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Turkey Prices in the U.S. Keep Soaring Due to Strong Demand and Labor Shortages

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Archives, Global Trade Daily, News

Turkey Prices in the U.S. Keep Soaring Due to Strong Demand and Labor Shortages

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IndexBox has just published a new report: ‘U.S. – Turkey Meat – Market Analysis, Forecast, Size, Trends and Insights‘. Here is a summary of the report’s key findings.

This November, the price for fresh whole body turkeys surpassed November 2020 figures by 9%, while frozen whole body turkeys jumped 20% y-o-y. A short supply of workers led to lower turkey output and higher prices on the backdrop of consistently strong consumer demand. Turkey imports to the U.S. maintained the previous year’s levels. Canada and Chile remain the only turkey suppliers to America. Unprecedented inflation rates have struck the entire food sector; in October 2021, price increases for meats, poultry, fish and eggs became the highest recorded in the past 30 years.

Key Trends and Insights

Due to accelerating food inflation, Thanksgiving dinner this year will cost Americans significantly more than the previous one. According to the latest report from the USDA, the average price for fresh whole body turkeys in November 2021 was $1.46 per pound, which is 9% more than the previous year. The price for frozen whole body turkeys came to $1.36 per pound, a 20% increase in comparison to 2020.

The average cost of organic fresh whole body turkeys totaled $3.24 per pound (+4.8% compared to November 2020), while organic frozen whole body turkeys were $3.30 per pound (+23%). On average antibiotic-free fresh whole body turkeys cost $2.37 per pound (a decrease of 7%), at the same time, frozen whole body turkeys are going for $3.30 per pound (twice the gains compared to November 2020).

The increase in turkey prices is caused by solid demand running into a 6% y-o-y drop in butchered turkeys to 4.6M tonnes, due in part to a deficit of workers. The turkey market size in 2020 totaled 2.4M tonnes, while this year, it is expected to decrease to about 2.3M tonnes.

Higher turkey prices are occurring in the broader context of unprecedented inflation for food products. According to the U.S. Bureau of Labor Statistics, October prices for meats, poultry, fish and eggs grew by 11.9% in comparison with October 2020. That is the fastest rate of price increases in the past 30 years.

It is unlikely that imports will offset the short supply of turkeys in the US. In 2021, imports remained at comparable levels to the previous year and from January through September consisted of 7K tonnes, accounting for about 0.4% of US consumption. In monetary terms, imports totaled $19.6M, having grown by 7% in comparison with the same period in 2020. Canada makes up 80% of American imports, together with Chile being the only suppliers of turkeys to the U.S.

Turkey Exports from the U.S.

In 2020, exports of turkey meat from the U.S. contracted to 214K tonnes, with a decrease of -11.8% compared with 2019. In value terms, turkey meat exports shrank from $483M to $416M (IndexBox estimates).

Mexico (135K tonnes) was the main destination for turkey meat exports from the U.S., accounting for a 63% share of total exports. Moreover, turkey meat exports to Mexico exceeded the volume sent to the second major destination, China (17K tonnes), eightfold. The third position in this ranking was occupied by Guatemala (4.8K tonnes), with a 2.2% share.

In value terms, Mexico ($262M) remains the key foreign market for turkey meat exports from the U.S., comprising 63% of total exports. The second position in the ranking was occupied by China ($27M), with a 6.6% share of total exports. It was followed by the Dominican Republic, with a 2.6% share.

From 2010 to 2020, the average annual growth rate of value to Mexico (+0.2% per year) was relatively modest. Exports to the other major destinations recorded the following average annual rates of exports growth: China (-3.0% per year) and the Dominican Republic (+0.2% per year).

In 2020, the average turkey meat export price amounted to $1,945 per tonne, with a decrease of -2.4% against the previous year. There were significant differences in the average prices for the major export markets. In 2020, the country with the highest price was the Dominican Republic ($2,434 per tonne), while the average price for exports to Jamaica ($1,195 per tonne) was amongst the lowest. Over the past decade, the most notable rate of growth in terms of prices was recorded for supplies to China, while the prices for the other major destinations experienced more modest paces of growth.

Source: IndexBox Platform

FTZs
Archives, Foreign Trade Zones, Global Logistics, Global Trade Daily

Demystifying Foreign-Trade Zones: Tackling 3 Myths to Leverage FTZs in 2022

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Bigfoot, the Boogie Man, the Loch Ness Monster, and… Foreign-Trade Zones? Despite the overwhelming advantages offered by U.S. Foreign-Trade Zones (FTZs), there are still many misconceptions — and sometimes a little fear — surrounding the program. Much like Bigfoot, the reality of FTZs is far less scary.

To better understand FTZs, let’s get back to the basics. Foreign-trade zones, also referred to internationally as “free-trade zones” (and formerly named “free ports”), are areas where goods may be received, packaged, manipulated, manufactured, processed, and re-exported without the intervention of the customs authorities. These zones are designated sites authorized by the U.S. FTZ Board. A site that has been granted zone status must be approved for FTZ activation by the U.S. Customs and Border Protection (CBP) to receive FTZ benefits. While FTZs are considered to be outside CBP territory, foreign-trade zones still fall under the supervision of CBP.

These guidelines and procedures allow domestic activity involving foreign items to take place prior to formal customs entry. As a result, businesses — typically manufacturers and distributors — that leverage these zones drastically reduce or eliminate duty costs, encourage U.S. trade, and improve supply chain productivity.

FTZs have been in existence since 1934, and despite the fact that the program offers distribution and manufacturing companies tremendous reductions in duties, customs fees, and even logistics costs, FTZs still seem to be a misunderstood or even unrecognized trade program. How prevalent are FTZs in the U.S.? Who uses them? Are they still a viable solution?

According to the 2020 FTZ Report to the U.S. Congress, there were 195 active FTZs across all 50 states and Puerto Rico, and 3,400 companies taking part in the program. Last year also saw $625 billion in shipments made through FTZs, despite the challenges the global supply chain faced in 2020.

It’s understandable for CSCOs and business leaders to have concerns when introducing a new trade program. Some companies may be dragging their feet due to the current strain on the supply chain, and others may believe common FTZ misconceptions. However, companies that are taking advantage of FTZs are realizing impressive savings, and in many cases, obtaining relief from a number of supply chain issues. It’s time to debunk some common myths to demystify FTZs, explore the benefits of the program, and learn how to leverage FTZs in an increasingly competitive world. Let’s get started.

Myth #1: “My entire company and supply chain will be disrupted if I start using an FTZ.”

Over the past 20 years, the FTZ program has changed significantly. These changes make it far easier to establish and operate an FTZ.  In fact, if an FTZ is implemented by a knowledgeable advisor, there should be little change to a company’s daily processes and procedures, including logistics.

With the right FTZ inventory and record-keeping system in place, the only changes a company will notice will be placed on the designed FTZ administrator. Today’s FTZ solution providers establish and manage the entire FTZ program and its inventory. Therefore, there is also no longer a need to physically separate foreign and domestic inventory between FTZ and non-FTZ areas within the facility.

Essentially, your supply chain will look and operate the same tomorrow in a foreign-trade zone as it did yesterday, with two notable exceptions. Firstly, the FTZ program can speed up your supply chain so that you receive foreign shipments quicker; and secondly, after implementing an FTZ, you will have access to all the benefits — which brings us to myth #2.

Myth #2: “Zones only benefit companies that have long inventory turns, or re-export. Our company turns inventory quickly and has limited exports, so the FTZ program will not benefit us.”

It is well-known that FTZs defer duty payment on merchandise brought into a zone and that duties are paid only when the goods enter into U.S. commerce. This holds a lot of value and can lead to additional cash flow, but that isn’t the only benefit to using an FTZ. Other benefits include:

Relief from inverted tariffs: There are many cases where a component or raw material is subject to a higher duty rate than the finished product. An FTZ allows the manufacturer to pay duty at the manufactured item rate, rather than the higher component rate. This helps U.S.-based producers serve the domestic market on a level playing field versus importers of the same finished product.

Duty exemption from re-exports: This one is pretty simple and a huge advantage for FTZ users: there are no duties on or quota charges on re-exports. Therefore, if you were to export goods to another country, they would generally be exempt from duties. Generally, with an FTZ, the only time you have to pay is when the item enters U.S. markets.

Savings with weekly entries: Under standard importing procedures, companies have to pay a Merchandise Processing Fee (MPF) for every Customs entry. As of October 1st, 2021, the MPF is capped at a maximum of $538.40 per entry. Under Weekly Entry procedures, zone users can group all imports within a week into a single customs entry and pay a single MPF. This can yield substantial cost savings and reduce processing time and labor. For instance, a company that has 2,500 Customs entries a year would pay $1,346,000, assuming each entry hit the cap. If the company utilized Weekly Entries, 2,400 entries would be reduced to only 52. This offers savings of $1,318,003 just on MPFs.

No duty on waste, scrap, and yield loss: Without a zone, an importer pays the Customs duty owed as material is brought into the U.S. In a zone, no duty is paid on irrecoverable yield loss, or merchandise that is scrapped or destroyed. This can lead to tremendous benefits with even a low scrap rate. There are also advantages for recoverable scrap that can be sold or recycled, as the most common duty rate for scrap sold into the U.S is zero.

The ability to fix damaged or non-conforming items: Savings can be further increased because when an item that is considered “damaged” or “non-conforming” is tested and repaired, no duties are owed. Items can even be altered, repackaged, or relabeled to meet U.S. requirements with no extra cost.

State and local benefits: Foreign and domestic goods held for export are exempt from state and local inventory taxes. In addition, FTZ status may also make a site eligible for state and local benefits that are unrelated to the FTZ Act.

Free zone-to-zone movement: More savings are to be had when transferring goods from one FTZ to another. In this scenario, regardless of the number of shipments you make, you are not subject to duty on the goods. A beneficial use of this would be the duty-free transport of raw materials and components, eliminating any fees until the finished product is officially shipped into the U.S. market.

These benefits can add up to millions of dollars in cost savings and offer a strong competitive advantage for U.S. manufacturers and distributors. What’s keeping companies from taking advantage of these benefits? Here we find myth #3.

Myth #3: “The process is too overwhelming.”

The process to implement an FTZ can seem overwhelming, but with the right advisor and software, implementing a zone comes down to four easy steps:

Step 1: Get an in-depth analysis. Contact a trusted provider of FTZ solutions and schedule a call to discuss your goals and challenges; request a complementary evaluation and cost/benefit analysis with a service provider (like this one). This will ensure you understand the net savings the FTZ program can offer your company.

Step 2: Choose an FTZ solution provider. Your selected partner should assist your facility to receive FTZ designation. If you are a manufacturer or producer, your partner will assist in securing FTZ production authority. In addition, they will help activate your facility with CBP.

Step 3: Implement the software. Probably the most important step in maximizing net FTZ benefits, is choosing the right FTZ inventory control solution. A comprehensive software solution will ensure you compliantly maximize FTZ savings while minimizing administration costs.

Step 4: Reap the benefits. It’s that simple.

Why now?

The supply chain and e-commerce underwent rapid transformation in the past several years due to COVID-19, Brexit, newly imposed tariffs, and other challenges. As consumer behavior evolves, the global e-commerce market is expected to grow by $1 trillion by 2025, too. These trends are causing global manufacturers to rethink the “just in time” lean manufacturing strategy into a “just in case” model. FTZs are the perfect solution, allowing them to store more inventory in the zone without incurring inventory costs and duty over time.

Debunking common FTZ myths helps unmask the many benefits they bring for manufacturers and distributors. As e-commerce grows and the world regains control of the supply chain, now is the time to get ahead and take advantage of them.

Corey Rhodes is the President of QAD Precision

logistics company
Archives, Global Logistics, Global Trade Daily, Warehousing

4 Strategies Every Logistics Company Must Start Doing

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On the consumer level, logistics companies are seen as couriers who deliver their most-awaited packages. But for business owners, the logistics industry is an extension of their service cycle. As such, logistics companies have a ton of responsibilities on their shoulders. 

As a logistics company, what practical steps must be done to maximize your clientele’s satisfaction? 

We can look into it in this manner. The primary goals of a logistics company can be broken down into three segments: warehousing, distribution, and transportation. For each goal, there must be actionable steps that your logistic company should do immediately. And if you are practicing it already, maybe it’s time for an upgrade. 

Here are some of our tips. Let’s go! 

Tip #1: Listen to Customers 

We know this is the oldest trick in the book. But, that only goes to show how effective this one is. The question now is how to listen to them effectively, considering that logistics companies cater to two different sets of customers. 

Client satisfaction surveys will never go out of style. You just need to upgrade the method to acquire them. 

To effectively collect data through surveys, make sure that the survey form is accessible. Most survey data now are collected through the internet. On top of that, most of them are composed of 5-7 close-ended questions only. 

Everyone wants it fast and instant nowadays, and you need to take advantage of that. Pose questions such as, “Which of our services are you most satisfied with?” and present them with choices. As much as you can, always provide choices to make the process easier for everyone. 

Apart from surveys, make sure to keep your social media presence known. Be active on social media platforms. 

Some might have hesitations thinking that logistics companies don’t need Facebook, Twitter, or Instagram pages. But, best believe, you do. 

Having one is one of the easiest and most open forms of communication between your clients. It’s akin to practicing an open-door policy in your company. 

You can easily look for customer feedback and provide them with easy solutions without them needing to go through customer reps. It’s a win-win situation for both sides. 

Tip #2: Reduce Waiting Time

Time is an essential aspect of any logistics business. And in the entire process from pick up to delivery, there are several points where you can reduce waiting time. 

First and foremost, ensure that your communication lines are always open and available. Establishing a comprehensive company website is essential in this day and age, regardless of what industry you belong in. 

If you are yet to create one, tap the services of an established web design company. They will handle everything from inputting the essential details of your company down to the overall design of the site. Make sure to partner with a company that prioritizes web design and development. 

Work hand-in-hand with these web design companies so that you’ll come up with a website that best caters and depicts your company’s needs and services. 

This published website will then become the go-to portal of all your clients, new and recurring. With a few clicks, they can check out your services and rates. And if your site also comes with round-the-clock chatbots, then the website also becomes the easiest and most efficient way to reach you. 

Aside from those mentioned above, the website will also serve as your company’s personal tracker. Instead of updating your clients manually about their shipment’s whereabouts, you can just update them through the site by sending them automated emails or chats. On the flip side, your customers can also use the site in the same manner. 

Some logistics companies often disregard the importance of well-designed websites because the services offered are all “offline”, but most of the clients today are almost always “online”. There is a need to bridge this disconnect. 

Tip #3: Understand and Deliver Customer Expectations

As much as goal-setting is fundamental for building businesses, expectations-setting also holds the same weight of importance. A large chunk of customer satisfaction relies on whether their expectations of your services are met or grossly missed. 

Regular and properly-crafted surveys and social media presence can help with this tip as well. But, an even more practical method to achieve this goal is to set the expectations yourself proactively. 

Say, for example, you are a logistics company that specializes in the transportation of goods. Even before a client can demand when they want their goods to arrive, make the first move. Tell them what is expected from your services. 

Provide the details on how you carry out your services. Most importantly, uphold transparency when it comes to dates. When you can pick up orders, when you can deliver, and when you can drop them off. These details are essential for your customers and they should be held as your company’s top priority too. 

Another method to meet your customers’ expectations is to do timely tool upgrades. Something as simple as bill printers can decrease your usual service time. Automatic tape machines also do the same. If you have the capacity to automate more than half of your process, then invest in it.

Tip #4: Research!

Lastly, research will always be your most valuable strategy. The demand in the logistics company started as seasonal, but that doesn’t seem to be the case now. To cope with this shift, full-blown market research is an effective tool to come up with solutions. 

But, that’s not always the case. Sometimes, simple research, such as looking into new trends or new delivery technologies, can catalyze further improvement for your company. 

Final Words

Even if logistics companies handle rough or brunt work every day, that doesn’t mean that you can forego other aspects of the company. Publishing company websites, social media profiles, and regular research should go together with the labor that gets done every day. These strategies keep your company running. 

If you are yet to start these practices, make sure to conceptualize how you can effectively translate your offline presence to the online domain.

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3pls, Archives, Global Logistics, Global Trade Daily

Top 7 Logistics Challenges Facing the Industry

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Few industries have as much impact as logistics. In a way, it keeps the world economy going. Manufacturers, retailers, farmers, and even service providers all depend on it. But even though it plays a significant part, there are still plenty of logistics challenges facing the industry. Today, we’re talking about the seven of the biggest ones.

Now, there are numerous reasons why things got so tough in the last couple of years. Consumers’ expectations are shifting, and technology advances and new regulations are constantly coming out. On top of that, the COVID-19 pandemic didn’t make it easier.

Of course, all these issues bring an opportunity for growth and improvement. If you can find a way to overcome the challenges, you can be sure that you’ll capitalize on that. Here’s what you should pay attention to in the following year.

1. Cutting Transportation Costs

We can safely say that this is the single biggest problem in the industry at the moment. In some cases, the transportation costs come to reach 50% of the value of the product. Still, the demand for shipping companies is rising almost as fast as the fuel price. There’s plenty of work, but it seems that there’s not enough money to go around for everyone.

Many retailers and distributors are choosing to let just one or two shipping companies take care of their complete transport. Their reasoning is simple — if you’re shipping more with one carrier, you can get better rates. And while all that is true, you have to trust one company with your entire stock. Imagine what you’d have to go through if there’s a week’s delay.

2. Meeting Consumer Expectations for Visibility

Due to companies like Amazon and Walmart, customers nowadays want to know where their shipment is at any given moment, as well as when they can expect it to arrive. And things aren’t much different if we’re talking about transport visibility in B2B. As a matter of fact, the problem is even more complex.

To meet all of their demands, you need to improve the visibility across your entire supply chain. You should be able to track each of your shipments and maintain constant communication with the drivers. However, you also need a real-time alerts and notifications system. It allows fleet managers and drivers to make prompt decisions if any issues occur.

3. The Shortage of the Drivers

The next of the logistics challenges facing the industry that we want to talk about is driver shortages. These are demanding jobs, and it seems that at the moment, there just aren’t enough drivers to fulfill the needs of the industry. There are also these government regulations that force companies into being more strict about hiring their drivers.

Hence, the recruiting process is long and expensive, and it’ll stay like that for a while. There’s not much you can do but follow the rules. On the other hand, you can optimize the routes your drivers are following and stretch the capacity that way. It’ll give you at least some leverage.

4. Getting Sustainable

Carbon emission reduction is more important today than it ever was. The public wants to see environmentally-friendly practices in the private sector, so governments have to push it.

Although this isn’t bad on its own, it’s putting a lot of stress on logistics companies. And if you’re at the front of one, you must act quickly, but luckily there are plenty of things you can do to make your logistics more sustainable:

-Adopt route and load optimization

-Upgrade your engines

-Track and report emissions

-Use alternative fuels

Going down any of these paths won’t be cheap, but it’ll pay off in multiple ways.

5. Improving Cooperation With Your Partners and Suppliers

If you want your transport and logistics company to be successful, you must talk to your partners and suppliers and get to agreements that benefit all of you. They must be satisfied with your service, and you must be happy with theirs. It sounds like common sense, but at the end of 2021, we feel like we need to stress it.

You should all understand the state of the market and the moment and get on the same page. If you support and help each other now, many new improvement opportunities will open up in the future.

6. Adopting New Technologies

As we already mentioned, logistics companies already need to start adopting new and innovative technology solutions. They help you increase productivity and reduce costs in the long run. And we’re already at the stage when things like warehouse management systems are becoming non-negotiable.

However, with so many options available, it’s hard to pick the right one. Don’t rush it, and consider all your unique business operations before you make a decision.

7. Grappling With the New Way of Doing Business

It’s clear to all of us that the COVID-19 pandemic brought plenty of challenges to the game. However, some of them are here to stay, and some we didn’t even see yet. Changes are happening all across the industry, and it’s difficult to predict what will be the next big thing.

So, we’ll say that the final of the logistic challenges facing the industry is that you can’t be sure what to expect. And with that in mind, making your processes as flexible as they can be is the best way to go.

_________________________________________________________________

Harper Mullins is a logistics specialist and a passionate freelance writer. At the moment, he’s working with Fit 2 Move on improving their storage and transport capabilities. He uses his free time to read every book he can get his hands on. 

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Archives, Global Logistics, Global Trade Daily, News

“New Kid on the Block” Networking Platform Addresses Sourcing Amid Supply Chain Crisis

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Best known for bringing manufacturers, reps, and merchants together, B2B networking platform company, Factrees, announced the release of its newest platform aimed at addressing nearshore sourcing bottlenecks amid the supply chain shipping crisis.

Driven by the power of artificial intelligence, the newly launched platform provides a reliable resource library consisting of searchable U.S. manufacturers, independent sales reps, distributors, wholesalers, and retailers for customers to select for sourcing. Companies can network and connect based on product lines, territory, services offered, and business relationships.

“We are creating a sourcing community that simplifies and expedites the process of finding quality sourcing partners while reducing the dependency on word-of-mouth and tradeshow marketing for driving growth,” said Keith Williams, Factrees Co-Founder and CEO.

“Factrees is the new kid on the block,” he adds.

Adding to the platform’s appeal is the option for companies to share their experiences with manufacturers and distributors — including reviews, ratings, and the option of messaging and real-time video meetings.

“There is a groundswell of realignment between manufacturers and sales representatives,” said Ron Smith, President & CEO of Curtis Stout. “Factrees is offering valuable tools; a professional approach to connect and match all manufacturers with quality sales agents.”

Through a series of straightforward and simplified steps, companies can utilize the platform and begin connecting once a profile has been created and claimed. This process supports efforts in getting products to customers from the factory.

“I have been in the industry for 30 years. Factrees is a very creative concept supported by a very helpful web interface, said Paul Entwistle, COO Hardware Industry. “I believe those who use it will have an advantage over those who don’t.”

To learn more, visit: www.factrees.com

Envirotainer
Archives, Global Trade Daily, News

Envirotainer’s CryoSure® Transforms Low-Temperature Shipping

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The future of cryogenic shipping is now met with a sustainable and revolutionized option thanks to Envirotainer – a leader in secure cold chain solutions for intercontinental shipments of pharmaceuticals bringing more than 30 years of expertise to the industry.

“For many years, the strategy of Envirotainer has been to extend our offering through new innovative products and services and to expand into new segments. This technology fits perfectly into our circular business model and is going to be an important part of our offering going forward. The unique, premium quality, and completely reusable technology matches perfectly into Envirotainer’s global footprint”, says Fredrik Linnér, Chief Business Development Officer at Envirotainer.

The company announced the release of four models representing its latest solution for pharma-related shipping known as the CryoSure® platform (X1, X2, X5 and X11). This platform offers multiple competitive capabilities and elements including  -70oC performance. Particularly beneficial for longer shipments, the CryoSure® technology addresses risks resulting from delays and human errors, ultimately providing safer, sustainable, and more reliable pharmaceutical shipping to benefit patients.

“This new CryoSure® technology takes pharma transportation to the next level by mitigating most if not all risks currently faced when shipping pharma products below -70°C. It is a game-changer and is going to revolutionize this part of the market”, says Mattias Almgren, CryoSure® Platform Executive at Envirotainer.

“Envirotainer has been leading the way ever since the beginning of the temperature-controlled shipments and it is with great pride that we today announce the launch of CryoSure®. We believe CryoSure® fills a substantial gap in the cryogenic -70°C shipment market and significantly improves patient safety”, says Peter Gisel-Ekdahl, CEO at Envirotainer.

Added benefits provided by CryoSure® include duration of three weeks, heat resistance, ease of use, and is known as the most sustainable solution currently on the market.

To learn more about CryoSure®, please visit: https://www.envirotainer.com/cryosure

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Archives, Global Trade Daily, News

Turkey, India and Vietnam Benefit from Rising American Carpet and Rug Imports

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IndexBox has just published a new report: ‘U.S. Carpet And Rug Market. Analysis And Forecast to 2025’. Here is a summary of the report’s key findings.

Last year, the U.S. ramped up imports of carpets and rugs by +11% to 796K tonnes. In value terms, imports reached $2.9B. Turkish, Indian and Chinese supplies comprise approximately 79% of American carpet and rug imports. In 2020, most of the import increment was provided by boosting purchases from Turkey, India, Egypt and Vietnam. Vietnam became the fastest-growing exporter of carpets and rugs to the U.S.

American Carpet and Rug Imports by Country

In 2020, carpet and rug imports into the U.S. expanded rapidly to 796K tonnes, surging by +11% compared with 2019 figures. In value terms, carpet and rug imports rose by +1.9% y-o-y to $2.9B (IndexBox estimates) in 2020.

Turkey (275K tonnes), India (224K tonnes) and China (127K tonnes) were the main suppliers of carpets and rugs to the U.S., together accounting for 79% of total imports. Egypt, Vietnam, Canada and Mexico lagged somewhat behind, together comprising a further 14%.

In 2020, supplies from Turkey (+71K tonnes), India (+15K tonnes), Egypt (+10K tonnes) and Vietnam (+20K tonnes) increased significantly. Vietnam recorded the highest growth rate of the volume of imports, expanding supplies to the U.S. from 12K tonnes to 32K tonnes last year.

In value terms, India ($904M), Turkey ($899M) and China ($377M) were the largest carpet and rug suppliers to the U.S., with a combined 75% share of total imports. These countries were followed by Egypt, Vietnam, Mexico and Canada, which together accounted for a further 12%.

Source: IndexBox Platform

holiday
Archives, Global Logistics, Global Trade Daily, Special Reports

Prep for the Holiday Season with Top E-commerce Strategies

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The most wonderful time of the year…is here. You already know that the holiday shopping season is the most critical period for retailers, both online and brick and mortar. How your business does during the last quarter of the year determines where things land for your bottom line.
 

This year, though, brand and e-commerce marketing managers are facing another wild ride, with uncertainty created by shifting trends. The pandemic brought on a surge in online buying, and many buyers are likely to continue to buy online. In fact, according to September 2021 survey data, consumers are planning a 50/50 split between online and brick-and-mortar buying. The retail giants—Amazon, Target, and Wal-Mart—are already capitalizing on convenience to hold onto their share of wallet.

 

There are other factors, though, to consider. Shopping trends are changing fast. News of supply chain pressures and worldwide shipping delays has spurred many shoppers to buy early or shift their buying behavior — 83% of shoppers intend to start before Thanksgiving this year, in a departure from the norm. In such an unpredictable market at such a high-stakes time of year, business intelligence has never mattered more. This is where the performance analytics platform Line Item can be the lifeline e-commerce marketers need right now to ensure they make the most of the holiday season.As we head into the heart of the 2021 holiday season, here are a few strategies to prepare and protect your digital shelf for the upcoming holidays.

Focus on organic search ranking. Whether they’re buying online or in person, many shoppers start their research online—on a smartphone or a tablet. This is why it’s essential to monitor and improve your online search ranking. Watch where you’re showing up, too. Moving from page 2 to page 1—and even into the top 10 listings—can significantly boost your sales. Improving your organic search ranking depends on visibility into what’s working—or not—for your brand. This is where Line Item can help, with detailed insight into what changes you could make to content, product descriptions, or imagery to affect your ranking in organic search results.

Analyze your paid search strategy. Shoppers are pressed for time, and you have only seconds to capture attention when it comes to search results. The holiday season is the time to invest in a robust paid search strategy, but you’ll want to be sure you understand what product attributes drive value. This is where Line Item can give you valuable campaign-level and product attribute insights. With them, you can better understand what’s driving the market and what your competitors are doing, so you can sharpen your edge and see ROI from a page-1 slot.Ensure your product detail pages are complete. This is a biggie. Incomplete or inconsistent product detail pages can harm you, whether we’re talking about Amazon listings or your own website. Across your e-commerce portfolio, all product detail pages should be complete, correct, and compelling. Line Item can help with this to make sure you aren’t overlooking clear areas or gaps that prevent you from meeting category bestseller benchmark standards.

Evaluate your SEO strategy and campaigns. During this volatile time of year, whims and demand drive the market in unpredictable ways. And that’s during a typical season, which 2021 is anything but. It’s essential to drill down to campaign elements, including CPCs, to ensure you have a read on how changing demand, sudden interest, or seasonality might be driving spend. E-analytics insight from Line Item can help you ensure your campaigns are profitable and that your overall marketing spend ultimately drives return on investment.

Watch out-of-stocks closely. Maintaining optimal inventory is key to profitability. When a customer is ready to buy and your product is out of stock, you lose the sale—and maybe the customer, too. Line Item helps you determine if out-of-stocks are hurting your revenue.

Track pricing. Many retailers are introducing new pricing strategies to drive sales this holiday season. Buy Now Pay Later is one of these, and it can appeal to segments like Gen Z and the unbanked, both of which are more price sensitive. The major retailers have already rolled out BNPL options; some have been in play since 2019. BNPL can affect pricing, so it’s important to monitor this. With Line Item, you can verify item pricing, selling price, and list price across platforms, ensuring that products are priced correctly even with new options like BNPL, and you can easily monitor third-party and competitor activity to protect your brand and products.

Of course, there are other strategies to consider, too—best practices like:

-Ensuring your checkout process is as easy as possible

-Providing access to customer service with tools like live chat, and with quick responses

-Creating engaging content, like gift guides

-Using targeting and segmentation to create personalized email campaigns

-Boosting sales with savvy retargeting

Using updated visuals and copy for featured holiday campaigns, and to ensure your site and product pages have that holiday look and feel, and more

This holiday season may be full of surprises, but your performance shouldn’t be one of them. The right insight can make or break your brand this holiday season, and business intelligence can give you what you need, when you need it. This is where Line Item really stands out as a single platform with insight into shopping trends and behavior, and what your competitors are doing—so you can finish 2021 in the black.

supply chain disruption nearshoring
Archives, Global Logistics, Global Shippers 101, Global Trade Daily, Imports/Exports

The True Issues Facing Shippers and Importers in this Supply Chain Nightmare – and How We Face Them with Resilience

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It shouldn’t come as a surprise to anyone in the industry that trade will remain incredibly tight for the remainder of 2021 and through 2022, with constraints resulting mainly from port infrastructure challenges, demand variability, COVID-19 resurgences, and carrier capacity.

“Global supply chain bottlenecks are feeding on one another, with shortages of components and surging prices of critical raw materials squeezing manufacturers around the world,” wrote reporters for the Wall Street Journal in an Oct. 8 story. 

I recommend to any executive seeking guidance that all aspects of their business ought to focus now on resilience. Engage your partners and stakeholders with transparency about the challenges; don’t try to shield them from reality. Leaders need to concentrate on business continuity and supply chain agility, whilst scenario planning throughout the value chain of inputs and flows. 

Even when it looks like conditions are approaching catastrophe, there is always something an organization can do. After the 2014 flooding in Somerset, Prince Charles visited the area to learn about relief efforts and remarked, “There’s nothing like a jolly good disaster to get people to start doing something.”

Now is a good time to remind managers that they need not wait for a jolly good disaster to create a plan of action. Rather, multiple “scenario plans” are crucial to providing guidance in the case of any disruption one can think of — and they must include mechanisms for coordinated communication and implementation across the value chain. Making sure these scenario plans result in opportunities for reserving capacity within manufacturing and transport divisions will allow your company to switch gears when needed. 

Any company that relies on a global supply chain is suffering to a degree right now. Obstacles have descended like a game of whack-a-mole; if capacity is secured, an issue like port congestion is ready to pop up and take its place as the bottleneck. That’s why I’ve been reminding my teams and customers that rather than keep strict, minute-by-minute tabs on external conditions, our time is better spent referring to (or developing, if none are found to be applicable) our scenario plans to discern what levers to pull, as well as the potential customer impacts. 

The best path toward actually implementing these chosen plans of action is consistent collaboration, transparency of information, and gaming with peer options/scenarios. It is also worthwhile considering that options are changing rapidly as providers, countries and infrastructures adapt — e.g. options you thought open today, may not exist tomorrow — so being present (understanding the landscape) is as important as planning scenarios in advance. 

The fundamental concept of trade, as outlined by Adam Smith in The Wealth of Nations (1776) is based on the concept of comparative advantages and division of labor offset against the cost of home manufacture and transport. If you ask modern-day economists, global trade conditions are a direct consequence; they echo the very same sentiments as Smith expressed in 1776. They produce daily figures such as PMI, GDP growth, wage inflation, etc., which do provide insight into trends that will directly impact the demand for global trade — outside of trade disputes, pandemics and government interventions, that is!

For more informed predictions, however, one must pair economists’ numbers with trade capacity data. We are trying to return to a normal state of demand and supply right now — with one challenge being that speed of recovery and capacity constraints are creating the real impacts, and this is only solved by normalization of demand, which is impacted by both inflation and opening of service sectors (or fundamental societal changes — don’t underestimate the potential for change from COP26); and/or increased capacity to service demand, which would require new vessels and terminal infrastructure that would be several years out from use.

The last two years have highlighted the fragility of global supply chains, as well as the interconnectedness of our world in general. We’re still feeling the effects of the initial COVID-related factory shutdowns in Wuhan, which immediately generated a global impact on supply chains. COVID has shown how shocks in long global supply chains can become impossible to repair, destroying businesses and wiping out hard-fought GDP growth. 

Among the most likely outcomes: companies will re-evaluate risk in sourcing internationally, consider more diverse sourcing strategies, and build segmented supply chains to manage risk. 

We must be mindful, however, that while the majority of the news over the last two years has been about COVID, major geopolitical changes have also been playing out: heightened tensions between the US and China, increased risk of conflict in the Asia Pacific region, and trade tensions between the UK / EU through Brexit. So when companies look at long-term strategy, these influences on trade policy may force more questions over resiliency, risk management, and diversity than the pandemic’s impact.

Also among the headlines is ongoing discourse about the US’s over-dependence on foreign supply, both in terms of resilience and sustainability agendas. 

In the short run, keep in mind that big problems very often don’t have simple solutions. We can manage the diversity of sourcing both nationally and internationally, remembering that even domestic supply chains are not 100% safe from natural disasters and environmental impacts. We can segment our supply, understand the sourcing of inbound products, and take steps to secure strategic inputs that the company depends on — all while utilizing a diversity strategy that blends domestic, near-sourced, and internationally sourced inputs from diverse supplier bases. 

Apart from the above actions, it’s good old effective planning, careful inventory adjustments, and sales management that remain the keys to supply chain resiliency, whether near- or far-sourced.

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Neil Wheeldon is Chief Strategy & Innovation Officer, BDP International. He is an experienced supply chain management practitioner having worked across numerous industries supporting customers in supply chain and digital transformation initiatives to drive growth. He can be reached at neil.wheeldon@bdpint.com.

caramel
Archives, Global Trade Daily, News

China Increases Caramel Imports Fivefold with Swelling Supplies from Asian Countries

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IndexBox has just published a new report: ‘China – Caramel – Market Analysis, Forecast, Size, Trends And Insights’. Here is a summary of the report’s key findings.

Last year, China recorded a sharp rise in caramel imports. The supplies into China grew from $80M in 2019 to $408M in 2020, or from 167K tonnes to 1.1M tonnes in physical terms. Thailand, Viet Nam and Myanmar remain the largest caramel suppliers, comprising 82% of Chinese imports. These three countries provided most of the increment in Chinese imports in 2020. The average caramel import price dropped by -21% y-o-y to $378 per tonne in 2020.

Chinese Caramel Imports by Country

In 2020, caramel imports into China skyrocketed from 167K tonnes in 2019 to 1.1M tonnes in 2020. In value terms, caramel imports surged from to $80M in 2019 to $408M (IndexBox estimates) in 2020.

Thailand (506K tonnes), Viet Nam (272K tonnes) and Myanmar (109K tonnes) were the main suppliers of caramel imports to China, together comprising 82% of total imports. These countries were followed by Malaysia, the Lao People’s Democratic Republic and Indonesia, which together accounted for a further 16%.

In value terms, the largest caramel suppliers to China were Thailand ($190M), Viet Nam ($101M) and Malaysia ($39M), together accounting for 81% of total imports. Myanmar, Indonesia and Lao People’s Democratic Republic lagged somewhat behind, together accounting for a further 12%.

Over the last year, China boosted the supplies from Thailand from $32M to $190M. Chinese imports from Viet Nam grew from $0.5M to $101M, while Myanmar’s exports to China rose from $1M to $26M. Among other countries, Malaysia, Indonesia and the Lao People’s Democratic Republic have also seen a rise in caramel shipments to China.

In China, the average caramel import price stood at $378 per tonne in 2020, decreasing by -21% against the previous year. Prices varied noticeably by the country of origin; the country with the highest price was Malaysia ($381 per tonne), while the price for Myanmar ($242 per tonne) was amongst the lowest. In 2020, the most notable rate of growth in terms of prices was attained by Myanmar, while the prices for the other major suppliers experienced more modest paces of growth.

Source: IndexBox Platform