What’s the supply chain equivalent of Carmageddon?

Carmageddon

Containergeddon.  That what these West Coast Port negotiations are beginning to feel like!

How many industries can you completely upset your customer base costing them lost sales, tying up their cash flow and causing economic havoc all at the same time and get away with it?  Not many that I can think of, but the ports and the unions seem to be doing a good job accomplishing all of this.

This past weekend, the west coast ports decided to close down adding fuel to the fire in the negotiations in which the unions have already been working without a contract for several months now.  It is about time we see some leadership step up and get this resolved.  The collateral damage is widespread and growing.  From truckers wasting time at the docks, warehouses with under-utilized people to companies losing sales due to inventories sitting in the supply chain gathering dust. Companies are even getting hit with severe financial penalties because they can’t fill orders due to the constraint in the supply chain.  Businesses that are dependent on importing and exporting products are feeling the pain and it is only getting worse.  There are limits to how much these companies can take.  According to the National Association of Manufacturers and the National Retail Federation, the last port disruption costs the entire US economy several billions the last time we went through this back in 2002.  This could be even worse.

How many businesses have to go under?  How many people have to lose their jobs?  This is the supply chain equivalent of shutting off several lanes of the 405 freeway in LA on a Friday afternoon before a big holiday and telling everyone to just deal with it.  The negotiations have gone on long enough behind the scenes with virtually no resolutions.  It is time for someone to step up.  Who’s it going to be?

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