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Inbound Logistics: Valentines Day!

Its that time again...Thursday  is Valentines Day!    Millions of us will rush out to buy flowers, candy and other goodies for their sweethearts.   For many of us, that’s a “day of” activity at the local florist, but increasingly, we’re dealing with the flowers by purchasing them on-line.  Companies like 1-800 Flowers, FTD, and even Wal*Mart have been planning for months for your order.   

In the flower business, 80 percent of the revenue is earned on just two holidays. Valentines Day, and then the biggie…Mothers Day.    In the United States, over 110 million roses will be sold on Valentines Day.   Good business.

Valentines Day is a $14 billion dollar floral market in the US alone.

About 65% of American roses are grown in California, but more and more are being imported from places like Colombia and Ecuador, where the growing climate remains ideal year round.  Fincas (farms) in South America bring flowers to Quito or Bogota where cargo airlines like Florida West, Tampa Airlines and Cielos de Peru fly in full jumbo jets of flowers.  Daily, 747’s, DC-10’s and B767’s arrive every morning in Miami.

The Race is On: From Farm to your table in three days!

Direct importers bring the flowers by the airline pallet load directly from the airport ramp into cold storage, where the flowers are chilled and await USDA and US Customs inspection.  Both activities take place within hours of arrival.    By 7PM, orders are being processed for delivery nationwide.

Your order from Wal*mart.com or FTD routes from their commerce servers to the direct importer, who creates the bouquet, packages it, and tenders it to a parcel carrier like DHL and FedEx.   

While many orders are flown by express carriers to their hubs in Memphis, Louisville or Wilmington, Ohio, a larger amount are actually trucked using refrigerated trucks to the express carrier hub.    This extends the cold chain for the flowers, thereby keeping them fresh longer and extending their shelf life.   Once in the parcel carrier hub, the boxed bouquets fly nationwide just like any express package.    By 10:30 the next day, your sweetheart has her flowers.   Total time from the growing farm to your dining room table is only an amazing three days!

Knowing those flowers are often accompanied by chocolates, lingerie, jewelry and other goodies, sites like FTD and Wal*Mart allow you to purchase it all on-line for delivery at the same time.  Those items source from different vendors on a drop ship basis, but the parcel carriers pull it all together for a timely delivery.

FedEx, DHL and UPS will be hand delivering flowers every day this week but especially on Thursday.   When you see your package courier , waive and say hello because they’ll be working extra hard this week.

RILA Logistics 2007 Conference

Between February 11th and the 14th, the Retail Industry Leaders Association held their annual conference and exhibition in San Diego, Ca.    RILA is the premier trade organization for big box retail and associated manufacturers and suppliers.     The RILA conference always draws the best and brightest from the retail industry.   Attendees usually include senior leaders from companies ranging from Wal*Mart, Best Buy and Target to the 3PL’s and transportation companies that serve them.   This year’s conference was the largest on record with close to 1000 participants.   Since RILA manages the balance between retail attendees and service providers, at least two thirds of attendees were retailers or manufacturers

I always enjoy RILA because it’s a unique opportunity to reconnect with old friends as well as to see key decision makers in Retail all in one location.    This year was no different in that I saw several former colleagues whom I had not seen in several years.  Reconnecting there was a real treat.   

Theme of this year’s conference was “Back to Basics”.  I found that interesting because of the flux the retail market is in.   Consumers have huge spending choices now, ranging from use of Gift cards, on-line purchasing and eBay.   Purchase channels are blurring. 

For big box retailers, the choice is either to extend the virtual storefront to these other channels or to entice consumers back to the store.     Best Buy does a tremendous job of tailoring the purchasing experience toward consumer lifestyles.   So does Whole Foods.  Go to any Whole Foods market and you’ll find convenience mixed with good taste and healthy products.   

Generally there appear to be three kinds of Retail spending types today.

• Purchasers who go to value stores like Wal*Mart
• Specialty stores like Chico’s Fashions or Ann Taylor.
• Department Stores such as Nordstrom’s, whose focus is a highly customized store experience. 

Customers are now less loyal to brands as much as they are to convenience or experience. The key is to engage the consumer in the way he chooses. 

While retailers continue to fight for consumer dollars, non-traditional retailers are appearing all over to compete for the same money.   Companies like Washington Mutual and Apple are now increasingly positioning themselves as retailers, while companies like Starbucks move beyond coffee to the sales of music and accessory products.   

Margin Pressures

While traffic to department stores and the shopping malls continue to be pressured by new sources of competition, CEO’s remain concerned about how to keep the margins they do make.    There was an interesting list put forward during the conference about what keeps CEO’s up at night. 

Some items included

• Attracting and keeping quality talent
• Leveraging use of Private Labels to improve margin and increase store branding
• Better ability to forecast product life cycles
• Increased supply chain visibility in order to maintain optimum product availability.

Did Fred "Mail it In"?

The keynote speaker for RILA this year was Fred Smith, the parcel express pioneer and founder of FedEx.   As a guy in the parcel business, I was most interested to hear what the man in purple had to say.    Fred Smith covered trends in retail and in the regulatory environment for multiple modes of transportation.    Overall a good speech, but I was a little disappointed that Fred didn’t cover any new ground.  Listening to people at the coffee break after his presentation, I guess I wasn’t alone.  Many found him to appear distracted.  The general opinion was that “Fred mailed it in”.   Strange.

RILA continues to be the primary forum and voice of big box Retail.  I look forward to the next conference.  “Logistics 2008” will be held in Orlando, Florida with a new primary sponsor: Exel Logistics. 

February 11-14th - 2007 RILA Logistics Conference

Go West Young Man!

February 11th through the 14th 2007 I'll be at the Retail Industry Leaders Association annual conference in San Diego, Ca.    RILA is the association for global thought leaders in retail supply chain logistics.   Senior leaders from major retailers and supply chain vendors will meet to discuss key topics and issues in retail today.   RILA is only open to retailers and sponsoring vendors, which makes for a very high quality crowd and an intimate setting.

Inbound Logistics: Hidden Costs in Overseas Sourcing

My brother, Eric Joiner is a senior sales executive with a major 3PL and Logistics integrator.  Eric is a regular contributing author to Logistics Recruiter.com.  Eric may be reached at ejoiner2@gmail.com.

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Linda Taylor of FedEx wrote an excellent article on “Hidden Savings” in international supply chains back in October 2006 for Electronic Supply and Manufacturing. The crux of Linda’s article was that in order to get products from point A to point B by the most efficient and cost effective means, you must control first costs and know what is happening to your freight while it’s in transit. That’s not rocket science, but many people don’t know exactly “why" that is important and "how" we got to where we are today.

Linda wrote for the electronics industry, but the conditions she notes apply to all international supply chains. It is especially true in industries like Retail, where costs of goods may be quite low relative to the cost to transport them.

Controlling costs means knowing what the costs are. Depending on your buying terms, there may be key transport costs that are either inefficient or marked up at a profit. Hidden costs only become visible when you pay for them.

Buying Terms Conversion

The Chart below shows the trend in the last 25 years toward increased control by US consignees in terms of control of buying terms.

Back in the 1980’s when many companies first started their import departments, goods were purchased Landed, Duty Paid (LDP, or the old “CIF” buying term). Companies in businesses like furniture and footwear had traditionally sourced domestically. With increasing costs of US manufacturing, sourcing managers started looking offshore for cheaper labor costs and sourcing closer to raw materials. Not being experienced internationalists; many companies bought through buying agents and allowed the goods to be delivered to destination for a fixed price. This left the cost of transportation entirely in the hands of the manufacturer and his agent.

Being enterprising folks, origin manufacturers often added additional profit margins to the transportation, since consignees couldn’t clearly see what the cost of transportation was.

It didn’t take but a few buying seasons of this for retailers to understand that they could get better rates on shipping if they controlled their own transportation.  Soon buying terms changed from title changing hands on CIF delivery to FOB Port of Origin in say, Hong Kong. Now major retailers were negotiating directly with ocean carriers.  Soon the rates negotiated by companies like Mattel and Nike would set the benchmark for all other ocean service contracts in the toy and footwear markets. Whether these companies accepted a rate increase often determined whether the whole trans pacific market would take one. Wal*Mart was a factor, but not the giant force it is today on ocean shipping (more on that later…).

By the late 80’s and early 90’s port infrastructure had built up in South China to handle the massive growth in container volume. The Port of Hong Kong remained the primary load port, but new ports in Chiwan, Shekou and Yantian were rapidly siphoning off Hong Kong traffic for two simple reasons. First was distance to port. With the factories in Dongguan, Guangzhou and other southern Chinese cities, it was simply closer to go to new port areas.

The other factor was the China / Hong Kong customs border crossing. In those days you didn’t send a truck from Hong Kong all the way to Guangzhou to pick up goods. A vehicle license on a Hong Kong registered vehicle cost too much. ($40,000 US Dollars roughly). Instead, a Chinese truck would haul the goods to the border, and the goods would be trans-loaded into a Hong Kong vehicle. This added labor cost and a damage element to the transportation many western customers were not even aware of! The Chinese drayage companies however thought this highly efficient because it kept their assets (the trucks with HK licenses) moving and generating revenue.

Time and cost drove traffic to the South China ports. For this reason, importers changed terms again from FOB Hong Kong to the cheaper and more efficient locations in South China’s Guangdong province.

Chinese manufacturers were happy to transport the goods to whatever port their customers wanted. What many of their customers still didn’t fully appreciate was that the factory sometimes either owned the trucker who hauled the container to port, or even better, was owned by a family member. Transport costs to port were therefore rarely done at cost, but with a mark up buried in the buying terms.

By now a trend was rapidly developing whereby importers in the US and Europe were working harder and harder to control more and more of the supply chain. Factories didn’t like having the side businesses eaten up, so in some cases, manufacturers would just raise their prices to cover the lost income on transportation!

Whether that happened of course was often decided by factors such as how big a customer you are, how easily he can resell his goods to another buyer and whether you are buying a specialized component or a finished good. To control these factors, and to be “where the action is”, many importers now had buying offices in Asia. Buying offices were first located in Hong Kong, but increasingly are now in South China itself.

With increased control, comes an increased need to know exactly where your goods are. In order to gain visibility and control, consignee retailers started to use consolidation companies and freight forwarders to insure that the goods that the retailer ordered were the goods that the manufacturer shipped (order compliance) as well as to make sure that goods were shipped on time and in appropriate quantities.

The consolidators and 3PL’s all of course charge for their services. Origin handling fees are collected from the factory, which the factory accounts for in their cost of goods and pass along to importers. The 3PL also charges the consignee for whatever services are rendered whether its order compliance, tagging, crating, garment handling, whatever.

Here’s a dirty little secret: Origin Receiving Charges are almost always non-negotiable in Asia. The reason? The factories all talk to each other. If a 3PL gives a “deal” to one factory, in about 2 days or less, everybody in South China will demand the same deal.

The key for a US consignee is to have the ORC billed by the consolidator in the US. That’s the only way a 3PL is likely to negotiate a receiving charge. The 3PL just wants to protect his revenue stream without jeopardizing his entire tariff with one deal. This is yet another reason for consignee control and buying terms that support it.

Demand for tracking and supply chain visibility software also increased in order to know where a particular order was. Buyers are the rock stars of any retail organization. Their job is to put the right merchandise on the store shelves that customers want. A buyer wants his goods NOW. If he is worried he may not get them on time, he orders more.

To keep the phone calls to the logistics department down, and to keep order quantities in check, importers demanded visibility software and EDI connections with their carriers, trading partners and vendors. And…since Logistics folks never seem to have any money for IT related things, they wanted it Free. Guess what? They pretty much got it. Whether its UPS, APL, United Airlines, Maersk Logistics, DHL or Joe the freight forwarder, all provide at least some tracking software now. That’s a good thing…because in 2001 the US got attacked.

Since 9/11 and the advent of C-TPAT (US Customs and Trade Partnership against Terrorism), importers have needed to insure that what they bring into the US exactly matches the cargo bill of lading or manifest. Use of buying terms that require the manufacturer to turn over control of the goods either at their door or the door of the consignees 3PL or freight forwarder, helps insure cargo security and control.

Wal*Mart imports almost 400,000 containers of goods a year from around the world. The vast majority comes from Asia. 400,000 container loads (FEU’s) is enough to run your own shipping line. With a Maersk K class ship averaging 6000 TEU’s in capacity, Wal*Mart could operate 133 voyages with nothing but their own freight.

                                      M/V Kate Maersk  (6000 TEU Capacity)

Don’t think that’s lost on Wal*Mart either. For some time, Wal*Mart ran their own mid stream container operation in conjunction with Great Western Steamship out of Hong Kong. The fact is though that Wal*Mart is so huge and their sourcing so varied that they have to use most of the major shipping lines for both capacity and container management.

It is for these reasons, that tight management of first costs, transportation and supply chain visibility are so important. Whether you compete with Wal*Mart or you ARE Wal*Mart, the time and distance and control of inventory are the difference between profit and loss. The key is ability to control these factors. Buying term conversion is the first key to control.

Eric

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PS: Quote of the Week:  Paul "Bear" Bryant.

“If anything goes bad, I did it. If anything goes semi-good, then we did it. If anything goes real good, then you did it. That's all it takes to get people to win football games.”

Its a great recipe for Marriage too!

Inbound Logistics: E-Tailer Logistics and Innovation.

During Christmas 2006, my household received 10 packages by parcel carrier.   3 USPS, 3 DHL, 2 FedEx and 2 UPS.   All contained products we had purchased as gifts for others or as gifts we ourselves received from friends and relatives.  Virtually all had been purchased on the Internet directly from online stores or from eBay. 

As a consumer, I hate shopping malls.  Too many people, too hard to get a parking space…you know the drill.    Point and click web shopping is the way to go for me!    Not only is it more convenient, the Internet simply has more products available.   As an example, my wife loves the old TV western show “Alias Smith & Jones”, which appeared on ABC in the early 70’s for a few seasons.     I always thought it was a goofy show, but Mary remembers it fondly from her childhood.   Fortunately, eBay sells everything, and I was able to purchase the entire series on DVD.     There is no way I would have found something so obscure in a retail shop.   For the retailer, it’s just too expensive to hold inventory that doesn’t turn.

As a guy who works for one of the big 3 integrators, I of course love the trend toward more parcels.  The US Postal Service, still the largest parcel and mail carrier around, expected to move over 900 million pieces of mail and parcels on December 18th, 2006, which was the peak shipping day for the season.  UPS was next closest, with an estimated 21 million parcels on their peak day.   The upward trend in direct ordering by consumers impacts the traditional retailer by moving purchasing away from the brick and mortar storefront and onto the digital screen.   Companies like Toys “R” Us now have distribution facilities specifically set up to ship Internet ordered goods.  For very good reason, these types of facilities are often located near parcel carrier hubs in places like Louisville, Memphis and Wilmington, Ohio.   Savvy retailers have now shifted to becoming even more clever “e-tailers”.    

Retail industry statistics for December, 2006 from Retail Forward show that same-store sales growth grew 3.2% from the previous month, but were down 3.6% from the year previous in favor of increased use of online purchasing, particularly at the expense of discount department stores and apparel and accessory stores.    I guess I’m not the only one who hates the Mall.

The impact on logistics is significant.   Not only are 3rd Party Logistics companies like Exel now operating distribution centers to handle web orders, the parcel carriers themselves, such as DHL and UPS, are aggressively marketing hybrid products like DHL’s Consolidation Distribution Service. 

DHL’s CDS allows a merchant to purchase goods from an overseas supplier, consolidate the goods into an air or ocean container, then on arrival in the US, rather than going to a traditional retail DC, the container load is broken at a port side cross dock and then directly injected into the DHL US domestic parcel network.    Customs clearance takes place in the air or on a pre-clearance prior to port arrival.    DHL uses its extensive air and ocean network through its DHL Global Forwarding arm to clear the goods, handle the cross dock and present the customer with a single invoice. Depending how the order is placed, the goods could go directly from an ocean container to delivery to your home, office or retail store.  For retailers with good demand planning, US domestic shipping labels can be put on individual packages going into the container while the goods are still in Asia.   

Here is a real example of where such a service could be of interest.  Say you are a grocery or drug chain store operator with 4000 stores nationwide.   Two days before Thanksgiving every year you need to get 10 cartons of gift wrapping paper into your stores for holiday merchandising.     That’s 4000 deliveries on the same day of a fixed quantity of low value goods.     The ideal way to move it would be a parcel shipment direct from the manufacturer.  The problem is the product is paper and the cost of transport would be too high.      Nevertheless, the delivery must be time definite.      Enter one of the hybrid CDS type services.    You get the benefit of ocean container pricing per unit from Asia to the US, and then incur the parcel service demand cost only on the last leg of the journey. 

These kinds of services ultimately impact online services like eBay as well.   eBays online auction has been around for over 10 years.   As Ed Cone’s article in this weeks “e-week.com” points out eBay is looking for ways to get beyond the traditional auction.    eBay is now partnering with a broad group of developers to embed API’s (Application Program Interfaces) between eBay trading technology and applications as disparate as salesforce.com for customer relationship management to parcel carriers such as FedEx and DHL.    This stuff can also link up to ERP systems like SAP.  An order is an order, regardless of where generated!

Using XML as a data communication protocol, customer order information could move from an ERP or CRM platform to an eBay procurement platform, ultimately to a shipment tender and delivery through a parcel carrier.  Don’t forget online payment through eBay’s Paypal network!      All this means more convenience for the customer through faster supply chain velocity, and potentially smaller, more frequent, customized orders.   

Customized orders don’t have to be small in terms of package size.    Say you go to a large electronics store and purchase a big screen TV or even better, purchase it online.   I’m talking about one of those 52-inch HDTV monsters I wish I had.   If you spend $3999.99 on this kind of unit, you expect it to be delivered!   No Problem.   Companies like Exel Direct and NYK Logistics specialize in these kinds of white glove home deliveries.    They’ll bring it to your house, wire it up and you’re watching in Hi Def in no time.    You'll think it was the retailer that delivered the goods, but in fact they either contracted it out, or more likely, the electronics vendor provided the service.  This isn’t because the retailer loves you.  Its because these televisions require wiring and controller set up that’s complex.    The retailers demanded that folks like LG Electronics and Philips provide these services as value adds so that they themselves didn’t have to handle the product beyond the box on the show floor or DC.

The Internet is the logistics high ground relative to consumer purchasing for the future.   To react to the demands of consumers, not only will retailers and their partners have to be increasingly creative in terms of the shopping and purchasing experience, but their logistics partners will have keep pace as well in order to get the product to the end user in a fast and cost effective way.   

The key to all this is data.   Not only customer data, but product level data on inventories, purchase order visibility, shipping label integrity and especially on billing and audit.     For this reason, eBays effort to create a developer network is a great thing.   FedEx and other parcel carriers have had EDI and XML Software Development Kits available for some time to allow data integration to their networks.    Soon, these efforts can be coupled with other network data streams in ways not imagined before.

Imagine the value of the database that will be created….

That may be the ultimate golden egg at eBay.

Inbound Logistics: Carry-On, my wayward son...

My brother, Eric Joiner is a senior sales executive with a major 3PL and Logistics integrator.  Eric is a regular contributing author to Logistics Recruiter.com.  Eric may be reached at ejoiner2@gmail.com.  The article below is written as an individual OpEd and reflects no official position by anybody other than Eric.

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During 2005, my company conducted a market research study looking at airline luggage and ways to reduce losses through both new technology and use of standard parcel express services to redeliver lost bags.  In doing so we interviewed a number of very senior executives at three major airlines.   All the executives we interviewed were keen to reduce the number of baggage misroutes not only to eliminate the customer service failures, but also to reduce the millions of dollars spent on rejoining the bag to the customer.    Key however was the opinion that if lost bags could be substantially reduced, then passenger confidence in checking luggage might increase.   Ultimately, that would lead to faster aircraft turns.   The savings in fuel costs and aircraft efficiency was thought to be in the hundreds of millions of dollars.    Possibly enough to substantially push struggling carriers toward black ink. 

The problem was nobody believed it could really happen.

Airline margins are slim-to-negative every day of the week.  A number of factors play into that, including competition, aircraft type, weather, passenger load, seasonality, and especially fuel.  Airlines make money when their airplanes are flying.   For that reason, aircraft turn time; the measure of when a plane arrives, and then departs again with paying passengers, is a critical factor in profitability.

A number of American air carriers have been in bankruptcy for the past 18 months, so for the American airline industry in particular, this is a strategic issue.   

The airlines have tried reducing the size and number of carry-ons passengers bring onto airplanes.  They’ve even tightened weight restrictions on baggage.     Nevertheless, the savvy business traveler with her trusty roll-aboard bag is still going to be throwing her luggage into an overhead bin instead of picking it up at baggage claim.   No single carrier would ever risk forcing the elimination of carry-on bags.  It would immediately alienate the business traveler to the point that they would change carriers.   That was the fear of the airlines prior to the summer of 2006.   

Then something happened…

During the summer of 2006, British and other western intelligence agencies uncovered a terrorist plot to blow up commercial airliners using liquid explosives carried aboard aircraft hidden in personal toiletries.   Thankfully, the plot was foiled and no destruction took place.   

As many will recall, the response from the US Transportation Security Administration, was swift and strong.  Overkill would be a good way to describe it.    Basically the TSA banned all liquids from being carried aboard commercial aircraft, either on your person or in passenger carry-on luggage.  For those of us who are regular business travelers, this meant that we couldn’t take our shaving kits and make up cases in our roll-aboard bags onto commercial aircraft.   Passengers were forced to either buy new toiletries at destination or check their luggage.

Toiletries, especially for the ladies, are expensive, so most of us grumbled (big time!) and checked our baggage.   Having had bad experiences with lost luggage, many figured this would be the beginning of a horrible end.   

But it turned out it wasn’t so horrible!

Shortly after the new rule was enacted, I recall sitting on a fully booked Delta 767 and watching with interest as passenger after passenger boarded…but the overhead bins remained open and empty.  Total time to board the airplane was a full 10 minutes faster than normal.   The flight actually departed early.    We arrived early.   Disembarking was also several minutes faster than usual.

As it turns out, my experience was not unique.   Airline on time performance in July and August 2006 shot up and passenger satisfaction increased.    Aircraft turn times improved for most major airlines as well.  In airline economic terms, this was huge. By forcing the checking of unwieldy carry on bags, airline turn time improved, and thus service and aircraft usage were also improved.

What is ironic is that most people would agree that commercial air transport is a key ingredient in our global industrial infrastructure. However, in this instance, foreign terrorists might have unwittingly found a way to help save the US airline industry.   

The terror plot in the summer of 2006 compelled the TSA to make a ruling that de facto eliminated all but a select number of carry ons from coming aboard US airliners.   No single airline could have ever done this because of the negative marketing associated with it.    Thanks to the TSA, I suspect there might have been at least some joy in the operations offices of more than one airline.    Keep in mind however that the switch to checked baggage also put a burden on the baggage departments of these same airlines.     Increases in checked bags also put a burden on airline conveyance systems and the TSA’s own screening processes. 

The TSA is a governmental organization with a massive security mission. I believe it is less concerned with, and absolutely less educated in, any economic influence it has on industry.   This is now clearly understood by folks like the makers of men’s business footwear whose styles require laces.  Slip on, “airport friendly” footwear are now a fashion category.  The TSA is a de facto 800 lb. gorilla whose weight has yet to be fully felt.  Even Al Qaeda has no clue what impact its actions might have relative to the economic impact of a TSA ruling. 

Back to our story… due to outcry from the traveling public, and a realization that most passengers really are carrying water in that bottle of Desani, the TSA modified its carry-on rules to the current one that limits travelers to the 3-1-1 measure. (3 oz containers only, stowed in a clear 1-quart bag, 1 bag per passenger.)    While somewhat more convenient to the average passenger, the government and the airline industry missed a huge opportunity to improve airline operations, improve on time performance and potentially create more competitive industry pricing by failing to compel checked baggage.   In the meantime, the 1-quart baggie is just one more thing to slow down the check line at the security checkpoint.

Yeah…OK.  So what?

Ultimately, passengers and luggage are a supply chain problem.   The airlines would love to fly only passengers.  Bags are after all, ugly freight.   For passenger luggage, there are no packaging standards, no size standardization, no quality control, no uniform labeling, poor (to non existent) stack ability, and no real uniform rating policy by the airlines.   Lets also not forget that toiletries, often containing alcohol and compressed gasses, are hazardous materials.   Passenger Airlines get a waiver from the FAA on these items so long as the baggage is accompanied by a passenger on board the same airplane.

What is ironic is that the critter that I think caused this whole problem… the ubiquitous black “roll aboard” bag…might be part of the cure.   Anybody who has flown on a commercial jet in the last 15 years has seen the roll-aboard bag that every business traveler (including me) has.  It fits into an overhead bin. Get on a US domestic flight and you will see that it takes people 20 minutes to board and longer to get off, as they compete for overhead bin space, then unfurl their belongings getting off.   The unique thing is that because it has to fit into a specific size and space, such as an airline “size wise” measurement unit, the “roll-aboard” bag may help in determining stackable, configurable luggage… but only if its checked and some form of standard is in place for the bag itself.

I have been checking a bag every week for years.   I have been “lucky” as I have only had my bags misrouted perhaps 4 times in 23 plus years.     As a general rule though, I don’t like schlepping a bag through security, onto airport rail trams, and juggling luggage on the airplane itself.  It’s just a hassle and a choice I make.   I travel every week and am willing to take the risk that my bag might get misrouted in order to have the convenience of NOT hauling it through a gauntlet of folks whose last job included "would you like fries with that?".

One day, the major parcel carriers (FedEx, DHL and UPS) will get involved in passenger luggage in a big way.  Right now, they only dabble in it because its ugly freight and non-conveyable in the sense that it bogs down automated high-velocity package sorting operations.   There are boutique services which do handle luggage but lack the huge operational capacity of the big three integrators.    

One day, I would like to be able to drop my families luggage at (any) local retail Express Mail Store anywhere in America and have the bags arrive at my destination without further effort on my part.   I expect to pay for it, but also expect that the economies of scale held by parcel carriers and a subsidy from the airlines for removing the cost and service burden from them to help off set that cost.

To be sure, this kind of service would not work well for the business traveler who needs his bag today, nor would it work for the luxury traveler whose standard bag is made by Louis Vuitton.  However for the resort vacation traveler, cruise ship passenger, or anyone with a multi-day itinerary, the service aspect would be worth considering.   It would also require more standardized luggage.  Someone's Louis Vuitton overnight bag would not be a good candidate to travel with a parcel carrier for the simple reason that there is no place to apply a sticky label when the item is made of fine leather.  Standardized luggage for us business folks would be a GOD SEND.    Anything that expedites handling, screening and release back to the original owners is a good thing.

To really standardize this kind of service in the US market the airlines will need help through improved standardization on luggage size, improved tracking technology and a change in the law to let a package carrier handle personal toiletries as non-hazardous goods just like the airlines.    Left to its own devices, the airline and parcel industries will come up with this solution only after years of debate on whether such services are cost effective, profitable, and a service the public will pay for. 

Then again… the TSA might make it happen overnight…by accident.

In the meantime, I’ll keep schlepping my stuff through the airport.