Management Update

Express and parcel carriers are imposing more accessorial charges as they get a better fix on their operating costs. Now that their drivers are using data-capture technology to record delivery details, carriers have a more accurate picture of their per-mile expenses. As a result, they've been imposing additional charges for rural and urban deliveries as well as other cost-incurring factors, said Michael Erickson, president of consultants AFMS Inc., at last month's National Industrial Transportation League meeting. With more parcel and express carriers using customized pricing models, Erickson added, shippers must understand their own pricing characteristics before they negotiate an agreement. Despite this trend towards individualized pricing, a flat market means parcel carriers will still be price-competitive as they try to wrest business away from other providers, he says. (For more on this subject, see "8 ways to shrink your parcel costs" in the January 2003 issue of Logistics Management. )

The California state agency charged with workplace safety wants advice from industry on ergonomics. California's Occupational Safety and Health Agency has asked the trade group Material Handling Industry of America (MHIA) for help in drafting guidelines for improving the ergonomics of manual materials handling. Cal OSHA is soliciting input on nearly 30 tasks, such as loading pallets and stocking retail shelves. The agency wants to develop literature that illustrates the best materials handling practices by the end of next year.

Importers are scrambling to comply with new regulations affecting imported foods. As of Dec. 12, most human and animal food imported for use or storage in the United States became subject to several new restrictions. According to a bulletin issued by the law firm of Meeks & Sheppard, foreign and domestic facilities that produce or handle food for U.S. consumption now must register with the Food and Drug Administration (FDA). Foreign facilities also must designate a U.S. agent who will communicate with the FDA on their behalf. Customs authorities, moreover, are authorized to hold shipments from unregistered facilities at ports of entry. The FDA also now requires electronic notification prior to arrival, and must issue an approval and release before a shipment may enter the country, the law firm says.

This is the season to give thanks to those who have made a difference— and that includes the many transportation and logistics professionals who have stepped in to help in an emergency. In times of disaster, logistics professionals work around the clock to make sure victims get the food, water, and emergency supplies they need. Others who deserve our thanks are the drivers who pull up to our loading docks every day. You'll think of them differently after reading about the remarkable acts of courage by recipients of Goodyear's "Highway Heroes" and the Truckload Carriers Association's "Highway Angels" awards, which recognize drivers who have risked their own lives to help others. To read about these remarkable men and women, go to www.goodyear.com/truck/whatsnew/heroes.html and www.truckload.org/highwayangels/news.htm .

The port of Shenzhen or Shanghai could surpass Hong Kong as China's leading gateway in the next five years. Both mainland ports are expected to achieve higher annual growth rates than Hong Kong next year. According to Erik Christensen of Hong Kong-based terminal operator Modern Terminals Ltd., container traffic at Hong Kong is expected to grow by about 6 percent to some 20 million TEUs (twenty-foot equivalent units). The Port of Shenzhen in southern China is expected to move 9 million TEUS in 2004, for a growth rate of between 9 and 10 percent. Further north, the Port of Shanghai is forecast to handle 10 million TEUS, a hefty 30-percent increase over this year's expected levels. If growth continues at that pace, Christensen said, the mainland ports could well overtake Hong Kong in five years' time.

IBM is pumping up supply chain research by supporting the creation of research labs at several universities. Earlier this year, Big Blue provided financial support, consulting services, and software, server, and storage technology to open a laboratory at Michigan State University. Now the company is helping to open similar facilities at Penn State, Arizona State, and the University College Dublin in Ireland. The labs will be linked to simulate the workings of a complex supply chain, allowing participants to conduct research on advanced supply chain practices that will help businesses respond to changing market conditions.

Sales for supply chain planning and collaboration software were strong this year despite a soft economy. Research firm ARC Advisory Group is pegging sales for that market at $1.9 billion in 2003. Manufacturers accounted for 85 percent of that figure—surprising, considering that economic weakness led most companies to slash capital spending. "The biggest difference between the situation a couple of years ago and now is that companies are investing almost exclusively to generate greater cost effectiveness," explains Analyst Steve Clouther. ARC is projecting sales in the supply chain planning market will reach $2.2 billion by 2008.

Dan Mullen takes over as the new president of AIM, the bar-code industry trade group. Mullen has worked for AIM for the past 10 years in a number of roles, most recently as its interim president. AIM is a global trade association that promotes the adoption of bar coding and other automatic identification data-collection technologies.

The Bureau of Customs and Border Protection (CBP) is trying to loosen up a C-TPAT bottleneck. Speaking at a meeting of the Council of Logistics Management's New England Roundtable, CBP Director of Field Operations Philip W. Spayd said that the agency has created a cadre of "supply chain security specialists" who will conduct on-site verifications of security measures outlined in applications for membership in the Customs-Trade Partnership Against Terrorism (C-TPAT). Hundreds of importers and other members of the international trade community have been waiting months for CBP to approve their applications.

A comprehensive training resource for private fleet managers is now available online. The National Private Truck Council (NPTC) recently launched the "Fleet Learning Center" to provide managers with the opportunity to learn current industry thinking on fleet management issues without leaving their desks. Funding for the center came from International Truck & Engine Co. and Idealease of North America. Registration for each course is $150 for NPTC members and $250 for non-members. For more information, go to www.fleetlearningcenter.org .

Two major ocean carriers will change their names on New Year's Day. Germany's Hamburg Süd will retire the Columbus Line and Crowley American Transport trade names effective January 1. Although those brands were well-known in their specific trade lanes, Hamburg Süd is bringing them under its own name to emphasize the company's global reach.

If you ship hazardous materials by ocean, be sure you're up to date on the International Maritime Dangerous Goods (IMDG) code , which becomes mandatory on January 1. Also effective that date is Amendment 31-02, which includes changes affecting placarding, labeling, marking, and documentation; limits and markings for limited quantities; use of portable tanks; and more. Hazmat transportation compliance specialists are offering training sessions and reference materials to help shippers prepare for the upcoming changes. Among them is Currie Associates Inc., headed by Logistics Management contributor Jack Currie. Currie has updated his "Complete Comply IMDG" guidebook and training program to reflect the new rules. For more information, go to www.currieassociates.com or e-mail: mail@currieassociates.com .