3 Days Vs 100 Days or Can you Risk 155 Days of transit Time and 4X the costs?

Transportation Benefits to US Manufacturing

In our last blog, we discussed current global conditions and proposed that it is time to reassess our supply chain. Does global outsourcing still make sense?

The news is full of supply chain challenges. Each of us has seen the empty shelves in our local markets just waiting for the next delivery. Ocean containers are either backed up on ships or sitting in ports waiting for trucks. There doesn’t appear to be any end in sight. Transportation is a big impact on our supply chains. Currently, it is taking longer, costing more and tying up more of our cash.

Can your company absorb this increase in costs and time?

Supply Chain Problems from Ocean Freight

As part of the global outsourcing model, most companies chose ocean freight as their most affordable method of transportation.

In the last 18+ months, the China/Eastern Asia route to the US West Coast has seen container prices increase almost 400%. All global routes have seen unusually high increases. Companies are struggling to pass on these cost increases to their customer and are experiencing margin erosion.

Here is a simple example of how the freight increase impacts product costs:

  •   Prior to Freight Increase:

o   1000 Units per container = $3.80 freight per unit

  •   With Current Freight Rates:

o   1000 Units per container =15.50 freight per unit

If the price increases weren’t bad enough, at the same time overall service levels declined. It’s hard to explain to a frustrated customer why their goods are taking longer to deliver and cost more! In the second half of 2021, the news was full of stories and pictures of the huge backlog of container ships in the LA port waiting to be unloaded.

E2open’s Ocean Shipping Index finds that in late 2021:

  •   The average global shipment took 12 more days, or 23% longer, than the same period last year
  •   Overall lead times from North America to Asia took 17 days longer 25% longer

When lead times are weeks instead of days, it’s very difficult to react to changing demand scenarios and now many major retailers are stuck with inventory they no longer need. This isn’t just a risk for retailers, all companies have these potential risks when demand changes quickly and transit times are extended.  

How will your company manage those risks if it happens to you?

Global Fees, Taxes and Tariffs, etc.

Even before we started seeing the increases in freight, tariffs have been increasing over the last few years. So now we have longer transit times, and increased freight costs combined with increased tariffs. During the Trump administration tariffs from China increased for some product classifications significantly. The Biden administration has made some adjustments, but for many electronics, the tariffs are now as high as 25%.

  •     In 2019, The World Bank reported that the US tariff weighted average was 13.78%, a 12.19% increase from 2018.

If our above pricing example was an electronic component, you would also pay an additional 25% of the value of the goods on top of the higher freight costs. Tariffs vary by product, and you can confirm your current tariff expenses by checking your specific HTS code (Harmonized Tariff Schedule).

In addition to freight and tariff costs, your landed costs will also include some or all of the following:

  •   Terminal Handling Charge
  •   Consolidation Fee
  •   Surcharges: Drayage Fee, CAF Charges, BAF Factor, Low Sulphur Fuel Charge, Peak Season, Carrier Security, etc.
  •   Custom Clearances Fee
  •   Merchandising Processing Fee
  •   Harbor Maintenance Fee (HMF)
  •   Delivery Fee

In our pricing example assuming an electronic item:

  • Product costs $5.00 + freight of $15.50 + tariffs $1.25 + various fees $.50 = $22.25 Landed Costs

Depending on the base costs of your imported product, you could be paying multiples in transportation costs. As you assess your current supply chain, consider all the extra costs and fees that are being added to your product costs. Is it still the right solution? Also, what is it costing you to have critical capital tied up in inventory that isn’t even available to you?

Perhaps it’s time to consider a US-based manufacturer?

Suppose you partner with someone like E4D Technologies. In that case, we can reduce your factory-to-factory transit time from over 100 days to 3 – 5 days AND you will see a significant reduction in overall transportation costs. This provides you with better cash flow as materials will be in your factory; before you are required to pay in full. Want to learn more about how E4D Technologies can help your business? Contact us!

Photo Sourced from Getty Images: #1318116805

Fireside Chat with E4D Technologies: How the Pandemic Has Impacted Global Supply Chains

Many people are worried about the COVID-19 impact on technology and the global supply chain. Will the global supply chain have to shrink in order to get stronger? Can we expect to see a change in technology logistics and the global economy coming out of Coronavirus regulations? We sat down with Tammi Carter and Brett Hetherington to provide our industry with insight, personal experience, and analysis of the logistics in technology after the dust settles with COVID-19. Here’s a fireside chat with E4D Technologies about the supply chain:

What Are the Flaws the Pandemic Exposed in The Global Supply Chain?

“Countries around the world addressed the pandemic in different ways. While some countries remained relatively open, others suspended production until they could safely address how to keep their employees safe. How were people going to work at their job without exposing themselves or others to COVID-19? In some cases, governments responded by placing tight restrictions on workers and even forced some manufacturers and suppliers to close their doors for an undetermined amount of time. Regretfully for some companies, this was too big of an impact and they have closed their doors for good. – Tammi Carter

“Coming out of the pandemic, many companies have had to face the harsh reality of relying too heavily on a sole source supplier. Those companies who had already reviewed their supply chain and eliminated much if not all of the sole source components, the impact of COVID was significantly less harmful.

Another element that protected companies was their scalability. As competition increased, and pressure for the existing and remaining suppliers increased in areas of COVID support. Without having the proper infrastructure for documentation, procedure, and training, companies who could still function within government regulations still faced the challenge of being understaffed and ill-prepared to train the number of workers needed.” – Brett Hetherington

What Have Companies Learned about Being Flexible and Agile?

“As people began to rush to stores to pick-up essentials, the global economy was in a crisis to continue to supply consumers with goods and services. Many businesses realized the importance of infrastructure and logistics in order to keep their customers happy while managing to stay operational. Properly scaling a business up became a necessity, but also effectively scaling a business down was equally crucial in specific industries. With a lack of supply and demand, how can you manage to stay operational? Companies not only had to find a way to cut costs, but they also needed new sources of income. One of the biggest challenges in many business structures and systems was the lack of training, documentation, testing, and discipline in their field. While some companies could handle the drastic change, others went out of business because they couldn’t ramp up or ramp down production due to a lack of organization.” – Brett Hetherington

“The supply chain also faced a challenge with logistics. Not only from the standpoint of having a sole supplier but also from the perspective of audits and inspections. How could you continue to perform the standard supplier audits when global travel was largely banned? Companies that had strong suppliers and a strong existing quality system found transferring to a virtual audit and review relatively simple. However, if none of that infrastructure existed, then it became a real test of trust between the client and the supplier. In some cases, to add additional suppliers or to eliminate the need for global travel, some companies have considered adding additional domestic suppliers..” – Tammi Carter

How Will the Supply Chain Look Coming Out of the Pandemic?

“There is no doubt that there will be fewer players in almost every industry. In [our] opinion, there won’t be drastic changes to how the global supply chain functioned before the pandemic. Ultimately, the world is too interconnected. It would be difficult to quickly change how it operated for decades before this point. We will see companies doing a thorough analysis of the supply chain and look for opportunities to dual-source and, as much as possible, source domestically. ” – Tammi Carter

“We do think that companies like E4D who are not able to do the majority of the work at home, will adapt lessons learned from this pandemic as it relates to keeping employees healthy at work. We would anticipate physical layouts of factories to take social distancing into consideration where possible. Wearing masks and some safety procedures will likely stay to protect workers from team members exhibiting cold or flu symptoms. More than likely, people will continue to wear masks when feeling ill, cleaning habits will stay in place, and we may even see an impact on factories’ design and layout.” – Brett Hetherington

What Will E4D Look Like After the Pandemic?

“As an essential business, E4D was open to support our healthcare professionals. We definitely experienced a slow down in some market segments while others grew exponentially. We attribute our abilities to our reliance on our strong quality systems and our flexible and creative team. We were able to function because we successfully ramped up our systems while simultaneously scaling down other areas of our business. Our documentation, training, procedures, testing, and discipline allowed us to keep our team on the manufacturing floor while supplying our customers with their orders. Some aspects of our company had to change, and with every change, we were transparent and honest with our team to make sure everyone was on the same page. E4D Technologies is more experienced, knowledgeable and agile than ever before. We couldn’t have done it without our fantastic team, and we’re so grateful to still be here today. Our process, development and company culture kept us moving forward even during the difficult moments.” – Tammi Carter

Ready to partner with E4D for manufacturing or design? Our advanced experience in technology design, manufacturing technology and logistics in technology can help your business achieve all of your goals. All aspects of our company work under one roof so that you can access all of our unique technological disciplines. If you’re ready to hear what we can offer your business, we want you to contact us today.

Photo Sourced from E4D Technologies

Thanksgiving Letter to Our E4D Family

As Thanksgiving approaches, we wanted to take a moment to reflect on the year, remember how far we’ve come and look forward to the future at E4D Technologies. We want to share a Thanksgiving letter from Tammi Carter to our E4D extended family, our vendors, and our customers. Please take the time to read our Thanksgiving letter and think about the things you are thankful for as we close out 2020. 

A Thanksgiving Letter from Tammi Carter

As the holidays approach, I can’t help but reflect on the traditions of my family.  At Thanksgiving, as my family gathered around the table, which was weighed down by all the fantastic food that my Mom had prepared, we first went around the table and each person expressed their thanks for someone or something from that year.  Of course, when I was a child, I just wanted to get it over with and dig into the amazing food, and maybe more truthfully, I really just wanted to get to the homemade pies Mom had made for dessert.  

As the years went by, I began to realize how meaningful it was to hear what my family and friends were incredibly thankful for each year and I began to enjoy who and what I would thank at each Thanksgiving dinner. Sometimes we celebrated the joy of a new family member or some years it was the celebration of the life of someone we lost that year or the feeling of gratefulness for overcoming a difficult situation. Many years later as I’ve continued this tradition I’ve learned that people are rarely grateful for the physical things they have, but, instead, they are thankful for the cherished people and relationships they’ve developed throughout the year.

At my childhood table, we were supposed to limit our sharing to one or two things because, after all, Mom didn’t want all the excellent cooking to get cold!  But when I consider all the significant aspects of E4D – it’s impossible to limit my gratitude to one or two things. So continuing the tradition of my family, here are some of the reasons why I am thankful this year…

To the E4D Team 

I’m so thankful and proud of the amazing team we have at E4D.  During this COVID year, this team could have settled for good enough, but they refused to settle.  They’ve taken a good company and made it great.  They never stopped innovating and finding new and better ways to serve our customers.  I’m grateful for all the teams’ sacrifices that helped us navigate challenging times. There were pay cuts, furloughs, cuts to the coffee budget and so many other things the team offered to do to help us survive the impact of COVID. They inspired me and encouraged me in those early days of COVID when things were so unsettled. I cannot express how thankful I am to have each and every member of the E4D team here today.  They truly are the secret to our success. 

To the E4D Extended Families

Surrounding all our great team members are their family and friends. We are incredibly grateful for their support of our team. We know that their influence, support, and encouragement create strong, creative, innovative, and tenacious team members.  We couldn’t be the great company we are without the strong support team!

To the E4D Owners

E4D and I are grateful to have great owners who support our innovations around the globe. Year after year, they have been a driving force behind our operations. Even during uncertain times, their support didn’t waver.  They provide a strong foundation for us which enables our success.

To the E4D Customers

All of this would not be possible if we didn’t have such great customers! Many businesses don’t have the privilege of working with customers who they genuinely like and get to help them transform the world through their amazing products.  It has been a pleasure being a part their success and assisting them in making the world a better place for all of us. 

To the E4D Vendors

Of course, we wouldn’t be able to provide unparalleled service without our vendors who jump through all our forecast changes and smile (or at least they pretend to)!  Nothing is possible without the whole supply chain coming together to make sure we can design and manufacture our customer’s current and upcoming products. Thank you for your flexibility, understanding, and unparalleled service. 

So as I close this out and prepare to gather around my table full of friends and family, on my list of things to share will be the blessing of being part of the E4D team!  


Happy Thanksgiving, 

Tammi Carter


There is so much to be thankful for after this unprecedented year. Thank you for taking the time to read this Thanksgiving letter, and we encourage you to contact our team to let us know what you’re thankful for this year.