Trade Secrets

A couple of years ago, an exec at a major freight forwarder asked me to guess how many shipments each employee handled on an average day. Naively, I guessed 60 or 70. I was wrong by several orders of magnitude. With each shipment requiring numerous steps, from booking a truck pick-up at the factory to certifying that pallets had been treated to kill pests, dealing with three shipments was considered a good day’s work.

Keeping track of goods moving through supply chains is a headache for every company involved in international trade. Lots of money and brainpower are going into improving information flows; the May 24 announcement that the Port of Long Beach is teaming with Amazon Web Services to provide “aggregate data for companies across industries and sectors to track cargo in real time from origin to destination” is only one of many examples. On May 27, the Biden Administration named a new “supply chain envoy,” Retired General Stephen R. Lyons, to help the logistics industry sort things out. Yet so far, these efforts have done little to make supply chains run more smoothly.

There are many reasons for this hold-up. Not everyone is keen on big solutions; some manufacturers and retailers have their own supply-chain management systems and expect suppliers and logistics providers to furnish data their way, not vice versa. Many ports, ship lines, freight forwarders, and other parties are developing proprietary information systems that may not mesh with others’ systems. And behind the scenes, there’s a struggle for control of data about individual shippers that might prove valuable in the future.

Improving supply-chain visibility will be an arduous process. Consider the most basic query a shipper might pose through an information system: when will our goods will arrive in port? Two ocean carriers that share space on the same vessel may have different answers to that question, because they have different definitions of “arrive.” That’s not a problem technology alone can solve.

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