Logistics Management: Shippers will invest in “mission critical” options

With an increased number of natural disasters, both abroad and here in the U.S. in recent months, businesses need to consider developing contingency plans, noted Saia Inc.

By ·

With an increased number of natural disasters, both abroad and here in the U.S. in recent months, businesses need to consider developing contingency plans, noted less-than-truckload (LTL) carrier Saia Inc.

As reported in LM earlier, Saia Inc. found that shippers responding to its “National Trends in Small to Medium-sized Businesses” had a variety of concerns. But chief among them is having a “Plan B.”

“Small to midsize businesses have a lot they are concerned about, most pressing is the economy,” said Saia President and CEO Rick O’Dell in an interview. “I was surprised and pleased to learn that they are increasing their supply chain spending this year.”

And a substantial part of that that will be invested in failsafe operations.

In the event of a major business interruption or emergency event, respondents said their company:

• Has alternative suppliers for key materials and parts (38 percent)
• Maintains safety stock (36 percent)
• Has a business continuity plan already in place (25 percent)
• Plans for contingent shipping arrangements (20 percent)
• Accelerates shipments as needed (21 percent)
• Carries business interruption insurance (17 percent)
• Implements a crisis communications plan with key vendors (14 percent)
• Monitors product transportation paths (13 percent)
• Taps into onsite emergency preparedness plans and onsite tools (8 percent)

“Even with the concern many executives are feeling, not all companies are cutting costs at every corner,” said O’Dell. “In fact, when it comes to their supply chain, many companies are increasing their budgets this year. Nearly half of those surveyed say they are increasing their less-than-truckload budget.”

With regard to shipping, executives say their 2011 budgets are increasing when it comes to:

• Less-than-truckload (46 percent)
• Truckload (20 percent)
• Expedited Shipping (19 percent)
• Guaranteed Shipping (18 percent)
• Distribution (15 percent)
• International (13 percent)
• 3PL (2 percent)

When it comes to carrier measurements, executives were asked which measurement they valued most. On-time delivery leads the way hands down (65 percent) followed by pick-up performance (11 percent) and claims-free service (9 percent).

Nearly half of all executives (41 percent) say they are unfamiliar with the federal government’s Comprehensive Safety Analysis (CSA) program. Of those expressing familiarity, more than half (54 percent) are concerned the program will impact their supply chain.

For related articles click here.

 


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Latest Whitepaper
How Lean is your Lean Quality Program?
Avoid quality program bureaucracy that can sap logistics productivity and increase costs
Download Today!
From the September 2016 Issue
Indecision revolving around three complex supply chain elements—transportation, technology and organizational structure—finds many companies waiting to commit to a strategic path. However, waiting too long will only result in a competitive disadvantage that will be difficult to overcome in today’s fast-paced, global economy.
Time for Asia’s ports to rebuild
Is the freight recession upon us…again?
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Supply Chain Best Practices: Visibility to In-Transit Inventory
During this webcast you'll learn on how various organizations have gained instant access to in-transit parcels and given access to this information to stakeholders.
Register Today!
EDITORS' PICKS
25th Annual Masters of Logistics
Indecision revolving around three complex supply chain elements—transportation, technology and...
2016 Quest for Quality: Winners Take the Spotlight
Which carriers, third-party logistics providers and U.S. ports have crossed the service-excellence...

Regional ports concentrate on growth and connectivity
With the Panama Canal expansion complete, ocean cargo gateways in the Caribbean are investing to...
Digital Reality Check
Just how close are we to the ideal digital supply network? Not as close as we might like to think....