MHI Solutions Improving Supply Chain Performance
Look at the list of the top U.S. logistics hubs and little has changed in the last century, except for the reasons why. Where Memphis’s access to the Mississippi River and cotton growth made it a hub early on, FedEx’s presence there has helped it hold onto its position.
That’s just one example in what has been a relatively stable list of top hubs. However, global shifts and local commitments to logistics development could create some potential movement on the list in the future.
“It’s all about population centers and being close to the customers,” said Rich Thompson, managing director for JLL. “For hundreds of years now, it was proximity to port locations and in Chicago, the rails. Now, it’s less about the rail, more about the people.”
Dr. Yossi Sheffi, professor at MIT, director of MIT’s Center for Transportation & Logistics and author of Logistics Clusters, attributes the development of logistics centers to traditional trade hubs, which have grown by adding infrastructure.
“If you think about Miami, it’s basically the capital of South America,” Sheffi said. “A lot of trade is going between Miami and South America. Los Angeles/Long Beach is the main gateway for maritime traffic. Usually where there is a big port, a lot of logistics activity develops.”
Sheffi quickly lists the top hubs and then points to what is behind their rankings. “There are all kinds of reasons, such as a central location or a port or an airport,” Sheffi said. “You can distribute through a large part of the country. Take Dallas, which has a central location in addition to the fact that trade from Mexico is coming through Texas.”
Southern Los Angeles/Long Beach makes the list due to its proximity to Asian shipping. Chicago for its rail hubs, a holdover from the days in which it was the gateway to the west thanks to rail and the Great Lakes shipping. New York for its sheer size. And then there’s Louisville, which has joined the list largely due to the presence of UPS.
By Sandy Smith