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Tuesday, December 22, 2020
Logistics Intelligence Brief
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Trucking

Trucking Faces Transitional Year in 2021

Transport Topics Connor D. Wolf December 21, 2020

“I think next year is definitely going to be a transitional year,” Farrah Salim, senior principal analyst at research and consulting firm Gartner, told Transport Topics. “The challenges that shippers have faced this year, I think have highlighted the fact there are inefficiencies in the transportation industry that have gone on for a very long time.” Alex Scott, assistant professor of supply chain management at Michigan State University, doesn’t foresee a return to normal for a while. He noted it will be at least six months until the transportation market is not being largely affected by the pandemic. He also noted that in some cases there may be a permanent shift. FTR Transportation Intelligence expects freight demand to be solid during the year, but there are risks to that outlook. The industry research firm warns there is a lot of uncertainty, and it cannot be assumed the truck freight market will return to any sort of normal until the pandemic is over.

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Shippers/3PLs

Retailers did not achieve 1-day delivery in 2020: study

Supply Chain Dive Tatiana Walk Morris December 21, 2020

According to an Accenture report emailed to Retail Dive, none of the 116 retailers studied managed to deliver in one day this year, compared to three retailers that did so in 2019. On average, retailers took 2.8 days to fulfill orders this year, compared to 1.8 days last year, the report found. Zara, Staples, CVS, Lowe's and Amazon Prime were among the top-performing retailers that had the fastest delivery orders completed with no errors. Twenty-one percent of orders arrived at their destinations within one week, a slight decrease from 22% in 2019, per Accenture's findings. The report noted that 65% of retailers either offered buy online, pickup in store; reserve online, pickup in-store; or curbside pickup — an increase from 52% last year. It also found that 57% of retailers are offering contactless pickup, an option that wasn't offered in previous years.

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Walmart and Amazon launch return options as some predict holiday onslaught

Retail Dive Ben Unglesbee December 21, 2020

Dive Insight: In a year of extreme e-commerce growth, which has stretched logistics networks across the industry during the holiday season, expect an extreme amount of holiday returns. Salesforce has estimated there could be around $280 billion worth of returns this holiday season. That is to be expected amid record online holiday shopping this year. It's also an effect of consumers avoiding physical stores amid the pandemic and so losing the ability to browse in person. Moreover, "bracketing" — where customers buy multiple versions of the same item to test them out at home — has been on the rise since the pandemic began. According to Narvar, which has developed shipping and returns platforms for merchants, 62% of consumers reported bracketing this year, a 50% increase over the past three years.

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Retailers designing stores to support inventory and logistics work, not just shopping

DC Velocity December 21, 2021

“Brick-and-mortar stores will remain vital for retailers for branding purposes and essential customer interaction, but the store’s purpose will shift to supporting the rise of the multichannel consumer – a consumer who uses physical stores, e-commerce, mobile commerce, and social media for shopping and purchasing,” John Morris, CBRE’s retail and industrial & logistics leader, said in a release. “This will be key for cost control, as shipping for online orders can eat away profits if retailer supply chains are not efficient,” he said. “To improve this, stores will now include a big portion of their overall footprint for inventory control, product sorting, and shipping/receiving.”

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Industry

Diesel Jumps 6¢ Per Gallon to Nine-Month High

Transport Topics December 21, 2020

The national average price of gasoline also surged significantly, by 6.6 cents to $2.224 a gallon, only 30.8 cents cheaper than a year ago. Diesel prices rose in all regions. The Midwest posted the highest increase, 8.1 cents, raising the price to $2.559.

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This year’s online shopping rush is great for e-commerce and bad for last-minute shoppers

The Washington Post Rachel Lerman December 21, 2020

That’s on top of what retail analysts say is more than two years of e-commerce growth crammed into a year, causing major growing pains as shipping networks, warehouses and supply chains rushed to keep up with demand. Adding to the crunch, the companies were scrambling to figure out how to try to keep workers safe and socially distanced, slowing things down. U.S. online shopping sales are projected to reach $795 billion this year, a 32 percent gain from last year, according to research firm eMarketer. Already, the Census Bureau reported that in the second quarter, the nation’s online spending surged to 16 percent of total retail sales, from 11 percent previously. And Forrester Research expects roughly a quarter of all holiday shopping to take place online, up from 20 percent.

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project44 eyes IPO following fresh $100 million investment

The Journal Of Commerce Eric Johnson December 21, 2020

Multimodal freight visibility provider project44 on Monday announced its largest venture capital investment to date and acknowledged that an initial public offering is a possibility within the next two years. The latest funding, a $100 million “inside” round from a group of existing investors that brings the total the company has raised to $241 million, will be used to expand its geographical footprint, product development, and to tie up strategic partnerships with fellow supply chain software providers, the company said in a statement. CEO Jett McCandless told JOC.com Monday his company has raised venture capital more frequently than its peers, both in the visibility market and more broadly, to avoid the equity dilution that he said comes with larger single investment attached to higher valuations. In other words, if a company raises a large amount of cash in a single round of fundraising at a high valuation, and doesn’t meet that valuation, it can have a hard time finding funding for the next round.

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Supply-Chain Technology Provider Project44 Gains $100 Million in New Backing

The Wall Street Journal Paul Page December 21, 2020

Project44’s technology provides visibility allowing companies to see how their shipments are moving through distribution networks and to help make adjustments in case of snags or changes in market demands. The company’s platform uses application program interface technology, or APIs, and other connections to collect information from numerous freight transportation and logistics providers and put it into a standard format that retailers, manufacturers and other shippers can use. “We are the connective tissue for logistics and supply chains,” said project44 founder and Chief Executive Jett McCandless.

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Technology/Innovation

Temperature-Tracking Tools Take Center Stage in Covid-19 Vaccine Rollout

The Wall Street Journal Jennifer Smith December 21, 2020

Temperature-tracking devices are commonly used when transporting vaccines, cancer drugs and other high-value perishable shipments. The technology ranges from passive data loggers that record conditions during a trip to more advanced connected devices that can transmit a package’s temperature and location in real time as it moves through distribution networks.

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Government/Safety

FMCSA Continues Waivers for Expired CDLs, Medical Certifications

Transport Topics Eleanor Lamb December 21, 2020

As part of its continued response to the COVID-19 pandemic, the Federal Motor Carrier Safety Administration has issued a waiver offering regulatory relief to commercial driver license and commercial learner permit holders. The waiver builds on previous federal notices, the first of which was issued March 24. The previous waivers similarly covered various regulatory provisions affecting CDL and CLP holders. The waiver is designed to offer relief to drivers who may be unable to renew their licenses or permits or provide medical certificates to their state driver licensing agency. The pandemic — and associated safety procedures — have placed constraints on service at state licensing offices.

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The case for hair testing in trucking

Fleet Owner David Heller December 21, 2020

Even more importantly, the prevalence of the Federal Motor Carrier Safety Administration’s new Drug and Alcohol Clearinghouse has provided our industry with a tool to discover prior positive drug test results on drivers throughout our industry. The greater problem with the guidelines put forward by HHS is that the original positive test results derived from hair would be unable to be admitted to the Clearinghouse. While many carriers have successfully implemented hair testing for drugs as part of their fleet’s program, the inability to include these results, either now or with the original positive result in the HHS guidance, ignores one of the very benefits that this type of test can actually provide.

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CDC changes vaccine priority suggestion, moves transport back to ‘Phase 1c’ of allocation

Transport Dive S.L. Fuller December 21, 2020

The Centers for Disease Control and Prevention's Advisory Committee on Immunization Practices recommended Sunday that transport and logistics workers be included in Phase 1c of vaccine allocation. This is a change from the panel's previous suggestion that put all essential workers, including those in transportation, in Phase 1b. The newest recommendation splits essential workers into two categories: "Frontline essential workers," roughly 30 million people, in Phase 1b. "Other essential workers," roughly 57 million people, in Phase 1c. The committee describes frontline essential workers as those "essential to the functioning of society" and at higher risk of exposure to COVID-19. As of press time, the CDC had not yet adopted this guidance. States are responsible for designing their own allocation plans and are not required to follow CDC guidance.

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