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PLUG IN & POWER UP: www.inboundlogistics.com THE MAGAZINE FOR DEMAND-DRIVEN LOGISTICS • OCTOBER 2007 Plottingg Rail’s Revival Navigating Maritime Trade ALSO: SITE SELECTION What Acquiring Minds Need to Know INTRODUCING THE ALL-NEW 2008 DODGE RAM 4500 & 5500 CHASSIS CABS. YourYouru businessbusiiness is aaboutbboutut ttoo shshine.iine.e TThankshah nkks too a 66.7L.77L CCuCumminsummmiins® TurboTuru bbo DieselDiei ssel withwiwithh anan integratediinntteegrg attedd eexhaustxhhausts brakebrb akke andand 610616 0 lb-ftlbb-fft ofo torquetorquq e thatththatat comescomo ess withwith a 5-year/100,000-mile5-5 yey arar/1/1000,000000-mmile CumminsCuCummm ini s DieselDiiesesele EngineEngngini e LimitedLiimimitet d Warranty,WWarrr aanty, RaRamm 445450050000 aandndd 55500500 ChassisChhassiis CCaCabsabsb mmakeakke otherootheh r trucksttrrucks ppaleale in comparison.coompariison.n WithWiti h ccocommercialommerciialal gradeggradde peperformanceerfformaancn e anandd eenengineeringgiineeriing ttoo pproviderovide mmaximizedaaxiimiizedd uuptime,ptp iime,e iitt shshedshedds lilightight on a wholewhholle newnew waywaya toto work.wwork. ForFor moremmoree information,infformaatitionn, ggo ttoo dodge.com/chassis_cabddoddgge.e coom/m/chhassiis_ccaab oro ccallall 80800-4ADODGE.00-44AADODODGGE.E The Cummins diesel engine is protected byby a separate Diesel Engine Limited Warranty covering the engine for 5 years or 100,000 miles, whichever comes first. See youryour DodgeDodge dealer for completecomplete details. Chrysler Financial is a business unit of DaimlerChrysler Financial Services Americas LLC. THE MAGAZINE FOR DEMAND DRIVEN LOGISTICS LOGISTICS AT SEA LEVEL October 2007 • Vol. 27 • No. 10 page 42 INFO INPRACTICE 92 WEB_CITE CITY READER PROFILE Greg Schwartz: Smooth Operator 96 CALENDAR Greg Schwartz, vice president, supply chain management at Jamba 98 CLASSIFIED Juice, gives supply chain procurement and sourcing a whole new fl avor. 100 RESOURCE CENTER DC SOLUTIONS Blue Bell Creameries Licks Storage Shortage Hot demand for its 50 different ice cream fl avors compelled Blue Bell Creameries to look up to create more space in its refrigerated DC. A new INBRIEF automated storage retrieval system increases capacity and effi ciency and keeps customers wanting more. 12 10 TIPS Reducing expedited freight costs. LIT TOOLKIT 19 TRENDS A New York Minute: Kids, Ships, and Creating Calm from Chaos Dolls…U.S. ports profi t from new A new warehouse management system green machine…The struggle for enables industrial hose distributor true supply chain collaboration. Red-L to create a more effi cient and 25 GLOBAL LOGISTICS employee-friendly warehouse. Global green ship mandate gets green light...Dubai plans a maritime logistics university… 3PLs enhance U.S/Mexico INDEPTH offerings…Tibet builds new Qinghai-Tibet Railway Logistics at Sea Level logistics center. Ocean, rail, and intermodal leaders 84 TECH UPDATE discuss why capacity concerns, infrastructure inadequacies, and 89 NEW SERVICES a paucity of policy keep them up 104 THE LAST MILE: at night. RAISING CHURCHILL’S LAST RIDE Rockin’ Rail For an industry with grassroots in the 19th century, and that hit its heyday in the mid-20th century, U.S. railroads are ready to rock and roll. DC SOLUTIONS page 77 2 Inbound Logistics • October 2007 " #"!" "! !! " %' " !"!'""'# """"# # ' ! $# #& "!)%"#)%' ""#!#" "% #"'#""""3- 4'! ( ""'!! ! "!# !'# #!" !*!"!" '# ( "" "!" #$" ' '!"!%"# #!" ' " !""! ( $"%""' " !"!# #!"! ( &"' " #!%" ! $" ! !!"#" ' (%'*! # " $!# !'# !"% $" "*!#! '# %' $" $!"%%%%'"!11 THE MAGAZINE FOR DEMAND DRIVEN LOGISTICS ROCKIN’ RAIL October 2007 • Vol. 27 • No. 10 page 52 INSIGHT INDEPTH 6 CHECKING IN Legislation heats up in Washington, Drum Beaters pitting railroads and government After making slow progress against the traditional 55-gallon drum for interests against each other. Which side of the track are you on? moving small-volume liquid shipments, intermediate bulk containers (IBCs) and intermodal tank containers (ISO tanks) are starting to accelerate 10 DIALOG their gains. Reader input and questions on blogs, Latin America, and warehouse safety. WMS Directory: Plug In and Power Up 16 KNOWLEDGE BASE: Whether your demands are vertical-specifi c, dictated by existing ERP AIR CARGO systems, or based on cost and complexity, WMS vendors are saturating the Sponsored by Mid-America market with a wide array of solutions. Search this directory to fi nd a WMS St. Louis Airport. solution that can recharge your supply chain. 30 ECODEV Understanding freight cost Setting Sites on Tomorrow modeling can help economic developers land big business. A new DC can open up a company’s supply chain capabilities, or expose it to considerable risks. Third-party intermediaries and economic development 32 IT MATTERS interests are helping businesses look beyond the basics to fi nd sites fi t for Emerging Web services promise to revolutionize the way shippers today and tomorrow. and LSPs integrate. 34 3PL LINE Finding the right 3PL can be fraught with pitfalls. 36 RISKS & REWARDS Diversifying air cargo handling services requires a new protocol for obtaining insurance coverage. DRUM 38 VIEWPOINT BEATERS Softening truck capacity and page 60 lessening demand have the shipping empire primed to strike back. But can it succeed? 4 Inbound Logistics • October 2007 CHECKINGIN Vol. 27, No. 10 October 2007 THE MAGAZINE FOR DEMAND-DRIVEN LOGISTICS www.inboundlogistics.com STAFF PUBLISHER Keith G. Biondo by Keith Biondo | Publisher [email protected] EDITOR Felecia J. Stratton [email protected] SENIOR ASSOCIATE EDITOR Joseph O’Reilly Railroad RXR? CONTRIBUTING EDITORS Merrill Douglas John Edwards he nation is at a crossroads on how to handle the rail industry in the Lisa Harrington Amanda Loudin coming decades. While much attention has been paid to the state of the Amy Roach Partridge T nation’s highways in light of the I-35 bridge collapse, a new Association of Deborah Ruriani American Railroads study indicates that U.S. railroads need an overhaul, too. Lisa Terry The National Rail Freight Infrastructure Capacity and Investment study (www. CREATIVE DIRECTOR Michael Murphy [email protected] aar.org/newsroom/Capacity_Investment_study.asp) lays out in detail the need for PRODUCTION/DESIGN ASSISTANT Shawn Kelloway major investment – to the tune of $135 billion over the next 30 years – to aug- [email protected] ment freight capacity to meet an expected doubling of rail freight demand. PUBLICATION MANAGER Sonia Casiano Investments would go toward constructing new track, signals, bridges, tun- [email protected] nels and terminals. CIRCULATION DIRECTOR Carolyn Smolin One proposed remedy is the bipartisan Freight Rail Infrastructure Capacity Expansion Act, introduced on Capitol Hill in July 2006 by Trent Lott (R-Miss.) SALES OFFICES and Kent Conrad (D-ND), and still bouncing around Congress. The bill NORTHEAST: Keith Biondo (212) 629-1560 • FAX: (212) 629-1565 aims to legislate a 25-percent tax credit for any transport business – shippers [email protected] included – investing in new rail track, intermodal facilities, rail yards, locomo- WEST/MIDWEST/SOUTHWEST: Harold L. Leddy tives, or other rail infrastructure expansion projects. (847) 446-8764 • FAX: (847) 446-7985 On the other side of the “how do we handle the railroads issue” is Rep. [email protected] James Oberstar (D-Minn.), chairman of the House Transportation and Marshall Leddy (763) 416-1980 • FAX: (763) 201-4010 Infrastructure Committee. Oberstar recently proposed legislation that would [email protected] re-regulate the railroad industry by introducing price controls and controlling MIDWEST/ECONOMIC DEVELOPMENT: Jim Armstrong access to shared networks to reduce costs for freight shippers – an appealing (815) 334-9945 • FAX: (815) 334-1920 proposition for some shippers with zero alternatives. [email protected] These converging and confl icting initiatives place rail shippers, specifi cally SOUTHEAST: Gordon H. Harper smaller players and captive shippers, between the rails. The promise of reduced (404) 350-0057 • FAX: (404) 355-2036 [email protected] freight costs in a market historically monopolized by a small number of large railroads spells welcome relief for some. But would reverting to pre-Staggers MOBILE, AL: Peter Muller (251) 343-9308 • FAX: (251) 343-9308 Act regulations stifl e or stimulate private sector investment? The AAR argues [email protected] that such legislation would cost the industry $5 billion in lost revenue annu- SPECIAL ACCOUNTS: Joseph T. Murphy Jr. ally and impede efforts to increase capacity. And we all know how regulation (203) 254-9595 • FAX: (203) 259-4447 fared in the past. [email protected] Ultimately the railroad’s complacency over the past three decades since SALES MANAGER: Rachael Sprinz (212) 629-1560 • FAX: (212) 629-1565 deregulation is partly to blame for this current scenario. “Although the [email protected] railroads have been increasing their capital expenditures, most of that capital FREE SUBSCRIPTIONS is going to sustain existing capacity rather than toward expansion,” reports a www.inboundlogistics.com/free January 2007 position paper by the Railroad-Shipper Transportation Advisory Council (www.stb.dot.gov/stb/rail/railshipper_council.html). Inbound Logistics welcomes comments and submissions. Contact us at 5 Penn Plaza, NY, NY 10001, (212) 629-1560, That both
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