Retail execs point to slowly-recovering economy, service, intermodal benefits at TransComp

A panel of shipper executives at the recently concluded TransComp expo, hosted by the National Industrial Transportation League, the Intermodal Association of North America, and the Transportation Intermediaries Association, shared their opinions on the economy, supply chain operations and future prospects in a wide-ranging discussion.

By ·

A panel of shipper executives at the recently concluded TransComp expo, hosted by the National Industrial Transportation League, the Intermodal Association of North America, and the Transportation Intermediaries Association, shared their opinions on the economy, supply chain operations and future prospects in a wide-ranging discussion.

The session’s panelists included: Brian Hancock, Vice President of Supply Chain, NAR, Whirlpool Corporation; Mike Mabry, Executive Vice President Logistics and Distribution, Lowe’s Companies Inc. and Rich Wallace, VP, Director of Supply Chain Operations at JCPenney.

One of the early themes of the session was to put things into perspective when gauging what retail sales are doing, in light of this week’s announcement from the Department of Commerce that October retail sales were up 1.2 percent and have been up on an annual basis for four straight months.

Lowe’s Mabry was direct in assessing these figures, explaining that “we are bouncing along the bottom. Things are not getting worse; there are some signs of things getting better. Economists keep pushing out projections of when that recovery is. It is cautiously optimistic, and we are preparing for more of the same.”

Whirpool’s Hancock agreed with Mabry, citing a sluggish housing market, with fewer people moving and subsequently not making as many home improvement purchases.

“If you talk to all retailers, you’re almost always as good as your craziest competitor that are doing [whatever it takes] to move product…and you have to be able to adjust to it quickly in the marketplace,” he said.

When asked supply chain operations and inventory management changes they have made during the recession and since the economy has begun a slow recovery, Lowe’s Mabry said that pretty much any decision he makes revolves around transportation costs, which he said serve as the trump card

And over the last several years, Mabry said Lowes has spent a fair amount on intermodal, citing good service, available lanes, green, and cost-effectiveness, which make it a good decision and provide a needed service.

At JCPenney, Wallace said he takes a “tough look” at each lane, lane-by-lane, where there are opportunities.

“Service is paramount,” he said. “We have front-load and standard intermodal and premium intermodal service we use. One of the things that we need as we move forward is consistency, and that consistency of service is…key, because if we have a delay on an import shipment and is misses a vessel and we get delayed seven days, we cannot make it up on intermodal. We will have to use over-the-road truckload. That is not something we necessarily like doing, but we are very diligent at service vetting.”

Whirpool’s Hancock said he uses intermodal, rail, and truckload out of each company facility and always plans to have two methods for moving a load, due to the size of Whirlpool’s durable goods products, some which come from facilities manufacturing 20,000 items per day.

“You have to give yourself a lot of options,” he said. “Intermodal is a critical part because its service has improved to the point where it is a great option for us if truck is not there or if trucking has run out of capacity. We always have that steady intermodal flow.”

A poll of the session’s audience focused on what the strongest drivers of intermodal growth are. The top three responses were service at 48 percent, truckload conversion at 38 percent, and green/sustainability at 14 percent rounding out the top three.

All three respondents stressed that fact that service is paramount above all other factors, but they also noted it is often easier said than done.

JCPenney’s Wallace said that his wants to use intermodal more and more, adding that there are great sustainability benefits, but he noted that at the same time service cannot be sacrificed.

This is especially true, he said, when moving freight though the Midwest: “I would love to solve Chicago,” he said. Chicago at the moment is a huge problem due to congestion, which he did not have a year ago, due to lower volumes, and can add up to three days of extra transit time.

And going hand in hand with service is keeping a close eye on costs, the panelists noted.

“We take a look at the supply chain as a whole, and there are times when we take a look at the balance of costs and service not only on the transportation side but on the facilities side,” said Wallace. “We are always trying to eliminate waste in the supply chain…to the tightest degree we can, but having a little flexibility goes a long way in letting us take on a little more risk.”

Even with some extra flexibility, Wallace said there is still going to be waste in the supply chain, because anytime there is a product in motion and variability there is waste. Key in addressing this from a shippers’ perspective is making sure they know exactly what a customer needs to provide increased options.


About the Author

Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

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!

Article Topics

IANA · Intermodal · NITL · Supply Chain · TIA · TransComp · Truckload · All Topics
Latest Whitepaper
Lead your organization through the driver shortage and over-the-road regulations.
Potential transportation disruptions are looming as increased over-the-road regulations are set to go into effect in 2017. Experts believe these regulations will further impact the already challenged driver pool as well as reduce driver productivity.
Download Today!
From the January 2017 Issue
Following LM tradition, we start off the New Year with our annual “Rate Outlook” cover story and subsequent Webcast
Moore on Pricing: The other TMS functional options
2017 Rate Outlook: Where are freight transportation rates headed?
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
2017 Rate Outlook: Where are freight transportation rates headed?
Join our panel of top oil and transportation analysts for an exclusive look at where rates are headed and the issues driving those rate increases over the coming year.
Register Today!
EDITORS' PICKS
2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...
Logistics Management’s Top Logistics News Stories 2016
From mergers and acquisitions to regulation changes, Logistics Management has compiled the most...

Making the TMS Decision: Ariens Finds Just the Right Fit
The third time is the charm for this U.S. manufacturer on the hunt for a third-party logistics (3PL)...
Motor Carrier Regulations Update: Caught in a Trap
The fed is hitting truckers with a barrage of costly regulations in an era of scant profits....