About the Author
By Craig Webb Monday, February 01, 2021
Dealers who have never measured their on-time/in-full (OTIF) performance often are surprised to learn that only 70% to 80% of their deliveries arrive by the time promised and with everything that was ordered on board. So what should you think of a shipper with an on-time performance of just 50%?
That’s the situation for container ships. According to the Global Liner Performance Report, the average schedule reliability for 34 ocean shipping lines fell to 50.1% in November. That’s the worst score in the nine years since Sea-Intelligence, a maritime data service, created the report. The performance is even worse when you look at the reliability of container ships traveling between Asia and the U.S. On-time arrivals in the October-November period fell to 28.6% for Asia-West Coast trade and 26.4% for Asia-East Coast trade.
Don’t expect an improvement soon. “With news of widespread port congestion, and with carriers not letting off capacity-wise until at least Chinese New Year (on February 12), shipping might not see improving schedule reliability until Q2 2021,” warned Sea-Intelligence CEO Alan Murphy, according to a report in American Shipper.
Ports aren’t the only places with disturbing news about the products you sell. Engineered wood products are on allocation as of the start of 2021, Zuern Building Products noted in a late December email to customers. “All manufacturers seem to be strapped with high demands and low inventory,” the Wisconsin-based dealer reported. “Please do not expect this to correct itself until mid-2021.”
COVID-19 and politics may have kept most people awake at night last year, but for dealers, product shortages rivaled and often topped those other two worries. This year, vaccines are on their way into Americans’ arms, and a new administration is taking charge in Washington, but supply-chain problems show no signs of receding. Lumber availability is likely to cause migraines all by itself, what with backups causing December’s direct-ship orders to be unlikely to arrive in yards until after President’s Day in mid-February. Add scheduling issues involving windows, insulation, doors, and other key products, and the problems mount.
What should dealers do? Experts suggest these tactics:
Winter has always been a challenging season for ordering and receiving supplies. Covid will make the job even tougher. But by staying nimble and staying informed, you’ll improve your odds of getting through this obstacle course.
Stay on top of industry trends and insights.
Subscribe to the Big Ideas for SMBs blog.
About the Author
Craig Webb is president of Webb Analytics, a strategy and research consultancy for building material dealers. Immediately before launching Webb Analytics, he served as editor-in-chief of ProSales magazine for 12 years. Prior to that, he was an editor and reporter at The Wall Street Journal, McGraw-Hill, United Press International, and other publications from Indiana to Italy. He lives in Washington, DC. email@example.com
Considering Artificial Intelligence and Machine Learning Technologies? Be Curious but Wary.
Scroll to see more blogs