2025 ILA Strike: How Shippers Can Minimize Disruptions and Costs
As the January 15, 2025 deadline for negotiations between the International Longshoremen's Association (ILA) and the United States Maritime Alliance (USMX) approaches, importers and exporters must take immediate action to protect their supply chains.
With the potential for strike, new tariff risks from the incoming administration, and the early Lunar New Year, disruptions at East and Gulf Coast ports could lead to significant consequences. Here’s how to proactively prepare, minimize risks, protect your operations, and maintain business continuity.
Analyze and Diversify Your Supply Chain
Start by identifying your vulnerabilities:
Evaluate Critical Shipments: Map all goods currently routed through East and Gulf Coast ports.
Explore Alternative Gateways: Consider routing cargo through West Coast ports or nearby Canadian and Mexican alternatives.
Work with Multiple Carriers: Diversify your shipping providers to avoid reliance on a single point of failure.
By spreading your risk across routes and providers, you’ll strengthen supply chain resilience and ensure options remain open.
Frontload Shipments Before the Deadline
Major retailers are already frontloading cargo, and with January imports projected to surge 12% year-over-year, shippers need to act fast.
Prioritize Critical Goods: Move high-priority and time-sensitive shipments ahead of January 15.
Secure Vessel Capacity Now: Booking space early helps avoid congestion as capacity tightens closer to the strike.
Plan for the Lunar New Year: With the holiday beginning on January 29, advance planning is essential to avoid additional delays.
Review and Strengthen Contracts
Being contractually prepared gives you the flexibility and confidence to manage disruptions effectively. Ensuring your legal agreements are airtight.
- Check Force Majeure Clauses: Ensure contracts include protections for delays caused by labor disputes or strikes.
- Negotiate Flexibility: Work with carriers and suppliers to allow for changes in routes and delivery schedules without penalties.
- Seek Legal Review: Consult legal experts to identify and address any gaps in current agreements.
Build Inventory Buffers
Increase Safety Stock and build buffers of 15–20% for critical goods. Secure Temporary Storage by partnering with third-party logistics providers (3PLs) to store additional inventory off-site. And also, focus on stock that has the greatest impact on operations and revenue, in other words, prioritize High-Demand Items.
Leverage Technology to Reduce D&D Fees and Optimize Container Management
Supply chain disruptions demand a data-driven approach to ensure containers are moved efficiently while avoiding unnecessary costs. Advanced tools like BlueCargo provide actionable insights to help you stay ahead.
Monitor Container Free Time:
Keep track of detention and demurrage (D&D) charges to ensure all steamship lines comply with applicable laws and rules, including the interpretive rule on D&D practices.
Effectively Mitigate Fees:
Prioritize containers based on their exposure to D&D charges by identifying which containers need to be pulled first. Understand where free time is paused to make smarter decisions.
Clear Holds on Arriving Containers:
Identify containers soon to arrive, assess any applicable holds, and resolve issues proactively to get them pulled faster and avoid delays.
Prioritize High-Exposure Containers: Focus on containers with the greatest D&D cost risk and prioritize their return or pickup to minimize charges.
Audit Accessorial Charges:
Review all fees to ensure they were necessary for moving cargo efficiently. Flag and dispute any improper or avoidable D&D bills to protect your budget.
BlueCargo's technology empowers you with visibility and control, ensuring your operations remain efficient and cost-effective during uncertain times.
Strengthen Supplier Relationships
- Engage Multiple Vendors: Diversify your supplier base to reduce dependency on a single source.
- Coordinate Timelines: Adjust production and shipping schedules to align with contingency plans.
- Build Local Options: Work with suppliers near alternative ports to reduce transit times when rerouting.
Communicate Proactively with Stakeholders
Transparency builds trust and reduces uncertainty during disruptions.
- Update Customers and Partners: Share your contingency plans and keep stakeholders informed about potential delays.
- Align Internal Teams: Ensure operations, logistics, and sales teams are on the same page regarding mitigation strategies.
- Set Clear Expectations: Proactively manage timelines and commitments to avoid surprises.
Prepare for Financial Impact
The financial implications of a strike can escalate quickly if not addressed. Start by budgeting for added costs, including detention and demurrage fees, storage expenses, and expedited shipping charges that are likely to arise during disruptions.
To control these expenses, automating freight bill audits is essential for identifying overcharges and recovering unnecessary costs. Partnering with experts like BlueCargo provides the added advantage of pinpointing savings opportunities and mitigating billing errors efficiently.
By planning ahead and implementing these strategies, you can minimize financial losses and maintain profitability, even in the face of supply chain disruptions.
Stay Informed and Take Action Now
Monitoring the status of ILA negotiations is critical. Regular updates from trusted industry sources like the National Retail Federation (NRF) and the Journal of Commerce (JOC) ensure you stay ahead of potential disruptions. Industry associations also provide opportunities to collaborate with peers and gain timely insights.
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Why Partner with BlueCargo?
BlueCargo is the solution you need to navigate these challenges with confidence. As an expert in supply chain optimization and freight auditing, we help businesses:
- Avoid Costly Delays: Real-time tracking and dynamic rerouting keep your goods moving efficiently.
- Recover Lost Revenue: Advanced auditing tools identify hidden costs, ensuring you only pay what’s necessary.
- Streamline Imports and Exports: BlueCargo now supports export invoice audits alongside our renowned import solutions.
Take Action Before the New Year
With the 2025 ILA strike approaching, proactive preparation is essential to avoid disruptions and unnecessary costs.
Connect with BlueCargo today to discover how our solutions can minimize D&D fees, streamline your container management, and keep your supply chain running efficiently. Taking action now will ensure you enter 2025 prepared, resilient, and ready for growth.
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Wishing You a Joyful Holiday Season
As we look ahead to 2025, it’s important to stay focused, plan smart, and remain resilient. At the same time, let’s pause to appreciate the year behind us and the collective hard work that keeps goods moving, businesses thriving, and supply chains connected.
From all of us at BlueCargo, we wish you a joyful holiday season filled with peace, well-deserved rest, and continued success in the year ahead. May your operations stay efficient, your freight costs low, and your supply chain stronger than ever.
Happy Holidays and a prosperous New Year! 🎄
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