Hundreds of shipping containers are piling up at the Los Angeles/Long Beach port complex, and thanks to equipment shortages and labor disputes, the products inside are not likely to make it out in time for the holiday shopping season.
JC Penney, Macy’s, Kohl’s, Nordstrom, Ralph Lauren, American Eagle and Carter’s all have merchandise sitting in limbo at the port, reports say. One anonymous port worker told reporters that the shipping containers arrived two weeks prior and had yet to be unloaded.
While it’s painfully clear to retailers that the shipments may not see the inside of their stores for the launch of the 2014 holiday shopping season, exactly how this nightmare before Christmas came to be is a bit more complicated.
Reports say a shortage of transportation equipment needed to unload the containers is slowing the process down. But dock management claims workers are deliberately slowing operations to gain leverage in contract negotiations.
The Pacific Maritime Association, a group representing port and shipping employers, claims the International Longshore and Warehouse Union has held back hundreds of employees from doing their jobs transporting cargo containers at the terminals. The National Retail Federation has backed up these claims.
A spokesperson for the Pacific Maritime Association released a statement claiming “the ILWU’s orchestrated job actions are threatening the West Coast’s busiest ports and potentially billions of dollars in commerce.”
The union did not comment on the allegations, but a spokesperson said contract negotiations are ongoing.
Regardless of the cause for the disputes, retailers are scrambling. Stores reportedly anticipated bumps from contract renewal talks and upped their delivery orders over the summer. And since the backup began, Wal-Mart reportedly diverted 300 shipping containers filled with products to the northern port of Oakland to avoid the backup.
The head of international trade at American Apparel and Footwear Association, Nate Herman described the debacle as “a domino effect.”
“When there is an interruption, things degenerate quickly,” he said.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More