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Flexport CEO on how to fix the US supply chain crisis

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Re: Flexport CEO on how to fix the US supply chain crisis

#191

Post by alex_young »

The basic problem is the increase in e-commerce.

Since more goods are being shipped to people on a one off basis, there is more demand for all of the resources needed to do this, from boats, to containers, to warehouses.

When you start to see slow-downs in international shipping, there become large incentives to do silly things, like stockpile supply in warehouses, so all of the warehouses fill up, and then all of the container yards fill up, and then all of the container ships have to wait, exacerbating the problem.

On top of all of this, there is a huge shortage of truck drivers, because it sucks to drive a truck for a living.

What can we do about all of this? Expand the number of containers we can store? Seems like an unlikely fix. If you have a clogged pipe, expanding the size of the funnel feeding it doesn't solve the problem.

Why not put a price on the clog itself? If it cost an exponential rate to store containers full of stuff at ports I think the stockpiling would quickly subside, wouldn't it?

Re: Flexport CEO on how to fix the US supply chain crisis

#194

Post by sushsjsuauahab »

dragonwriter wrote: post #149
sushsjsuauahab wrote: post #148

Earlier quoted context omitted.

One source for this claim is that the President has declared that operations at the port should become 24 hours per day, 7 days per week. If the original output was acceptable, he wouldn't have had to do that.

That “source” does not support the claim that customs is the bottleneck, it supports the claim that port operations in their totality are the bottleneck.

While that is a fair criticism, I would like to ask you this: why are there so few ports in the USA? https://en.m.wikipedia.org/wiki/List_of_ports_in_the_United_...

The answer to this question is that merely possessing coastal land is not a sufficient enough condition to open a port-- rather various levels of government are involved in creating and regulating an official "port of entry" to the United States.

Otherwise, you would have people bringing in nuclear bombs in the cover of darkness at a port that doesn't have government agents operating at it, no?

If we had more ports, we would have less bottlenecks. But we can't have more ports, because of inefficient operations.

Re: Flexport CEO on how to fix the US supply chain crisis

#195

Post by dzhiurgis »

LurkingPenguin wrote: post #26
kmlx wrote: post #22

Earlier quoted context omitted.

weird. i don’t know anyone who has had a good experience, or who prefers american made products. cars, food, fashion etc. they represent bad taste and poor quality. i thought this was known globally. like how germans are technical. one of those things that are part truth, part myth. where i come from if someone wants great quality we buy european, japanese or chinese products. whenever i travel to different continent…

I have had exposure to industrial equipment sales in Asia, Latin America and the Mideast. American-made equipment generally has an excellent reputation. Cost, however, is often an issue. It would be helpful if you were more specific. Where do you come from? What types of products are you talking about?

I share same sentiment on consumer goods, especially cars.

Your experience with industrial equipment is irrelevant here since it's still being done in US.

Re: Flexport CEO on how to fix the US supply chain crisis

#196

Post by dzhiurgis »

LurkingPenguin wrote: post #25
kmlx wrote: post #20

Earlier quoted context omitted.

i am very careful. i prefer any other nations products. japan, china, almost any country in europe, lots in south america. but the US has constantly disappointed. and not only recently, but throughout the decades.

Can you name Chinese products (made in China by and for Chinese companies -- not American or European companies) that you consider to be of high quality? Same for South America. And what American products have "constantly" disappointed you?

Huawei and Xiaomi comes to mind. Build is not Apple quality, but technically superior (I say that as I own pretty much every Apple product)

Re: Flexport CEO on how to fix the US supply chain crisis

#197

Post by drak0n1c »

ta988 wrote: post #176
thephyber wrote: post #145

Earlier quoted context omitted.

I’ve also heard that ships are rushing back to Asia to chase high profits after unloading at US ports before they allow empty containers on the ship. I think we have mismatched incentives that allow something like Tragedy of the Commons.

There are some systems that don't have a capacity for self-regulation, and this is not solved by believing really hard that if left alone they would. This will need intervention if we don't want to just burn money to let time solve it.

Given that the described root cause is city port regulations and zoning ordinances, I don't see how such a deeply regulated and forcefully handicapped system is an argument against self-regulation. If anything, the opposite. Yes, the current mess of conflicting piecemeal regulations and dissonant incentives will need additional state intervention and reform to untangle ASAP - but that does not rule out the possibility of a future unencumbered self-regulated alternative potentially working better than the current route of incrementally adding context/dynamism-aware patches to the heavily and archaically regulated status quo.

Re: Flexport CEO on how to fix the US supply chain crisis

#198

Post by native_samples »

jeffbee wrote: post #173
shusson wrote: post #162

Stupid question, why isn’t simple capitalism working on the port? This solution while admirable, reminds me of the USSR trying to set the price of bread.

Simple capitalism is what causes the problem. The capitalist looks at all the buffers and safeguards and regulation of a system and thinks that could all be thrown out for higher profits. That appears to work, until it stops working. It is the same reason Texas has cheap electricity until suddenly without warning they have no electricity. Planning and regulation and bureaucracy prevent these problems, at the cost of…

The explanation in the Twitter thread is the opposite: capitalism isn't working because of zoning regulations.

Re: Flexport CEO on how to fix the US supply chain crisis

#199

Post by chmod775 »

AnimalMuppet wrote: post #66
chmod775 wrote: post #48

Earlier quoted context omitted.

Railroads are literally a textbook example of a natural monopoly. In fact they're typically somewhere near the top of the list in any textbook.

For any particular industrial customer? OK. For a medium-sized town? Maybe. For hauling containers from LA to Dallas, or even from LA to an air force base 100 miles away. in a world where interstate highways exist? No.

> For hauling containers from LA to Dallas, or even from LA to an air force base 100 miles away. in a world where interstate highways exist? No.

Moving the same amount of containers that a train can carry from LA to Dallas with trucks will require you to pay for than more 200 truck drivers/trucks for a 2 day journey. The cost compared to using a train will be ridiculous. And that's only if you're lucky. Due to trucks being able to carry much less weight, you may need to up that number (and split the contents of containers) or switch to heavy transport vehicles.

In fact you've got that reversed. The costs for moving that stuff to an air force base 100 miles away will be much closer. You usually need some trucks to go the last miles anyways, and the logistics involved in loading/unloading a train is going to make it less efficient compared to the longer journey.

Re: Flexport CEO on how to fix the US supply chain crisis

#200

Post by thesimp »

graton wrote: post #60

Related: The mayor of Long Beach has increased the stacking limit. https://mobile.twitter.com/RobertGarcia/status/1451679404757...

Wait what? They are/were only stacking 2 containers high? When I google on how another big port is doing it, or example Rotterdam, I get a 5 year old video of 5 high stacks and a fully automated system: https://www.youtube.com/watch?v=60Fz5gZRX9c.

What's going on in Long Beach?

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