Amidst today’s challenging global trade environment, Alison Leavitt is maintaining high spirits as she leads a not-for-profit, 600-member-company association of beverage importers.
As managing director of the Portland, Maine-based Wine and Spirits Shippers Association Inc. and a member of the Federal Maritime Commission’s National Shipper Advisory Committee, Leavitt remains optimistic that, while some companies simply won’t survive, progress is coming on multiple fronts, from tariff stabilization to broadening implementation of blockchain technologies.
Having been engaged in international shipping since the mid-1980s, running WSSA for the past eight years, have you ever seen things as bad as now?
The short answer is no, and I think there would be consensus from any industry veteran you would ask. We have never experienced anything like this meltdown of the supply chain on a global basis.
The wine and spirits trade lanes are especially shocked as the rates from almost all production areas have been incredibly stable for years, with only slight fluctuations. To see service plummet and rates skyrocket is an incredibly disturbing scenario.
How can wine and spirits importers and exporters best survive – and even thrive – amidst the perfect storm of adversities, from COVID-19 to tariffs to skyrocketing rates and congestion?
Some companies will not survive. The price point increases promulgated by freight cost increases may not allow the imported or exported generic beverage alcohol products to remain on the shelves.
However, keep in mind that many beverage alcohol products are nonfungible, unique to their terroir, and thus cannot be replaced by a similar product. Irish whiskey can only come from Ireland and, as we approach St. Patrick’s Day, we are struggling to get the Irish products onto shelves and into bars and restaurants.
All importers will be forced to increase lead times dramatically and plan on the cost increases that will continue to grow both on ocean freight and land freight.
What glimmers of hope do you see?
Two years ago, all we were talking about were the trade issues, such as CBMA [Craft Beverage Modernization Act] and tariffs. It is a huge benefit to the industry to have the stability now available with the permanence of CBMA and the long-term suspension of tariffs.
The balanced approach to trade under U.S. Trade Representative Katherine Tai is greatly appreciated, and we are hoping for further good news on U.K. talks to eliminate tariffs on certain U.S. beverage alcohol products. This issue is currently stymied due to discussions on the Brexit-Irish border issue.
In terms of ocean freight rates, we do not expect the extreme volatility in ocean shipping rates experienced in 2021.
All of these factors will help our members budget and plan.
How has WSSA’s process of negotiating freight rates adapted to recent circumstances?
We have had to evaluate, adapt and reorganize for success with each of our carrier partners. Every carrier has a personality and there is no “one-size-fits-all” in terms of negotiations.
Allocation and service are our top priorities, and we also know which carriers will honor what is signed into the contract. Communication and monitoring allocation is now a weekly agenda item, and the level of attention to every sailing is essential. Relationships still matter, and the ability to pick up the phone and get results is essential.
Carriers suffered for many years with low rates and limited to no consequences for shippers not meeting their contracted MQC [minimum quantity commitment]. The tables have now turned, and I hope we can reach a new normal of honoring commitments and reaching long-term working partnerships.
What role can blockchain play in enhancing supply chain visibility?
I have been a blockchain advocate for years and would love to see universal adaptation on a single platform. We are still not there, but visibility is more important than ever due to the chaos. We need visibility from point of pickup through to delivery in a single immutable window.
My hope is that the profits achieved by carriers in the past year can be used to improve visibility and move together toward the adoption of blockchain technology.
Congratulations on being named to the Federal Maritime Commission’s newly formed National Shipper Advisory Committee. What role do you see this committee playing?
Thank you, and I am honored to serve on this committee. I am incredibly impressed with the depth of knowledge and intelligence among the members.
The committee is at its formative stages and will be defining how to provide a viable impact to benefit the shipping industry over the next few months. We all know that there is no quick fix to this multilayered meltdown, and the committee will be working together for the next few years in a results-focused format.
How did you get into the global shipping business?
Shipping is indeed in my blood. My ancestors were sea captains, merchant mariners, naval officers, and shipping agents, and I got drawn into the business at an early age and have been living and breathing shipping for over 35 years.
My aunt was one of the first female licensed customs brokers, and I am proud to carry on the legacy of both the family and of female leadership in a male-dominated industry.
How is it that WSSA is based in Portland, Maine, and how does the location suit your active extracurricular interests?
When I took on the role at WSSA, I was able to continue to reside in Maine and eventually built a great team that works virtually in Virginia, New York, Georgia, and Maine. We developed a work-from-home model 8 years prior to COVID!
Living in Maine allows me to follow my passion for healthy living and the great outdoors. As a lifelong competitive athlete, I enjoy the ability to run, bike, swim, hike, and ski in the amazingly clean air and natural environment of Maine.
When you relax in front of your fireplace, what is your favorite beverage to have in hand?
Great question! I tend to be a purist, and, whether it be a perfect martini or a glass of fine Bordeaux, I savor quality, avoid sugar and sip slowly!
