Welcome to the Freight Industry November Roundup, a series of articles where we gather breaking news and important information from the Logistics Industry and add our unique perspective to it. Why waste time searching for news yourself when we do all the work for you? Enjoy!
Black Friday Shoppers Go Online
It’s all about Thanksgiving this month so let’s talk Turkey! Whichever way you slice it 151 million people shopping over Thanksgiving Holiday weekend is good for the economy! Shopping habits have changed big time with the majority of shoppers going online for their purchases.
And shoppers aren’t waiting for Black Friday to spend. E-commerce sales were up 51% by midday on Thursday, compared with the same period a year ago, according to ChannelAdvisor Corp., which makes e-commerce software and measures online transactions. Amazon.com’s sales rose 31%, eBay increased 11% and Google Shopping was up nearly 60%, according to ChannelAdvisor.
Parcel Carriers Are The Big Winners
PHOTO: MICHAEL NAGLE/BLOOMBERG NEWS
Ocean Carriers, Railroads and Truckers all experienced a weak peak this year with the parcel carriers projecting a huge holiday season surge.
UPS, which predicts its deliveries will increase 10% to a record 630 million packages between Black Friday and New Year’s Eve, compared with last year. The U.S. Postal Service announced earlier this month it expects to deliver 600 million packages during the same period, an increase of 11% from last year, while FedEx has said it would deliver 12% more packages from last year, or 317 million, between Black Friday and Christmas Eve.
E-commerce is changing the face of retail and the parcel carriers are the big winners. As retailers figure out how to manage their inventory more effectively over the coming years the traditional carriers may lose out in the long term.
“Retailers are currently working toward full visibility of every item in stock, in stores and distribution centers, in real time, said Steve Osburn, a supply chain consultant with Kurt Salmon. While it’s a work in progress, “ultimately the long term play is if you get better use of inventory, you don’t have to carry as much inventory,” he said.
Transportation Insight Buys Parcel Delivery Software Platform
PHOTO: JUSTIN SULLIVAN/GETTY IMAGES
Yet more evidence that the most vibrant logistics sector is consumer parcel delivery driven by e-commerce. Transportation Insight are a leading 3PL company and have just purchased BirdDog who develop software that helps shippers streamline parcel deliveries.
“The fastest-growing sector of U.S. shipping is e-commerce,” he said. “We intend to be part of the evolution of e-commerce.” said Paul Thompson, Transportation Insight founder and chairman.
I like to see a forward thinking company invest in technology to provide a wider range of solutions for their clients. We need more companies to do the same!
Amazon Dominates E-commerce but Walmart Fight Back
Walmart have been busy rebuilding their technology infrastructure from scratch in an effort to develop the technological wherewithal to compete with Amazon. Project Pangaea, as it is named, started in 2012 under the leadership of Jeremy King, chief technology officer.
“Pangaea replaces everything,” says Mr. King, in an interview. “My peers, they think I’m out of my mind. Most people don’t replace entire systems in one shot, especially with from-scratch development,” he says. “But given how rapidly this place is changing, we didn’t have time to screw around.”
Walmart definitely have Amazon in their sites. It will be interesting to see who wins out in the long term. The one thing Walmart has that Amazon does not are about 5000 brick-and-mortar locations. How that plays into the mix is yet to be determined. I’ll report back at a later date to see how successful their online Thanksgiving sales were.