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September 9, 2022

Supply Chain Snapshots - News & Trends You Should Read This Week

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Friday, September 9, 2022

Looking for a quick one-stop-shop for top supply chain and logistics news and trends making waves this week? Read "Supply Chain Snapshots" for the top stories, with helpful summaries and commentary.

#1 East Coast, Texas Ports Gain as Retailers Skirt Pacific Gridlock

Read the full story from Bloomberg here

  • Supply-chain obstacles are forcing U.S. retailers to rewire their shipping routes.
  • The early winners are East and Gulf Coast ports, which are taking business from rivals out West at the fastest pace in at least two decades.
  • Imports through the West Coast are down 0.1%.
  • Higher volumes are a windfall for ports from Massachusetts to Texas—leading to greater investments in ports and warehouses while increasing demand for workers to staff bigger operations.

#2 It’s Going To Be a Weird Christmas for Target, Walmart and Amazon

*Read the full article from FreightWaves here *

  • It's a very challenging time to be planning for order delivery as a retailer.
  • Flexport’s chief economist Phil Levy points to the confusion around mortgage rate hikes as one complicating factor. "If mortgage rates remain consumer friendly, retailers like Wayfair or Pottery Barn should continue ordering more product. Even the sharpest forecasters, though, aren’t certain of anything."
  • Big box behemoths like Best Buy and Bed Bath & Beyond have bloated stockrooms and falling sales.
  • Inventory-bloated retailers are continuing to struggle with middling or negative sales growth.

#3 Union Chief Willie Adams Steers a Tough Course Through Port Labor Negotiations

*Read the full story from The Wall Street Journal here *

  • Union President Willie Adams has the power to scuttle or sustain the U.S. supply-chain recovery, if he can wrangle a sprawling membership with varied concerns in historically contentious, high-stakes contract talks.
  • For the first time since he was elected president in 2018, Adams is leading labor negotiations with the companies that run cargo-handling sites at West Coast ports—the country's main gateways for trade with Asia.
  • Major importers and exporters, the world's largest ocean-shipping firms, and the Biden administration are watching to see if Mr. Adams can steer his membership, including local chapters with varied agendas, toward a deal that would bring a measure of labor peace to maritime operations integral to the American economy.

#4 Flexport Flow Direct: ‘Easy Button’ for SMB Supply Chains?

Read the full article from Sourcing Journal here

  • Flow Direct was created to help smaller companies figure out sailings from China and how to get that product into U.S. fulfillment centers.
  • This new offering from Flexport is an end-to-end global logistics shipping option designed for eCommerce merchants. It is powered by the Flexport Platform and a growing fulfillment network of 3PLs to bring inventory to market faster with more visibility and tracking.
  • This provides weekly sailing options with fast transit times from China directly to pre-approved 3PL fulfillment centers in the U.S., at highly competitive rates for shipments as small as 1 cubic meter.

#5 Retailers Start Selling Something New: Logistics Services

*Read the full story from The Wall Street Journal here *

  • Apparel sellers Gap Inc. and American Eagle Outfitters Inc. are betting their logistics expertise can bring in revenue alongside jeans and tees—even at a time where delivery reliability and speed is strained, yet critical.
  • The retailers want other businesses—including rival merchants—to use their warehouses and distribution networks to manage their flow of goods, similar to Amazon.com Inc’s warehouse and shipping services for third-party retailers.
  • The retailers face hurdles pushing into the logistics market, including concerns from prospective customers about data privacy and potentially giving up the competitive edge of controlling their own logistics network.

#6 Supply Chain Problems are Getting Worse, Not Better, for U.S. Food Retailers

Read the full article from Quartz here

  • Increases in consumer demand, labor shortages, and trucking and shipping capacity restraints continue to interrupt supply chains.
  • Food retailers are still struggling with their supply chains. A recent survey from the Food Industry Association (FMI), a trade organization that represents food retailers and wholesalers, found that 70% of retailers said supply chain disruptions negatively impacted their business, up from 42% the year before.
  • In response, food retailers are using AI and robotics to help make logistics and inventory management more efficient during times of disruption.

#7 Shanghai Port Opens Giant Empty Container Transportation Centre

Read the full article from Splash247.com here

  • An empty container transportation centre has opened in Shanghai, the world’s largest container port.
  • The availability of empty containers has been a serious issue throughout the pandemic, with many containers becoming stuck in North America.
  • The new centre is designed to provide empty container services for shipping operators and customers in Northeast Asia, along the Yangtze River Delta region, and areas along the Yangtze River.
  • Bonded Zone can handle 3m teu per year. Maersk, CMA CGM, MSC, and Evergreen have come onboard as partners.

We'll be back next week with another edition of Supply Chain Snapshots.

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