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Category: Logistics & Supply Chain (Page 1 of 5)

Green Supply Company

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“By Henry Canitz of  Inbound Logistics”

Sustainability impacts everything from how companies approach product design all the way through to customer delivery. In today’s competitive environment, sustainability must improve profitability and reduce risk.

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How Much Do You Really Need to Make?

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Article by Mike Periu, President, Proximo, LLC

FEBRUARY 10, 2014 

How much money do you need to pull out of your business each month to cover your living expenses? That’s a question most business owners ask themselves. Typically you pay yourself a salary and from time to time take out an owner’s withdrawal directly from the company’s equity to help cover surprise expenses.

Many small-business owners try to set their total cash withdrawals based on what the business can afford. However, rather than focus on what you can afford to pull out of the business, you need to focus on how much you need to earn at your business in order to afford the lifestyle you want to have. This is where the Personal Earnings Goal, or PEG, comes into play.

The PEG Formula

The PEG is a simple formula that will revolutionize your way of thinking about business profits. I developed it as a methodology specifically for small-business owners, especially those in service fields like consulting. To calculate your PEG, follow these steps:

1. Determine how much money you want to pull out of your business. This amount should be based on your household budget. It should include fixed expenses like your mortgage, insurance premiums, car payments and tuition. It should also include variable payments like utilities, food and clothing, as well as a component for surprise expenses and savings. Let’s say that you calculate your household budget at $15,000 per month. This is what you need to be able to pull out of your business every month.

2. Now, calculate your living expenses per hour. On average each month has 720 hours (30 days x 24 hours per day). If your budget is $15,000, then it costs you and your family $20.83 per hour to live ($15,000 / 720). Every single hour of every day, you’re spending nearly $21.

3. Calculate your productive hours. Out of the 720 hours per month, most of that time isn’t spent working. Assume that you work nine hours per day Monday through Friday and another four hours over the weekend; that’s 49 hours a week, which comes out to 196 working hours per month. However, just being “at work” doesn’t mean you’re being productive and it certainly doesn’t mean you’re doing anything that actually earns you money. So, being generous, let’s assume that during the week you have a solid three hours per day of truly productive work and we’ll assume that all four weekend hours are productive. That works out to 76 productive hours per month.

4. Calculate your PEG. In this example, you need to generate $15,000 over the 76 productive hours per month. That works out to $197.37 per productive hour ($15,000 / 76). $197.37 is your PEG. If you calculate your own PEG, you’re likely to be shocked at how much you really need to earn per productive hour. The more time you waste on tasks that aren’t productive, the higher your PEG will go. If you miss just a few hours of productive time per week, it could generate thousands of dollars in earnings shortfall per month.

Why Your PEG Number Is Important

The purpose of this exercise is to impress upon small-business owners the value of your time. You simply can’t afford to waste it. If your PEG is $200, then a wasted one-hour meeting that includes two hours of commute round-trip just set you back $600. An unproductive business trip could cost you thousands.

Prioritize your time by focusing on activities that will help you achieve your PEG. Ask yourself, “Before I do this, will it help me toward my PEG or not?” You’ll find yourself saying no more often than not. And that’s a step in the right direction toward higher earnings.


Procurement pendulum is swinging back to centralized models

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article courtesy of

KPMG International has documented a strong trend toward the adoption of centralized and “center-led” procurement operating models, but cautions that decentralized activities can be beneficial for many companies.

The pendulum is swinging again: Many procurement organizations are moving away from decentralized procurement functions and management and toward centralized management, according to the latest quarterly “Procurement Advisor Pulse Survey” conducted by the consulting firm KPMG’s international arm. Respondents included procurement advisory professionals in KPMG’s member firms, who reported on what they are seeing at clients’ companies worldwide.

The report, “Bargain hunter to business partner: The monumental opportunity facing procurement,” documented a strong trend toward the adoption of both centralized and “center-led” models. The survey findings also indicated that outsourced procurement and hybrid procurement operating models are gaining traction in some organizations.

Researchers said the changes stem in part from procurement’s evolution from being seen as a dispersed cost-center function to being treated as a strategic business partner. Centralized procurement operating models allow companies to better leverage purchasing power and economies of scale, the report said. However, a center-led model that centralizes control but decentralizes activities is more nimble and more responsive to local business needs.

Hybrid models facilitate category management by recognizing the differences across categories of spend, said Samir Khushalani, Americas Practice Leader for KPMG’s Procurement Advisory practice. Categories may be managed locally, regionally, or enterprisewide, depending on factors such as strategic importance, commonality or uniqueness of requirements, and the nature of the supply market. Khushalani cited the example of high-growth, technology-focused companies where the speed and agility of a decentralized approach may be more valuable than a centralized model.

The survey also looked at the top priorities for the procurement function among KPMG’s clients. Generally improving performance was the top priority, cited by 58 percent of respondents. Next came aligning more closely with business functions, at 42 percent, and improving governance and compliance capabilities, cited by 40 percent of the survey takers.

The research found that procurement organizations as a whole do not continually manage risks such as a lack of qualified personnel, loss of critical suppliers, and pricing volatility. Due diligence, even on key suppliers, is inconsistent, and few procurement teams conduct regular, systematic reviews of risk exposure in terms of probability and potential damage, the report said.

The fourth area studied was how companies measure the value of the procurement function. Most use cost savings and cost management as their primary measures. Qualitative measures that demonstrate procurement’s broader impact and value—such as performance related to supplier risk, supplier relationship management, and social and environmental impacts—are relatively rare, the study found. KPMG suggests that procurement organizations develop a “return on procurement” measurement and assessment model that tracks and demonstrates the function’s linkage to corporate strategic objectives as well as to top- and bottom-line growth. In most cases, that will require real-time monitoring of spending and improved data capture and analysis, the report said.


5 Steps for Improving Your Logistics Training

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By Anne Yarmark, Inbound Logistics Contributor

Training is often viewed as an employee benefit, rather than an investment in the business. That’s why in difficult economic times, training and employee development are among the first budget items to go. To avoid these cuts, you must align educational programs with your company’s business objectives, and position them to drive results.

Here are five steps for building effective logistics training programs:

  1. Understand the business. The most meaningful training programs address one basic question: What does the company need to do to improve the customer experience? No matter what business you are in—but particularly in logistics—you are nowhere without the customer. Understand the challenges your company faces, then build a training program that addresses them. It will be easier to gain buy-in for training investments if management sees it as a vehicle to strengthen the business.
  2. Conduct a needs assessment. Logistics training programs need to be relevant, constructive, and engaging. Talk to key stakeholders in your company to determine what they are trying to accomplish on a departmental and employee level. Create a meaningful program around those business needs.

    Take into consideration not only the enterprise’s needs, but also employee needs. Everyone does not respond to the same learning techniques, so mix it up. Using a blended-learning approach gets everyone involved. Include visuals, and make the program interactive so everyone has an opportunity to participate.

  3. Gain buy-in. The beauty of conducting a proper needs assessment and soliciting input from key stakeholders is it raises awareness of your goals. If management believes your training programs will strengthen the supply chain and position the company for success, they will be more likely to support those initiatives. But don’t stop there. Ask for management’s feedback as you develop and implement your training program. Assess whether your program is achieving what you set out to accomplish, and try to use as many metrics as possible. Embrace feedback from management and employees alike.
  4. Keep your focus. Don’t try to tackle too many new initiatives simultaneously. Stay focused so you can gain some quick wins and momentum, then build from there. Providing employees with the necessary skills, tools, and resources will not only enhance the customer experience, it will also boost logistics and operational efficiencies, allow you to build credibility with employees, and help improve retention and morale. Don’t be afraid to adjust your training plan. Remember, the goal is for employees to embrace the training, and for management to support it.
  5. Stay connected. Follow up with employees at three-, six-, and 12-month intervals post-training to ensure they are incorporating what they learned into their daily routines. During these one-on-one meetings, ask employees to describe what they learned, and to provide specific examples of how they have incorporated this knowledge into their daily routine. By using these sessions as coaching opportunities, you will be able to help employees understand the value in applying what they learned.

Following these five steps will enable you to develop a learning culture that includes meaningful and relevant training programs. It will also align your logistics training initiatives with your company’s business objectives, which will position your employees and your company for continued success.

11 Tips on How to Land a Job in Logistics

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Article Originally Posted on LogisticsDegree.Net

Even though the logistics industry is growing, finding a job in this field takes a bit of preparation on your part. Let us help you get a foot in the door and navigate the process from start to finish by following our tips, tricks, and how-to’s.

Tip #1: Determine your career goals.

To reach your career goals in logistics, you must define your ambitions. Do you want to run the company, or do you want to specialize in a particular field? What are your short-term and long-term goals? Sit down and write out a career plan detailing what you want to achieve, then brainstorm ideas for how you’ll get there.

Tip #2: Network, get feedback, and find a mentor.

The cliché is true: It’s not what you know, it’s who you know (though knowing stuff definitely helps). Discuss your career aspirations with someone who currently works in the job you’d like to have, such as a coworker, a family friend, or a connection made through networking. If you currently work at a logistics company, have a discussion with your boss or a human resource staffer about what you need to do to earn a promotion and set yourself on the right career track. Ask your mentor or coworkers to introduce you to others in the field or at specific companies you’d like to work for. If you attended a school with a career office, contact them to ask for advice and connections to alumni.

Tip #3: Determine what you’re qualified for now.

Entry-level job titles in logistics include van driver, dispatcher, scheduler, expeditor, merchandise buyer assistant, and clerk for distribution, operations, traffic, or import/export. Some entry-level jobs, such as operations research analyst or process associate, may require a Bachelor’s degree or other certifications, so determine your skill sets and educational needs before you begin applying for jobs. You’ll save yourself time and rejection-related heartache if you limit the scope of your search to what you can realistically accomplish at this point in your career. If you’ve been working in the logistics field for a year or more, assess your experience based on your inside knowledge of the industry. is an excellent resource for researching job descriptions, requirements, and expected salaries.

Tip #4: Seek out general knowledge and formal education.

Read newsletters and trade publications of associations like the American Society of Transportation and Logistics, and the Warehousing Education and Research Council. After you’ve whetted your appetite and gained a working knowledge of the current prevailing logistics ideas and technologies, take it a step further: Research educational programs in your area or online that offer logistics or logistics management programs. Keep your career plan from step #1 (with feedback from step #2) handy in order to structure your search based on your current skills and long-term goals.

Tip #5: Develop your computer skills.

These days, logistics professionals depend on computer system skills to get their jobs done. Learn to work with Microsoft Office, including Word, Excel, and PowerPoint. Many companies also use computer management systems to keep track of inventory and transportation, so seek out opportunities to work with those systems as soon as possible.

Tip #6: Request more responsibility and team projects.

In your current job, get involved in project-based work and be an active, helpful team member. Take on more responsibility whenever possible, whether that means scheduling, operational management, warehouse inventory, or even innovating new ideas to help make operations more efficient. Successful careers in logistics require a wide range of skills, so be enthusiastic about taking on any new responsibility.

Tip #7: Research companies before applying.

Spend time researching companies you’re interested in through their websites. Twenty minutes on a search engine can bring up all sorts of information, including company growth and performance history. Avoid applying to companies that have been cutting jobs or posting declining profits. If the company looks good, check whether they post employment opportunities on their website. Major companies like Wal-Mart have entire pages dedicated to logistics and supply chain employment opportunities.

Tip #8: Use industry-specific as well as general job search websites.


Another great way to find logistics job postings is through career-specific websites like or Other online career sites like can also provide leads to jobs at every level of logistics.

Tip #9: Prepare your resume.

A clean, professional resume is crucial to landing a job in the logistics industry. Career services offices and resume help websites can lend plenty of advice, but the basics are simple:

  1. Keep your resume to two pages or less, and only one page if you’re applying for an entry-level position.
  2. Include all your contact information, such as a professional email address (get rid of “” and opt for your name instead) and a phone number.
  3. List specific achievements as well as industry experience. Key accomplishments should be highlighted at the top of each position listed.
  4. Include logistics industry keywords.
  5. Include your technology and computer skills.
  6. Always give your resume to someone else to review – preferably someone who works in human resources or a similar role where they see many resumes and can offer sage advice.
  7. Triple-check your resume for grammar and typos. Then check it again.

Tip #10: Be prepared for the interview.

Once you land an interview for a job in logistics, take time to prepare. Review common interview questions and practice your answers, including ways to highlight your achievements and downplay any gaps in experience. Research the company so you can ask questions that indicate you’ve taken a real interest in this particular company and this particular job. Dress appropriately and display confidence in yourself and your skill set. Remember: You need to be the right fit for the company, but the company needs to be a fit for you too.

Tip #11: Work hard, play nice with others, and set your sights high.

Upper-level logistics managers and planners, who can exercise more latitude and creativity in their daily tasks, can earn six-figure salaries with just five to 10 years of experience (usually with a Bachelor’s degree in an area of specialty). As soon as you land your entry-level job, be the model employee: Show up on time, dress and behave appropriately, and demonstrate an insatiable desire to learn and mature. Your growing knowledge of logistics concepts, practices, and procedures and your increasing experience in the field will help you excel, especially if you are a team player and display the attitude of a generally likeable person.

Companies Are Hiring

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Despite what we may read or hear concerning anemic economic growth, recruiters are seeing companies hire an increasing number of candidates. This increase is across multiple industries  – manufacturing, distribution, sales, technology, and service providers.

What this means…

•    Hiring Authorities: Candidates are more receptive to considering outside opportunities.  A smooth and timely interview process will undoubtedly help in landing top talent.

•    Candidates: Companies are hiring industry experts across multiple business sectors.

Most professionals are aware of increased employment opportunities through their own company’s growth, industry news, and their phones are ringing. Our candidates are telling us they are getting multiple calls from recruiters about potential jobs.  They also tell us they are getting multiple interviews.

We are seeing the most successful hires completed by companies that have a thorough, dedicated, and timely interview process. Increasingly, we are seeing candidates considering multiple opportunities. They are now more willing to look outside their current role and are opening their options re: location, industry, title, career progression. Because candidates have choices, we will occasionally lose a candidate to another position. The leading reason for companies losing talent in the interview pipeline is time – a lengthy interview process.

We consult with our clients to help them streamline the interview process in an effort to minimize the chances of losing a top candidate (or a backup candidate). Though it’s always frustrating to lose a great candidate, the big picture is looking good: The unemployment rate for experienced college-educated professionals is @ 4.5% (US News, 10/12).
Good hunting!

Logistics: It’s Where The Jobs Are

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By Dr. Jennifer S. Batchelor, Program Director, Transportation and Logistics Management, American Public University System. This article has been republished from Inbound Logistics.

Effectively managing human capital is more vital than ever to businesses and organizations, and higher education will continue to play a critical role in training the next generation of transportation and logistics management (TLM) leaders.

The Bureau of Labor Statistics projects increases in TLM occupation employment growth and replacement needs, which are on the rise due to individuals in the field retiring, transitioning into new fields, or leaving the workforce.

Promising career opportunities await new TLM professionals within the decade. According to the labor bureau’s estimates:

  • Transportation and materials handling careers are up 15 percent, and will create 1.3 million new positions.
  • Retail trade logistics employment is up 12 percent, and will create more than 1.8 million new jobs.
  • Transportation and warehousing is up by 20 percent, and will generate 853,000 new jobs.
  • Overall, high-level logistics management employment will increase by a modest projection of seven percent within the next seven years.

This growth creates a need for educational programs to help fill job openings with a skilled and knowledgeable workforce. The American Public University System (APUS) created its Industry Advisory Council to work collaboratively with industry experts to address current and evolving trends in the industry, and integrate them into the APUS curriculum. Leaders from organizations such as the General Services Administration, a leading international shipping company, and a maritime association have contributed to this discussion.

Among the insights gained are that automation will drive many new logistics jobs, and warehousing will require technology skills not often covered in new employee training.

Leadership Know-How

The need for education goes beyond entry-level workers, however. C-level executives need to know more than just the basics about TLM. For logisticians looking to enhance their career growth prospects, gaining specialized knowledge through advanced coursework is vital.

Any formal education or training in TLM needs to tie into supply managers’ everyday experiences. Content has to be geared to the real world to help make that critical connection.

Leadership expertise will be more vital than ever for logisticians at the tactical, strategic, and operational levels. Employees need to understand processes and build efficiencies, while motivating others through leadership.

Focus Areas

In addition to the importance of advanced education and leadership training, the following specialty areas represent top priorities for the logistics sector:

  • Environmental concerns. Hazardous materials regulations and public policy issues shape logistics and transportation operations.
  • Technological support. Tools such as RFID and track-and-trace capabilities are key to account and shipment management.
  • Quality control. Purchasing agents, and storage and distribution managers are in demand because of concerns about sourcing, domestic threats, and international terrorism.


A transportation contingency plan update on Hurricane Sandy

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To say Hurricane Sandy has made her presence felt is very likely the understatement of the year. In this space yesterday, we basically speculated what the impact would be and now a day later it is clear this could very well be the biggest storm we have seen and been part of in our lifetimes.

Yesterday, I stressed safety and I hope you are all safe and sound (and warm and dry, too). I am without power for who knows how long in Southern Maine, but some family members are not so I can keep banging on the keyboard.

That said, we wanted to give you an overview of what is happening with various freight transportation carriers, providers and ports. What follows below are verbatim statements from company Web sites to keep you informed in a brief and concise manner. Again, please be careful out there today and for the next several days:

-ABF: “ABF is closely monitoring Hurricane Sandy. We are taking precautions to ensure the safety of employees and to minimize service disruptions for our customers. However, with a storm of this magnitude, service disruptions are inevitable. For this reason, customers may monitor the latest service center closures by visiting Customers with freight currently in ABF’s care can rest assured that we are taking the proper steps to keep it safe until we are permitted to deliver it. Following the aftermath of a hurricane, ABF is bound to federal, state, and local municipality safety mandates, which dictate service areas we may conduct business in. We will resume service in these areas as soon as conditions allow.”
-YRC: Several YRC terminals are closed. For a full listing, please click here;
-A. Duie Pyle: “As the remnants of Hurricane Sandy continue to pass through the Northeast many areas are still hazardous and impassable. Because of this issue we are not running any Pickup and Delivery operations Tuesday morning. As the day progresses we are planning to bring drivers in to perform pickups as our customers get their operations up and running. Please call customer service at 800-523-5020 for more information.”;
-New Penn: “New Penn facilities will be closed and not operating Tuesday, October 30. Additional updates will be posted on when conditions change;
-Pitt Ohio: The following terminals are closed for deliveries as a result of Hurricane Sandy: East Windsor NJ, Baltimore MD, Cherry Hill NJ, Cumberland MD, Hazleton PA, Allentown PA, Harrisburg PA, and Norristown, PA. All other terminals are operating. Our linehaul is limited to the Western part of our service territory due to weather conditions last evening. We have power outages in Norristown PA, Allentown PA and East Windsor PA resulting in no phones at this time. Thank you in advance for your cooperation and understanding.”;
-UPS Freight: “As Hurricane Sandy transforms into an overland storm, UPS Freight will resume operations in some impacted areas as soon as we can do so safely. In those areas, UPS Freight people will be out making pickups and deliveries for customers whose businesses are open and require service. To schedule pickups, please log in to My LTL Freight or call UPS Freight Customer Service at 1-800-333-7400. Power outages, flooding, snow, road closures and civic restrictions will still affect service today. Disruptions can be expected in Delaware, Maryland, Washington D.C., New Jersey, New York, West Virginia, Connecticut, Rhode Island, Pennsylvania and coastal and northern Virginia.”;
-FedEx Freight: “Unavoidable service delays should be expected due to local road conditions. FedEx Freight is committed to providing service to the best of our ability in areas that can be safely accessed and where conditions have improved. We will continue to monitor the situation to minimize the impact on service. Please continue to check for updates.” More information for FedEx Freight can be found” title=“here”>here.

As for other modes, LM’s Patrick Burnson reported this morning that various ports are closed and in this space yesterday, it was reported that CSX and Norfolk Southern have contingency plans in place.


About the Author:

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review.

Cutting Costs From Your Logistics Budget

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1. Eliminate supply chain bottlenecks.

By periodically reviewing and analyzing their supply chain networks, companies can pinpoint issues and proactively address them. Strategies to reduce or eliminate bottlenecks include addressing vessel schedule planning, ensuring proper documentation and regulatory compliance for imports and exports, and revamping network design.

2. Reduce inventory at the port, manufacturing sites, and warehouses.

Companies often stock excess inventory because they lack supply chain visibility. To effectively reduce excess inventory, you have to gain reliable information on future orders. Visibility software can help.

3. Cut demurrage and detention fines.

While an occasional fine may not seem like much, these costs can add up. Auditing carrier bills and tracking where issues occur in the supply chain can substantially cut fine payments.

4. Identify opportunities to shift modes.

Without adequate visibility into logistics operations, a company may not realize that an air shipment could move by sea at a much lower cost. Companies that use technology to evaluate modal options typically see a five- to eight-percent cost reduction.

5. Use postponement strategies to divert inventory at an international gateway.

A successful postponement strategy can dramatically lower forecasting errors as well as improve customer service by reducing out-of-stocks. Companies also can cut transport costs by reducing inventory misallocations and shipping more items in bulk.

6. Use preferential trade agreements.

Companies that take advantage of preferential status can save millions in duties and taxes. A software system that automates the qualification process can save time and effort, as well as improve compliance and data accuracy.

7. Rebalance supply and fulfillment networks by determining tax-efficient sourcing and distribution strategies.

Companies must periodically review their supply chain networks to assess duties and logistics costs, labor costs, regulatory controls, and global political climates. By comparing geographic options, taking into account the costs and regulations of each option, companies can optimize their supply chain.

8. Become a self-filer.

Using technology to connect electronically with brokers lowers entry filing costs and reduces manual entry errors. It also can enable pre-clearance of goods at borders and reduce the number of staff needed internally to manage logistics operations while boosting productivity.

9. Control your procurement process.

By implementing a process-based workflow that includes tracking and managing order acceptance, consolidating invoices, creating shipments and generating documents— and by extending that process to trading partners— companies can reduce cycle times, cut supply chain execution costs, and better support compliance initiatives.

10. Implement performance management metrics and tools.

Companies need a system, data, and tools to benchmark actions and make informed decisions. Developing a performance management process allows companies to manage service providers and critical cycle times to lower costs and continually improve performance.


About the Author:

If you want to reduce logistics costs, you have to take the time to review your processes. Nathan Pieri, senior vice president of marketing and product management for Rutherford, N.J.-based Management Dynamics, offers these tips for trimming your logistics budget.

State of Logistics Report

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20th annual State of Logistics Report highlights weakness in ‘08, shaky outlook for ‘09

Report shows U.S. logistics costs in 2008 declined for the first time since 2003.

The 20th annual “State of Logistics Report” released June 17 by the Council of Supply Chain Management Professionals painted a picture of a shaky U.S. economy and a logistics industry that will require an economic rebound in the United States to regain its strength.

The eagerly awaited report found that total U.S. logistics costs in 2008 slid to $1.34 trillion from $1.4 trillion in 2007, the first decline since 2003. Logistics costs as a percentage of U.S. gross domestic product dropped to 9.4 percent from 10.1 percent in 2007. The 2008 results were attributable to a 13-percent plunge in inventory carrying costs as interest rates declined precipitously, the report found.

The drop in the cost of capital may have been the only bright spot in the 2008 report. The average investment in all business inventories fell by $45 billion in 2008 as the value of existing inventory declined and as companies struggling with weak demand in the year’s second half liquidated stock on hand rather than replenish inventories.

The combined impact of falling inventories and declining interest rates led to a 54-percent drop in the interest component of the report’s calculation of inventory carrying costs.

Warehousing costs rose 9.5 percent year over year, while warehousemen reported a significant decline in inventory turns as goods spent more time in warehouses, the report said. By the end of 2008, warehousing rates were declining for the first time in three years, while vacancy rates were rising due to slowing demand, the report said.

In an interview with DC VELOCITY prior to the report’s release, Rosalyn Wilson, the report’s author, said she doesn’t believe the U.S. economy “has hit bottom yet.” She added that supply chain activity won’t return to its historic norms until employment and the housing market stabilize and consumers feel more confident about their financial situations.

Wilson said that “we are seeing a permanent change in … spending and consumption patterns” as Americans become more frugal in their buying habits. This will result in a painfully slow economic rebound and have a profound impact on the supply chain for years to come, she said.

Demand for trucking, which moves nearly 80 percent of the nation’s freight, remains very weak and may not pick up appreciably until well into 2010, Wilson said. Freight rates will initially remain stable as volumes improve, she said. However, the significant reductions in trucking capacity during the past two to three years will lead to an upward spike in rates once the recovery takes hold, she said.

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