{"id":899,"date":"2024-02-27T09:52:09","date_gmt":"2024-02-27T09:52:09","guid":{"rendered":"https:\/\/phoenixglobalgroup.com\/?p=899"},"modified":"2024-02-27T09:52:09","modified_gmt":"2024-02-27T09:52:09","slug":"import-growth-and-inventory-replenishment-remains-a-sharp-supply-chain-focus-area","status":"publish","type":"post","link":"https:\/\/phoenixglobalgroup.com\/el\/nea\/import-growth-and-inventory-replenishment-remains-a-sharp-supply-chain-focus-area\/","title":{"rendered":"Import growth and inventory replenishment remains a sharp supply chain focus area"},"content":{"rendered":"
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By\u00a0Jeff Berman, Group News Editor\u00a0\u00b7\u00a0September 17, 2020<\/p>\n
Over the course of the ongoing COVID-19 pandemic, and especially in recent months, there has been a common theme for many supply chain stakeholders: inventory management and replenishment.<\/p>\n

There are various factors for that, of course, but most go back to the rapid upswing in demand early on in the pandemic for basic household items such as paper towels, toilet paper, certain food and dairy commodities, in addition to a whole host of other consumer packaged goods (CPG), among others.<\/p>\n

What\u2019s more, with consumers largely staying at home and not venturing out to shopping malls and stores with the same frequency as they have in the past, it has led to an unprecedented upswing, or surge, in e-commerce activity, which has subsequently led to a changing of the e-commerce logistics playbook for 3PLs, carriers, and shippers alike. And this development has, in turn, placed a heightened focus on inventory management and replenishment, of late.<\/p>\n

A good example of that came in the form of August 2020 data issued by the Port of Los Angeles (POLA) and the Port of Long Beach (POLB), whom collectively account for roughly 40% of total United States-bound imports.<\/p>\n

POLA reported that at 961,833 Twenty-Foot Equivalent Units (TEU)\u2014were up 11.7% annually, marking the highest-volume month in the port\u2019s 114-year history, topping October 2018, which was above 952,000 TEU. And POLB said that total August volume\u2014at 725,610 TEU\u2014saw a 9.3% annual gain, marking the best August tally over the port\u2019s 109-year history and what it called a strong start to Peak Season, at a time when the ongoing COVID-19 pandemic continues to create an uncertain economic environment.<\/p>\n

POLA\u2019s August tally was paced largely by imports, which came in at 516,285 TEU, for a 17.98% annual increase, as was POLB, with imports\u2014at 364,792 TEU\u2014up 13% compared to August 2019.<\/p>\n

\u201cAugust volume is more than double what we moved in March, when we dropped sharply with the onset of nationwide shutdowns,\u201d said POLA Executive Director Gene Seroka. \u201cHowever, with this amount of volume, we also see complexity within the supply chain. We are working with stakeholders on the challenges that arise on one way import surges like the one we are seeing right now. We are listening closely, responding and staying nimble to the needs of our customers and partners. The bottom line on<\/p>\n

August: we are seeing both replenishment of warehouse and distribution center inventories, along with retailers prepping for year-end holidays. The supply chain has been choppy for the last two-and-a-half years. While we built up some inventory during pre-tariff milestones, that has been predominantly worked down. Now, we are restocking that inventory that goes all the way to the store shelves and our homes.\u201d<\/p>\n

And Jonathan Gold, Vice President of Supply Chain and Customs Policy for the National Retail Federation (NRF) said that the West Cost port numbers are in line with the Port Tracker Report issued by the NRF and maritime consultancy Hackett Associates.<\/p>\n

\u201cThe economic recovery is not just planning for the holiday season but also inventory restocking for all of the products moving over the last few months,\u201d he said. \u201cBut I think we are looking for the rest of the year to be just as strong. We will see a downtick, as we usually do, when we get past the Peak shipping season and things may cool off. But the next six months are likely to come in at higher levels than the prior six months, which sends a very strong signal. I think there is a lot of uncertainty, though, looking towards the end of the fourth quarter and into early 2021. And retailers are trying to plan against the ongoing uncertainty of where we are and where we will be with COVID recovery.\u201d<\/p>\n

A noted trade expert told\u00a0LM<\/em>\u00a0that it is import to note that the boost in imports, especially in consumer goods, to replenish inventories, does not necessarily reflect an increase in in consumer demand.<\/p>\n

\u201cIt is an increase in demand from retailers expecting consumers to make purchases, and we will learn in third quarter earnings whether companies have imported more than they should have and if consumer spending is there or if they acted too soon,\u201d said Chris Rogers, Director of Research for global trade intelligence firm Panjiva. \u201cWhat we might see is companies importing while they can just in case there is another surge in COVID-19 cases or another round of industrial or commercial lockdowns. It is almost a case of \u2018let\u2019s fill up the inventories while we know that we can so we don\u2019t get caught [empty] weeks out.\u2019\u201d<\/p>\n

From a service provider perspective, Frank McGuigan, CEO of Dallas-based Transplace, a non asset-based 3PL, explained that it is likely that inventory replenishment is going to go right into peak and then right into replenishment for 2021, again, right after peak just to get to what is a new inventory schedule.<\/p>\n

\u201cWe believe it will be a peak from August through January,\u201d he said. \u201cLook at the boom this has been for anyone with a highly developed e-commerce network. There are folks that have invested in that channel winning in a huge way in this marketplace, and they are consuming a tremendous amount of logistics network capacity. And as other folks come online that are dealing with a capacity dislocation, where does it go and is it enough? The answer is, with this surge, there is not enough.\u201d<\/p>\n

Source:\u00a0https:\/\/www.logisticsmgmt.com\/article\/intersection_of_import_growth_and_inventory_replenishment_remains_a_sharp_s<\/a><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

By\u00a0Jeff Berman, Group News Editor\u00a0\u00b7\u00a0September 17, 2020 Over the course of the ongoing COVID-19 pandemic, and [\u2026]<\/span><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[30],"class_list":["post-899","post","type-post","status-publish","format-standard","hentry","category-nea","tag-2020-el"],"yoast_head":"\nImport growth and inventory replenishment remains a sharp supply chain focus area - PHOENIX GLOBAL FREIGHT GROUP S.A. - Since 1991<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/phoenixglobalgroup.com\/el\/nea\/import-growth-and-inventory-replenishment-remains-a-sharp-supply-chain-focus-area\/\" \/>\n<meta property=\"og:locale\" content=\"el_GR\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Import growth and inventory replenishment remains a sharp supply chain focus area - 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