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Supply Chain by the Numbers
   
 

- Nov. 21, 2014 -

   
  Supply Chain by the Numbers for Week of Nov. 21, 2014
   
 

UPS Bulks Up for 2014 On-Line Orders; Levi's to Offer Low Cost Lowns to Asian Vendors; Maersk Says It May Cut Money-Losing Contracts; ILWU Takes Long Pause in West Coast Port Negotiations

   
 
 
 

900

Number of new trailer spots that UPS has created at its Worldport Louisville air freight hub, as the parcel giant is clearly doing everything it can to avoid the delivery meltdown it experienced just before Christmas in 2013, in which millions of parcels didn't make it to on-line shoppers by Dec. 24th. Last year, UPS had troubles unloading cargo planes fast enough in the face of a huge surge in last minute on-line orders, a situation which apparently these new trailer spots will help address. Meanwhile, FedEx Ground says it is upgrading its network to accelerate delivery by at least one day in more than two-thirds of the U.S., as well as introducing a new reporting system to help with delivery planning. We'll see, but it looks like UPS and FedEx have well bulked up for this year's Christmas season.

 
 


 
 
 

550

Approximate number of suppliers that Levi Strauss has and which will be eligible for low cost loans through an interesting and innovative program between the blue jeans icon and an arm of the World Bank.  Under the program, Levi's will provide support for the World Bank's International Finance Corporation arm, usually at much lower rates than they could receive in their home countries (usually in Asia). In addition, vendors that show good progress in areas such as treatment of labor, safety and the environment will be rewarded with even lower loan rates. This all arising from a series of deadly fires and other accidents at apparel factories in Bangladesh and Pakistan in 2012 and 2013, most notably the 2013 collapse of a building in Bangladesh, which left more than 1,100 dead across five companies operating in the facility.

 
 
 
 
 
13%

Amount of capacity that will be added to Asia to Europe routes by the end of 2015 in the ocean container shipping sector, according the latest estimates from Drewry Research. That estimate as the largest carrier in the industry, Maersk Lines, said this week it plans to cut unprofitable long-term contracts and will try to raise its shipping rate again as weak demand and persistent overcapacity are likely to continue for at least two more years. Silvia Ding, head of South China operations at Maersk, said in an interview that the current rates for shipments moving from Asia to Europe, the world's busiest trade route, are unprofitable. "If we can't get the rate up to a sustainable level, then in some cases it might mean we have to walk away from certain businesses," Ding said. We'll note that shippers have called this bluff in the past, and usually came out with the winning hand.

 
 
 
 

12

Number of days that the International Longshore and Warehouse Union said that it will take as a break from "big table" negotiations with the Pacific Maritime Association that represents West Coast ports and terminals. That means negotiations on the full contract won't resume until Dec. 2, even as ILWU members have been working without a contract since June 30, with recent PMA allegations that the ILWU has orchestrated labor slowdowns at some ports, leading to massive congestion, notably at LA-Long Beach, but all the other West Coast ports to one degree or another. The ILWU has rejected recent PMA calls for signing a contract extension, because that could trigger a mandatory arbitration process to resolve the issues, while to date the Federal government has largely stayed out of the talks and wpuld be forced to engage under arbitration.

 
 
 
 
 
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