Southeast Emerging as Viable Logistics Hub
The West Coast of the United States has been a primary hub for imports given its proximity to Asia. However, the ports in the region have experienced a series of significant challenges in recent years such as labor strikes, wild fires, and record-breaking container ship backlogs causing major disruption to supply chains.
The Southeast: A Rising Logistical Giant
The challenges currently experienced by 3PL companies on the West Coast have led shippers to evaluate alternative import solutions. In the meantime, state economic development groups and port authorities in the Southeast have been making substantial investments to makes sure they are well positioned for growth.
With that said, it’s no surprise more manufacturers and logistics providers are calling these states home. When you consider that within an hour or two of Sunland Logistics Solutions’ distribution and fulfillment centers in Greenville, SC there are manufacturing plants such as BMW, Michelin, and Bosch and distribution centers for major retailers such as Walmart, Walgreens, and TTI, you can see that this shift is gaining traction. This is a trend that is also in large part due to the rise of eCommerce and an increasing need for multiple fulfillment centers to be placed across the country, so orders can be shipped and delivered as quickly as possible to the customer.
COVID-19 a Catalyst in the Shift to the East Coast
The COVID-19 pandemic brought many interesting things to light. Among them, that the supply chain logistics industry was not prepared to handle the sudden influx of online purchases as a result of quarantines and lockdowns. As more people turned to online shopping instead of visiting brick and mortar stores, it created a burden for an industry that was already experiencing challenges to keep up with demand.
Online sales had been experiencing a significant surge in recent years. Since 2018, the holiday season (Thanksgiving, Cyber Monday, Christmas) online sales have seen rapidly increasing and steady growth. However, 2020 put it squarely on the map with record-breaking numbers. Mobile shopping on smartphones generated 52% of the revenue for 2020 Christmas Day sales.
In Southeast, cities like Greenville, South Carolina, Birmingham, Alabama, and Savannah, Georgia are rising up to support shippers and logistics companies to be able to meet the increased demand and help absorb the escalating volume. While the pandemic seems to be the catalyst for this sudden burst of growth and expansion in the Southeast, it is not the sole cause. This was a long time coming. Slower growth has been occurring over the past decade but was accelerated exponentially in 2020 in response to consumer behavior due to the pandemic. That growth shows no sign of stopping.
The Search for Better 3PL Solutions
In the wake of the pandemic, amid the challenges West Coast logistics companies were experiencing, many businesses began looking elsewhere for short-term 3PL solutions. The Southeastern United States quickly became one of the logical choices for shippers seeking ways to keep the flow of imports moving to minimize interruption.
The South Carolina Ports Authority (SCPA) reported a 12% increase year-over-year in 2020 in twenty-foot equivalent units (TEUs) moved at two SC container terminals. November alone saw 201,066 TEUs moved which the SCPA cites as evidence of a rebound of global trade after shutdowns nationwide due to the pandemic in early 2020.
Add to that continued growth in the state as Walmart begins building its $220 million, 3 million square foot distribution center in Ridgeville. The site was purchased by SCPA in 2018 after receiving a $22 million grant from the U.S. Department of Transportation to build infrastructure for future as well as current tenants, primarily those that are port-depending businesses. Walmart was the first tenant for the site, but most certainly not the last.
Already many companies are beginning to reevaluate their supply chain networks. Ocean Terminal in Savannah, Georgia has added more than 200,000 TEUs of new capacity. This provides direct access to US 17, linking the Port with Interstates 95 and 16 for accelerated transport to area distribution centers and inland markets.
Sunland Logistics Solutions is a Growing Third Party Logistics Provider Helping to Support Shippers Expanding in the Southeast
Sunland Logistics Solutions is taking great strides to meet the needs of port dependent businesses across the country. Based in the Southeast since 1982, Sunland Logistics Solutions has the established relationships and a new leadership team with global supply chain experience. With an expanding network of warehouses and significant investment in advanced technology, Sunland Logistics Solutions is uniquely positioned to serve as a valuable strategic 3PL partner for new and existing customers. It is expected the newfound focus on the Southeast as a logistics hub to increase as more businesses discover the exciting developments and growth of the region.
Case in point. Like South Carolina, Georgia’s Port of Savannah notched a 21.7% year-over-year upsurge in January 2021, moving 459,608 containers when compared with 377,672 in the 2020 period. The Georgia facility has set volume records for the past four months, moving more than 445,000 units on every occasion. Even with a fall in the first and second quarters of 2020, the port broke 2019’s all-time high for containers by 1.8%, processing 4,682,255 containers, compared with 4,599,172 in 2020.
The Southeast is poised to be recognized as a viable region for the supply chain and logistic industry. These facilities are able to deliver two-thirds of the U.S. 2-day ground shipping that originate from the Southeast {Sunland Logistics: Shippers Struggling with US Import Delays Look to Capacity in Southeast for Relief}. And businesses are taking notice.
To learn more about Sunland Logistics Solutions’ and how they can benefit your business, contact us today at [email protected], call 864-688-0346, or visit our website at SunlandLogisticsSolutions.com.
Sources:
https://www.dcvelocity.com/articles/49939-cargo-volume-up-at-west-coast-ports
https://www.adobe.com/content/dam/www/us/en/experience-cloud/digital-insights/pdfs/adobe_adi_holiday_recap_2020.pdf
https://edpa.org/news-item/birmingham-emerging-as-southeast-logistics-hub-with-500-new-jobs-on-the-way
https://www.inboundlogistics.com/cms/article/georgia-super-hub-of-the-southeast
https://www.freightwaves.com/news/south-carolina-ports-southeast-market-booming
