As much of the East Coast seeks to recover from the devastation of Hurricane Sandy, the storm’s wake could have a significant impact on inbound freight as Black Friday looms less than a month away.
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Jeff Kline, president of Kline Management Consulting, said in an email that given the amount of inventory stored in the New York-New Jersey area for distribution in the Northeast, “it is very possible that we could find product shortages for the upcoming holiday season. In particular, reorders of ‘hot’ products could be adversely impacted.”’
Initial holiday orders for both B2C and B2B companies should already be in-house, Kline said. “The impact will be on re-orders.”
According to transportation service provider YRC Worldwide, its two major distribution centers in the Northeast are congested with the inbound traffic that has been arriving for the past 12 hours.
“All terminals are open and fully operational in the New England area,” YRC Worldwide’s notice said. “All terminals NOT in the New York City and New Jersey metro are open to some degree. Some are still without power, and there are areas in their service territory that we will not be able to make pickups or deliveries due to damage from the storm.”
According to YRC Worldwide, its four facilities in Pennsylvania are operating with limited manpower. But its New York and New Jersey facilites are closed.
Tom Stanton, International analyst with AFMS Logistics Management Group, said one of his company’s East Coast customers — an importer of auto accessories – had several containers that were not delivered to the port of New York on Monday and were moved to a “safe harbor.” That vessel, Stanton said, has not docked yet but is expected to end up in Norfolk, VA.
If imported through Norfolk, VA, Stanton said delivery of these containers will be further complicated by snow in the area. This company also had two containers on the dock in New York when the storm hit and therefore they are not sure whether they have too much water damage to receive and use the material in those containers.
Due to the damage at New York and Elizabeth, NJ ports, Stanton said, the company is considering delivery options for the next month to shift to Norfolk, VA, assuming they will be able to receive the containers now on the move from China.
Shippers should be concerned about the disruption of flights for overnight and second-day service for the major parcel carriers. Newark Airport reopened today with a limited flight schedule.
Chris Merritt, vice president of retail, supply chain solutions for Ryder System, said in email that the port of New York/New Jersey is the No. 2 port in the U.S. “Although I have not heard of any specific damage at the port, having managed through hurricanes in Florida, getting employees to work when they have their own personal emergencies is difficult. I would expect the port to be well below capacity for one to two weeks.”
Being this close to Black Friday, Merritt added, could lead retailers who source from Europe with out-of-stock situations.
“It will affect their business if they have advertising queued up and won’t have the items in time,” Merritt said. “Right now is the toughest time because you don’t know how long it will take to clear the port and transport through the distribution center and into the store.”
Gerard Hempstead, president of Hempstead Consulting, said in an email that the primary issue will be getting freight down the supply chain to delivery drivers in the hardest hit areas of Connecticut, New York, New Jersey and Pennsylvania.
“The biggest days for B2C shipping lie ahead of us, with enough cushion that by the time Black Friday is upon us most of the storm disruption will be behind us,” Hempstead said.