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What's Next for the Logistics Market, Once Things Settle Down?
Even as logistics providers struggle to cope with rising costs and a drop in customer demand, they are thinking about how to prepare themselves for economic recovery.

The latest economic crisis has forced all businesses into survival mode. But logistics service providers can't just withdraw into a shell and wait until things get better. They still have to meet the strict service requirements of their customers.

In fact, shippers have a greater need than ever for the most reliable service that carriers and intermediaries can provide. At the same time, vendors must cope with a slump in demand, see-sawing fuel prices and greater unpredictability of major market trends.

For transportation providers, "the biggest problem right now is the lack of freight," says Gary Girotti, vice president of Chainalytics' transportation practice in Atlanta. Carriers have witnessed a double-digit decline in import volumes-the mainstay of the U.S. freight market-in recent months. On the trucking side in particular, he says, there is a "massive imbalance" between supply and demand.

The problem has carriers scrambling to reduce their equipment burdens. Even before the worst of the recession hit in late 2008, they were moving to cut capacity by selling trucks overseas. According to Girotti, around 21,000 used Class 8 (heavy-duty) tractors were exported from the U.S. in 2007, up from 10,000 in 2006. Activity in 2008 was roughly equal to that of the prior year.

The big jump was largely the result of increased demand for equipment by...
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Management Dynamics Enables Export Compliance for Midmarket Exporters
Management Dynamics, a vendor of global trade-management software, has released Export On-Demand. The export-compliance tool is aimed at small and medium-sized exporters. It addresses all aspects of compliance by centralizing product compliance data, screening trade parties and generating required documentation. The vendor generates a compliance "blueprint" based on its experience in automating many of the world's top exporters. A multi-organization and role-based security model configures the export process according to the user's own business processes. A management dashboard combines with workflow tools to organize the entire compliance process. A comprehensive product master stores all global compliance data with...
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Even in a Poor Economy, Businesses Need to Stay Aware of Threats to Their Operations From Climate Change
As the recession drags on, climate change is in danger of slipping down the list of executive concerns. In fact, out of 634 suppliers recently surveyed by the Carbon Disclosure Project (CDP), only 58 percent felt that climate change posed a risk to their operations. A full third said it posed no risk at all.

The London-based CDP is a non-profit organization whose database of corporate climate-change information is drawn from annual surveys of 475 private companies, purchasing entities and government bodies. In all, more than 2,000 major corporations around the world report their greenhouse-gas emissions through the group. The latest CDP report, compiled by PricewaterhouseCoopers LLP, finds that between 40 and 60 percent of companies' total emissions are the result of supply chain activities such as...
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Chinese Economic Growth Points to New Opportunities in Global Logistics
It is no longer just FedEx's Fred Smith who thinks that "we have probably hit the bottom" of the current global economic downturn (Ti Logistics Briefing, Briefing, March 20).

This weekend saw Dominique Strauss-Kahn, head of the IMF (International Monetary Fund), commenting that the world's major governments had probably done enough for this year to avoid a slump, if not a recession. So it would seem that now is the time to consider what the global economic recovery will look like when it eventually materializes.

The first thing to note is that the economic crash has had the characteristic of not merely a cyclical downturn but of a restructuring of the world's economy--and particularly of its trading system. The high level of private consumption in the US, in particular, had driven economic growth across the world, amplified by the ability of global supply chains to deliver increasingly cheap products. However, western consumers over-reached themselves and are now aggressively retrenching. The future will not resemble the past.

A key question is what role China will play in a restructured world economy. China's economy is at least still growing. Chinese exports have fallen heavily but the economy is being driven by a huge government stimulus package. Whilst the beginning of year saw the economy growing at an annualized rate of around 6%, some optimistic forecasts, such as one from Goldman Sachs, assert that will rise to 8%.

Central to such optimism is the expectation of an expansion in consumer spending in China. Retail spending has...
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A New Emphasis on Corporate Trade Management Is Coming to the Executive Suite, According to KPMG
Senior executives are turning to corporate trade management as a means of guarding against higher levels of risk in the global trade arena, according to a new white paper from KPMG LLP. The heightened regulatory climate that controls international trade is driving companies to do a better job of managing risk. What's more, that effort "is likely to intensify with the turbulent economic climate," says Andrew Siciliano, a partner in KPMG's Trade and Customs Services practice. Historically, trade management has focused on such basic functions as customs clearance of imports and exports. Today, the function is applied at a more strategic level, with an eye toward protecting against risks across the organization.

Companies are beginning to realize that trade and customs risk should be managed like other financial areas, KPMG says. Executives are searching for ways to standardize the process of identifying, prioritizing, testing and communicating global trade risk. Their primary goal is...
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DHL Express Opens New Gateway Facilities in Taiwan and South Korea
DHL Express has opened two new gateways in Taiwan and South Korea. The Taipei Gateway at Taiwan's Taoyuan International Airport, and the Incheon Gateway at South Korea's Incheon International Airport, are equipped with state-of-the-art technology, DHL said. The Taipei facility covers 13,500 square meters, four times larger than the previous site, and will triple shipment-handling capacity. Drop-off and cut-off times will be extended by up to two hours. The Incheon Gateway occupies 20,000 square meters and includes....
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Harte-Hanks Joins With FreightCo Logistics to Extend International Supply-Chain Offerings

Harte-Hanks, Inc. has entered into a partnership with FreightCo Logistics to offer international supply-chain management services to clients. Harte-Hanks is a global company offering support for direct and targeted marketing programs. FreightCo is a worldwide freight forwarder. The deal is intended to extend the range of...
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When It Comes to GTM, the Accent's on Management
Quite a few enterprises are into global trade, but many of those are unable to step back and assess their performance. There are many issues to deal with, including governmental and regulatory compliance, containing costs, and improving one's competitiveness. With cross-border trade transactions amounting to more than $10tr in 2007, global trade management is nothing to take lightly, says Marisa Brown, APQC senior program manager. But there has to be a coordinated management approach to GTM that encompasses all company departments--logistics, tax, finance, legal and operations....
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Ask The GTM Expert: This month, James Preuninger, CEO of Management Dynamics, is available to answer your GTM questions.

Past Global Trade Management Issue:
March, 2009

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