Richmond’s Edge in Logistics: Human Capital

The Richmond region has the potential to become a leading center of shipping and distribution, and logistics could become one of the key drivers of the regional economy, concludes a report prepared by the Logistics Task Force of Richmond’s Future, “The Future of Logistics in the Richmond Region: Getting to the Tipping Point.”

Over and above  its mid-Atlantic location, access to four Interstate highways and proximity to the Ports of Virginia in Hampton Roads, the Richmond-Petersburg region has three pillars to build on:

  • Fort Lee. The U.S. Army is building out Fort Lee at a cost of $2 billion to become its logistical training center. The Army Logistics University (ALU), it is estimated, will train 35% of the Army’s personnel at some point during their careers. The potential exists to tap this expertise for the benefit of logistics-based companies in the Richmond-Petersburg region.
  • The Virginia Logistics Research Center. A logistics research center, backed by four Virginia universities, would use academic research to promote the rapid commercialization of logistical technologies. The research collaborative, which is in the advanced business-plan phase, would be supported financially by the private sector.
  • The Port of Richmond. Now that the Port of Richmond has been incorporated into the Virginia Port Authority and regular barge traffic has been established with Hampton Roads, the riverine facility has the makings of an Inland Port comparable to the one in Front Royal. With improved connections to major rail lines, such a facility could function as the nucleus for warehousing and manufacturing development.

The Greater Richmond Partnership identified logistics years ago as one of the Richmond region’s strongest industry clusters. World-class freight carriers are headquartered here, such as Estes Express Lines and UPS Freight (formerly Overnite Transportation), as are Fortune 500 companies that are built upon logistical competencies such as Universal Leaf, a global tobacco distributor, and Owens & Minor, a national distributor of hospital supplies. Presumably, these companies would benefit from access to a logistics resources such as the Army Logistics University and the logistics research center.

There is a lot of work to do, however, before Richmond develops a world-class logistics cluster. It is not clear from the Task Force paper how to make the Army Logistics University a magnet for attracting talent and corporate capital to the region — the graduates, after all, will be reassigned to Army posts around the world. However, Virginia universities may be able to collaborate with the Army to build stronger logistical-related training programs accessible to corporate clients.

The research center is still an aspiration, not a reality. And the inland port idea, while interesting, offers few obvious synergies with Fort Lee or the research center. Be that as it may, the authors are asking the right questions and groping for productive answers. The ideas are all worth pursuing. While it make not yet be clear on how all the pieces fit together, the prospects of building a globally competitive logistics cluster are inherently more realistic and achievable than chasing will o’ the wisps such as biotechnology or semiconductors.

– JAB

7 Responses to Richmond’s Edge in Logistics: Human Capital

  1. This is exciting indeed.

    I am reminded of the logistics center in Louisville, the difference it’s made to that community.

    And, believe me, Military People often come back looking for a home in an agreeable place where they once served. And they often do it a lot sooner than one might think. Norfolk /Va. Beach is a poster child for that.

    Done right, this project – the Army Center / University combo / Port – will offer much to leverage off of. And in ways that draw the kind of people and businesses that bring the skills and energy all communities need.

    A great opportunity!

  2. There’s no question that the Ft. Le expansion is a big plus and the fact that a variety of schools are likewise taking notice is nice.

    I wouldn’t get too breathless about Richmond’s tiny port facility. It is too small to handle much other than barges and the small ocean-going freighter. There’s hardly anywhere to turn a larger ship around. You’d have to back it out al the way to Hopewell. If I recall, there’s one, forlorn rail spur line to the facility that would be completely inadequate for heavy hauling. Before the VPA took over, the port was so badly run it lost its main business to Wilmington, NC.

    Before tobacco took a hit, it was pretty much there to import and export tobacco products and since many shipments were bonded, they needed special controls. I don’t believe Philip Morris USA exports any of its products. That’s why they split off Philip Morris International, to avoid the big health lawsuits.

    So, logistics not a “great opportunity” but a plus.

  3. re: What do military people become when they come home?

    judging from my county and region- they become sheriff deputies, state troopers, fire and rescue guys/gals, and NoVa beltway bandits.

    here’s what most do not become – teachers.

    we should have a path for them to become teachers. The perspective that they could share would be invaluable.

    Most schools do not have near enough men who actually teach something beside “gym” and “sports” and many kids – about 1/2
    the population lack an in-home Dad type person and that’s especially true of black kids. I think we should have a program that allows military guys become STEM specialists to teach kids how STEM integrates with real world jobs.

    • Military people are among the world very best logistics experts, and always have been – see my website: amphibiouslanding.com – on that score.

      They are also highly expert at endless other high skill jobs – Information systems, construction, planning, engineering, mechanics, the list is endless.
      On that score see notes to Saipan and tinian sections of:
      2ndarmoredamphibianbattalion.com

  4. Agree. The US military is king of the logistics game – from soup to nuts.

  5. Here are the top 10 undergraduate schools for supply chain / logistics:

    http://colleges.usnews.rankingsandreviews.com/best-colleges/rankings/business-supply-chain-management-logistics/spp+50

    An interesting mix including Michigan State next to MIT and Carnegie Mellon next to the University of Tennessee.

    As usual, the University of Maryland had pushed its way into the Top 10 in this important field.

    I am not sure how much the Army school at Ft Lee will matter. The US Navy had its Supply Corps School in Athens, Ga from 1954 until 2011. No vast logistics empire was created in Athens and the University of Georgia is not even among the Top 10 supply chain and logistics schools. Basically, I agree with Peter – it’s a plus but not a mandate for success.

    The question is really whether the Richmond Bubbleups will get off their collective asses and do something or not. Will the economic and political elite start earmarking their contributions to the University of Richmond for logistics? Will one of the business leaders of a logistics firm build a lrage and successful APICS organizations and involve the Army personnel as well as college students?

    Much could be done in Richmond with regard to logistics. However, it will take a concerted effort by the localities, state and private interests to make it happen. It will not just “bubble up”.

    Disclaimers:

    My father was a US Navy officer who spent part of his career in teh Supply Corps. He taught in Athens.

    My son graduated from one of the Top 10 supply chain and logistics schools with a degree in logistics.

    I am a former member of APICS.

Leave a Reply