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    D e c e m b e r 2 0 0 8

    A Penton Media Publication outsourced-logistics.com

    Look out for 2009Its going to be tough

    Also in this issue:

    Trade Routes:

    Carriers go east

    Do we need another supply

    chain application?

    Elections have consequences

    http://outsourced-logistics.com/http://outsourced-logistics.com/
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    agilitylogistics.com

    Troy HammondRetail Branch Manager

    Agility, Seattle

    TOYSRUS HAS TROY HAMMOND. The next-genvideo game revolution of 2006 sent product demand to an all-time high

    and put trusted retailer, ToysRUs, to the ultimate test. The number of new

    systems Agilitys Troy Hammond was handling broke records for Agilitys

    13-year-old Direct-to-Store program. To secure the necessary courier lift,

    trucking support, and temporary labor for the fast-moving products, Troys

    team managed a multiple-carrier program. By systematically processing

    allocations on a store-by-store basis, Troy kept ToysRUs shelves stocked

    and gamers stoked.TOYSRUS HAS AGILITY.

    http://agilitylogistics.com/http://agilitylogistics.com/
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    Theres a phrase making the rounds in conference

    presentations and the media which logistics profes-

    sionals need to ban from their vocabulary. We must

    help the general business public understand reverse glo-

    balization is a faulty concept or, at least, a misnomer.

    If you must persist, you might substitute commercial

    agoraphobia (a little redundant since agoraphobia literally

    translates to fear of the marketplace). Or, try isolationism

    or protectionist.Or, just scrap the economic theories of the last 232

    years. Thats when Adam Smith described the supply

    chain. Smiths global view was primarily geared to com-

    modities that were not available locally and thus had to be

    transported great distances.

    He described, in An Inquiry Into the Nature and

    Causes of the Wealth of Na-

    tions, the role of the

    supply chain in pro-

    ducing the woolen

    coat on the back

    of a common

    day laborer as

    extending from

    the shepherd

    to the sorter of

    the wool, the

    wool comber or

    carder, dyer,

    s c r i b -

    bler,

    spinner, weaver, fuller and dresser. Then he noted a num-

    ber of merchants and carriers are involved in the transport

    of the goods between these functions. He posed the ques-

    tion, how much commerce and navigation and, by exten-

    sion, ship builders, sailors, sail makers and rope makers

    were involved in bringing the materials to the dyer so he

    could complete his job? What about the tools and com-

    modities used by the others?

    Smith described what we have retitled lean manufac-

    turing. In large-scale production, Smith saw a division of

    labor necessary to complete the tasks that could not feasi-bly or economically be done by a single worker or a single

    set of skills or tools. In those great manufactures . . . which

    are destined to supply the great wants of the great body of

    the people, every different branch of the work employs so

    great a number of workmen, that it is impossible to collect

    them all into the same workhouse.

    His view of mass production describes multiple work-

    shops and implies outsourcingbut a more narrow form

    than todays standard because the economics of producing

    manufactured goods did not support separating those

    different production and assembly steps by any great dis-

    tance.

    Smith recognized a number of supply chains come

    together in the production of even a simple product like a

    woolen coat. He described a division of labor which, with

    fast, efficient and inexpensive transport does not require

    every task to be performed locally. He also knew that the

    total landed cost would determine the nature and struc-

    ture of those various supply chains.

    This difficult economy certainly requires a reexamina-

    tion of how we produce and distribute goods and it will

    lead to reengineering supply chains. But as we go through

    those network optimization exercises to bring sourcecloser to production or production closer to market, call it

    that: supply chain reengineering, network optimization or

    even near sourcing. But dont call it reverse globalization

    unless you want to go back to the hunter-gatherer days of

    our distant ancestors.

    Editorial

    Reverse Thinking

    Perry A. Trunick, chief editor,perry.trunick@penton.com

    Outsourced Logistics |December 2008 | 1

    mailto:perry.trunick@penton.commailto:perry.trunick@penton.com
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    6Global Markets

    REACH, The EU's Chemical Reaction

    Community VoiceIt's back to the basics

    of fulfilling customer demand

    14Operations

    The Post Office Looks for Better Returns

    Community VoiceAchieving a Demand-Driven Supply Chain

    34Logistics Services

    China Carries a Torch for Logistics

    Community VoiceElections Have Consequences

    Features

    22Operations

    Look Out or 2009

    Warnings abound concerning the near-termoutlook for the global economy.

    26Global MarketsThe Changing Map o the World'sTrade Routes

    As dynamics of global supply chainsmove to meet ever evolving economic

    currents, carriers reconfigure the placesand ways in which they respond to theirown and shipper needs.

    30Field Report

    Does the World Need Another SupplyChain Application?

    AMR Research has stated the problem,"Brand owners need better visibility intoand control of the outsourced supplynetworks, but current technology optionsare not up to the task."

    403PL FileRyder

    Departments

    1 EditorialReverse Thinking

    38 Classifeds

    Advertiser Index

    Decembe r 2008 Vo lume 1, Number 7

    2 | December 2008 | Outsourced Logistics

    24

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    STAYING ON TRACK

    AND ON TIME

    DOESNT FLY SOLOAT PILOT.

    Thats why they selected CRST Van

    Expedited for reliable ground support,

    and why they have presented us with

    their Carrier of the Yearaward. We

    share their dedication to providing

    customers with unparalleled logistics

    solutions. Responsive, on-time delivery

    at a fair price qualities that keep Pilot

    Freight Services counting on us as a

    trusted partner. And the same award

    winning qualities youll receive when you

    contact us at www.crstvanex.com

    http://www.crstvanex.com/http://www.crstvanex.com/
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    Have you

    heard?

    Outsourced-Logistics.com

    is more than just a

    companion site to the

    magazine. It is the online

    logistics daily, providing

    news, decision-making tools

    and information resources

    for logistics professionals.

    Daily News Featureson the industry

    White Papers

    Webcasts

    Current and PastIssues

    Forums/Rateem & Rankem

    Outsourced Logistics (ISSN 1547-1438) is published monthly by Penton Media, Inc.,9800 Metcalf Ave., Overland Park, KS 66212-2216.

    The magazine is sent to qualified management in the field of logistics.Periodicals postage paid at Shawnee Mission, KS and at additional mailing offices.

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    Editorial

    Publishing DirectorDavid H. ColbyeMedia Market Development ManagerJason Washburn

    Circulation ManagerTyler MotsingerProduction Coordinator Rachel KlikaCustom Media GroupTerrence Grogan

    Bob MacArthur Senior VP Industrial Group

    Chief Executive Officer Sharon RowlandsSharon.Rowlands@penton.com

    Chief Financial Officer Jean B. CliftonJean.Clifton@penton.com

    1300 E. 9th StreetCleveland, OH 44114-1503

    216.696.7000 216.696.2737 faxwww.outsourced-logistics.com

    249 W. 17th St., New York, N.Y., 10011212-204-4200

    Chief Editor

    Perry A. Trunick

    Senior Editor

    Roger Morton

    Professional ContributorsJames A. CalderwoodDesign

    Art DirectorBill Szilagyi

    Business

    EASTERN REGIONJim Oot, Phone: 973-335-8902, Fax: 973-335-8903, jim.oot@penton.com

    WESTERN REGIONKeith Taunton, Phone: 334-514-8107, Fax: 334-514-9377, keith.taunton@penton.com

    FLORIDABob Eck, Phone: 352-391-5577, bob.eck@penton.com