Matson Logistics Expedited LCL Service Fills Transpacific Void

Due to ongoing congestion at U.S. West Coast ports, demand for LCL services from Asia is ramping up, say industry analysts. The surge in e-commerce is further fueling growth.

But just as nature abhors a void, one innovative supply chain player is finding an opportunity in the Transpacific.

Matson Logistics Expedited LCL Service has come up with a consistent and reliable alternative solution to this demand, while it represents an alternative to expensive and unpredictable airfreight.

The service is much faster than conventional ocean LCL services, and significantly less expensive than direct or deferred airfreight.
It combines the reach of their network throughout China with ocean service from Shanghai to Southern California, and 50-state delivery coverage in a single-source solution.

Weekly, dedicated service from 13 different origin points to 10 different U.S. Metro areas and on demand delivery to any commercial address in the U.S.
Mike Johnson, Vice President of Supply Chain, added details of this service in an exclusive SCMR interview.

Supply Chain Management Review: Why has the LCL issue become such a crisis in recent months?

Mike Johnson: We have seen a significant increase in our LCL volumes over the past several months. (Since we are a niche player in the trans-Pacific LCL market, I can only speak to our business.)

We offer a specialized service in the market for customers that need weekly service and day-definite delivery. It’s the fastest LCL service from China to Southern California, with a 10-day transit and 11-day availability in Long Beach. The demand for our expedited LCL solution has been quite strong over the past several months as congestion has increased at West Coast ports and container capacity is in high demand.

Expedited LCL is twice as fast as standard ocean, and an alternative to deferred air freight at a fraction of the cost.
There is a continued need for fast and reliable expedited LCL service to fulfill retail and e-commerce product demand, and restock inventory that has been depleted across many consumer and manufacturing sectors.

A large portion of our customer base depends on the service and dedicates a larger portion of its PO product quantity to satisfy retail delivery requirements. Customers also gap our service against air freight and take advantage of the cost savings accordingly.

Because we offer direct delivery to just about any commercial address in the U.S., a customer can schedule shipments direct to their stores, or to its customer’s locations. This eliminates the need for deconsolidation, storage, and rehandling at a distribution center. It helps to fulfill ongoing product demand by “pulsing” the shipments with weekly deliveries.

Expedited LCL can also help manage elevated or unexpected demand in a certain part of the country. For example, if a style of shoe is extremely popular in New York City, a dedicated shipment of those shoes can ship from the China factory and be at the New York retailer within 15 days.

SCMR: Will this be an ongoing trend for the future?

Johnson: We anticipate this trend to continue through the traditional peak shipping season and on into the fourth quarter of 2021.

SCMR: Which commodities are feeling the greatest impact?

Jonson: Throughout the first few months of this year we have seen several importers taking advantage of this service with a variety of commodities ranging from apparel, accessories, footwear, toys, sporting goods, home goods, costume jewelry, watches, e-goods, etc.
Each week’s vessel carries with it a variety of commodities and not one Regarding PPE shipments, we do not see as much PPE moving in our expedited service as we did in 2020.

SC
MR