Good News, Bad News at America’s West Coast Ports

Good News, Bad News at America’s West Coast Ports

After more than nine months of negotiations, the International Longshore & Warehouse Union and the Pacific Maritime Association reached an agreement last week to get back to work at the major ports of the U.S. West Coast.

The complete shutdown negatively impacted retailers and manufacturers, not just throughout the U.S., but across the entire NAFTA region. Some estimates show the closures cost between 1 to 2 billion dollars a day. Aside from impacting jobs throughout the country, the shutdown created a negative image with our trading partners—one reflecting the U.S. West Coast ports as an unreliable point of entry. This may have a long-term impact if the trend of routing shipments to other ports on the East Coast or in Canada becomes commonplace.

The most recent dispute highlights the risks a business faces when sourcing products overseas.The delays in shipments caused on-time delivery of goods to market to become an impossible feat, and caused in-house productivity slowdowns. Many U.S. businesses had to absorb costly air freight shipping in an effort to deliver products, further eroding profitably.made_in_usa

Resuming work at the ports is, of course, a positive start—but the residue of the last nine months remains, even as American businesses get back to working with global trading partners. It may take upwards of 12 weeks to clear the backlog caused by the shutdown. Will shipping to America’s West Coast ports continue to be an unreliable option?

Logistics is playing an ever more important role in strategic sourcing decisions. America boasts an excellent rail and ground transportation network, allowing for an easy and economical flow of goods. This reveals one way U.S. businesses can bypass damaging port shutdowns—by making the smart choice to buy Made in the U.S.A.