Saturday, September 7, 2013

Groundbreaking innovations: the shopping cart and the container

Forget the mobile phone and the computer. Forget television and the Green revolution. The two major game-changers of the 20th century were the shopping cart and the container.
The capacity for human shopping is determined by the size of your wallet, but also by the physical ability to carry the stuff. Sylvan Goldman, owner of a food store in Oklahoma City noticed that customers usually quit shopping when the baskets became too heavy, shopping fatigue. In 1937, he invented the shopping cart which largely expanded the customer’s ability to hold and purchase more goods at the same time.

© Vladimir Tonic
In 2013 Maersk’s Mc-Kinney Møller made its maiden voyage from the Daewoo shipyard in South Korea. For a while it will be the biggest ship in the world. It carries 18,000 containers, each of them 20ft long, 8ft wide and 8ft high. That’s enough space for 36,000 cars or 111 million pairs of trainers. Over the next two years, Maersk is overseeing the construction of another 19 similar vessels, forming a class of ship it calls “Triple-E” dedicated to the Asia-Europe route.
This ship is a powerful, albeit often neglected symbol of globalization.

Containerization greatly reduced the expense of international trade and increased its speed, especially of consumer goods and commodities. It also dramatically changed the character of port cities worldwide. Prior to highly mechanized container transfers, crews of longshoremen would pack individual cargoes into the hold of a ship. Loading took a lot of time, there was high risk of damage to the goods by bad weather or theft. A common joke at the New York piers was that the dockers’ wages were “twenty dollars a day and all the Scotch you could carry home” From factory to end customer up to twelve handlings are eliminated by the containerization[i].

Malcolm McLean, a trucking entrepreneur from North Carolina wanted to integrate trucking on land and shipping, which so far had been separate business. He let convert a World War II tanker into the Ideal- X, with a reinforced deck to sustain the load of 58 modified lorry trailers. The world's first purpose-built container crane started to operate in 1959 and loaded one 40,000-pound box every three minutes. The productivity gains from using this container crane were staggering, as it could handle 400 tons per hours, more than 40 times the average of a longshore gang.

Three researchers, Daniel M. Bernhofen, Zouheir El-Sahli and Richard Kneller concludes in a recent study that:
"Regarding North-North trade, the cumulative average treatment effects of containerization over a 20 year time period amount to about 700%, can be interpreted as causal, and are much larger than the effects of free trade agreements or the GATT." 

Containers are generally constructed of aluminum or steel with each container size and type built according to the same ISO specifications, regardless of where the container is manufactured. There are more than 17 million container units and every container has its own unique unit number, who owns the container, who is using the container to ship goods and even track the container's whereabouts anywhere in the world[i]

What would Wal-Mart or IKEA be without shopping carts and containers?

[i], accessed 6 September 2013
[i] Estimating the Effects of the Container Revolution on World Trade  Daniel M. Bernhofen
Zouheir El-Sahli, Richard Kneller, February 2013

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