fed risks running the economy into a recession.

At the latest Congressional hearing, Fed Chairman Powell admitted a recession is possible. He further stated that achieving a “soft landing” would be “very challenging.” Against that backdrop, teetering between inflation and recession, let’s dive into the data.

General Macroeconomic Indicators

Inflation RateCurrent data as of May 2022 shows inflation at 8.6 percent. Inflation hasn’t been this high since 1981. Here’s how inflation affected various sectors of the economy.

Energy increased the most. It had the largest impact with a price increase of 34.6 percent. That measure includes gasoline, fuel oil, electricity, and natural gas prices.

Food costs were next with an increase of 10.1 percent. Food costs increased in the prices of meats, poultry, fish, and eggs.

Significant increases occurred in other sectors. Housing showed a rise in inflation at 5.5 percent. Household furnishings and operations increased by 8.9 percent. Used cars and trucks increased 16.1percent, and airline fares rose 37.8 percent.

Bucking the trend, new vehicle costs decreased to 12 percent from 13.2 percent.

Gross Domestic Product (GDP)—On June 29, 2022, the Bureau of Economic Analysis (BEA) reported that GDP contracted by 1.6 percent from the fourth quarter of 2021.

The decline reflected decreases in six categories. They were exports, federal government spending, private inventory investment, and state and local government spending.

Meanwhile, the economy saw increases in four other categories. Imports increased, which are subtracted from exports. Nonresidential fixed investment, personal consumption expenses (PCE), and residential fixed investment rose.

The Bureau of Labor Statistics (BLS) will release June’s GDP, the 2nd Quarter, on July 28, 2022.

Atlanta Fed uses a real-time tracking model called GDP Now model, which says the economy is in a recession. The BLS’ latest report revision shows second-quarter GDP falling 1 percent.

If that happens, it would be the second consecutive quarter of negative GDP growth. That would result in the second consecutive quarter of negative growth in real GDP. And that means we are in a recession.

Given the Atlanta Fed’s GD Now report, a recession seems likely. If the data holds up as projected, the only question now is how long and how deep a recession will be.

Consumer Price Index (CPI)As of May, the CPI was 8.6 percent. June’s data becomes available on July 13, 2022). May’s increase was 1.0 percent compared to an increase of 0.3 percent in March 2022. The causes for the increase are discussed in the GDP update above.

The Bureau of Labor Statistics (BLS) will release June’s data on July 13, 2022.

  •       Producer Price Index (PPI)May’s PPI data revealed a rise of 0.8 percent. On an annual basis, demand prices rose 10.8 percent for 12 months, ending in May 2022.

The Bureau of Labor Statistics (BLS) will release June’s data on July 14, 2022.

  •       UnemploymentMay’s unemployment data did not change, remaining at 3.6 percent. However, drilling into this metric shows some encouraging signs.

The Bureau of Labor Statistics (BLS) will release June’s data on July 8, 2022.

First, the number of long-term unemployed (27 weeks or more) dropped slightly to 1.4 million. While that is below February’s level by 235, 00, May showed a welcome decline.

Second, teleworking employees dropped to 7.4 percent from 7.7 percent in April 2022.

Third, the number of people unable to work because of the pandemic declined. That number dropped to 455,000 compared to 586,000 last month.

Overall, the various economic reports show mixed—not clear-cut— indicators.

Tracking macroeconomic data gives us a perspective of the economy as a whole. In assessing the logistics industry’s health, we need relevant industry indicators. Those indicators must drill down and measure industry-specific performance.

We find that with the Logistics Manager’s Index.

May 2022 Logistics Manager’s Index (LMI)

As a refresher, the LMI Index comprises eight unique metrics that reflect the health of the

logistics industry. To determine the industry’s health, the LMI measures eight key categories. Those elements include inventory costs and levels, prices for inventory, warehouse utilization and prices, and transportation capacity and utilization.

A rating above 50 percent indicates that the logistics industry is expanding. A reading below 50 percent suggests that the logistics industry is declining.

May’s rate dropped 2.6% from April’s index of 69.3%. That indicates continuing growth, but at a lower rate. The eight key categories representing logistics industry health are below.

Five metrics indicate growth occurring at an increasing rate compared to March’s performance data. The only exception is Transportation Utilization.

  •         Inventory Costs—increased to 88.1% up from 87.7% or a 0.4% increase.
  •         Warehousing Utilization—increased significantly to 45.9% from 40.8%.
  •         Warehousing prices—increased marginally by 1.7% to 87.5% from 85.8%.
  •         Transportation Capacity—increased markedly by 7.8% to 64.7% from 56.9%.
  •         Transportation Utilization—This metric remains unchanged at 64.3%.

These two metrics indicate a slowing growth rate.

  •         Inventory Levels—decreased 3.0% to 69.3% from 72.3%.
  •         Transportation Prices—decreased decidedly by 8.7% to 65.3%, down from 73.9%.

These metrics show a slowing rate of growth. Growth is still above historical averages and suggests slow growth, not no growth.

Only one key metric is contracting: Warehousing Capacity.

May’s LMI Index declined 2.5 percent from 69.7 to 67.1. This snapshot indicates gradually improving logistics conditions. It implies a state of slow growth, not no development.

The combined metrics suggest easing supply chain pressures on prices, capacity, and delivery time. Only warehousing capacity is diminishing.

These improvements are occurring against a backdrop of sustained volatility. That said, uncertainty seems to be waning as China recovers from its Covid lockdowns. The pace of manufacturing and shipping should increase.

China’s lockdown has benefited, as companies have used shipping slowdowns to work off bottlenecks at ports.

Also, as the war drags on, businesses adapt to economic sanctions against Russia. And businesses are still flush with inventory because of the surge coming out of the pandemic. The inventory data suggest businesses are slowly drawing down their stocks.

In sum, the snapshot of logistics industry health shows a decline in growth, but it is still growing.

To compete successfully, you can take several steps to keep your business running through any turmoil.

Mitigation strategies to keep your business running

The economic data continue to suggest a future of volatility and uncertainty. However, the severity of impacts and risks to global supply chains appear moderate.

Contain costs by maintaining cost consciousness without shortchanging customer service

To prosper in these times, your business must be cost-conscious, being mindful of eliminating wasteful spending. But not all spending is wasteful, as external events drive some costs affecting your supply chain.

To address externally-generated costs, you should have as many workable options as possible.

Identify and exploit unplanned opportunities

You should look for opportunities to increase your options to avoid supply chain uncertainty.

Adjust your inventory product mix

You can reduce supply chain friction by changing your product mix by matching supply to demand. That’s a temporary measure. But it might get your business through tough times.

Future-proof your supply chain through strategic planning

Here, you can make some headway. You can build resilience, speed, and risk mitigation into your supply chain. This proactive step can serve you well in the short- and long-term.

As the New Normal takes shape, it is clear that business as usual is over. Re-calibrating your strategy to address increased volatility and uncertainty can boost your competitive edge.

Future-proof your supply chain with agility

Besides resilience, speed, and risk mitigation, agility is another key driver of competitive supply chains. Static, set-piece processes will break under today’s pressures. Hence, the future belongs to nimble organizations.

Competing in a high-risk environment is possible. The best way to do that is to adapt your business processes. They must be adaptive at the strategic and tactical levels. You need new business processes to address new challenges because the old ones don’t work.

Legacy processes are ineffective in today’s marketplace. The alternative is to change, to adapt.

Next Steps: Positioning Your Business for the New Normal

The industry is not returning to business as usual. So, staying abreast of the latest economic trends is more critical than ever.

Today’s marketplace has more risks with greater severity than in pre-pandemic times. That’s especially true for economic risks, which can have long-lasting consequences.

Tracking key economic events and indicators can result in significant benefits.

At American Global Logistics, we track whatever affects your business. We track trends, including key economic indicators. We do that because that can make the difference between success and failure.

Tracking economic performance is only one aspect of identifying trouble before it occurs. We track critical data to identify trends. As a data-driven 3PL, we identify trends as a matter of routine.

The AGL Team looks for patterns to see what they tell us. We are proactive in avoiding supply chain disruptions. More importantly, we also identify opportunities that can arise from supply chain disruptions. That’s how we drive a competitive advantage for our partners.

Contact us today to find out how we can drive competitive advantage for your business.

AGL Recognized as Georgia’s Fastest Growing Company

Atlanta, GA. American Global Logistics has won ACG’s Fastest Growing Company in Georgia for 2022. Each year ACG Atlanta, the Atlanta Chapter of The Association for Corporate Growth® (ACG), a global professional organization focused on middle-market growth, mergers, acquisitions, and private investment honors the top 40 fastest-growing middle-market companies in Georgia. Out of the Top 40 honorees, AGL was named Georgia’s fastest-growing company over a three-year span. 

“This is a huge testament to all of our employees and all of the hard work they have all done these past few years,” said Chief Executive Officer Chad Rosenberg.

American Global Logistics delivers customized logistics solutions that empower businesses to solve their most significant supply chain challenges. Their proprietary cloud-based technology offers unprecedented visibility and control throughout the supply chain, while their end-to-end logistics solutions help provide a greater depth of service to global enterprises.

Recognized as one of Fortune Magazine’s “Top 50 Great Places to Work, along with Inc. 5000’s Best Places to Work and Fastest Growing Companies, AGL is grateful to have earned another accolade.

“In the single word that describes the culture and DNA of AGL is resilience,” said President Devon Wijesinghe. “From three years to go from effectively nothing to this year, tracking at $1 billion in revenue is pretty incredible.”

Founded in 2007, American Global Logistics (AGL) offers customized solutions to fit businesses’ unique requirements and goals, powered by agile, proprietary technology that adapts as their partners’ logistics needs do.

Ocean Shipping Rates: Reversing Excessive Prices and Relieving Congestion

Ocean Shipping’s Supply Chain Disruptions on the Economy and the Logistics Industry

In a whirlwind legislative effort, Congress passed a bill for the President’s signature in record time. The bill passed with record bi-partisan support, which the President signed within a week.

On the surface, this looks like a positive development. We can conclude that Washington works when it comes to important issues. Bi-partisanship still carries the day and is the way ahead in passing bills into laws.

However, as we dive deeper into the new law, the Ocean Shipping Reform Act of 2022 (OSRA-22). We’ll examine who’s impacted and whether it addresses inflation or supply chain disruptions.

To answer these questions, this post will:

  • Identify the key points of OSRA-22
  • Identify supporters and critics of OSRA-22
  • The near-term outlook for ocean shipping.

As you might infer, this law has far-reaching consequences that are not clear-cut.

Issues the OSRA of 2022 intends to remedy or address

The shipping of agriculture failed to ship because of container constraints.

  • Lack of cargo space because of prioritization favoring the return of containers to China for shipping higher-value goods.
  • Reverses the burden of proof of “demurrage and detent” on” from shippers to carriers.
  • That a “demurrage and detent” on” charges comply with federal regulations under the force of penalties.
  • Common carriers must report to the Federal Maritime Commission (FMC) the number of empty containers carriers are shipping.
  • Outlaw retaliation against shippers or threatening to refuse cargo.
  • Establish the FMC Office of Consumer Affairs and Dispute Resolution Services.
  • Improve chassis management by requiring the Bureau of Transportation Statistics.
  • Commission a study aimed at developing best practices of chassis management.
  • Authorizes the FMC to collect data in times of emergency, such as severe congestion.

These issues are wide-ranging. They run from improving performance to regulating prices. OSRA-22 addresses gaps in U.S. maritime law. It does so by regulating commerce.

“… eliminate unfair charges, prevent unreasonable denial of American exports, and improve the oversight and enforcement tools needed to crack down on unfair practices facing American consumers.”

Strong Popular Support for OSRA-22

OSRA-22 targets primarily foreign ocean carriers. The administration’s sights are Maersk, MSC, CMA CGM, Cosco, Evergreen, HMM, Hapag-Lloyd, ONE, and Yang Ming. These concentrate on trans-pacific trade that dominates the bulk of ocean shipping.

These carriers have come under fire because their rates have increased to 1000%. That suggests collusion in price-fixing that limits competition.

Supporters include farmers, truckers, logistics service providers, trade associations, retailers, and bankers. You can find a complete list of supporters here.

But not everyone agrees that OSRA-22 is the answer to inflation or congestion,

On May 31, 2022, the FMC itself issued a final report: Fact-Finding Investigation 29 Final Report that contradicBiden’sn’s charges of collusion. The Final Report concluded competition was not limited and was, in fact, vigorous. It further stated that Trans-Pacific trade was not concentrated and that “… Trans-Atlantic trade was only minimally concentrated.

In case you didn’t notice, FMC issued this Final Report only two weeks before the passing of OSRA-22. The ink was barely dry.

Also, the World Shipping Council (WSC) questioned the administration’s charges. In equally strident language, the WSC came out swinging.

The WSC state:

“We are appalled by the continued mischaracterization of the industry by U.S. government representatives and concerned about the disconnect between hard data and inflammatory rhetoric. The 22 (not nine) international carriers that serve the American people, industry, and government in the Asia – United States trade are part of the global supply chain that has built this country, importing and exporting food, medicine, electronics, chemicals, and everything else we depend on.”

In short, the WSC disagrees that OSRA-22 will remedy port congestion. It believes intermodal improvements are necessary along with investment in landside logistics infrastructure.

So amid the harsh language is an offer of conciliation. It indicates a deep understanding of the complexity of ocean shipping.

It recognizes that global stakeholders must find a holistic solution to address the root causes of this issue. Only then can the industry make enduring progress. Also, to accomplish that implies doing so cooperatively in partnership.

Will OSRA-22 remedy inflation and supply chain congestion? Or will it trigger retaliatory actions that further disrupt supply chains?

The Near-term Outlook for Ocean Shipping and Supply Chain Disruptions

Everyone hopes for a positive outcome. However, you must base your shipping decisions on reality rather than hope. The industry is moving toward fact-based decision makinIt’st’s also moving towards long-term partnerships to resolve long-standing issues. Cooperation, collaboration, and coordination epitomize the future of logistics operations.

These modernized ways of working reflect how to thrive in the New Normal.

Likewise, American Global Logistics already leverages these modernized ways of working.

Specifically, AGL operates on fac-based decision-making. We also adopt close relationships with our partners. And we seek long-term partnerships.

Contact us if you’re considering a long-term partnership with a 3PL in today’s world of uncertainty. We’re positioned to thrive in any economic or political climate.

Summer Reading in Logistics

6 Books for Summer 2022 and More…

We’re at the mid-year break for 2022. NW risks and challenges have presented themselves into what’s popularly referred to as the New Normal.

This year we’re recommending six books around the theme of the New Normal. That’s the predominant theme going forward in the logistics industry, and it’s shaping the future. 

The recommended books help define the New Normal in the areas of management, change management, customer service, and support, data-driven decision-making, and the future of the industry.

As with last year’s recommendations, these recommended reads draw from the past and the present. That ensures you have a balanced summer reading plan.

Finally, in keeping the vast distribution of content, this year’s recommendations also offer a variety of related and valuable content. So, you’ll find articles, blog posts, podcasts, and webinars. 

These recommendations are timely, topical, and condensed so that they won’t consume as much of your time. That makes these recommendations valuable as a complement or supplement to the recommended books.

Let’s dive into the recommendations.

Why You Should Read This Book: Peter Drucker is known as the “Father of Management.” So it only makes sense that if you’re going to read anything about management, you might as well read a book by one of the industry’s foremost thought leaders.

Although Peter Drucker passed away in 2005, his works are considered classics. They’re timeless, having as much relevancy today as when he authored his books. That said, Drucker did not author this book. 

Instead, Elisabeth Haas Edersheim wrote this recommendation, whom Drucker gave special access to his files, notes, and works almost 2 years before his death. So her insights and analysis are rare and extremely useful.

This book covers the landscape of management with direct applicability to the New Normal. They include 1) the influence of customers; 2) the impact of innovation; 3) the benefit of long-term partnerships; 4) the value of knowledge workers; 5) the power of breakthrough decision-making.

This book is also an excellent way to overview Drucker’s thinking. After reading this book, you can decide which of his many other books to read based on your needs and interests.

Alternate Recommendation: Drucker on Leadership, by William A. Cohen (304 pages)

Why You Should Read This Book: This book was published on August 24, 2021. So it’s a book with a message that’s arrived just in time. This book applies to organizations as well as individuals. 

This category is called Change Management+ (note the +) because, as stated in the preface of this book, Flux is more than change management. It’s about adapting to change with a Flux mindset. It’s about changing your perspective at the organizational and individual levels to survive.

The main theme of this book is that change and uncertainty are not new. They’ve been with us for a while now. But now, change and uncertainty are happening at a more rapid pace than ever before. 

Thus, we live and work in a state of Flux. And to survive the unending change and uncertainty, we need to adapt. Accordingly, the author, April Rinne, provides 8 superpowers for thriving. She dedicates one chapter to each superpower. 

Knowing and understanding our environment is critical to managing change in a positive and productive manner. This book makes for a good read because its message is timely and positive. That goes a long way in times like these where fear and pessimism seem to prevail.

Alternate Recommendation: Change Management: The Adaptation Advantage by Heather McGowan and Chris Shipley (272 pages)

Why You Should Read This Book: Although this is an older book, published in 1999, its message resonates with today’s priorities and realities of the New Normal. This book reflects IBM’s approach to customer value management. And as the title suggests, IBM views the customer as the most important aspect of a business.

Importantly, this book focuses on how businesses can thrive in changing times. Again, the key to success is to focus on the customer. This thinking puts the customer ahead of profit. So, today’s shift in planning for optimal customer service and support is not new. But it shows the enduring awareness of that tenet. Businesses must embrace that tenet if thriving in an environment of constant change is imperative. 

Themes prevalent in customer-centered enterprises are listening to your customer. Listening to your customer facilitates continuous change. In turn, that approach will lead to increased profitability because you will deliver what the customer wants.

Profitability comes from alignment with your customers’ needs and wants. One indirect effect is that this approach reinforces customer loyalty and reduces attrition. According to a University of Pennsylvania study, a reduction of attrition to 5–10 percent can increase profits from 25 to 75 percent.

Following a customer-centered approach will give your company a competitive advantage, despite today’s uncertain markets. 

Alternate Recommendation: Exceeding Customer Expectations, Kirk Kazanjian (256 pages)

Why You Should Read This Book: Data-driven decision-making is a much-discussed topic nowadays. Talk about that is not new, but now companies are leveraging new technologies that support data-based decision-making.

Several key themes run through this book. Among them are the need for digitization, holistic planning, strategic partnering, and adapting to survive and thrive. So, this book is chock full of useful information, especially concerning today’s market dynamics. It is timely, and it is irrelevant. In fact, it has been called groundbreaking.

Again, the concept of data-driven decision-making is not new. However, what’s new is the accelerated shift to building data-driven digital networks. This is a race for the swift and sure. They are the businesses that will succeed in the New Normal and beyond.

The discussion of company size takes a back seat to adopting data-driven digital networks, irrespective of size. It’s simply the new path ahead for operating in extremely competitive markets.

Better business decisions, informed by data, can deliver tangible results in all aspects of your business. Informed decision-making about investments, human resources, training, procurement, and inventory, to name a few, can cut costs and increase revenues.  

Competing in the future means maximizing a data-based decision-making capability — without exception.

Alternate Recommendation: The One Thing, Gary Keller (240 pages)

Why You Should Read This Book: Published in 2006, this book may seem dated, but its projections address the volatility rampant in today’s markets. He focuses on practical advice, not just prognosticating the future.

Almost like a crystal ball, Canton discusses energy and its tenuous future. Think about the impacts of the Russo-Ukraine war. Canton also discusses the future of the workforce and the strategic drivers of change for businesses. Climate is another major theme, as well as globalization. 

Canton cites these and others while offering a way to position your business for the coming changes. 

Beyond that, he tackles issues affecting America today, such as individual rights, a neutral media, and the looming threat of a growing China.

This is an all-in-one book about the future that informs and fascinates you. Overall, this book has both projections and prescriptions. It also provides insights into future threats.

Alternate Recommendation: The Next Global Stage, by Kenichi Ohamae (312 pages)

Why You Should Read This Book: This book covers many bases. It discusses the future of work, innovation, and adapting to new circumstances. In addressing these themes, Palmer and Blake focus on achieving a competitive edge through learning. 

Reading this book brought back memories of Peter Senge’s book: “The Fifth Discipline: The Art and Practice of the Learning Organization.” While Senge’s book focused on organizations, Palmer and Blake’s focus more on individuals. 

The connection between both books is that you can derive competitive advantage through learning. In today’s increasingly technologically advanced world, technical skills are gaining importance. They can serve as a means of differentiating one business from another in a meaningful way. 

Having a skilled workforce can make up for underemployment, and it can also create a competitive edge. Besides competing for human resources and engaging in smart training, businesses can build a loyal employee base and minimize turnover. 

Understanding the ramifications of the expertise economy can help you build a business positioned to succeed in the future.

Alternate Recommendation: The Future Workplace Experience by Kevin Mulcahy (304 pages)


Articles, Blog Posts, Podcasts, and Webinars

If you don’t have time to read a book and would prefer to listen to a podcast or watch a video, here’s a mix of a few select and timely topics for you below.

Sources: Supply Chain Brain Wall Street Journal, Journal of Commerce, InBound Logistics, and Supply Chain Management Review. (Note: Some of these require subscriptions to access.)


YouTube Videos

Supply Chain Brain

The Big Logistics Challenges Now and Tomorrow (12:26 minutes)

The Impact of the Baby Formula Shortage, (11:30 minutes)

Data-Driven Predictive Supply Chains, (54:14)


Articles, Blog Posts, and Podcasts

Wall Street Journal

Warehousing Giants Are Consolidating in a Shifting Real-Estate Market by Liz Young

Biden Blasts Ocean Carriers as Congress Readies Tougher Shipping Regulations by Paul Berger


Journal of Commerce

East Coast’s Busiest Seaport Gets New Leadership as Shipping Challenges Mount by Paul Berger

‘Spillover’ cargo market shows signs of waning by Janet Nodar

Demand for digital truckload spot quotes rises as prices fall, by William B. Cassidy

Red-hot ocean carrier profits face cooling volumes by Greg Knowler


Inbound Logistics

Reshoring? Not So Fast, by Keith Biondo

PODCAST 134: Industry Outlook: What investments can draw collaboration from the chaos, Guest: David Ross, Chief Strategy Officer, Ascent

Podcast 133: Sustainability: In today’s business climate, just how sustainable is sustainability? Guest: Jason Traff, Shipwell


Supply Chain Management Review

Future-Proofing the Supply Chain in 2022, by S&P Global KY3P®

Are we running into a freight recession? By Dale Rogers, Arizona State University

Supply chains in the age of scarcity by Michael Gravier


Reading with a Purpose… and Taking Action

After completing some of these books, articles, etc., consider where your business is in the transition to the New Normal.

  • Is your business scrambling to future-proofing your hiring, employee training, technology, and sustainability? 
  • Is your business surviving the heightened risks facing your supply chain? 
  • Is your business surviving the erratic swings of supply chain processes? 
  • Is your business transitioning to a data-driven enterprise?

Whatever the case, if you’re looking for a partner to help you address your current challenges, look no further than American Global Logistics.

Summertime is a great time to reflect on your path ahead for the rest of the year. As you assess where you are and want to be, why not contact us? We’re standing by ready to assist you in addressing your questions and concerns about your path ahead.

Ocean Carriers Overcome Volatility and Continuing Risks

Ocean carriers continue to deal with uncertainty and volatility. Risks have not subsided; instead, they persist in the post-pandemic era.

External risks loom large with the typical risk that plague ocean carriers. In particular, political and economic threats have increased uncertainty and volatility.

Despite the significant risks and challenges, ocean carriers are succeeding against formidable odds.

This post will review the challenges facing ocean freight today. It will also delve into how ocean carriers overcome the odds stacked against them. With these insights, shippers can understand today’s circumstances better. And that should enable them to secure critical capacity and competitive pricing.

Persistent risks and challenges plaguing ocean carriers

You know the risks and challenges well.

Where should we start?

Let’s focus on the big-ticket items: external political and economic events. These are beyond your control.

Specifically, the war in Ukraine and inflation are the two overriding challenges. Both negatively impact ocean freight and global supply chains.

  • Seaports have been put off-limits because of economic sanctions and safety concerns.
  • For the same reasons as above, airspace is restricted.
  • Delays have resulted from freight bogged down in Russia and Ukraine.
  • Fuels, supplies, and materials are in short supply with no end in sight.
  • Prices for fuels, supplies, and materials have increased, aggravating inflation.

According to a GlobalData Annual Report, the war has disrupted 130 multinational companies doing business in Russia or Ukraine. The most exposed sectors include metals and mining, consumer packaged goods, industrial goods and machinery, and pharmaceuticals. Other affected sectors comprise automotive, oil and gas, technology and communications, and financial services.

That doesn’t leave many business sectors untouched by the war. Also, these disruptions have global effects, with the EU enduring the most of them.

How ocean carriers are overcoming today’s challenges

With all those disruptions occurring, import volumes have remained strong. That is reflected in the continued backlog of vessels anchored at major U.S. ports. Also, DC Velocity reports that infrastructure-related work is adding to these backlogs.

Despite these risks and challenges, carriers are operating more effectively and efficiently. For example, total vessel losses have declined 57% worldwide. In 2021, ocean carriers lost only 54 vessels. That’s a decline from 65 total losses in 2021.

To put that into perspective, the global fleet of vessels has increased from 80,000 ships 30 years ago to 130,000 today, or 62 percent. That makes the reduction in total losses more impressive.

At the moment, flexibility is key to mitigating disruptions.

Ocean carriers also add to capacity by using non-container vessels to carry containers. Although this adds to capacity and is likely a temporary measure, it heightens the risk of shipping improperly secured cargo.

Inclement weather could affect bulk carriers as they adjust, putting cargo at risk. That said, this is a temporary measure and not in wide use, yet it adds some relief.

Also, some ocean carriers are diverting vessels to avoid port congestion. reports some carriers diverted cargo from Charleston to Savannah. In addition, many carriers diverted their ships from west coast ports to east port coasts. That has mitigated some of the congestion issues.

But carriers are not working alone to return to normal operations. They’re getting help from various ports authority and other governmental authorities.

Increasing port capacity and increasing operational hours are other measures taken to reduce the impact of supply chain disruptions.

Last year, the Port of Savannah could only handle about 80,000 containers. Its utilization rate at the Garden City Terminal was above 80 percent. Now, because of the Peak Capacity Project aimed at increasing port capacity. By summer’s end, handling capacity will increase to  100,000 containers.

Flexibility also comes in, providing truckers increased access to ports. Turning to the Port of Houston, container terminals will be open to truckers on Saturdays. This is also a temporary measure that will remain in effect through the end of 2022.

Safer operations, adaptability, and infrastructure improvements have been key. They have allowed carriers to continue operations through disruptions. Some mitigation steps taken are temporary, while others are longer lasting.

Regardless of the risks and challenges, ocean carriers are working to mitigate disruptions. And, despite difficult conditions, the improved loss rate shows a significant improvement. Keep in mind that reduction in losses comes with a 62 percent increase in operating vessels.

How to navigate today’s challenges and minimize your risks

Ocean freight remains an essential mode of transportation. As risks and challenges increase, shippers compete for limited capacity and battle rising prices.

That makes today’s markets extremely competitive. Understanding today’s challenges can aid you in adapting to overwhelming odds.

Working alone in today’s environment is tough and ineffective. Just as ocean carriers are not working alone to achieve more seamless flows, neither should you.

That’s why working with a partner who can mitigate risks and leverage opportunities makes sense. It’s about securing capacity when you need it at a competitive price.

At American Global Logistics, we track trends in ocean freight tirelessly. We do that to mitigate risks and leverage opportunities to benefit our customers.

When you partner with us, we’ll do the same for you.

Contact us to learn more about how we can hone your competitive advantage against the odds.