Book of the Week: The Box

05 Apr 2014

This week I read The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger by Marc Levinson. I’ve been thinking a lot about how goods move from place to place and how that will change in the future as the sharing economy grows. The Box tells the story of how the shipping container overcame obstacles and became ubiquitous. The world became a much smaller place, because of the shipping container.

Containers can be just as efficient for smuggling undeclared merchandise, illegal drugs, undocumented immigrants and terrorist bombs as for moving legitimate cargo. - The Box

Stevedore What I never realized was how the coasts changed. Before there was a romanticized notion of being a seafarer. Communities would live by the coast to support the loading and unloading of ships. The longshoreman would show up and be hired as day laborers. When they wanted to go fishing instead of work, they would just now show up. It took many men to load and unload each item aboard the ship and properly stow it. Containerization changed all that, because cranes could lift and move containers much faster for much cheaper. The unions did everything in their power to save jobs, but eventually containerization won out. Once loading and unloading a ship became a factory like job, the communities changed. Innovator’s Dilemma

The country’s best-known trucking magnate walked away from the business he had built in order to build a new one, based on some untested ideas about shipping.

A lot of the book is about Malcom McLean’s contributions to containerization. He was a visionary willing to take the risks to realized his vision. I was amazed at the deals he was able to structure to leverage enough capital. Building ships is very capital intensive. I would characterize him as a very shrewd businessman. He had to sell off his successful trucking company to move into shipping, because of laws preventing him from having a hand in both. He had to weave an obstacle course of unions, ports, cartels, conferences, military logistics and government oversight. He saw the path to the future and did everything he could to make sure he was at the front of the pack. The Box is truly a story of innovation that changed the way people manufacture goods. Before it was only raw good and finished goods, but now it is a global supply chain. The world would be a much more disconnected place with the system of container transport by truck, rail and ship. It took a lot of effort to get the ball rolling, but once it started rolling, it became hard to stop. If you want to read more about shipping, there is also Ninety Percent of Everything: Inside Shipping, the Invisible Industry That Puts Clothes on Your Back, Gas in Your Car and Food on Your Plate by Rose George. Barnacle leverages the sharing economy to let people ship things that were unpractical before.