CHAPTER 4
Distribution Blunders GETTING IT THERE
IN
O N E P I E C E —B U T T H E N
WHAT?
I happened to interview a senior executive of a manufacturer based in the US Midwest. Just a few months before, his company had a major international deal—one of its first—fall through because a container-load of its high-value machine parts was smashed to a pulp while being off-loaded from a ship in a Southeast Asian port. Getting the container to the Port of Oakland for transshipment to its final destination was easy: the company’s logistics management provider had made sure the documentation was in order and had planned that the container would arrive in the San Francisco Bay area with a minimum amount of lag time before it would be loaded aboard the ship. Transportation time of 12 days would get the container to its transit port. There it would be off-loaded and moved via a smaller, feeder-type cargo ship to its destination port. A truck would then shift the container to a warehouse to await final disposition by the buyer—a manufacturer of plastic consumer goods. But, alas, it wasn’t meant to be. Some of the container-handling equipment in use at the transit port was in a serious disrepair, and poorly trained workers (filling in for striking regulars) had to make do with improvised chain slings to unload the boxes off the ship. The improperly positioned sling slipped— dropping the container and its US$1.1 million cargo 60 feet onto the dock. “I was told the sound it made when it hit the dock was really something,” the president of the US company said wistfully. “What was salvageable could have fit into a suitcase.” Sure, he said, most of the loss was covered by the insurance the freight forwarder had insisted his company purchase. But the deal was squelched: the customer, in desperate need of equipment to meet his own production schedules, went to a European company for the machine tools. Fortunately, the incident didn’t turn the company off to expanding globally. Nevertheless, the affair teaches some serious lessons. “Getting the goods to market is just as important an element of success as the design of your product or its suitability for the global market you want to penetrate,” the executive told me. “You can design the best, most attractive product in the world, but if you don’t get it where it needs to be, when it needs to be there, you’re dead. If we’d paid a little more attention to the process, we could have done it differently.”
SEVERAL YEARS AGO,
75
