Warehouse Wisdom. Weekly. 06/28/2024

Happy Friday!

As we celebrate the Fourth of July holiday and have fun in the sun, don’t forget about those workers in the warehouse and the dangerous effects of extreme heat. Yes, that's right – while some of us are perfecting our BBQ recipes and planning our beach days, warehouse workers are working hard to keep things running smoothly, rain or shine—often more shine than they’d like. 

With the summer heat cranking up, it's crucial to stay aware of the potential dangers of extreme temperatures. As a result, the push to add protections for warehouse workers during extreme heat is more critical than ever.

And, while you get ready to enjoy the fireworks and festivities, let’s catch you up on this week’s newsletter! We will update you on the retailer event sales showdown for this coming July, Chinese retailers and luxury brands linked to forced labor and poor working conditions, Shipstation launches new features for streamlined shipping, more Red Sea devestation causing global shipping prices to rise, and more. 

LOGISTICS VITALS

AMAZON ANNOUNCES PRIME DAY 2024 EVENT

Get ready to plan those offers because Amazon just announced its Prime Day 2024 event dates! This will be the 10th annual Prime Day sale, and it will be a two-day extravaganza set to take place on July 16 through July 17, starting at 12:01 a.m. Pacific time. In 2023, customers saved nearly $2.5 billion with deals and coupons, with Prime members reigning supreme. Let’s take a closer look at the gross merchandise sales on Amazon during the Prime Day event: 

• $12.90 billion - 2023

• $12.09 billion - 2022

• 24 – Total number of countries the event will take place 

So, get those promotions ready because this year's event is bound to be even bigger and better. Remember, Prime members get exclusive access to millions of deals, including invite-only deals.

MARKETPLACES

AMAZON MAKES MOVES WITH PAPER FILLER PACKAGING AND CHINESE GOODS LAUNCH, ETHICAL SUPPLY CHAIN ISSUES ARISE, AND RETAILER EVENT SALES SHOWDOWN

Big news from Amazon - they've swapped out 95% of plastic air pillows with paper fillers in North America. And, by the end of the year, they're aiming to eliminate plastic from their packaging entirely! This move will be Amazon's biggest plastic reduction effort in North America, eliminating nearly 15 billion plastic air pillows annually.  And speaking of Prime Day, you won't find any plastic air pillows in your deliveries. The future of packaging is looking more and more eco-friendly by the day.

And the e-commerce giant is not running out of big ideas, as Amazon is taking on Temu and Shein with a new section on its site for cheap items from China. This new marketplace will have apparel, home goods, and more shipped from China in 9 to 11 days. But it's still a mystery if these items will avoid U.S. customs duties like Temu and Shein. 

However, as online retail has made prices so low, human costs have become substantial. Shein and Temu, known for cheap products, and other Chinese retailers have been linked to allegations of forced labor and poor working conditions such as long hours with no overtime pay and minimal days off. But it's not just them - the fashion industry as a whole faces similar issues. In fact, an Italian court found a company that makes handbags for Dior guilty of forcing workers to live in factories 24/7. The court's verdict? Poor labor conditions are rampant in the fashion industry as a whole.

Meanwhile, Target is teaming up with Shopify to show off its best merchants. With Target Plus, they're bringing popular brands like Caden Lane and True Classic, maybe even to their physical stores! Shopify merchants can apply to sell products on Target Plus using the Marketplace Connect app. With over 2 million products and 1,200 merchants, Target Plus covers everything from apparel to sporting goods. This looks like a great partnership potential for merchants to expand sales.

Remember Amazon’s Prime Day event? Well, Target announces another Target Circle week, teasing that it’s their biggest sale of the season with up to 50% off deals. And guess what? It's right before Amazon's 10th Prime Day sale. Target Circle Week is back from July 7 to 13, loaded with savings on summer and back-to-school essentials. And they've got more deals for Target Circle loyalty program members!

And Walmart, of course, wants to take part in the deal week action, too. Walmart+ Week just ended, and now Walmart is bringing "its largest savings event ever," called Walmart Deals, which will kick off on July 8 and ends on July 11, starting at 5 p.m. Eastern time. So, it looks like it will be a showdown of deals.

SHIPPING

RETAIL AND LOGISTICS FACE GEN-Z DEMANDS, RISING EMISSIONS, AND SHIPPING INNOVATIONS

Gen Z is posing unique challenges for last-mile delivery. Logistics providers better step up their game to keep up with the Gen Zers. With their love for convenience, speed, and transparency, retailers have to revamp how they handle fulfillment and logistics completely. Here’s a tip: Gen Z is all about those cutting-edge technologies that offer flexible, customer-friendly solutions.

What’s the cost of all those expedited freight deliveries? Potentially 25% increase in greenhouse gas emissions. According to a report from Stand.earth, the U.S. contributed over 40% of global air freight emissions. Dr. Devyani Singh, who helped with the analysis, wants air freight companies to switch to greener transportation methods like marine shipping or rail. Additionally, air freight releases about 80 times more carbon than sea or truck shipping - making it one of the worst for the environment!

Can companies like Stitch Fix teach smaller retailers a trick or two about reducing costs by adding more shipping carriers to the mix? CFO David Aufderhaar mentioned on the company's earnings call that Stitch Fix managed to cut shipping costs and improve profits by mixing it up with carriers. Their gross margin jumped up 280 basis points compared to last year, thanks to better rates from different carriers. However, it's not entirely clear how many carriers Stitch Fix uses to ship their curated clothing boxes. While they mention national carriers like FedEx and USPS on their website, they also work with regional delivery providers.

Finally in shipping news, do you use Shipstation? The software company just unveiled new key features that you might want to check out to streamline shipping! They're all about helping online businesses make shipping easier, improve customer experiences, and boost efficiency. The features include Inventory Sync, Deliver-by Date, Harmonization Code Import, Checkout Rates, and Add-On Marketplace. If you use this popular software, the updates are worth checking out.

WAREHOUSE TECH

NEW JERSEY WAREHOUSE ROOFTOPS TURN INTO SOLAR POWER PLANTS

Warehouse rooftops hold great power potential - literally. Solar arrays are sprouting up on the flat roofs of commercial buildings in New Jersey, turning them into mini power plants. These arrays pump energy into the grid for nearby residents to use. Currently, there are about 20,000 subscribers, but they're looking to add 60,000 more by the end of this year or halfway through 2025. State projections say community solar will soon generate a gigawatt of electricity for 125,000 households. So how does it work? A renewable energy developer rents a roof and installs solar panels to sell electricity and renewable energy credits. It's a bright idea!

LOGISTICS JOBS

WALMART EMBRACES ROBOTICS TO ENHANCE WAREHOUSE JOBS AND CAREER LONGEVITY

Could robots actually increase warehouse worker’s careers? That’s what Walmart claims, at least. Despite fears of automation taking over, Walmart claims robots are actually giving workers more time on the job. Automation with robots and forklifts in Walmart's distribution centers is changing warehouse work by reducing physical strain and potentially extending workers' careers. 

Chief Financial Officer John David Rainey believes robots can add a good ten years to employees' careers by taking on manual tasks and making things run more smoothly. Plus, automation makes distribution centers four times more efficient, allowing Walmart to grow without hiring more workers. With less walking and heavy lifting, robots make jobs more sustainable and keep warehouse workers happy. So maybe robots aren't so bad after all.

OCEAN FREIGHT

SUPPLY CHAINS UNDER SIEGE: SEA ATTACKS CAUSE SHIPPING FUEL PRICE SURGE AND GLOBAL DELIVERY DELAYS

It’s time to sink into reality – supply chains are under attack! Red Sea attacks (including yet another one yesterday) are causing unthinkable damage for supply chains by attacking vessels heading to the area. This has caused global shipping prices to skyrocket and has caused everyone to worry about shortages and delays. It's like deja vu from the pandemic era, with disruptions threatening the flow of goods worldwide. 

The result? Ports are packed, freight rates are through the roof, and industries struggle to deliver on time. With no clear end in sight to these geopolitical tensions, importers are left dealing with higher costs and lots of uncertainty. It just goes to show how fragile global trade can be when faced with disasters.

WAREHOUSE QUICK DELIVERIES

UPS SELLS COYOTA TO RXO, FEDEX PLANS TO SELL SOME OF ITS FREIGHT BUSINESS, AND MORE

• UPS Plans to Sell Coyote to RXO for $1.025 billion.

• FedEx Considers Selling Off Portions of Its Freight Business.

• Strike Breaks Out at Smart & Final Warehouses Amid Alleged Mass Layoffs.

• Protesters Rally at Connecticut's Largest Amazon Warehouse Over Labor Issues.