As long-time Ohio 3PL supply chain managers, On Time Delivery & Warehouse is in the business of helping clients navigate everything from minor quirks of tricky logistics to major, unexpected supply disruptions and market changes. The U.S. federal shutdown that began Dec. 21st has the potential to threaten supply chains – in the U.S. and globally – on several fronts as the political gridlock drags on, especially if both sides dig in their heels for weeks or months, as the president has said might happen.

If you think government employees and a few federal contractors are the only ones impacted by a government shutdown – think again. Federal motor carriers, freight shipping carriers and agricultural suppliers are just a few examples of entities our Ohio 3PL supply chain managers know can be squeezed when official stalemates stretch on.  Sparring and posturing in D.C. and between U.S. and international leadership are often regrettable but inevitable realities. Resolution of those issues is slightly above our pay grade, but what our Ohio 3PL providers can do is help our clients be prepared as possible.

We may not know when this government shutdown will end or if/when there will be another. We do know these issues have a way of cropping up again and again. When they do, we’ll be ready.  We have a long list of contingency plans that include alternative suppliers, routes, transport methods and storage facility options that we can deploy at a moment’s notice. This helps our clients keep their goods and services moving and minimize losses, even if they can’t be avoided altogether.

Among the potential long-term government shutdown impacts our Ohio 3PL supply chain managers are monitoring:

• Dramatic delays in customs’ clearance for imports, both land and sea. For now, cargo clearance operations are continuing and the shutdown impact has been minimal. U.S. Customs and Border Protection officers and agriculture specialists are still required to report to work, though they aren’t being paid at this time. Certain port activities could be scaled back or stopped, and there’s likely to be some variation from port-to-port regarding priorities because each has discretion. And while “essential employees” remain on-the-job, the staff at D.C. headquarters is decidedly thinner. This could cause problems if there is a discrepancy on customs clearance because there is no one at headquarters to resolve it. We haven’t seen that happen just yet, but if it does, it could result in thousand of dollars in demurrage and detention penalties.  Those relying on importers and exporters should discuss operation impact concerns for each port with their Ohio 3PL provider.
• Trucking slowdowns and rulemaking delays. So far, there have been no major issues on this front. Appropriations for the U.S. Department of Transportation have expired, but so far the Federal Motor Carrier Safety Administration and the Federal Highway Administration are still up-and-running, mostly with funds from alternative sources and savings, allowing operations to continue unabated for now. If the shutdown does continue, there could be important rule-making delays, such as hours-of-service for truck drivers. DOT construction might also be stalled.
• Impact on supply when farmers and ranchers are pinched. Although they are still able to access limited data important for crop planning while the U.S. Department of Agriculture is closed, it won’t be long before farmers and ranchers won’t be able to deposit federal checks, which must be endorsed by the Farm Service Agency. If those workers are still furloughed, it could hurt farmers and in turn the supply chain as a whole.

Ultimately, all this comes down to what our Ohio 3PL providers have always found is the biggest impediment to efficiency in any supply chain, government shutdown or not: Uncertainty. The impact of a long federal shut down in 2019 is going to mean many companies will be affected in ways perhaps not immediately clear. This will make planning and on-time order processing difficult.

Trust the experienced third-party logistics professionals at On Time Delivery & Warehouse to help you avoid losing your financial footing and customer confidence.

If you have questions about Ohio 3PL supply chain management, contact On Time Delivery & Warehouse by calling (440) 826-4630 or sending us an email.

Additional Resources:

Oklahoma Farmers Struggle With Government Shutdown, Jan. 3, 2019, Food Logistics

Minimal cargo risk from US government shutdown, Jan. 4, 2018, By Ari Ashe, JOC.com

More Blog Entries:

Cleveland 3PL Supply Chain Management Talks Tariff Strategies, Nov. 15, 2018, Ohio 3PL Supply Chain Management Firm Blog