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West Coast Port Strike Update


As a follow up to my previous blog post on the potential port strike, I wanted to provide an update of the situation. It’s after June 30, and yet no deal has been reached. The current contract has been extended briefly, until July 11 2014. There has been minor disruption at the port, but enough to get people thinking about alternate options. Cargo will continue to move and operations will carry on at the port until an agreement can be reached through these disruptions. Both sides understand the strategic importance of the port to local, regional, and U.S. economy. While this doesn’t rule out the possibility of a strike, the likelihood of one will always be there.

Last week, I was on CNBC’s Power Lunch discussing this issue. In case you missed it, you can view it here.

The impact of a strike would have a multi-billion dollar impact on the still fragile U.S. economy. A strike lasting only five days could impact the GDP by an average of 1.9 billion dollars. For retailers, already lean inventory levels could lead to empty shelves. Last but not least, the carrier community has filed a congestion surcharge if there is a labor disruption, which could potentially cause prices rise as the additional cost is passed to end users.

Supply chains can face a variety of disruptions—from port strikes to harsh weather —that make it increasingly important to work closely with your provider. Not every disruption can be prevented or avoided, but the right preparation can help minimize the impact on your supply chain.