Supply Chain Insight – May 2023 – E-Commerce with Vincent Iacopella of Alba Wheels Up

Introduction

Welcome to Supply Chain Insight, where we delve into the latest trends, issues, and news in the supply chain with industry leaders, experts, and influencers. In this episode, we explore an exciting new initiative at the Port of Long Beach aimed at enhancing speed and marketability for e-commerce fulfillment.

Over the past three years, e-commerce has experienced historic growth, and this trend is expected to accelerate in the coming years. Today's business executives demand high levels of efficiency, flexibility, cost management, and operational excellence from their supply chains. As a result, the Port of Long Beach is committed to delivering greater value to its customers and partners.

We are joined by our guest Vincent Iacopella, Executive Vice President at Alba Wheels Up. Vince brings a wealth of experience, having worked across Asia Pacific managing relationships with importers and exporters for over 35 years, with a focus on trade-sensitive shipments subject to rigorous regulations.

E-commerce Trends and Market Dynamics

The e-commerce market is flourishing, driven by several key factors. Although an increase in online sales was predicted even before the pandemic, COVID-19 significantly accelerated this growth. Vince highlights the confluence of three major trends that contributed to this surge:

A regulatory change in 2016 that increased the de minimis value for cross-border e-commerce from $ 200 to $ 800.
A shift in consumer purchasing habits, moving away from brick-and-mortar stores to online shopping.
The implementation of Section 301 duties in 2017 and 2018 that imposed higher tariffs and forced businesses to reassess their approach to e-commerce shipments.

Interestingly, there has also been a shift from air freight to ocean freight for e-commerce shipments as brands sought to manage costs better. Vince points out that even post-pandemic, the e-commerce market is expected to continue its upward trajectory.

The E-commerce Supply Chain

Vince notes that e-commerce has significantly redefined the meaning of speed to market. Traditionally, shipments were sent via air, arriving directly at the customer's door. However, the pandemic prompted a migration toward ocean freight, where inventory could be arranged closer to the consumer, such as in Northern Mexico.

This shift brings unique challenges, such as congestion and delays at the port, which directly impact the ability to fulfill online orders promptly. Vince emphasizes that the expectations of consumers have evolved – they want rapid delivery, often the day after placing their orders, putting immense pressure on e-commerce supply chains.

The E-commerce Speed to Market Task Force

Recognizing the need to improve e-commerce logistics, Vince and his team at Alba Wheels Up collaborated with the Port of Long Beach to create the E-commerce Speed to Market Task Force. This initiative involved a diverse group of stakeholders, including customs brokers, truckers, and third-party logistics (3PL) providers.

The task force convened to discuss shared challenges and opportunities in the e-commerce landscape. Participants contributed vital insights on:

The need for better management of equipment and chassis pools
Extended hours of operation for terminals
Improved data sharing among stakeholders to enhance overall supply chain efficiency

The final recommendations will focus on leveraging advanced data, instituting demand-driven appointment systems, and fostering a virtual port environment. These improvements are not only crucial for e-commerce but for the broader supply chain as well.

Next Steps and Future Potential

As the findings of the task force are finalized, the focus is on implementing extended port hours, advanced data usage, and pilot programs for participating stakeholders. The long-term vision is to create an ecosystem that supports e-commerce logistics while enhancing service for all container types.

Vince emphasizes that addressing these systemic issues can significantly improve competitiveness for the Port of Long Beach. The region boasts unmatched capacity for last-mile fulfillment, making it an attractive option for brands looking to fulfill direct-to-consumer orders efficiently.

In conclusion, the initiative and recommendations born from the E-commerce Speed to Market Task Force undoubtedly arrive at a crucial time when container volumes are down. Improving speed and efficiency will be key to ensuring the Port of Long Beach thrives in a rapidly evolving e-commerce landscape.

Keywords

E-commerce
Supply chain
Port of Long Beach
Vincent Iacopella
Speed to market
Ocean freight
Task force
Advanced data
Logistics
Consumer behavior

FAQ

Q: What is the E-commerce Speed to Market Task Force?
A: It is an initiative created by the Port of Long Beach and Alba Wheels Up to enhance e-commerce logistics and identify shared challenges and opportunities among stakeholders.

Q: What are the main challenges faced by the e-commerce supply chain?
A: Challenges include port congestion, increasing consumer expectations for rapid delivery, and managing costs associated with duties and shipping.

Q: How has the pandemic affected e-commerce shipping methods?
A: There has been a shift from air freight to ocean freight for e-commerce shipments, driven by the need for cost management and logistics optimization.

Q: What recommendations have emerged from the task force?
A: Key recommendations include extending port hours, leveraging advanced data for better efficiency, and establishing demand-driven appointment systems.

Q: Why is the Port of Long Beach well-positioned for e-commerce fulfillment?
A: The Port has the capacity for last-mile fulfillment, extensive customs broker resources, and a strategic location for ongoing e-commerce operations.