International Warehouse Group Looks to Benefit from new Trade Zone
With the potential expansion of Suffolk County’s current Foreign Trade Zone (FTZ), International Warehouse Group (IWG) is anxiously anticipating increased opportunities for trade. At an April 26th press conference at IWG headquarters, Senator Kirsten Gillibrand, a member of President Obama’s Export Council, announced her official request to expand the current zone, as outlined in a letter that she wrote to Under Secretary for International Trade, Francisco Sanchez.
Currently housed in two buildings occupying approximately 250,000 square feet of space in Melville, New York, International Warehouse Group is one of America’s foremost warehousing and distribution businesses. The current FTZ location is on the Islip Grounds of the Islip Airport. International Warehouse Group is one of the first companies to apply for this designation to expand the FTZ to their Melville location. With the possibility of FTZ expansion on the horizon, IWG CEO Jeffrey Heydt is optimistic about not only an increase in trade-related jobs in Long Island, but for the expansion of IWG itself.
"This will allow International Warehouse Group to grow, hire additional employees and expand to future locations on Long Island," says Heydt. "Our goal is to bring additional tax revenues and dollars back to Long Island."
Originally designated as a Foreign Trade Zone in 1980, this area of Suffolk County has seen a substantial increase in employment and income, and has significantly contributed to Long Island’s continued upward mobility in imports and exports. Currently, Suffolk County contributes 8.4% of New York State’s exports value of $11 billion.
The proposed expansion from a Traditional Site Framework to an Alternative Site Framework would result in more businesses being able to tap into the many benefits of being part of an FTZ, including reduced duties on imported products and assembly and a reduced duty on products that are re-exported. This will allow companies to import products which will allow the assembly of the components under the FTZ in the proposed facility area, which would result in savings on duties and tariffs on the assembled components. Senator Gillibrand also requested the delay of the five-year sunset for the FTZ, allowing businesses like IWG to continue transforming the FTZ benefits into more jobs and greater income for Long Islanders for years to come.
"I would like to thank Senator Gillibrand and Suffolk County Executive Steven Ballone for their push for Suffolk County's restructuring,” concludes Heydt. “This restricting will allow Suffolk businesses, including my own, to access this program in an expedited way and bring with it quicker savings. Saving money with hopes of bringing manufacturing back to Long Island is a win win."
FedEx is Reshaping Last Mile with Autonomous Vehicles
FedEx is embarking on an expanded test of autonomous, driver-less delivery vehicles to develop its last-mile logistics.
The US logistics firm piloted autonomous vehicles from Nuro in April this year, and the pair will now explore that further in a multi-year partnership. Cosimo Leipold, Nuro’s head of partnerships, said the collaboration "will enable innovative, industry-first product offerings that will better everyday life and help make communities safer and greener".
FedEx will explore a variety of on-road use cases for the autonomous fleet, including multi-stop and appointment-based deliveries, going beyond more traditional applications of the technology in single-route movement of goods from A-B. Exponential growth in ecommerce is spurring its broader experimentation in new autonomy solutions, Fed-Ex says, both in-warehouse and on-road.
“FedEx was built on innovation, and it continues to be an integral part of our culture and business strategy,” said Rebecca Yeung, Vice President, Advanced Technology and Innovation, FedEx Corporation. “We are excited to collaborate with an industry leader like Nuro as we continue to explore the use of autonomous technologies within our operations.”
The changing role of couriers
Unlike structured delivery networks, operating under long-term partnerships and contracts, agility is where couriers deliver true value - and their ability to deftly solve last-mile fulfilment has most acutely been felt during the pandemic. For the billions of people around the world forced to stay at home to protect themselves and their communities from the spreading COVID-19 virus, couriers have been a constant. They may have been the only knock at the door some people experienced for weeks or months at a time.
But the last-mile has been uprooted by a boom in ecommerce, a shift that has been most apparent in the UK, US, China and Japan, according to the Global Parcel Delivery Market Insight Report 2021 by Apex Insight. These are markets with dominant economies and populations used to running their lives with a tap of a screen or double-click of a mouse.
“Getting last mile delivery right has long been a challenge for retailers,” says Kees Jacobs, Vice President, Consumer Goods and Retail at Capgemini. “In 2019, 97% of retail organisations felt their last-mile delivery models were not sustainable for full-scale implementation across all locations. Despite increasing demand from customers, companies were struggling to make the last mile profitable and efficient.”
Jacobs says that the pandemic alleviated some of these stresses in the short term. With no other option, consumers were understanding and tolerant, if not entirely happy, with longer delivery times and less transparent tracking. “But, as extremely high delivery demand continues to be normal, customers will expect brands to contract their delivery times,” he adds.
Last mile's role in ESG
Demand and volume weren’t the only things that have changed during the pandemic - businesses looked closer to home and as a result became more sustainable. Bricks and mortar stores were transformed from mini-showrooms to quasi-fulfilment centres. Online retailers and other businesses sought local solutions to ship more faster. In densely populated London, UK alone, Accenture found that delivery van emissions dropped by 17%, while Chicago, USA and Sydney, Australia saw similar emissions savings.