Day in the life of
Logistics Manager – Steve Hurvitz
Every day is an adventure. Never make the mistake of thinking today will be an easy day, whether it’s a Monday, a Wednesday, or a Friday. There are so many variables that can affect what you do. Here are just some of the roadblocks you may face each day:
- Late arrivals. Are the carriers going to arrive for their pickup or delivery on time? Shippers impose penalties for late deliveries and many other offenses. Many shippers will look for any reason to deduct for them.
- Rising fuel costs. This year is going to be like no other. Rates compared to last year are going to be double-digit and more. Fuel is going to be a huge factor. Going from $2.25 per gal to almost $3.00 in less than 40 days who knows where it will end. What does that mean? Let’s say you paid $1,000.00 for a load going 400 miles. That same load today will be over $1,500.00. That’s as of today. It will be higher next week, and next month, so you need to be prepared to deal with rising fuel costs.
- Driver shortages. What is driving these rates is the capacity issue of drivers. There is not a pool of drivers to keep up with the demand for freight. There are very few replacements and thus the shortage of drivers. Carriers large and small are reluctant to agree to pricing that locks them in for a long period. Before it was nothing to agree to a 2-3 year agreement. Today, you are lucky to get 3 months. Shippers that have volume have a different issue. Carriers do not want to devote a high percentage of their fleet to one client. In these instances, volume is not your friend. Finding carriers is a long and tedious process. It may come down to who you know vs what you know. The who you know part is based on your years of service in the industry.
- Global logistics delays. That’s the domestic story. International shipping is another monster. Rates coming out of China for 40-foot spot load containers have jumped from $3,500.00 per box to over $8,000.00 or higher. You ask how can that be? Steamship lines have parked vessels and worked out arrangements with other steamship lines to book space. This has increased the efficiency of full vessels but reduced the number of available spots on the ship, thus driving up the price. Since these are mostly spot rates, the steamship lines are taking the loads that obviously pay more and the ones that don’t sit at the pier until they can get on the ship at their rate. This can translate to weeks-long or month-long delays in arrival times.
- Port congestion. Port congestion has not been this bad in years. What is port congestion? You send your driver to the port to pick up a container. Since the volume is so high, in many cases you must make an appointment to pick up your load. You think “great I have a slot to pick up my load”. Well, you do but it doesn’t mean much if there aren’t enough longshoremen to move the containers around. You can wait for hours just to pick up 1 container. The situation is exacerbated if you have more than 1 to pick up.
- Time constraints. “Last Free Day” means the port gives you a certain amount of time to get the container off the port. After so many days, they start assessing charges. Why would we run into last free day issues? Because there are not enough dray drivers to pull them off. Again, a driver shortage. In addition to spending too much of your time looking for domestic carriers, you are also spending your time looking for carriers that can pull your containers off the pier. There is the possibility of negotiating with the port authority to give you a break on the demurrage charges. They will not release the freight until they get paid for not getting the freight off in time.
Sound hectic? All of these examples are things that I dealt with before 10 a.m., with the rest of the day still ahead. It reminds me of a saying from the marine’s advertisement that said something like this: “We do more before noon than most people do in a week.” It’s a juggling act. The rest of your time is spent taking meetings with other clients on new projects, investigating what resources will be needed and whether you can handle it. Logistics managers have difficult jobs. So, why do they do it? Because it is rewarding and challenging and tests your ability to think on your feet. If you love problem-solving and meeting challenges head-on, logistics management is a great career option.
3PL logistics managers
If you are a 3PL, (Third Party Provider) and handle multiple modes of transportation, your load is increased even more. Finding refrigerated, flatbed, or final mile solutions just adds to your day. This may sound like “how can you cope with all of this?” To say it’s no big deal is an understatement. If you have been in this business a long time like I have, when see you these situations unfolding, you need to adapt and find new solutions. What might have worked yesterday may well be different today.
A logistics manager working for a company has their work cut out for them. He would need a staff just to source equipment, not to mention compliance and everything that goes along with each shipment. Let’s not forget about price. Breaking the bad news about price increases with management is never easy and requires excellent communication skills and the ability to work well under pressure. For instance, a shipment that cost $1000.00 last time it was transported could increase in price by $500.00. Or a container from China that previously cost $3500.00, it’s now going to cost $8000.00. You are the person who must break that bad news to the people who are very focused on staying within their budgets.
If you are a 3PL, you have those same issues, but you have a staff to help with the sourcing and your market for finding equipment and pricing. That makes doing your job a tad bit easier since you have higher buying power than the logistics manager from a company.
So, it’s now 5 pm and you think the day is over. WRONG! Everything you set up during the day must be verified to ensure things go as planned. It’s like looking after your kids. They say yes, we will behave, but you need to make sure they do.
A final bit of advice for those interesting in pursuing a logistics management career: Remember, it’s always easier to be proactive than reactive.
plan, direct, or coordinate purchasing, warehousing, distribution, forecasting, customer service, or planning services. Manage logistics personnel and logistics systems and direct daily operations.