Becoming McLean

90 percent of everything

"In 1996, by which time around 90% of world trade was moving in containers on specially designed ships, New York threw a party for Mr McLean, variously described as shipping's ‘man of the century’ and the inventor of ‘the greatest advance in packaging since the paper bag"

The Economist[i]

In her book, ‘90% of everything’[ii] English journalist Rose George spends several weeks aboard a ship carrying goods in containers that would stretch around 11,000 miles if lined up from end to end. The central thesis of George’s book was that approximately 90% of global consumption is fueled by container shipping.

Malcolm Mclean is more responsible for the rise of container shipping than anybody else. His innovation allowed shippers to drastically reduce their costs and the time required to load cargo. It’s in large part because of the changes brought by Malcolm Mclean and his company that the industry now generates around $450 billion every year.[iii]

Malcolm Mclean combined trucking and shipping to revolutionize transport

Malcolm Mclean was not a shipper by profession – he was a trucker. In Marc Levinson’s book, ‘The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger,’ the third chapter, entitled ‘the trucker’, traces his story. As the author says: “an obsessive focus on cutting costs was the key to Mclean Trucking’s success.”

In a certain manner, it was the combination of both – obsessive cost cutting and trucking – which ultimately led to the containerization of shipping. Growing state-by-state regulation of the trucking industry and unionization led Mclean to believe that shipping could offer a more cost-effective way of delivering products.

He said: “ships would be a cost-effective way around shoreside weight restrictions . . . no tire, no chassis repairs, no drivers, no fuel costs . . . Just the trailer, free of its wheels. Free to be lifted unencumbered. And not just one trailer, or two of them, or five, or a dozen, but hundreds, on one ship."[iv]

Applying this concept, Mclean redeveloped trucks into two separate parts – a wheeled truck bed and an independent container sitting on top. He also patented a reinforced steel structure for containers, which would allow them to be manipulated faster and ensuring that they would hold together under duress.

A key component of containerization is not just that standardized containers can be stacked quickly on ships, but also that trucks can manouever the same standardized containers at either end of the journey. The industry – ports, trucks and ships – all quickly began to adapt to the new roll-on roll-off reality of cargo transportation.

It also led to a massive reduction in costs for shipping. Analysts for the New York Port Authority in the 1950s estimated that the cost of sending a beer on board a coastal ship had fallen from about eight dollars a ton (including unloading), to around twenty five cents a don as a result of Mclean’s idea. While Mclean is often credited with creating a revolution, he merely merged a few processes from similar but separate industries to generate massive efficiencies.

[i] https://www.economist.com/obituary/2001/05/31/malcolm-mclean

[ii] George, R. (2013). ‘Ninety Percent of Everything: Inside Shipping, the invisible industry that puts clothes on your back, gas in your car, food on your plate.’ Metropolitan Books.

[iii] http://www.worldshipping.org/benefits-of-liner-shipping/global-economic-engine

[iv] https://hbswk.hbs.edu/item/the-truck-driver-who-reinvented-shipping