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News March 26, 2024

Promo Pros Discuss Impacts From Tragic Bridge Collapse in Baltimore

Industry companies in and around the city say they haven’t yet experienced direct major issues, but they have concerns for what lies ahead. More broadly, some industry executives worry supply chain challenges could result.

By  Christopher Ruvo and Sara Lavenduski

The “mayday” call from the cargo ship came shortly before 1:30 a.m. Tuesday.

Dali, a Singapore-flagged vessel stacked with shipping containers, had lost power and was traveling up the Patapsco River, unable to stop or divert course, toward the Francis Scott Key Bridge in the Port of Baltimore, according to press reports.

Minutes later, the worst fear became a reality: The ship collided with a support, toppling the bridge into cold, 50-foot-deep water … and touching off a tragedy.

Soon after, emergency crews were working to find a reported eight construction workers who’d been on the bridge. Two had been located, but six remained missing as of Tuesday afternoon.

The 1.6-mile-long steel bridge, part of Interstate 695 and a significant thoroughfare that carries roughly 34,000 vehicles daily, was destroyed. Traffic was being rerouted, and the Port of Baltimore had closed indefinitely.

Promotional products companies in and around the city say they haven’t experienced direct major issues, but they have concerns for what lies ahead. More broadly, some industry executives worry supply chain challenges could result.

Baltimore Promo Firms React

Baltimore-based promo firms that ASI Media spoke with reported minimal business impacts from the bridge collapse as of Tuesday.

Towel Specialties (asi/91605) is located about 10 miles from the bridge. The supplier said no employees were affected and that its business is fully operational.

“We don’t anticipate this tragedy affecting our business,” said Murray Siegel, marketing director at Towel Specialties. “We are, of course, mournful of the loss in the community and appreciate everyone’s concerns.”

Brian Sommers, general manager of Baltimore’s BGD Promo (asi/37720), told ASI Media that “there sure is a very creepy vibe around town.”

“Local traffic will be an issue for several years, as congestion and longer routes will need to be taken to accomplish the same travel points,” Sommers said. “I do see this as being an issue for a period of time in the Mid-Atlantic.”

Murray Siegel“We are, of course, mournful of the loss in the community and appreciate everyone’s concerns.” Murray Siegel, Towel Specialties

Ayme Lederman is the office manager and sales consultant at Badges, Buttons...Plus!! Specialties (asi/129600), northwest of the city. While her company doesn’t heavily rely on products and supplies arriving by water, Lederman said she’s anticipating some disruption down the line, though it’s hard to say what that might be.

“We’re not expecting commute interruptions,” she said. “We live at the top of the Beltway, and we don’t go over the Francis Scott Key Bridge much at all. I’ve been over it maybe once.”

Tom Jones, vice president of SwagDog (asi/340307) just north of the bridge, said most of the traffic that travels to his area [east of downtown] goes through two tunnels on I-95 and I-895. “That bridge is the least traveled of the three,” he added. “I don’t anticipate major delays.”

Let’Sgo Logo (asi/252552) is located directly north of downtown Baltimore. President Ben Bell also doesn’t expect much disruption, but he continues to monitor conditions as the situation develops. “First thing will be to remove the bridge wreckage to reopen the waterway at the Port of Baltimore,” he said.

Trip Burch is the owner of White Star Sales & Promotions (asi/359706), located just five minutes from Baltimore’s Inner Harbor, at the northernmost end of the Port. Right now, the distributor isn’t experiencing disruption, but looking ahead, “I’m not 100% sure,” Burch said.

Supply Chain Fallout?

Suppliers ASI Media spoke with do not, at this point, believe there will be major negative impacts on their supply chains in the wake of the bridge collapse. Even so, some worry that the potential for ship congestion at other East Coast ports and possible higher costs of importing could result because of the Port of Baltimore being closed.

Port congestion can cause delays in promo suppliers and other importers receiving product, and in extreme cases can contribute to inventory shortfalls. Higher costs for importing, if severe and prolonged enough, could drive pricing higher on promotional products and other goods. Those worst-case scenarios aren’t anticipated, but industry sourcing pros expect there could still be some fallout from the tragedy.

“It’s too soon to tell about long-term implications, but I have already received emails from overseas importing partners saying that steamship companies may use this terrible situation to raise rates,” said Jeffrey Nanus, CEO of AAA Innovations (asi/30023), a New Jersey-based supplier of eco-friendly hard goods.

Shipping rates shot up dramatically in the early part of 2024, primarily due to a drought in the Panama Canal and terrorist attacks in the Red Sea on commercial vessels traveling to the Suez Canal. Rates have started to decline, but the most recent data from the Freightos Baltic Index, a freight tracker, indicates that rates remain elevated from levels seen late last year. The current average cost to ship a container from China/East Asia to the East Coast is $5,283.

“I’m not sure the port being closed will have a broad impact to importing costs everywhere, but would assume it will increase importing costs into the Baltimore area, as importers have to shift to alternative ports and incur higher drayage costs as a result,” said Doug Donnell, chief operating officer at Florida-headquartered Top 40 supplier Hit Promotional Products (asi/61125). “There’s a potential that the number of ships and containers stuck in the port could negatively impact overall ocean capacity to some degree, which could impact costs more broadly, but I wouldn’t expect that impact to be substantial.”

Hit doesn’t import through Baltimore and doesn’t expect higher drayage costs relative to its operations.

Jing Rong doubts importing/freight rates will rise dramatically. “If there are increases, I believe they will be short term and minimal,” said Rong, vice president of supply chain and sustainability at Braintree, MA-based Top 40 supplier HPG (asi/61966).

Massachusetts-based Top 40 supplier Gemline (asi/56070) does not use Baltimore as a primary port for shipments, but will be reviewing its routing on future incoming vessels to avoid ships that do make a stop at this port. “I suspect many shipping lines may be taking out this stop until further notice, which could put pressure on the New York and Virginia ports as they take on more volume,” said Tim Behling, Gemline’s vice president of global supply chain.

Rong had a perspective on port congestion pressures, too: “I suspect that we will see delays at nearby ports as a result, but am not sure of the magnitude of at this time. Also, the containers already gated in at Baltimore terminals will likely have to wait until the port reopens, potentially taking more vessels and containers off sailing schedule.” Fewer vessels and fewer containers in circulation can contribute to freight/container cost increases.

The Loadstar reported that the Port of Baltimore has the deepest draught on the U.S. East Coast. Some ships are of a size that they can only be handled by select other East Coast ports, such as New York, Norfolk and Savannah. “The supply chain that could take a massive hit from [the bridge collapse]…is finished vehicles being imported into the U.S.,” The Loadstar noted. “Baltimore is the largest car port in the nation, handling around 750,000 finished vehicles a year, and exporting around another 320,000.” Whether any such supply chain issues would trickle down to impacting automotive industry clients' spend on promo was an open question as of this writing.

Trucking and less-than-truckload rates could also rise, at least locally. That would affect promo companies that rely on such services. “Trucks will be forced to divert around this area, causing delays and slowdowns,” said Behling.

Promo firms and other businesses in the Baltimore area or sending product to the city/region could experience local delivery/trucking challenges. “I am sure there will be some significant disruption for standard parcel and LTL deliveries in the Baltimore metro areas for the next couple of weeks,” said Hit CEO/President CJ Schmidt, a member of Counselor’s Power 50 list of promo’s most influential people.

The Francis Scott Key Bridge was named for the poet of the same name. Key wrote the "Star-Spangled Banner." 

“We’re praying," said Schmidt, "for those in this area that their families and commerce are not impacted too drastically.”