Supply Chain Brain - October/November 2011

sees value in it.”
Postponement, expedited services,
bundling—these are just some of the things
one needs to remain competitive. Failing
that, says Gifford, a company will become
a tier-two or tier-three provider at best.

3PLs and the Role of
Government

From large to small, logistics services
providers should be concerned about
the impact legislation will have on
them, says John E. Wagner Jr., presi-
dent of Wagner Industries. Whether
working through their own legal
staffs or industry advocacy groups,
3PLs must be aware of such things as
the Food Safety Modernization Act
and laws affecting pensions, union
activity, drivers’ hours and many
other areas.

This family owned business is typical of
companies that don’t have their own lobby-
ists and in-house legal experts, Wagner says,
but which have needs very similar to the
largest players in terms of understanding and
dealing with government regulation.
Wagner Industries is involved through its
trade group, the IWLA, which has an active
governmental affairs committee. Of course,
Wagner and others like him also fly into
Washington from time to time to speak with
their representatives.
Much of what’s involved is education,
making sure legislators understand what the
supply chain is and what carriers, warehouse
operators and 3PLs do.
He says when the food safety act was being considered, it was
vitally important to make Congress understand that the role of the
warehouse industry is different from that of manufacturers. As a
consequence, the industry gained some concessions that reflect
that reality.
“They tend to think in terms of ‘Are you a trucking company, a
railroad or a public warehouse,’” Wagner says. “They just don’t
understand the roles of each. When you speak of logistics and
blending these various competencies within a single company, it
becomes very confusing for them.”
Site visits and tours are good tools as well. “They can see what
you are doing. It’s a total education process.”
Wagner says the impression many smaller 3PLs have is that all
rule-making will simply increase costs whether the legislation is
justified or not. “That makes it hard to plan your future supply
chain because of the uncertainty.” Yet you can’t just throw your
hands up and walk away, he says. “At the end of the day legisla-
tors will hear from taxing authorities and labor and others, so if
you don’t speak up you will be left outside and angry.”

The Importance of Marine Highways
to Cargo Transportation

The U.S. has more than 25,000 miles of coastal and inland
water highways, yet only 2 percent of all cargo is moved on
them, says Mark Yonge, vice chairman of the Marine High-
ways Cooperative. But in the next several years, he sees
more shippers realizing that these waterways are the inter-
modal transportation alternative for the future.
Forty to 60 percent of all European cargo moves on so-called