UPDATE FOR OUR VALUED CLIENTS

 UPDATE FOR OUR VALUED CLIENTS

05/13/21

Communication within the supply chain is crucial for all businesses; however, this becomes a greater focus when the supply chain is under distress. Our Reilly International Team has been in the office communicating and collaborating on ways to be successful for our clients. They are communicating on a day-to-day basis with all our clients to provide the most current state of your shipments and the concerns of delays or rate increases. We realize the news is not regularly good, but our value is realizing the supply chain (YOUR supply chain) must continue to move. Your Reilly Team recognizes this responsibility falls on their shoulders so that you are able to provide meaningful service to your customers. The following is a summary of the current environment with the intention to provide you value to protect yourselves and your customers.

Over the past couple of months, we have continued to experience drastic impacts on the global and U.S. supply chain:

  • Pipeline Cybersecurity Breach – On Wednesday, May 12, Colonial Pipeline has announced they have initiated the restart of pipeline operations at 5 pm. It is estimated it will take several days for product delivery supply chain to return to normal. Per Colonial: “Some markets served by Colonial Pipeline may experience, or continue to experience, intermittent service interruptions during the start-up period. Colonial will move as much gasoline, diesel, and jet fuel as is safely possible and will continue to do so until markets return to normal.”
  • The Port of Montreal Strike – The government intervention has relived the pressure. However, there is still a backlog and a human element of a group of workers wanting to exercise their right to strike being told “no.” We would anticipate the work to continue to be done, but not at the normal pace.
  • Trucking Drayage Shortage – The drayage industry historically has yielded the lowest paying driver wages or Owner Operators who relied on two to three local moves a day. With organization like Amazon, UPS, FedEx, Walmart, Costco…etc offering top dollar CDL driver wages, the drayage driving force is leaving quickly. A backlog on dray company’s dispatch boards has been created because they are now only able to do one, maybe two, local moves due to long waits at the rail. Furthermore, the rail is trying to manage the influx of drivers by requiring appointment times. This is causing containers to be stored at trucker facilities before being returned and tying up chassis.

REILLY SOLUTION:We recognize your freight must move. We cannot move the containers thousands of miles for them to not make it the last fifty miles. At the risk of higher rates, Reilly has contracted an inhouse carrier model providing us exclusivity for our clients in the Chicago and Midwest. In addition, we are planning to use our warehouse, if needed, for the out of state customers. This will allow us to do a container move locally and cross dock the cargo into a regular 53ft trailer where there are more trucking options to deliver the cargo across state lines.

Airfreight Handling – A picture speaks a thousand words…..

  • Airfreight Handling – A picture speaks a thousand words…..The O’Hare Cargo Handling facilities are being overwhelmed with difficulties of hiring staff. Their ability to break inbound pallets and release the freight is moving at a slower rate than in the past. The reduction in turn around time has caused airline pallets to be staged outside due to lack of space in the warehouse and drastic wait times for driver’s picking up. Our carriers have reported 3 to 5 days backlog of being able to pickup from certain cargo facilities around O’Hare.

REILLY SOLUTION:Shipments under 2,000kgs – Reilly has its own small box truck for hot shots. We have been utilizing our own truck and staff to avoid the delays, storage or missed flights. The flexibility of the vehicle allows us better in and out times and more opportunity for success with our client’s shipments.

  • Container Capacity – Space limitation on vessels is no surprise to any of our clients shipping out of China. The carriers continued to pull more vessels out of key parts of China in May. This has caused the rates for space to go up drastically. We have been seeing three times the amount of what was being charged a couple of months ago.

REILLY SOLUTION: We are planning and requesting projections from all of our clients. The more we know, the more we can plan, the more successful we can be with moving your containers. We are asking all of our clients to work very closely with your suppliers to not miss ready dates. If a ready date is missed, we will utilize the booking with another client and the container will take a couple of weeks before being able to move. Gone are the days of canceling a booking without consequences. Carriers are now charging cancelation fees or worse, pulling guaranteed space from us.

  • Cargo Insurance – Now is an excellent time to double check you have Marine Cargo Insurance. We have all heard of the Ever Given….The $900M fine assessed to that vessel. Every organization with cargo on board that vessel will be paying for that and paying BEFORE the containers are released to them. If covered with the right insurance, your carrier would cover the expense. If not, you would be required to provide a cash deposit before you can recover your cargo.

Reilly International provides its employees with an environment of producing meaningful work. There is nothing more meaningful today than to protect the supply chain. No greater calling than to ensure all goods are delivered to keep manufacturers producing, services being performed and people staying employed. The Reilly Team will continue to do so with integrity and with a desire to serve our clients so they can serve their clients. We are grateful the trust you have put in us and will continue to communicate as the world continues to change.

Reilly International provides its employees with an environment of producing meaningful work. There is nothing more meaningful today than to protect the supply chain. No greater calling than to ensure all goods are delivered to keep manufacturers producing, services being performed and people staying employed. The Reilly Team will continue to do so with integrity and with a desire to serve our clients so they can serve their clients. We are grateful the trust you have put in us and will continue to communicate as the world continues to change.