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Hanjin Bankruptcy Demonstrates Fragility of Ocean Freight Market Prior to “Black November”

NC State SCRC

The recent bankruptcy announcement of Hanjin, a major shipping line, on the Friday before the last Labor Day long weekend, was a shock to everyone working in the global logistics shipping industry. Many ship builders and ocean carriers overextended themselves while the economy was growing, and these expectations resulted in a huge amount of investment that has resulted in too many ships and carriers competing for too little cargo.

The Supply Chain’s Vision Problem

Enterra Insights

Most companies weren’t buying from China or Taiwan or Malaysia like they are today.”[4] Point of sale data tracks exactly how many black shirts in size medium were sold yesterday, then meshes with inventory management technology to generate demand predictions that then prompt production of more (or less). When a shipment of those black shirts in medium gets put on a truck or, even more, a ship, things go dark.

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36 innovative companies re-inventing and rethinking supply chain and logistics

6 River Systems

In higher-traffic markets, Advance Auto Parts has “hub” stores that keep more inventory in-stock to give customers what they need when they need it. Bed Bath & Beyond @BedBathBeyond Bed Bath & Beyond has discovered a way to save millions of dollars on freight over the next few years, thanks to a new 755,000 square-foot distribution facility slated to open in the fall of 2019. PST will ship the same day.

Southeast Asian Pirates: Nothing to Shiver your Timbers Over

Elementum

With one third of the world’s freight traveling through these waters, the region would naturally be a hotspot for pirate activity. And while Malaysia managed to rein in the issue over a decade ago, hijackings and thefts have been cropping up further east, in Indonesian waters. There is chance of a rise in insurer premiums for ships that travel that area, which could lead to increased shipping costs. Hijacked ships can face weeks of delays and cost millions of dollars.