Companies Struggle to Ship
Products"> Barge shipment poses other obstacles, Almond said. The large and expensive containers required for shipping the wood by barge would be making one-way trips to warehousesunless the company opted to pay return fare for empty containers. Meanwhile, Louisiana-Pacific Corp., a large lumber producer based in Nashville, Tenn., has temporarily switched its production plant in Silsbee, Texas from siding to OSB structural panels, according to a company spokesperson.To read about how cyber-looters have capitalized on Katrina, click here."OSB is sort of an equivalent to plywood," the spokesperson said. "People will need [OSB] as they rebuild." Yet right now, some manufacturers are finding it tougher to find raw materials, a problem that, in turn, further affects the availability of finished goods. "Practically all the materials used in manufacturing around here have always come through New Orleans," said Gambinos Petry. Although Gambinos has been able to locate raw materials from alternative sources, Petry isnt all that pleased with the results. "Weve found alternative sources [of materials], but the quality isnt as high," he said. "Its been especially hard to source flour." By Friday of this week, Gambinosa 50-year-old veritable institution in Louisianahad taken down its Web site for the time being. "We havent been able to ship any product," Petry said, during a follow-up interview. Gambinos isnt using any computer-based tools to deal with these supply chain and logistical nightmare. Neither is Almond Brothers. But makers of the software tools point to a number of supply chain/logistics customers with operations in the Gulf Coast region. International product distributor Cargill uses Red Prairie Corp.s WMS (warehouse management system), said Erv Bluemner, Red Prairies vice president of product marketing for transportation solutions. Dawn Salvucci-Favier, director of transportation and logistics management at Manugistics Inc., cited a grocery store chain and a large food distributor in the Gulf region as members of Manugistics customer roster. Manugistics provides a wide variety of tools for strategic and tactical supply chain management, Salvucci-Favier said in an interview. Using the vendors tools for supply chain network design, for example, businesses can "simulate a storm," and then locate either alternative sources or alternative product destinations based on the scenario. With Manugistics TMS (transportation management system), customers can divert capacity between different modes of transportation, such as road and railway. Red Prairies tools for supply chain and transportation management also cover a broad gamut, according to Bluemner, who mentioned in particular the softwares ability to "bring together multiple pick-ups and multiple destinations" for logistics. Also according to Bluemner, Red Prairie makes HR (human resources) management tools that can help companies relocate facilities to new geographic areas which are rich in needed skill sets. Meanwhile, the effects of all the Katrina-created supply changes are starting to be felt along the East Coast, West Coast and Midwest regions of the US. Click here to read about Katrinas impact on chip production Since the hurricane, wholesale pricing for OSB has already hit several spikes, reaching $2.50 per sheet by this Friday, said Dave Sims, vice president of Stones Building Center, a retail lumber store in Wausau, Wis. Prices of other lumber products have been going up, too, "but not as badly," according to Sims. "There isnt a shortage [of lumber] yet, because the Gulf region hasnt started rebuilding. But it looks to me as though people might be buying and hoarding lumber, in anticipation of a shortage," he said in an interview. The retailer does expect, however, to see some leveling off of lumber prices in the near future. Check out eWEEK.coms for the latest news and analysis of enterprise supply chains.