Executive Briefings

Equipment Crunch, Labor Dispute Threaten On-time Deliveries to Retailers Eager for Holiday Season Items

A shortage of transportation equipment and possible labor disruptions at the Los Angeles/Long Beach port complex, the nation's busiest, is delaying shipping containers for up to three weeks, threatening timely delivery to retailers for the holiday season.

The delays are affecting retailers, including JC Penney Co, Macy's Inc, Kohl's Corp, Nordstrom Inc, American Eagle, Ralph Lauren and Carter's, according to three people with direct knowledge of the situation.

Retail giant Wal-mart Stores Inc is said to have recently diverted 300 shipment containers to Oakland to avoid the congestion. Wal-Mart declined comment.

The problem stems from a shortage of trucking equipment, called chassis, but the National Retail Federation in a statement said protracted labor negotiations were an issue, too. The International Longshore and Warehouse Union declined comment on whether talks were having an effect.

Most retailers acknowledged the delays at the key ports for shipments from Asia, but said they did not anticipate product shortages during the holidays. Even so, any delay can derail a finely calibrated just-in-time inventory control system, making it costlier for retailers to put merchandise on the shelves.

"It's a domino effect," said Nate Herman, vice president of international trade at the American Apparel and Footwear Association. "When there is an interruption, things degenerate quickly."

Read Full Article

The delays are affecting retailers, including JC Penney Co, Macy's Inc, Kohl's Corp, Nordstrom Inc, American Eagle, Ralph Lauren and Carter's, according to three people with direct knowledge of the situation.

Retail giant Wal-mart Stores Inc is said to have recently diverted 300 shipment containers to Oakland to avoid the congestion. Wal-Mart declined comment.

The problem stems from a shortage of trucking equipment, called chassis, but the National Retail Federation in a statement said protracted labor negotiations were an issue, too. The International Longshore and Warehouse Union declined comment on whether talks were having an effect.

Most retailers acknowledged the delays at the key ports for shipments from Asia, but said they did not anticipate product shortages during the holidays. Even so, any delay can derail a finely calibrated just-in-time inventory control system, making it costlier for retailers to put merchandise on the shelves.

"It's a domino effect," said Nate Herman, vice president of international trade at the American Apparel and Footwear Association. "When there is an interruption, things degenerate quickly."

Read Full Article