The 2:00 Minute Warning with Mike Regan

What happens if the East and Gulf Coast Ports are shut down on October 1st?

Written by Mike Regan | Sep 25, 2024

 


WE ARE ABOUT A WEEK AWAY FROM A POTENTIAL SHUT DOWN AT THE EAST COAST PORTS. ACCORDING TO EXPERTS, THERE'S ABOUT A 90% CHANCE THAT THE PORTS WILL SHUT DOWN ON OCTOBER 1ST.

The reason we're beginning with this alert is that last week I had an interesting call with a shipper that’s a friend.

He told me that he always reads the Two Minute Warning and is a fan, but he was wondering why we haven't talked about the potential strike at the East and Gulf Coast ports.

Since he’s my buddy I decided to go easy on him, but I let him know that over the past three months, several of our Two Minute Warnings have talked about the possibility of a strike and what shippers need to do to prepare if it became a reality.

Later in the call with my friend, I covered a top question shippers are asking: What are the alternatives is the strike materializes? 

Let me cut right to the chase. The time to take this seriously and prepare was months ago. The Biden administration has made it clear that they have no intention of invoking Taft-Hartley to get the unions back to work. We're also seeing a wide gap between what the two parties expect in a contract. 

But with the likelihood of a strike less than a week away, there are still some things to recognize. Even if you haven't done anything to date, there are still actions your company could take now. 

First, identify the most critical parts in your inventory or items that you need to fulfill. Even if you don't have a lot of ocean freight within your company, you may have suppliers that provide you with critically important inventory parts that could be affected. And given the reality that we live in a interconnected supply chain world, what happens in one node in the transportation function could affect all nodes. 

Second, figure out what alternative modes of transportation your company could utilize. Do you have resources to help you determine whether other modes such as air freight would make sense for different types of your freight?

Additionally, you may be able to arrange for ocean shipments to be diverted to non-union port facilities. TranzAct has resources that can help get the freight moved after arrival.

When these events occur, it is always good to communicate with carriers that you have relationships with often.

This all underscores the need to plan for predictable surprises. If you’re looking for more advice on how to handle the situation at the East and Gulf Coast ports or other tips for managing your supply chain, I simply give us a call, send me an email, or schedule a short conversation.

 

BY MIKE REGAN, CO-FOUNDER OF TRANZACT

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