The Biden administration is weighing National Guard deployments to help alleviate the supply chain bottlenecks at U.S. ports, Commerce Secretary Gina Raimondo told a Washington Post virtual event Wednesday. “We’re looking at all our options,” she said. “The reality is that Americans are challenged at the moment” by the congestion at the ports and the rising prices for consumer goods that have ensued, she said. As Rhode Island governor, Raimondo deployed the National Guard last year “very effectively during COVID,” she said. “The National Guard could potentially be very helpful. They have tens of thousands of people that have commercial driver’s licenses to theoretically drive trucks,” plus “logistics experts” with the “arms and legs to help with the loading and unloading” of shipping containers, she said. “We don’t have a plan specifically,” but using the National Guard “certainly would not be a long-term option,” nor would it ever “displace workers who are doing this job,” she said. “But right now we have a backlog, and we have to look at everything that would help us unstick the backlog.” There’s no “magic elixir” to fix the global semiconductor shortage, which is an “urgent” crisis and a “huge problem” for American consumers and businesses, said Raimondo. Chips “underpin everything we do in a day,” she said. But the U.S. makes “zero percent of the most sophisticated chips on our shores,” and 70% of the “leading-edge” chips that Americans consume come from Taiwan, she said. “I find that to be an almost terrifying prospect,” amid the looming threat the island nation faces from China, she said. "We are exceedingly vulnerable, and getting even more so as our economy becomes more digital.”
Consumers worry that supply chain bottlenecks and delivery delays “will wreak havoc on the holidays,” and are responding by planning to shop earlier than usual, reported Oracle Tuesday. The company canvassed more than 5,700 consumers globally in September, including about 500 in the U.S., finding 52% of Americans had already started holiday shopping. Gift cards are an especially hot item this year as a hedge against supply chain woes. About a third of the respondents planned to buy more gift cards than usual this year, including nearly six in 10 baby boomers, said Oracle. Other survey findings: (1) 40% agree that out-of-stock items “constitute a lousy shopping experience”; (2) 38% will be attracted to brands or companies this year based on product availability; (3) about one in five won't wait for a retailer to restock before going somewhere else. Though supply chain challenges will be a “global reality” this holiday, consumers “will still measure retailers on their ability to deliver on their wish lists,” said Mike Webster, Oracle Retail senior vice president-general manager. "Accountability will be the name of the game.”
The Bureau of Industry and Security plans a virtual forum 9 a.m. EDT Oct. 29 to gather recommendations on bolstering the resiliency of “critical supply chains” for the U.S. information and communications technology industry “that are at risk of disruption, strain, compromise, or elimination,” says Tuesday’s Federal Register. Requests to give oral statements at the forum are due Friday. Submissions to listen in are due Oct. 27. Information collected at the forum will help the Commerce and Homeland Security departments prepare their report to the White House by the one-year anniversary of President Joe Biden’s Feb. 24 executive order on curing ICT supply chain disruptions. BIS also seeks comment by Nov. 4 on building more resiliency into ICT supply chains (see 2109170042).
Samsung and Walmart are among six large companies committing to using newly expanded 24/7 hours at the Port of Los Angeles “to move more cargo off the docks, so ships can come to shore faster,” and ease the "bottlenecks" there and at the Port of Long Beach, said the White House Wednesday. Long Beach expanded to 24/7 operations in mid-September, it said. International Longshore and Warehouse Union members “are willing to work those extra shifts,” said the Biden administration, giving no estimates on the added labor and logistics costs. Samsung is committing to move nearly 60% more containers out of these ports by operating 24/7 through the next 90 days, said the White House. Walmart will increase its use of nighttime hours significantly, “and projects they could increase throughput by as much as 50% over the next several weeks,” it said. Target already is moving about half of its containers at night, and is committing to increasing that volume by 10% during the next 90 days, it said. FedEx, Home Depot and UPS also are expanding operations at the ports to take advantage of the new “off-peak” hours, said the White House: “Across these six companies over 3,500 additional containers per week will move at night through the end of the year.” None of the companies named by the administration responded to requests for comment. All sent representatives to a White House meeting Wednesday with Vice President Kamala Harris, including Samsung Electronics North America CEO KS Choi. “Today’s White House meeting underscores the urgency to strengthen American supply chains to promote economic security, national security, and jobs here at home,” said U.S. Chamber of Commerce CEO Suzanne Clark, who also attended. "We applaud the administration’s engagement in helping to solve this crisis.”
Increased demand for products “is nothing new for this time of year,” blogged Joe Metzger, Walmart U.S. executive vice president-supply chain operations, Friday, addressing widely reported supply chain issues and uncertainty in the marketplace. “With so many news stories about port delays, increased consumer demand and holiday season forecasting, it’s natural to wonder whether items will make it to store shelves and how this might affect holiday preparations,” Metzger said. Walmart is “doing even more” this year to be sure product orders arrive when customers need them. It has worked with suppliers to source merchandise earlier than usual and move products inside its supply chain network quickly, Metzger said, including chartering ships and diverting shipments through less congested ports, and it has rerouted inland shipments, using less conventional transportation methods to avoid rail delays. The retailer hired more than 3,000 drivers “with more in the pipeline," added 20,000 permanent supply chain employees and hired 150,000 employees to fill online orders, he said. Walmart also added storage capacity in the fulfillment and distribution network by bringing new facilities online, he said, while automating existing facilities and shipping products straight from stores. “While we’d like to see inventory levels continue to improve, we’re on the right track,” Metzger said.
It’s hard for contract manufacturer Jabil to answer questions about "when does the fever break” on the tech industry’s global supply chain woes, said CEO Mark Mondello on a call Wednesday for fiscal Q4 ended Aug. 31. “Does the demand start to soften a bit?” said Mondello. “Does the supply start to strengthen a bit? There’s a significant amount of variables there.” Previously unforeseen “incremental tightness” in the supply chain during July and August caused Jabil to finish its Q4 with net revenue of $7.4 billion, below the midrange of the guidance it published June 17. The stock fell 6.2% Wednesday to close at $57.23. For fiscal 2022's first half ending Feb. 28, “we’re going to still see tightness about equivalent to what we saw” in the last two months of Q4 -- “very tight supply in components,” the CEO said. Leveraging the scale of the 400 customers Jabil serves, including Apple, Dish Network, Philips and Sony, plus “just the amount of overall parts we buy," Mondello and his team think “things will start to maybe move in a better direction as we get into the back half” of FY 2022 ending in August, he said. “We’re by no means suggesting that the supply chain is back to normalized levels by the back half of the year.” But if demand trends hold, “and we’re working through this solely on the supply side, then I would think we don’t see normal conditions in the supply chain” until FY 2023's first half ending February 2023, “the way things sit today,” he said.
A new warehouse, inventory and logistics credential for retail employee skills training in supply chains was launched by the NRF Foundation and the Association for Supply Chain Management Foundation, said the National Retail Federation Monday. E-commerce and supply chains “are increasingly essential to our economy,” said NRF CEO Matthew Shay. The new credential “will give job seekers and employees the training they need to navigate the complex supply chain challenges retailers currently face.” The credential will target current and future potential employees interested in supply chains or working in warehouses, distribution or fulfillment centers, NRF said: “The educational program highlights the increasing importance of warehouse, distribution and similar facilities and their workers to both the retail industry and the U.S. economy.”