The Midwest Cargo Security Council shared valuable information and strategies for cargo theft prevention during its quarterly meeting, held at Illinois-based AIT Worldwide Logistics, a full-service transportation management provider with continental headquarters in Chicago, Amsterdam and Hong Kong.
The meeting emphasized the council’s growth and need for continued support in providing vital resources — such as guest speakers like Glenn Master, Director of Loss Prevention & Safety at Newgistics, Inc., an omni-channel commerce software and technology services provider for retailers and brands in the United States and internationally.
“Third Party Carriers, an Inside Look”
Glenn’s presentation gave insight on Third Party Carriers (3PLs) and best practices in partnering with these regional carriers. With roughly $200 billion spent annually on products online and the height of shopping, shipping and cargo theft threats upon us this holiday season, the timing was great and so were the takeaways.
Most regional carriers are located near airports, operating in 5,000-20,000 square-foot facilities across multiple locations. Couple the size of their operations with this: employers/managers account for 10% of their business, while 90% is contracted labor; and 95% of regional carriers do not have a comprehensive loss prevention department nor basic security (alarms, CCTV). And the risks start to add up: volume + lack of controls = loss exposure.
In response, Glenn recommended the following best practices in partnering with regional carriers:
- Make sure they have a security addendum in the contract
- Assess regional carriers before doing business with them
- Conduct routine audits
- Require them to perform self-audits; most regional carriers will comply and do what they can to help
- Establish penalties for repeat failures
- Don’t over demand; use the industry standards
- Partner with regional carriers during the investigation of a loss and in information sharing on security practices
Glenn has 18 years of loss prevention experience and helped develop the International Supply Chain Protection Organization (ISCPO), which promotes security in the global supply chain. Read our blog post on risk management and the recent ISCPO conference. Contact Glenn Master
According to AIT, the logistics industry is rapidly changing, which makes security a never-ending battle. AIT, which only experiences .4% in notified claims per year, is now seeing a 50/50 split in claims from cargo theft and damages. (Before, claims from damages were much higher than claims from cargo theft.)
As the logistics landscape changes and cargo theft incidents rise, law enforcement resources are being reduced due to cuts in funding. The Illinois Cargo Task Force is down to 2 members due to such cuts and relying heavily on help from the private sector when investigating cargo theft. The need for resources and partnerships like those provided by the Midwest Cargo Security Council is essential.