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Freight Dynamics Steady Amid Challenging Holiday Season

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Global Logistics, Global Trade Daily

Freight Dynamics Steady Amid Challenging Holiday Season

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Freight dynamics remain steady despite the challenging holiday season, as reflected in the FreightWaves Supply Chain Pricing Power Index staying at 40 for shippers for another consecutive week. The unchanged index value suggests that shippers continue to hold balanced pricing power with carriers. According to data cited from the FreightWaves report, the coming weeks are expected to provide clearer direction, especially after the New Year reset.

Read also: Carriers Regain Ground in Freight Negotiations Amid Seasonal Slowdown

Market Signals Indicate Seasonal Patterns

FreightWaves SONAR insights reveal that the Outbound Tender Volume Index (OTVI) exhibits a significant decrease of over 31% compared to last week. This comes as the freight industry grapples with the logistical disruptions caused by holidays falling mid-week. Contract Load Accepted Volume, which tracks accepted load volumes, aligns with this trend, also reporting a similar decline. Notably, of the diverse freight markets, only four reported volume growth, largely in rural segments.

Shifts in Equipment Type Indices

Dry van shipments have experienced a more pronounced downturn than the broader market, with Van Outbound Tender Volume Index falling by 34% in a week. Conversely, reefer shipments maintain resilience, with their respective index only dropping by 21.2%, marking a yearly improvement of 3.4%.

Tender Rejection Rates and Spot Rates

Unanticipated spurts in tender rejection rates saw them cross the 10% threshold briefly – a first in over two years. The Outbound Tender Reject Index (OTRI) highlights this shift, with a weekly climb of 35 basis points to 9.69%. This landscape is echoed in variations by equipment type. Dry van and reefer market tender rejection rates soared, whereas flatbeds noted an impressive 360 basis points rise.

The National Truckload Index’s ascent to $2.46 per mile is notable, while linehaul rates also report marginal increases, standing as a significant 18 cents per mile above rates from the previous year. As the market regains footing in post-holiday adjustments, IndexBox data anticipates potential rate evolutions as carriers react to these fluctuating conditions.

Source: IndexBox Market Intelligence Platform  

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Global Logistics, Global Trade Daily

US Holiday Retail Sales Surge Exceeding Projections

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In a robust end to the holiday season, U.S. retail sales witnessed a significant surge of 3.8% from November 1 to December 24, driven by last-minute shopping spurred by heavy holiday promotions. According to a Mastercard report, this increase surpassed the anticipated growth of 3.2% forecasted earlier in September. This year’s figure also comfortably exceeded the 3.1% rise recorded during the same period last year, highlighting a notable improvement in consumer spending.

Read also: 8 Ways AI Can Streamline Your Packaging Process for the Holiday Rush

The Mastercard SpendingPulse report, which tracks both in-store and online retail sales while excluding automotive sales, indicated that the last five days of the shopping season were particularly critical, constituting 10% of all holiday expenditures. This data underscores the impact of strategic retail promotions and the evolving consumer behavior of delaying purchases until the final days before Christmas.

Insights from the IndexBox platform further illuminate the broader retail landscape, revealing that categories such as electronics, apparel, and home furnishings were among the top contributors to this sales boost, reflecting consumers’ preference for seasonal discounts in these sectors.

Source: IndexBox Market Intelligence Platform  

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Global Logistics, Global Trade Daily, News

Beat the Freeze With a Proactive Fleet Winterization Strategy

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As any trucker or fleet manager knows, winter weather and icy conditions can be particularly strenuous on logistics operations. Failure to adequately prepare vehicles can lead to costly breakdowns, delayed schedules and even road safety hazards, ultimately impacting the bottom line. 

Read also: Clean Fleet Revolution or Gamble? California’s Bold Move and the Future of Transportation

Implementing proactive winterization becomes paramount as the temperatures drop and snow begins to fall. Explore the most effective ways to beat the freeze and keep fleets in top working order during the colder months. 

Fleet Winterization Strategy Checklist for Logistics Professionals

Before winter’s icy grip takes hold, savvy fleet operators prepare their vehicles for harsh conditions by implementing a thorough maintenance checklist. These steps form the foundation of a robust winterization strategy for ensuring resilience throughout the cold season.

1. Inspect and Test the Batteries 

Many commercial trucks operate on coupled 12-volt batteries, which are particularly susceptible to cold weather problems. When temperatures drop, the chemical reactions within the battery slow down, reducing its ability to produce electrical energy. This decrease in capacity can lead to difficulties in starting the engine. Data from the Automobile Association reveals that 24% of winter breakdowns are battery-related. 

Drivers are also more likely to use heaters, lights and wipers during winter, putting extra strain on the battery.

Preventing these issues requires conducting regular voltage tests and inspecting for corrosion on terminals. Wrapping battery blankets around the box’s exterior can also help maintain a stable temperature in cold weather. 

For EV fleets, installing heat pumps can be an effective way to improve operations in snowy conditions. Industry reports show heat pumps can limit driving range reductions while minimizing battery strain.

2. Check Tires

Freezing weather can significantly impact tire performance, stiffening the rubber and reducing its grip on snowy roads. This phenomenon also affects tire pressure since air contracts in the cold. The consensus from leading manufacturers is that tires can lose about 1-2 psi of air for every 10 F drop in temperature. Underinflated tires can lead to reduced fuel efficiency, uneven wear and increased risk of blowouts.

Icy conditions can also accelerate tire wear, especially on commercial vehicles covering long distances. The combination of cold temperatures and rough road conditions can lead to faster tread wear and reduced tire longevity. Incidentally, 35% of delivery vehicle issues stem from tire-related complications. 

A well-rounded tire winterization strategy includes ensuring the air pressure is within the recommended range and monitoring tread depth. Transitioning to winter tires with enhanced grip is also essential to improve traction and reduce the risk of skidding. 

3. Test Braking Efficiency 

Icy road conditions reduce traction, increasing stopping distances and making it challenging for brakes to slow down or stop a vehicle effectively. In extreme cases, this inefficiency can lead to complete system failures due to the inability of brakes to generate sufficient friction against the road surface. There’s also the heightened risk of vehicular and pedestrian collisions to keep in mind. 

Preparing for winter by testing brake efficiency helps mitigate potential risks associated with driving in adverse conditions. Conduct a comprehensive inspection of the brake system — brake pads, rotors, calipers and brake lines — to ensure they are in top condition. Check the air chamber housings for corrosion and make sure the dust plugs are correctly fitted.

Testing the ABS functionality on a snowy road is also vital to ensure it operates effectively without compromising steering control during emergency braking.

4. Perform Fluid Checks and Top-Ups

Fluid viscosity increases in cold weather, leading to potential challenges in maintaining proper flow within trucking operations. For instance, hydraulic fluid serves as the medium for power transmission within the system, enabling the transfer of force from one component to another. Viscous hydraulic fluid reduces efficiency, slows response times and strains components.

This imperative also applies to other fluids, including coolant, engine oil and windshield washers. According to the North American Transportation Association, about 40% of roadside breakdowns result from cooling system problems, highlighting the critical role of maintaining proper fluid levels.

Regular inspection and topping up of all vehicle fluids is essential. Additionally, using winter-grade oil can prevent viscosity issues in cold temperatures. 

5. Perform an HVAC System Check

The HVAC system plays a vital role in regulating cabin temperature, defrosting windows and ensuring air quality inside the vehicle. In cold weather, a malfunctioning HVAC system can lead to fogged-up windows, reduced visibility and discomfort for drivers, affecting their focus and alertness on the road.

Winterization for HVAC primarily involves testing the heating system to ensure it can provide sufficient warmth to keep drivers comfortable when driving. Ensuring proper ventilation is essential to maintain air quality inside the cabin is equally paramount. Preventing stuffiness ensures a comfortable environment for long hauls in cold weather.

Installing additional cabin insulation may also be beneficial in retaining heat and improving overall HVAC efficiency in extreme temperatures. 

6. Inspect the Electrical System

A well-functioning electrical system is essential for safe and efficient winter driving. It powers critical components such as lights and safety features, which are fundamental in maintaining visibility during low-light and snowy conditions. 

Thorough inspection and maintenance are vital winterization steps to ensure optimal performance and safety for commercial drivers. Check the wiring for signs of wear, damage or corrosion to avert electrical issues that can lead to lighting failures. Conduct voltage tests to verify the system is functioning within the expected parameters.

Equipping commercial vehicles with an emergency electrical kit containing spare fuses, bulbs and essential electrical components is also necessary. This proactive step can help address minor electrical issues quickly and efficiently, minimizing on-road downtimes. 

Winterization Tips for Truckers

An effective winter preparedness strategy provides updated best practices for drivers to increase road safety and maintain hauling schedules. 

Check Weather Forecasts

Stay informed about upcoming weather conditions to plan routes and schedules accordingly, ensuring safe travel during winter.

Level up Defensive Driving Skills

Winter driving can be dangerous — 2022 saw nearly 500 fatal crashes and over 32,000 injuries on snowy or sleet-covered roads. Practicing defensive driving techniques, such as anticipating hazards, maintaining a safe distance and being alert to other drivers’ actions, enhances safety in these conditions.

Stay Well-Rested

Ensure adequate rest to maintain alertness and focus while driving in challenging winter weather. Pack essentials like blankets, food, water, flashlights and warm clothing in case of unexpected delays or emergencies.

Communicate With Dispatch

Keep in touch with dispatch for updates on road conditions and potential hazards, ensuring informed decision-making during winter travel.

Ensure Smooth Fleet Operations in Winter 

Embracing an advanced fleet winterization strategy is key to successful vehicle management and driver safety during freezing weather. Utilize this checklist as a strategic roadmap for optimizing vehicle performance and ensuring operational continuity during challenging winter months.

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Global Logistics, Global Trade Daily, Imports/Exports, News, United states news

DHL Celebrates 21 Years of Bringing Holiday Joy to Troops Abroad

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For over two decades, DHL Express has continued its heartfelt tradition of delivering holiday cheer to U.S. military personnel stationed overseas. Through its annual initiative, Operation Holiday Cheer, the global shipping leader is sending hundreds of freshly cut Christmas trees, festive ornaments, menorahs, holiday lights, and heartfelt letters from schoolchildren to troops deployed in Djibouti, Kuwait, and Bahrain.

Read also: Globalization Resilient Amid Geopolitical Strains, DHL Tracker Reveals

Now in its 21st year, Operation Holiday Cheer is a collaborative effort between DHL, Dees’ Nursery, and several New York-based charities. “The holidays are especially tough for those stationed away from loved ones,” said Greg Hewitt, DHL Express U.S. CEO. “This program allows us to show our appreciation and bring a bit of home to these courageous men and women. It’s a privilege for our DHL family to play a part in spreading holiday warmth to our troops.”

The festivities kick off on Monday, Dec. 9, at Dees’ Nursery in Oceanside, New York, with a celebratory event featuring veterans, community members, and local schoolchildren. Santa Claus will make a special appearance, and students will read touching letters to soldiers before a patriotic and holiday-themed performance by the American Bombshells.

Following the event, a police-escorted convoy will transport the shipment to DHL’s JFK Gateway facility. From there, the holiday packages will be loaded onto a DHL 767 aircraft, stopping briefly at the company’s Cincinnati/Northern Kentucky Airport hub before heading to DHL’s Bahrain hub and onward to U.S. military bases in the region.

The initiative traces back to 2004, when the mother of a deployed soldier reached out to Dees’ Nursery for help sending her son a Christmas tree. This simple request inspired Dees’ Nursery, DHL, and local businessman Jim Adelis to launch the program, which has since delivered over 13,500 trees to troops stationed abroad.

This year, Dees’ Nursery provided the trees, while additional donations came from organizations such as Adopt-a-Soldier Platoon, the Lt. Dennis W. Zilinski Memorial Fund, and various VFW chapters across New York.

Operation Holiday Cheer continues to grow, uniting communities in gratitude and ensuring service members stationed far from home feel the warmth of the holiday season.

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Global Logistics, Global Trade Daily, United states news

U.S. Spending Soars on TikTok Shop During Holiday Season

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NEW YORK (Reuters) – U.S. TikTok users have turned to TikTok Shop in droves this holiday season, significantly boosting spending on the platform. According to a Reuters analysis, TikTok Shop has successfully captured a larger segment of the e-commerce market since its U.S. launch in September 2023.

Read also: AI: The Driving Force Behind Holiday Season Logistics in 2024

TikTok Shop’s burgeoning success reflects in its reported $100 million in sales on Black Friday, a key shopping day, where American consumers eagerly seek online deals. Despite looming regulatory challenges, such as a potential U.S. ban on its parent company ByteDance, TikTok Shop remains a potent sales channel for brands like e.l.f. Cosmetics and Ninja Kitchen.

U.S. merchants and influencers leverage the ‘LIVE’ feature, allowing customers to purchase items directly during live-video sessions. The number of such live sessions has reportedly tripled over the past year, tapping into TikTok’s 170 million U.S. users and their growing appetite for innovative purchasing experiences.

This growth trajectory places TikTok Shop in fierce competition with counterparts like Shein and Temu, surpassing them in U.S. spending during the seven days leading to Cyber Monday, as per Facteus data, which samples between 7-10% of nationwide spending across 140 million consumer cards.

Source: IndexBox Market Intelligence Platform  

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Global Logistics, Global Trade Daily, News

AI: The Driving Force Behind Holiday Season Logistics in 2024

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As the holiday rush approaches, a survey commissioned by Merchants Fleet highlights how artificial intelligence (AI) is becoming a vital tool for managing delivery challenges. Over half of fleet decision-makers cited supply chain disruptions as a top concern, yet 88% agreed that AI could alleviate operational pressures, emerging as a critical ally for logistics teams this season.

Read also: Artificial Intelligence – How it is Shaping and Redefining Logistics

Conducted by Atomik Research, the survey included more than 250 decision-makers from shipping, trucking, and logistics organizations that manage consumer-packaged goods across the United States.

“With this year’s holiday season presenting unprecedented logistics challenges, AI is poised to play an indispensable role in reducing operational friction and enhancing fleet performance,” said Dr. Suzannah Hicks, AI Strategist at Merchants Fleet. “Our findings show growing confidence among fleet leaders in AI’s ability to ease resource strain and workforce stress, making it a potential game-changer for holiday logistics.”

Survey insights revealed AI’s capability to optimize supply chains, with 67% of leaders citing this as a top benefit. Over half of respondents (53%) emphasized AI’s effectiveness in scheduling and route planning, showcasing its importance for resource management during peak demand.

Additionally, 56% of decision-makers believe AI could play a pivotal role in mitigating supply chain disruptions this season. Key advantages include improved route optimization (65%) and enhanced inventory management (62%), ensuring seamless shipping operations.

Fleet safety and vehicle maintenance also stand to benefit, with all respondents agreeing AI can reduce downtime by identifying maintenance issues early. A notable 91% of leaders expressed confidence in AI’s ability to enhance driver safety, while 88% said it could reduce holiday-related workforce stress. Furthermore, 90% highlighted AI’s role in more effective allocation of resources such as drivers and vehicles, ensuring readiness to meet seasonal demand spikes.

As holiday shipping intensifies, AI’s ability to transform fleet operations is becoming undeniable, offering logistics leaders a much-needed edge in navigating seasonal complexities.

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Global Logistics, Global Trade Daily, News

Christmas Rush has Gripped Logisticians Earlier this Year

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Although from a consumer perspective, there is still a long way to go before Christmas or November sales such as Black Friday, the TSL industry is already starting to feel the Christmas rush. The most dynamic situation is in sea freight. This year, the importance lies not only in the distance from production markets but also in the resilience of supply chain. We are seeing about a two-week shift compared to the peak shipping periods we’re used to. What’s more, some have started transporting Christmas shipments as early as June. The reason for this is the blockade of the Suez Canal. Ships take a circuitous route around Africa, which extends transit time by precisely 10-14 days. Christmas or sale goods, including electronics, textiles, ornaments and toys, arrive mainly from China, which is the EU’s largest import partner next to the UK and the US. According to Eurostat data, China accounted for 20.5% of EU goods imports in 2023.

Read also: Road Freight Prices Rise unexpectedly in the Lead up to Christmas, Increasing in November for First Time Since 2019

But how about rail from China to Poland?

A consequence of the Red Sea situation is also a greater interest in rail transport. This is influenced by both the longer transit time by ship and costs. Over the past six months, we have seen comparable prices for sea and rail freight, which has further encouraged customers to choose the latter option. Currently, sea freight rates are falling, which may result in mainly urgent cargoes being transported by train. Nonetheless, the blockade of the Suez Canal has meant that there are some companies that, for the sake of building resilience in their supply chains, have permanently included rail in their transport options portfolio. Despite the drop in sea freight rates and I think that even after the reopening of the aforementioned route, a portion of the volume will still be transported by rail. In addition, there is great potential in the Middle Corridor, leading from China to Europe via Central Asia, the Caspian Sea, and the South Caucasus, bypassing Russia. Due to the complexity of this route, the best solution there is intermodal freight, which, incidentally, is also becoming increasingly popular in pan-European transport.,  largely driven by the need to reduce the carbon footprint.

Cost-conscious customers are already planning air transport before Christmas

Air shipments usually start their journeys in late October or early November. However, this year, similar to sea freight, we anticipate a postponement of this date due to customers’ caution and their desire to build resilience of their supply chains. This is especially relevant in South Asia, where, unlike in China, air freight is the only alternative to the sea option. Decisions to transport goods by air earlier will also be dictated by the natural process of changing the route network from summer to autumn/winter, which will result in an approx. 10% decrease in the number of services and therefore a reduction in capacity. In the context of South Asia, mention should be made of the unstable political and social situation in Bangladesh. Numerous riots in July and August led to blockades of ports, airports, and land transport routes. This has implications for supply chains, especially in the important garment industry for this market. The situation is currently stabilizing, but as a consequence of these demonstrations, local authorities have introduced a number of restrictions, including increased controls at borders and key transport points such as airports and seaports. All this also affects the efficiency of supply chains.

It is also worth noting that the increased demand for the aforementioned global freight is also significantly influenced by the Chinese Golden Week (1-7 October). During this time, similar to the Chinese New Year, the economy in the Middle Kingdom slows down significantly, so customers plan the delivery of their goods well in advance.

Road transport, due to its relatively short distances, is at the latest starting to feel the pressure of the upcoming autumn-winter shopping season. At this point, it is still too early to talk about an increase in . However, the logistical system of interconnected vessels will certainly react in due course.

Warehouses are also bustling before Christmas

Bringing goods in well in advance naturally leads to an increased interest in contract logistics, as we are currently seeing. Warehouses are also bustling ahead of Christmas or Black Friday with value-added services. Many companies from various industries are interested in, for example, assembling special promotional product sets or creating display stands that later attract consumers in stores..

Uncertainty as the norm in logistics

Consumption in Poland is steadily increasing, although, as recent market research shows, consumers are carefully reviewing their budgets, not least in view of inflation, and, for example, are spreading Christmas spending over two months. As a result, manufacturers and importers are trying their best and fastest to prepare for the increased Christmas traffic. Undoubtedly, the challenge is that recent years have taught us that the only constant in logistics is unpredictability, as exemplified by the aforementioned crises in the Red Sea or Bangladesh, or earlier, the coronavirus pandemic.

Two years ago, traffic peaks around Christmas or Black Friday were characterized by much higher volumes than capacity, resulting in congestion and delays. Last year, the situation was quite the opposite. Therefore, looking at the past, it is difficult to draw conclusions about repeatable trends. Every year is different. During this year’s holidays, we transported significantly more volume than in the same period in previous years, which was due to both earlier-than-usual dispatching of sale goods and a slight upturn in the economy. However, many economic indicators now show that we can expect a slowdown from September onwards. This raises the question: will the market already begin to weaken in the last quarter of the year?

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Archives, Global Trade Daily, United states news

Holiday Hurrah: Measuring the Impact of Holiday Sales on America’s Small Businesses

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The holidays are big business. That’s not going to come as a shock to anybody — but, just how important are they to America’s economy? The latest figures from Adobe Analytics show that from November – December 2023, Americans spent more than $222 billion (yes, billion!) while shopping online. That activity was largely driven by an increase in total purchases.

Translation: Americans want to spend during the holiday season. The businesses who can tap into this strong demand are much more likely to achieve their revenue goals and set the table for a strong start to the new year.

Since 99.9 percent of businesses in the United States are small businesses, this also illustrates how critical the holiday season is to the continued success and viability of the SMBs who power our communities. At Constant Contact, we wanted to better understand how small businesses tackle this time of year, so we polled 500 SMBs across a variety of industries to get their thoughts. We also asked 500 consumers about how their interest in shopping small changes before, during and after the holiday season.

Here are the stats and trends we uncovered, along with some additional findings from our Small Business Now report that help illustrate what small businesses can do to start 2024 on the right foot.

Small businesses depend on holiday sales to hit their annual goals.

  • 75 percent of retail SMBs rely heavily on holiday sales to meet annual revenue goals.
  • 58 percent of retail SMBs say holiday customers are “extremely important” to the overall success of their business.
  • 50 percent of SMBs get at least one-quarter of their annual revenue from holiday shoppers, and that number jumps to 73 percent for retail SMBs.​

However, most shoppers don’t realize how vital their holiday spending is to small, local businesses.

  • Supporting small businesses and their communities is the number one reason why Americans choose to visit or buy from an SMB. 
  • However, only one-third (33 percent) of shoppers feel that visiting or purchasing during the holidays makes a significant impact on an SMB’s livelihood.

The holiday season is a great time to attract new customers, and fortunately, shoppers are open to being courted.

  • The top goals for SMBs heading into the holiday season are finding new customers (63 percent), retaining current customers (52 percent), and planning for next year (45 percent).
  • 84 percent of consumers planned to visit a “new to them” small business last holiday season.
  • 87 percent of consumers say they are more likely to return to a small business in the future after visiting/buying during the holidays.
  • Personalized emails and texts (52 percent), social media ads (42 percent), and sales or discounts (40 percent) are the most popular marketing tactics SMBs use to grow their customer base during the holiday season.

During the last three months of the year, small businesses see waves of new customers both in-person and online. These shoppers are highly engaged and looking for reasons to visit or buy. This makes the holiday season a terrific time for SMBs to capture people’s attention and grow their customer base.

Most small businesses do not have an effective marketing strategy to nurture, retain and convert their holiday customers in the new year, and it could be holding back their growth.

  • 81 percent of consumers are more open to receiving marketing messages from a small business after visiting or buying from them during the holidays.
  • 93 percent of SMBs feel that retaining new holiday customers into the following year is important – but just 18 percent feel their Q1 strategy is highly effective.
  • 14 percent of SMBs have no post-holiday retention strategy at all.
  • Less than half (49 percent) of shoppers receive an email after making a purchase, and 27 percent never hear from the business again.

Most SMBs are heavily focused on reaching new customers and growing their lists during the holiday season, but equally important is how those customers are nurtured once the calendar turns to January. The key to making the most of the holiday season is having a good customer retention strategy in place. 

So, what have we learned? The holiday season isn’t just a big deal for small businesses — it’s absolutely vital to their success. Every dollar, or sale, goes a long way and might make the difference between a good year and a bad one. Since shoppers are looking for excuses to visit and buy from SMBs during the holidays, it’s critical that those businesses market themselves and communicate their value. 

It’s also important to keep marketing once the holidays end. Americans showed similar interest in supporting small businesses in the new year as well, and many were turned off after never hearing from a business again after making a purchase. We see our customers dial up tactics like loyalty programs, events, and contests in an effort to activate their audience and turn holiday customers into repeat buyers in the following year.

 

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Archives, Global Logistics, Global Trade Daily, News, Ocean Ports

Navigating the Waves: Examining the Looming Threat of Port Congestion

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By Bryn Heimbeck, President and Co-Founder of Trade Tech, an industry-leading global logistics platform. He asks the question: Is it time to worry about port congestion again?

The following outlines Mr. Heimbeck’s position on why shippers and stakeholders throughout the supply chain should be looking for solutions to address the challenge of entering what he calls the “congestion zone” again.

According to Mr. Heimbeck, the White House’s announcement of the formation of the Council for Supply Chain Resilience is coming none too soon. There are a set of key facts facing the US Supply Chain Market today:

  • Carriers have an enormous number of new vessels on order and coming on line now.
  • New tonnage is driving freight rates down, although they seemed to plateau over the summer Peak Season.
  • The US Economy grew at an amazing 5.2% in the 3rd quarter according to Reuters and indications are for continued strong growth.
  • The low water issues in the Panama Canal has significantly reduced the number of vessels that can transit the canal and avoid the US West Coast ports.

“The pivotal point here is the level of container throughput in the ports. This was the bottleneck in 2020 – 2022 and will be the bottleneck again until capacity at the ports is enlarged either through capital development or process changes yielding greater efficiency.

The concern should be that October container volumes reached the same level where port congestion started in 2020. It is probably safe to project that November through February will have lower seasonal volumes but if March and beyond is normal and the economy continues to grow and carriers reroute vessels away from the Panama Canal, then we should anticipate port congestion is exactly the way we project traffic during rush hour in any large city. Congestion is just what happens when traffic volumes exceed a known point.

CALL TO ACTION

It’s time for the industry and the government to move forward quickly in discussing alternative ideas and concepts for process changes in cargo management. Focusing on these process changes stands a better chance of mitigating port congestion rather than waiting for several years to see capital projects implemented.

It’s time to look seriously at leveraging the data flowing to US Customs from the ocean carriers and NVOCCs as part of the 24 Hour Rule. This data includes all legal shipments, is standardized to meet US CBP’s requirements, is complete or otherwise rejected, and yields full accessible visibility that so many in the market have called for.

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Archives, Global Logistics, Global Trade Daily, Uncategorized

6 Reasons Retailers Should Care About Supply Chain Visibility During the Holiday Peak Season

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As the holiday season approaches, retailers are gearing up for the annual rush, both online and in-store. The 2023 holiday season will pose many challenges due to changed consumer demand, the uncertain economy, ever increasing delivery charges and unreliable delivery service in part caused by lack of warehouse labor. During this festive, yet highly complex, frenzy, supply chain visibility emerges as a critical factor that can make or break the holiday success for retailers. Real-time Item Level Visibility (RTILV) supported by technologies such as Radio-Frequency Identification (RFID) and advanced traceability software play a pivotal role in achieving this visibility goal. 

Here are six compelling reasons why retailers should make supply chain visibility a top priority, especially during the holiday peak season:

  1. Accurate Inventory Management

One of the primary challenges during the holiday season is managing inventory effectively. RTILV enables real-time tracking of products as they traverse the supply chain through the use of RFID technology allowing retailers to move beyond traditional barcode scanning. Paired with traceability software, this technology provides a comprehensive view of inventory levels, locations, and even product conditions. Retailers can thus maintain precise control over their stock, ensuring that popular items are readily available and reducing the risk of overstock or stockouts.

  1. Enhanced Order Fulfillment Speed

Holiday shoppers expect swift and reliable order fulfillment. RTILV allows retailers to monitor the progress of orders in real time. When integrated with traceability software, this data can be leveraged to identify bottlenecks and streamline fulfillment processes. By optimizing order processing speed, retailers can meet customer expectations for timely deliveries and elevate their overall shopping experience.

  1. Proactive Issue Resolution

The holiday season is rife with potential disruptions, from unexpected surges in demand to logistical challenges. RTILV empowers retailers to identify issues before they escalate. By tracking the movement of goods in real time and providing key insights based on the collected data, retailers can pinpoint delays or inefficiencies in the visibility platform, allowing for swift intervention and resolution. This proactive approach minimizes the impact of disruptions, ensuring a smoother supply chain operation during the critical holiday period.

  1. Optimized Customer Experience

Consumer expectations continuously increase and even more during holiday peak season, making an exceptional in-store experience paramount. RTILV enables retailers to go beyond basic inventory tracking. Smart shelves and real-time pricing adjustments become possible, providing customers with accurate product information and reducing the likelihood of frustration due to inaccurate stock levels or pricing discrepancies. This also creates efficiencies for in-store employees improving their jobs and allowing them to focus more on the in-store shopper.

  1. Data-Driven Decision Making

RTILV platforms generate a wealth of valuable data providing retailers with real-time insights that can be turned into real-time decisions. Retailers can leverage this data to gain insights into consumer behavior, supply chain performance, and overall operational efficiency. By applying artificial intelligence and machine learning on this data, retailers can make more real-time, faster, better informed, data-driven decisions that extend beyond the holiday season. This analytical approach positions retailers to adapt quickly to changing market conditions and continuously optimize their supply chain strategies.

  1. Increased Retail Profitability

Retail profitability is significantly impacted by supply chain visibility in several ways. When retailers have a clear and real-time understanding of their supply chain processes, it enables them to make informed decisions, reduce operational costs, enhance efficiency, and ultimately improve their overall profitability.

Enhanced visibility allows retailers to identify and eliminate inefficiencies in their supply chain processes. This can result in reduced operating costs, including transportation, warehousing, and labor expenses, contributing directly to improved profitability. Accurate visibility into inventory levels and demand patterns helps retailers optimize stock levels. By preventing overstock or stockouts, retailers can reduce carrying costs, minimize the need for markdowns, and avoid missed sales opportunities, positively impacting profitability. Clear visibility further enables retailers to minimize holding costs associated with excess inventory. This includes costs related to storage, insurance, and potential obsolescence. Reduction in holding costs directly contributes to higher profit margins. Improved visibility also facilitates better decision-making in order fulfillment processes. Retailers can choose the most cost-effective shipping methods, warehouse locations, and distribution strategies, leading to cost savings and increased profitability. Finally, supply chain visibility helps minimize stockouts by providing insights into inventory levels and demand fluctuations. This prevents lost sales opportunities and ensures that retailers can meet customer demand, positively impacting overall revenue and profitability.

The holiday peak season presents both challenges and opportunities for retailers. By embracing real-time item level visibility, retailers can ensure seamless operations during the holiday rush and also establishes a foundation for long-term success. Supply chain visibility allows retailers not only to meet but to exceed customer expectations during the most crucial time of the retail calendar.

Supply chain visibility is also a critical factor in enhancing retail profitability. By optimizing operations, reducing costs, and making strategic decisions based on real-time data, retailers can create a more efficient and resilient supply chain, ultimately leading to improved financial performance.

Author Bio

Bart De Muynck is a strategic advisor at Mojix, a provider of enterprise SaaS solutions for the automation and digitization of operations and supply chains in the luxury, retail, food, and industrial markets. He has worked for major international companies, including EY, GE Capital, Penske Logistics and PepsiCo, as well as several tech companies. He also spent eight years as a vice president of research at Gartner and, most recently, served as chief industry officer at project44. He is a member of the Forbes Technology Council and CSCMP’s Executive Inner Circle.