Logistics Legal Question

[DBMaster]

Do we have any experienced logistics managers on this forum? Here is my situation. I am a supply planner (buyer). I have a number of suppliers whose B/L's will state "X number of pieces on X pallets." My warehouse managers feel that they do not have time to verify piece counts on the pallets and by signing the B/L clear all they are doing is stating that they received X number of pallets. After the fact, when they come up short a carton, or several, they state that all they "are required to sign for" is the number of pallets. I disagree and when that happens the invoice for the product has to be delegated to the purchasing manager to pay for good we did not receive.

Are the warehouse managers correct? Seems to me like they are just telling me that "if we don't have time to do it or don't want to do it we are not required to do it."

 

[Alfred_B]

I come across the issue of "I do not have time to do x" all the time...

I agree with your disagreement. After all, your company does not really care how many pallets there were, they care about whether they received all the items they ordered.

Who covers the shortfall? Are the warehouse managers penalized for such losses?

Do you have numbers tied to the current practice. Sometimes hard numbers are eye openers and time is suddenly found to do the right thing.

 

[Yah-Tah-Hey]

"Do not have time to verify" means employees doing the receiving have more time to cork off. Saw this very often in my decades in power generation maintenance. When I ordered material for outage projects, I always stated that vendor was to state how many pieces each box would contain and how many boxes would be on each pallet. Warehouse blokes signed for pallets received and vendor made up the shortage. On critical items, I went to the warehouse and made a hard count. Easier to do it that way than get into the middle of big repair with time restraints and discover we were short on items that had a long lead time. It's called covering your @**, and I could write a book on the number of times I got molested even after planning things down to the last ten bolts and nuts. Those who were in planning/scheduling that were involved with scheduled overhauls/outages/ turnarounds(whatever you want to call it) know what I'm talking about.

 

[Hokiefyd]

Originally Posted By: Alfred_B
After all, your company does not really care how many pallets there were, they care about whether they received all the items they ordered.


This is the bottom line. Your company isn't buying x number of pallets of widgets; they're buying y number of widgets, which happen to be containerized on x number of pallets.

 

[Leo99]

It's your supplier's that are the root cause the discrepancy. That's where corrective action needs to occur.

 

[DBMaster]

Well, the funny thing is that the purchasing manager allows A/P to pay the suppliers, but makes sure the variances are applied to the offending cost centers. I am beginning to make headway. I think I finally got to a manager willing to run this up through compliance/accounting.

Funny thing is that I have been getting this sort of push back from managers at much higher levels than simply receiving supervisors. I am expected to always side with them and never with the supplier.

 

[eljefino]

Are the pallets sealed with that plastic shrink wrap? If the unloader forbids unwrapping before signing for it, that to me would seem like an out.

 

[DBMaster]

Originally Posted By: Leo99
It's your supplier's that are the root cause the discrepancy. That's where corrective action needs to occur.


Most of these issues end up being carrier related and not supplier. My suppliers take care of me when it's their fault, but if the carrier loses items (carriers are SO sloppy these days) and the warehouse signs for the skid clear either my company or the supplier (depending upon FOB terms) is left without a leg to stand on when filing a shipping claim.

 

[DBMaster]

Originally Posted By: eljefino
Are the pallets sealed with that plastic shrink wrap? If the unloader forbids unwrapping before signing for it, that to me would seem like an out.


Apparently, our logistics folks are not covering all bases since they are not forbidding OUR carriers from using the "STC" language on their B/L's. That means they are not requiring our carriers to verify the supplier's piece counts.

 

[DBMaster]

I appreciate the input. I was really looking for a definitive answer about whether or not a piece count on the B/L was legally binding. I think yes. I'm not talking about opening cartons to count the widgets inside (heating and air conditioning parts). The piece count is only referring to the number of master cartons on the pallet.

 

[Leo99]

It's better to prevent the carrier from losing stuff than to make better detection of missing items your fix. Sounds like plastic wrap from the supplier will fix this.

 

[DBMaster]

Ha! I could send you photos of skids that started out shrink wrapped and arrive with the corner braces sticking up and the entire top layer gone. That, however is an exception (YRC).

As long as I have been in the supply chain profession (21 years) "problem solver" has been my middle name.

 

[dlundblad]

I have often wondered this. We had this same sort of issue at my last job at an online retailer (30k different items). Either we were losing it or the vendor under shipped.

We'd easily get 15-20 skids in at a time containing 50+ products. I understand the need to count cartons because we had discrepancies too, but that is a lot of counting (time) that'd really [censored] off the LTL guy.

*As far as an answer, according to the guys in inventory planning, there is such a system that essentially does all the work for you. Each carton is tagged with some sort of bar code from the vendor that is scanned/ counted as it comes in. Once again, time is the issue though as well as cost. I heard they are $$$.

 

[KD0AXS]

Originally Posted By: dlundblad
that is a lot of counting (time) that'd really [censored] off the LTL guy.


It doesn't [censored] me off, I get paid by the hour. It just ends up being more overtime for me. However, if they keep us waiting more than 10 minutes, we charge $1.00 per minute.

 

[DBMaster]

Originally Posted By: KD0AXS
Originally Posted By: dlundblad
that is a lot of counting (time) that'd really [censored] off the LTL guy.


It doesn't [censored] me off, I get paid by the hour. It just ends up being more overtime for me. However, if they keep us waiting more than 10 minutes, we charge $1.00 per minute.


This is also one of the reasons given by the receiving managers "The driver isn't going to wait." The kind of piece count verification I am talking about would take no more than about 5-10 minutes.

Alas, this does appear to be one of those questions for which definitive answers do not exist.

 

[javacontour]

I'm not in logistics, so take this for what it's worth. This seems like the perfect application for an RFID tag in/on each box. Supplier sends you a list of RFID tags that are in each box. When you receive, you scan the pallet for all the tags. Any missing tags are reported back to the supplier.

If items are missed due to tags not responding, they can be reported back to the supplier when they are manually discovered.

I can't imagine what it's like to deal with hundreds or tens of thousands of items. I pull my hair out trying to get the two dozen or so parts I might use during a week. I can't imagine that multiplied by hundreds or thousands.

Good luck to you.

 

[FSully1]

Originally Posted By: DBMaster
Do we have any experienced logistics managers on this forum? Here is my situation. I am a supply planner (buyer). I have a number of suppliers whose B/L's will state "X number of pieces on X pallets." My warehouse managers feel that they do not have time to verify piece counts on the pallets and by signing the B/L clear all they are doing is stating that they received X number of pallets. After the fact, when they come up short a carton, or several, they state that all they "are required to sign for" is the number of pallets. I disagree and when that happens the invoice for the product has to be delegated to the purchasing manager to pay for good we did not receive.

Are the warehouse managers correct? Seems to me like they are just telling me that "if we don't have time to do it or don't want to do it we are not required to do it."


They didn't sign for X pallets, they signed for x pieces on X pallets stating that they received the entire shipment. And with no exception on Freight Bill, the shortage is on your warehouse.

 

[dlundblad]

Seems like it's logical to count depending on the number of things that need counted. Lol.

In regards to the LTL guys getting impatient, I figured they were hourly so I never understood why they were so impatient. A few guys wanted unloaded as soon as they got there regardless of how many trucks were in front of them. Probably depends on the person. As far as paying extra, I'm sure the additional dock time is well worth the expense of losing product.

 

[DBMaster]

Originally Posted By: javacontour
I'm not in logistics, so take this for what it's worth. This seems like the perfect application for an RFID tag in/on each box. Supplier sends you a list of RFID tags that are in each box. When you receive, you scan the pallet for all the tags. Any missing tags are reported back to the supplier.


That's exactly what I was thinking when I read the earlier post about the bar codes. I recall that Wal Mart was going to start requiring its suppliers to RFID tag everything. That was several years ago so I wonder if it happened. But, true, excellent use of the inexpensive technology!

 

[DBMaster]

Originally Posted By: FSully1
They didn't sign for X pallets, they signed for x pieces on X pallets stating that they received the entire shipment. And with no exception on Freight Bill, the shortage is on your warehouse.


This is my contention. The regional ops managers - well, several of them - do not agree with me. To them, it is ALWAYS the supplier's fault and, therefore, my problem, not theirs.