Category Archives: The Passage

Four Major Risks in the Global Supply Chain if Russia/Ukraine Conflict Materializes

As tens of thousands of Russian troops continue to mass along the Ukrainian border, and with diplomatic talks between the U.S. and Russia yet to bear fruit, the threat of a Russian invasion within the next few weeks appears to be growing.

A Russian invasion of Ukraine has the potential to cause extensive and debilitating disruption across global supply chains, resulting in rising input costs to a heightened threat of cyber attacks.

Today thousands of U.S. and European companies do business with suppliers in Russia and Ukraine, which could be at risk during a prolonged military conflict. Analysis of global relationship data on the Interos platform reveals key findings:

-More than 1,100 U.S.-based firms and 1,300 European firms have at least one direct supplier in Russia.

-More than 400 firms in both the U.S. and Europe have tier-1 suppliers in Ukraine.

-Software and IT services account for around 12% of supplier relationships between U.S. and Russian/Ukrainian companies, compared with 9% for trading and distribution services and 6% for oil and gas. Steel and metal products are other common items purchased from the two countries.

While the proportion of U.S. and European supply chains that include tier-1 Russian or Ukrainian suppliers is relatively low, this figure increases significantly when indirect relationships with suppliers at tier 2 and tier 3 are included.

-More than 5,000 firms in both the U.S. and Europe have Russian or Ukrainian suppliers at tier 3.

-More than 1,000 firms in both the U.S. and Europe have tier-2 suppliers based in Ukraine, with around 1,200 dependent on suppliers at tier 3.

Supply chain and information security leaders in U.S. and European organizations should review their dependence on Russian and Ukrainian suppliers at multiple tiers as a key first step in their efforts to assess risk exposure in the region and ensure operational resilience.

In the event of a Russian invasion of Ukraine, there are four major areas where global supply chains could be negatively impacted:

1. Commodity prices and supply availability

2. Firm-level export controls and sanctions

3. Cyber security collateral damage

4. Wider geopolitical instability

Although many of these risks may not materialize and represent a worst-case scenario, executives should be thinking now about the potential impact of a Russia-Ukraine military conflict on their operations over the coming months. These same leaders need to ensure that appropriate contingency plans are in place for their most critical supply chains and riskiest suppliers in the region.

With proper analysis, planning, and execution through knowledgeable logistics companies, it is possible to mitigate significant risk and ensure operational resilience.


Transporting Capacities are Being Added to the Industry

In response to ongoing demand for increased transport capacity, international freight forwarders have launched new services between Europe, the United States and Asia.

In 2021, after the French logistics provider GEODIS chartered its first vessel to alleviate container capacity shortage on its Asia-Europe routes, the company has launched its own-leased A330-300 full freighter aircraft under its brand name to upgrade its AirDirect services between Europe, the United States and Asia. Operating between Amsterdam, London, Chicago and Hong Kong, the aircraft also serves the China-Europe route for the peak season.

With the continued strain on air freight capacity, we wish to ensure a more sustainable supply of air cargo space for clients and the industry is investing in this first dedicated freighter.

The provision of self-controlled air freight services with own-leased aircraft pays off has also been proven by DACHSER USA, a subsidiary of the global logistics provider Dachser. Since starting its weekly trans-Atlantic freight service between Frankfurt and Chicago in 2020, it has grown with more than 85% of its U.S. customers utilizing this service between Europe and the United States more than once.

Proving to be such a dependable, efficient solution that this route has become a cornerstone in the global air freight services network and is becoming the sample for many other new routes.

Looking for more innovative freight solutions? Contact us today!


New Global Business Indicator

Our Industry is Constantly Evolving. Learn About the New Global Business Indicator (GBI)

U.S. Customs and Border Protection (CBP)  has introduced a pilot program for the new Global Business Indicator (GBI) initiative, which proposes replacing current manufacturer/shipper ID codes (MID) with a new ID system that provides the CBP with more transparency to identify the main legal entity and ownership, specific business and global locations, and supply chain roles and functions.

The pilot will have importers use the Data Universal Numbering System (DUNS), Global Location Number (GLN), and Legal Entity Identifier (LEI) to determine the optimal combination for the GBI. The GBI pilot program is expected to go live in the Spring of 2022. There won’t be mandatory reporting of GBI, but the pilot will be live and available for those who want to participate.

The reason behind the program is that the increased volume of import/export activity in the U.S. introduces an unacceptable level of risk. The CBP wants more information on cargo entering and exiting the U.S. to help identify high-risk cargo and make the whole system more efficient and transparent.

If you need more information about this new program, or any segment within shipping, logistics, warehousing, freight, or more, contact one of our experts who are currently standing by and available to help.


Why It’s Important to Hire A Professional Logistics Consultant

If you own or run a small or medium-sized enterprise and have difficulty managing containerized freight shipping, it might make sense to look externally for help. A reputable supply chain consulting firm can assist you with all the challenges.

From finding a suitable logistics partner to understanding costs, ensuring compliance, and training staff to become a freight shipping experts, professional consultants can aid and support you.

Along the way, they can help your organization gain the knowledge, skills, and expertise you need to enjoy more success with international trade by successfully navigating the complexities of international container-freight shipping.

Of course, you can always rely on external consultants as a long-term solution providing the cost would not be prohibitive. However, by enlisting help to evaluate your processes and relationships with logistics partners, optimize them and transfer knowledge to your team, that period of paid support should position you to ship international freight more successfully and with greater confidence in the future.

At Precision Global Logistics, we field an expert team of supply chain and logistics consultants, several of whom specialize in helping clients with container shipping.

An initial consultation call with one of those specialists will yield much success for your future logistical needs.


Mobile Computing – Time to Innovate in 2022

Technological innovations had come a long way since the 1970s when mainstream computing devices were first introduced. Similarly, mobile computing devices came into use in supply chain management during the late 1990s and have continued to evolve into all aspects of supply chain management. 

In the most basic sense, a supply chain consists of a supplier, manufacturer, warehouse, mode of transport, retailer, and final customer sections. Among these sections, there are three main flows; product flows, information flows, and financial flows. Satisfying customer demand largely depends on efficient and quick information exchange between these sections.

Considering the global disruption of the COVID-19 pandemic coupled with the growing usage of mobile internet-connected devices, supply chains have become more decentralized, more complex to manage and measure, and more vulnerable to risks of disruptions.

One of the most significant advantages of mobile computing is that it enables a ‘connected supply chain.’ By leveraging structured and unstructured data generated across the supply chain, mobile computing improves the connectivity of the network. This helps companies to connect with their suppliers, vendors, and customers better.

Mobile computing operates on a flexible, usage-based model. With mobile computing, businesses can manage their supply chain successfully, especially in a volatile market. It enables faster planning and execution resulting in reduced time to market, therefore adding value and lowering costs.

To remain competitive, firms must reimagine their business processes, in particular, their supply chains technology.

Amid the various technologies available today, mobile computing is a real game-changer for businesses to innovate. Mobile computing provides both a method of communication and a source of information to employees and business owners, facilitating business tactics, competitive initiatives, and dealing with uncertainty. This makes mobile computing an essential tool in the repertoire of the supply chain professionals of tomorrow.

Are you interested in learning more about transitioning your supply chain operations to mobile technologies? Get in touch with one of our team members today.


Ocean Shipping Reform Act of 2021

Ocean Shipping Reform Act of 2021 is passed by U.S. House of Representatives.

The United States House of Representatives signed off on the bipartisan Ocean Shipping Reform Act of 2021, H.R. 4996, by a convincing 364-60 vote.

The bill was introduced by Representatives John Garamendi (D-CA) and Dusty Johnson (R-SD) in August, with the objective of making the Federal Maritime Commission (FMC) “a more effective federal regulator.”

The bill’s next step is for it to be sent to the U.S. Senate to be considered.

Key components of the Ocean Shipping Reform Act of 2021 include:

  • Establishing reciprocal trade to promote U.S. exports as part of the Federal Maritime Commission’s (FMC) mission;
  • Requiring ocean carriers to adhere to minimum service standards that meet the public interest, reflecting best practices in the global shipping industry;
  • Require ocean carriers or marine terminal operators to certify that any late fees —known in maritime parlance as “detention and demurrage” charges—comply with federal regulations or face penalties;
  • Shifting the burden of proof regarding the reasonableness of “detention or demurrage” charges from the invoiced party to the ocean carrier;
  • Prohibiting ocean carriers from declining opportunities for U.S. exports unreasonably, as determined by the FMC in new required federal rulemaking; and
  • Requiring ocean common carriers to report to the FMC each calendar quarter on total import/export tonnage and twenty-foot equivalent units (loaded/empty) per vessel that makes port in the United States.

Conversely, John Butler, President and CEO of the World Shipping Council said it does not do enough to materially move the needle towards making meaningful improvements.

The World Shipping Council will continue to work with Congress to seek real solutions that further strengthen the ocean transportation system that has supported the U.S. economy throughout the pandemic.

(Ref. Logistics Management 12/09/2021)


Stay On Top of Freight Shipping During the Holiday Season

With the holiday season upon us, it’s important to stay on top of your freight shipping strategy. Extra volume, complex shipping windows, and other outside factors accompany the millions of gifts that have been ordered this year.

To get a firm grasp on the demand of the season, you will first want to collect all of the facts to understand where possible delays may occur and how to best utilize the resources at your disposal. Let’s look at a few ways you can navigate the holiday freight shipping season.

Thinking ahead of the holidays.

One of the biggest holiday freight shipping obstacles to overcome is understanding the window you have to work with. While certain dates are blacked out completely, others are operated with modified service. Staying aware of these peak season dates is extremely helpful in building out your overall strategy.

Just because your freight is placed on a trailer before the holiday does not necessarily mean it will arrive there in time. Small and medium-sized businesses have to take extra precautions and really look at the bigger picture. This means that you must leave a few days in between to account for unexpected delays along the way.

Knowing what factors could affect your holiday shipment.

Another component of creating your holiday freight shipping plan is to understand the delays you may end up facing. In addition to knowing your blackout and modified service holiday dates, you need to know which day of the week they fall on.

Also, keep up with the weather, especially on the destination side of things. Weather can turn on a dime, and you don’t want a small snow squall to be the factor that stood between your freight and its final destination.

Finally, take a good hard look at the amount of freight you are planning on shipping. It might seem to be a simple enough task, but underestimating how much volume you have could lead to roadblocks later on. Take inventory and triple-check freight dimensions to ensure everything will fit on the trailer.

Take advantage of your resources.

Diving into the holiday freight shipping season can be quite an undertaking, especially if you’ve never done it before. Consider pairing up with an online freight service provider to help make sure you are staying on track and navigating the unexpected.

Working with a freight service provider has several benefits you may not be aware of, such as easier tracking and better access to a large carrier network. They will also offer alternative options should anything unforeseen occur. Walkthrough your plan with your provider ahead of time so that you can better allocate your time and money, utilize space, and boost productivity.

Remember to monitor the factors that could potentially cause delays and keep consistent communication so that your holiday season will be filled with nothing but joy.

To learn more about how to plan for this holiday shipping season, make sure to contact us today to speak with one of our experts.


How Data Can Speed Container Delivery

The Federal Maritime Commission is trying to pinpoint how data can help speed the flow of containers through the supply chain.

The multi-phased effort is proposing “recommendations for common data standards used by the international shipping supply chain, as well as access policies and protocols that would streamline information sharing across the ocean supply chain,” according to the FMC.

Initial findings are expected to be presented at a maritime data summit next spring.

“Events of the past year have proven the need for the United States to achieve more capacity from our cargo delivery system,” said FMC Chairman Dan Maffei. “Information sharing and additional transparency in how containers move is one way we can move more containers more efficiently.”

The initiative marks the latest effort by the FMC to address supply chain efficiency and congestion.

Given the immense national economic impact and our nation’s reliance on ocean shipping, sustained surges in cargo volumes, and other operational impacts caused by COVID-19, it is clear that there is a need to develop a stronger system of information for the shipping industry.

The agency will work with the transportation industry to boost transparency around international freight systems. US port gateway corridors are limited by physical constraints, and the best options for efficiencies lie with the greater utilization of information technologies and coordination between the different modes in the supply chain.

(Ref. American Shipper November 15, 2021)



Nearly all container shipping trades are hit by congestion.

Of all the trade lanes covered, most trades showed a significant increase in delays in September this year compared to a baseline of 2016 – 2019, indicating that the congestion problems leading to delays are indeed prevalent globally and not isolated to just a few significant vital trades.

In an update on its Fiscal Year 2021 Q2 initiatives, companies continued to see bottleneck constraints as a result of land-side labor shortages and high consumer and industrial demand for products.

Hundreds of ships waiting around the world at anchor is the “effect” (and not the “cause”) of such inland logistics bottlenecks backing up into the port infrastructure. The land-side supply chain challenges appear to be somewhat universal, but North America and Europe seem to be the most significantly impacted.

The industry saw an improvement in the first half of 2021 over the same period in 2020. It could have carried more cargo had it not been forced to pause Asia sailings due to heavily delayed vessels returning from elsewhere. As things stand in Q3 and Q4 2021, we see no major improvement in the current situation so far.

Shipping backups at big U.S. ports are not likely to resolve themselves until well into 2022, according to economists. Though, the problems should lessen after the holidays and Lunar New Year as container traffic backs off.

Companies have been left to find ways to keep their products moving amid the supply chain disruptions. Some of these solutions include services like the ones we at Precision Global Logistics offer.

Shipping a container through major U.S. ports now takes triple the time it usually does. President Joe Biden tried to fix the problem by ordering ports to stay open 24 hours, but it has only helped at the margins. Ongoing labor shortages and a lack of coordination among the multiple players in the U.S. supply chain blunt the effect of the move.


How to Pick the Right Freight Forwarding Company

The process of getting goods from point A to point B undamaged and on time will invariably present challenges because there are so many factors in flux along the average international shipping line. Some difficulties and inconveniences are just part of the overall shipping process. In contrast, others may cause a company to reconsider their partnership with their freight forwarding company.

When your business needs to choose a freight forwarding company, there are a few things you can do to make the process run smoothly without incurring surprise fees or experiencing delays in shipments. However, the onboarding process can be daunting, so you need the right partner.

Why Companies Switch Freight Forwarders
Before you change, first assess whether your current freight forwarding company is performing well and whether it’s a good time to switch providers.

Unacceptable Customer Service
When familiar contacts at your forwarder leave the company or there’s a staff change, communication tends to suffer. If the department eliminated positions, there might no longer be a local contact to handle questions and problems. If there’s a new contact person, they may not be familiar with your shipping needs and SOPs. The onboarding process takes time for someone who is new to the job and is trying to understand and meet the needs of multiple clients, creating the opportunity for mistakes and misunderstandings.

Competition from Another Freight Forwarding Company
Using the same forwarder long-term may create a situation where the best and least expensive options aren’t on the table. Whether it’s because the company is comfortable or the freight provider has already earned your trust, this familiarity opens the door for a competing freight forwarder to present new and cost-saving ideas.

Changes in Leadership
Even if a company is happy with its current freight forwarder, leadership changes in the shipping department may cause a reevaluation of the freight company’s services. The new employee may want to improve the shipping process or cut costs by introducing a freight company they used at their previous job.

How to Plan for a Smooth Transition When Changing Freight Forwarding Companies
When it’s time to switch freight forwarding companies, there are many factors at play. Understanding the possible problems and taking steps to prevent shipping delays and increased fees is crucial to a smooth transition.

Discuss a Transition Plan
A transition plan will guide the process of switching forwarders. This time is crucial for the shipper and new forwarder to determine when and how the business will transition to them.

Some companies may not want to make a sweeping, all-inclusive change by simultaneously eliminating their previous freight forwarder and hiring a new one. Then, they must decide which situations cause the most pain and start there.

Ensure an SOP is in Place
Before transitioning to a new forwarder, a standard operating procedure (SOP) should be in place. This living document is updated as changes or expectations evolve, and it outlines the practices, processes, and communication required to manage your account seamlessly. Depending on the complexity of your supply chain, an in-depth SOP covering each trade lane may be appropriate.

Rescind Power of Attorney When Making Broker and Provider Changes
After making the change and granting the new company power of attorney, verify that shipments are moving as planned. Then, be sure to terminate that right with the former company. It’s wise to limit the number of forwarders and Customs brokers that have a power of attorney.

Know the Freight terms
When getting quotes from a potential new freight forwarder, it’s crucial they understand your terms. Otherwise, you may be comparing quotes for different services. You will want to gather quotes from forwarders confidently, knowing they are familiar with their terms and that you will be able to compare apples to apples. Otherwise, if one forwarder quotes port to port and the next forwarder quotes door to door, there isn’t an easy way to see which quote is the better value.

Switching freight forwarding companies is a common practice that can be prompted by poor performance, staff turnover, or outgrowing a long-term partnership. When switching freight forwarding companies, there will be many questions. To ensure a smooth transition, anticipate possible interruptions in service, and pay attention to how you grant power of attorney to keep costs low and service running smoothly.

Want to learn more? Contact us here!