For several decades now, the Port of Los Angeles has been handing the bulk of goods and supplies intended for the United States. As the main entry point of trade to the country, the megacity has unsurprisingly nurtured hundreds of logistics, transportation and warehousing companies.
Among those companies are Dependable Global Express (DGX), Vantec Hitachi Transport, Eastern Car Liner (ECL) and Nakano Warehouse and Transportation. While DGX and Vantec Hitachi are multinational giants with a reach in every continent, ECL and Nakano have become known as small but agile players.
“It’s phenomenal to live here and cargo wants to come here. L.A .is among the biggest ports in the world and I am very proud to work here. Even with its high cost and strict regulations, I see the advantages of this place,” said Nakano General Manager Tomohiro Aoki.
As Southern California hosts the largest Japanese expat community outside of Japan, trade between the two countries has expectedly been expanding continuously. But as Japanese companies move to nearby markets in Asia, such as China and Taiwan, because of lower costs, these transport and logistics companies have adapted to the emerging “triangle trade,” wherein they handle Japanese goods manufactured elsewhere for the U.S. market.
Vantec Hitachi, Nakano and ECL have the advantage of being Japanese and thus, becoming familiar and preferred providers for fellow Japanese companies.
But, these three companies also prioritize their U.S. business because of the bustling trade with Japan.“Japanese companies are all over Asia. For us, being in those markets helps us to expand. Knowing the Japanese market and understanding their procedures and processes also help us greatly,” stressed DGX President Brad Dechter.
“Our company is Japanese oriented. That’s why we have to get more Japanese accounts. But, we still have to grow globally,” said Vantec Hitachi President and CEO Keisuke Fukazawa.
Known to many around the world, Japanese business culture is unique and gives a high premium to excellence and quality. Foreign companies have learned that adopting those values is key to building relationships with their Japanese counterparts.
ECL Executive Vice President and Chief Operating Officer Bill Christ does not take the Japanese connection for granted: “One of the key things is that we are a Japanese company. And there are a lot of shippers in Japan that want to deal with a Japanese company.”
Despite the advantages that the Port of Los Angeles presents, some companies are concerned about the rising costs of living and doing business in California and its strict regulatory environment. They are considering the benefits of moving to cities like Chicago and Mexico, where operating costs are lower.
“My biggest concern is increasing the minimum wage because for this kind of business, we need a lot of people. So rates will have to go up, and I don’t know if customers will agree with that,” Aoki said.
But, until those fears become reality, the advantages of being in Los Angeles still outweigh the downsides, as industry players strive for greater efficiency, expanded services and more globalization in a very tough environment.