In the previous post’s comments, Missy asks, “How does one in Panama get a shipping container? How does one get a shipping container delivered? Do you get a used one in Panama near the canal? Are you going to do all the welding?” Good questions. Here’s the story.
(Subject to the changing nature of Panamanian reality — I recently read a quote by Helmuth von Moltke, “No battle plan survives contact with the enemy.” Not that Panama is the enemy. It certainly isn’t. But personal resiliency is key here. Vital, in fact.)
I recently read a book titled, “The Box.” It is the story, written by an economist, of how the invention and development of the shipping container changed the world. Stevedores used to swarm over many docks in many ports around the world. Every item, whether a coil of wire or a crate of widgets, had to be moved from factory to truck to transportation center to truck to railroad to truck to dock to dock storage to dock to ship, then reverse the whole process to the ultimate recipient, handled by hand at each transfer. Delivery of your goods was slow, expensive, lacked security, and the goods were often damaged.
Enter Truck driver Malcom Mc Lean in 1956 who saw a better way. Over the next years and continuing on to today, fortunes were made, lost, and made again. Thousands of stevedores lost their jobs and hundreds of ports closed as The Box made shipping fast, economical, safe, and did I say, fast. Huge specialized mega-ports were built and often closed without ever being used as a newer, faster, better port was built a few miles away. This continues at this moment today, as the widening and third set of locks of the Panama Canal changes everything again. New ports, such as Houston and others over on the east coast, are now readying to take traffic away from the old mainstays such as Long Beach and Oakland in California.
Now, as the World economy shrinks, and especially that of the United States, fewer containers are in motion making the trip from China to your local BigBoxMart. And, with the economy the way it is, it is often cheaper to make a new container in China than to ship an empty one back from Kalamazoo. The empties are stacking up around the world, mostly at the ports. In Los Angeles, they are stacked so high, that sunrise in some residential neighborhoods is an hour later. No, really.
Armed with this knowledge, I know there are millions and millions in surplus, and with this knowledge, it is a buyers’ market. This reminds me of when I was 16 years old. Looking for a piece of wood for a carpentry project, I went to a local woodworking shop. I spotted the scrap cutoff box and asked the owner, “Hey mister, is this wood all scrap?” He replied, “Yes boy, it is, until you want a piece of it!” So life tells me they aren’t going to give me six of them for free, but neither am I going to buy them as if they were gold plated.
Which brings me to Missy’s first question, “How does one in Panama get a shipping container?” Connections, Missy, connections. Everything in Panama is about connections. One day I was talking with Ramiro who is the caretaker at the estate across the street from our current house. I practicing my Spanish, and he practicing his English, we came to the point that he has a friend who works at the port in Colon, and he would call him for me. Colon is the larger of the two ports, Panama City being the other. Ramiro came back to me later that day, saying I could get them for $4,000 each, FOB Colon. This is a very good price for the seller, but as my great grandfather is said to have said, “It all depends on whether you are buying or selling the pianni (piano).” From my research on the Internet, I see that $2,500 is a fair price in the States, and given that labor is so much less here, I figured that $2,500 would be a fair price here. Delivered to my lot. This also happens to be right in our budget. So I asked Ramiro to make another call, this time with my $2,500 delivered price. I told him that this is all we have, and if we want to be able to buy and install windows and doors in the boxes, then this is a true statement. The new price came back at $3,000 each, delivered. Back in his court, $2,500. Delivered. I figured that having $15,000 cash in hand was a powerful incentive, and indeed, the price was set at this number. Now, I fully expect the price to have “gone up, when the time comes to place my order” but there must be a hundred dealers of used containers, and the first one who puts his hand out for the money gets the contract. It is still a good fair price.
I’ll go to Colon to inspect the used containers, record the serial numbers, then the “successful contract winner” will put the six containers on six trucks and deliver them to our lot. I will have to get a crane at an extra expense, probably around a thousand dollars I figure, as there are none in our area.
After they are delivered and installed on the concrete piers, I will weld them together and cut out the window and door areas with an angle grinder with a metal cutting blade and/or a plasma torch. I can get a Man With Welder for $25 a day and/or do it myself.
Then the real fun begins.