May 17, 2020

UPS expands four North American distribution facilities

UPS
North American logistics
Admin
2 min
The service combines UPS shipping with insurance for high-value goods in an all-in-one, simple solution
Follow @SamJermy and @SupplyChainD on Twitter.UPS has announced the addition of three buildings and the expansion of another in four North American loca...

Follow @SamJermy and @SupplyChainD on Twitter.

 

UPS has announced the addition of three buildings and the expansion of another in four North American locations, boosting its supply chain solutions network size by nearly 1.2 million square feet.

 

Rapid growth of customers in the high-tech, industrial manufacturing and retail industries fuelled the demand for new or expanded facilities in Mira Loma, California; Hebron, Kentucky; Louisville, Kentucky; and Toronto, Ontario, Canada.

This marks the second time in 2014 that both the Mira Loma and Hebron campuses has increased in size.

Stephen Hydrick, Vice President of North American distribution at UPS, said: "These investments are needed to not only support our existing customers and their growth but to also create capacity to support our new business expansion. As our customers grow, we will continue to find and invest in solutions."

UPS's global supply chain solutions network includes 596 facilities and nearly 32.8 million square feet. Services and capabilities offered at UPS supply chain facilities include: warehousing and fulfilment; inventory, transportation and returns management; custom kitting and packaging; and store-ready displays. These modern facilities are critical for customers as 99 percent of the US population is within a two-day time-in-transit of inventory.


After increasing the southern California campus by 309,000 square foot in April, this building added an additional 228,000 square foot. The campus is one hour from the two largest seaports in the US. It is also just five minutes from LA/Ontario Airport, a UPS regional air hub, within eight miles of four major freeways, and just 15 minutes to transcontinental rail connections. Total campus size of Mira Loma now includes 1.6 million square feet.
The Hebron campus, considered a key logistics operation serving the retail industry, has access to 62 percent of the US population within two days via UPS Ground and 64 percent using UPS Freight. The campus, which increased in size by 151,000 square foot. in April, added an additional 274,000 square foot with this investment. The campus is minutes from the Greater Cincinnati Airport and is within 600 miles of 30 major metropolitan markets. Total Hebron campus size now includes 1.25 million square feet.
This Shepherdsville, Kentucky location increased by 606,000 square foot. The building is located within 20 minutes of Louisville-based UPS Worldport, the largest fully automated package handling facility in the world. Total supply chain solutions size in the Louisville area is now 4.4 million square feet.
The expansion added 62,000 square foot to the Toronto facility, which is located less than 10 minutes from Toronto's Pearson International Airport. Total size in the greater Toronto area is now 2 million square feet.

 

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Jun 19, 2021

Driver shortages: Why the industry needs to be worried

Logistics
SCALA
supplychain
Brexit
Rob Wright, Executive Director...
4 min
Logistics professionals need urgent solutions to a shortage in drivers caused by a perfect storm of Brexit, COVID-19 and compounding economic factors

While driver shortages are a global problem, with a recent survey from the International Road Transport Union suggesting that driver shortages are expected to increase by 25% year-on-year across its 23 member countries, the issue has very much made itself felt for UK businesses in recent weeks. 

A perfect storm of factors, which many within the industry have been wary of, and warning about, for months, have led to a situation wherein businesses are suddenly facing significant difficulties around transporting goods to shelves on time, as well as inflated operating costs for doing so. 

What’s more, the public may also see price rises as a result due to demand outmatching supply for certain product lines, which in turn brings with it the risk of customer dissatisfaction and a hit to brand and stakeholder reputation. Given that this price inflation has been speculated to hit in October, when the extended grace period on Brexit customs checks comes to an end, the worst may be yet to come.

"Steps must be taken to make a career in the industry a more attractive proposition for younger drivers, which will require a joint effort from government, industry bodies, and the sector as a whole"


That said, we have already been hearing reports of service interruption due to lack of driver availability, meaning that volumes aren’t being transported, or delivered, to required schedules and lead times. A real-world example of this occurred on the weekend of 4-6 June with convenience retailer Nisa, with deliveries to Nisa outlets across the UK affected by driver shortages to its logistics provider DHL.

But where has this skills shortage stemmed from? 

Supply is the primary issue. Specifically, the number of available EU drivers has decreased by up to 15,000 drivers due to Brexit alone, and this has been further exacerbated by drivers returning to their home country during the COVID-19 pandemic, as well as changes to foreign exchange rates making UK a less desirable place to live and work. This, alongside the recent need to manage IR35 tax changes, has also led to significant inflation in driver and transport costs.

COVID-19 complications have also meant that there have been no HGV driver tests over the past year, meaning the expected 6,000-7,000 new drivers over the past year have not appeared. With the return of the hospitality sector we understand that this is a significant challenge with, for instance, order delivery lead times being extended.

It is little surprise, therefore, that the Road Haulage Association (RHA) earlier this month became the latest in a long line of industry spokespeople to write to the government about the driver shortage for trucks. The letter echoed the view held by much of the industry, that the cause of this issue is both multi-faceted and, at least in some aspects, long-standing. 

So, many in the industry are in agreement as to the driving factors behind this crisis. But what can be done? 

Simply enough, outside of businesses completely reorganising their supply chain network, external support is needed. In the short-term, the government should consider providing the industry with financial aid, and this can also be supported more widely with legislative change. 

Specifically, immigration policy could be updated to place drivers on the shortage occupations list, which would go some way towards easing the burden created by foreign drivers returning to their home countries. Looking elsewhere, government should also look for ways to increase the availability of HGV driver tests after the blockage created by the coronavirus lockdowns.

Looking more long-term, steps must be taken to make a career in the industry a more attractive proposition for younger drivers, which will require a joint effort from government, industry bodies, and the sector as a whole. As it stands, multiple sources suggest that the average age of truck drivers in the UK is 48, with only one in every hundred drivers under the age of 25. We must therefore do more to increase the talent pipeline coming into the industry if we are to offset more significant skills shortages further down the line. 

On the back of a turbulent year for the supply chain industry, it has become increasingly clear that the long-foretold shortage of drivers is now having a tangible and, in places, crippling effect on supply chains. 

Drivers, and the wider supply chain industry, have rightly been recognised for the seismic role they played in keeping the nation moving and fed over the past year under unprecedented strain. If this level of service is to continue, we must now see Government answer calls to provide the support the sector needs, and work hand-in-hand with the industry to find a solution. If we do not see concrete action to this effect soon, we are likely to be in for a turbulent few months. 
 

Rob Wright is executive director at SCALA, a leading provider of management services for the supply chain and logistics sector

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