Warehouse Wisdom. Weekly. 11/01/2024

Only the most relevant news for SMBs to improve logistics – picked, packed, and delivered without the bias.

Happy Friday!

Hope you had a happy Halloween—and here’s hoping the children’s candy bags had a healthy portion of chocolate to satisfy the sweet tooth. With cocoa prices soaring, candy producers have had to cut back on the real stuff. Whether this is a long-term ‘shrinkflation’ trend or just a trick of inflation remains to be seen, but for now, those cocoa beans are worth their weight in gold. And, of course, the delicate balancing act of supply chain management seems to be something that will continue into 2025 and beyond.

In this week’s newsletter, we’re diving into the latest in warehousing and logistics, from port strikes in Montreal to AI in your shopping cart, plus the twists and turns of trucking rates as we head toward year-end. Let’s dive in…

Ocean Freight

Port of Montreal and Canada Post navigate potential strikes

The Port of Montreal strike negotiations continue to hold up freight, keeping goods in limbo and leaving Canadian retailers on edge as holiday inventory sits at a standstill. Negotiations are ongoing, but there’s still no resolution in sight.

Meanwhile, Canada Post has its own labor concerns, with a strike looming over contract discussions. A second hit to Canadian logistics could leave retailers scrambling for alternatives. The latest proposal includes annual wage increases amounting to 11.5 per cent over four years.

On the brighter side, the Panama Canal saw a whopping $3.45 billion in profit for the fiscal year ending in September, even with fewer ships passing through due to drought restrictions. Operators have navigated the challenge creatively, showing that the canal is more than just a waterway—it’s a cash flow powerhouse.

Maersk, however, has decided to stay out of the Red Sea until at least 2025, citing regional security concerns. This rerouting means longer transit times for certain goods, but for Maersk, safety trumps speed.

And in the US, many shippers are sidestepping East Coast ports to avoid the risk of another labor strike. Caution seems to be the name of the game as holiday shipments ramp up.

Accomplish More. Juggle Less.

Your business is growing, and so are your responsibilities. So what do you do?

You do more.

You see a chance to expand your reach and increase your impact.

You do more.

You take on more hours, juggle more deadlines, and wear more hats. You miss a ball game here and there. Come home late a few more nights. You spend a holiday or two in your inbox. And you tell yourself,

This season just requires more.

But what if growing your business isn’t about doing more things — but instead doing the right things?

What if you could enjoy the holidays this year knowing that someone else is handling the “more”?

Your time is too valuable to waste. BELAY’s flexible staffing solutions can help.

Whether it’s administrative, accounting, or marketing support that you need, BELAY’s highly vetted professionals have the more you’re looking for.

Our exceptional Virtual Assistants, Accounting Professionals, and Marketing Assistants combine AI tools with extensive industry experience to ensure that you are always getting more without sacrificing quality or time.

Accomplish more and juggle less with BELAY.

Learn how with our free ebook, Delegate to Elevate, and leave the “more” to BELAY.

Online Marketplaces

OpenAI launches search engine to compete with Google

Lots of new developments in online e-commerce this week! First off, Amazon has put out a friendly reminder that West Coast ports may face inventory congestion this holiday season. If you’ve got high-priority shipments, you may want to consider alternative routing strategies.

Meanwhile, OpenAI is stepping into the search engine space with a new AI-driven model that could give Google a run for its money. This is one to watch, as it could transform the e-commerce search experience.

Walmart has also tapped into AI for a more personalized holiday shopping experience. For shoppers, this means the aisles may feel a little smarter, while for Walmart, it’s another tool to boost retention.

And Shopify has launched a new financial tool suite for SMBs to streamline cash flow and financial management—timely help for merchants heading into the year’s biggest sales period.

Finally, TikTok has also joined the holiday fun, launching its 2024 promotions. From live shopping to festive deals, the app is aiming to turn its followers into holiday shoppers, merging social and commerce like never before.

Logistics Vitals

Air freight demand remains strong but growth slowing

Air cargo demand has remained robust, with the International Air Transport Association (IATA) reporting a 9.4% year-over-year increase in total global cargo tonne-kilometers (CTKs). Key data points include:

  • International Route CTKs experienced a 10.5% rise compared to May 2023, indicating strong global trade activity.

  • Asia-Pacific (42%) and Europe (26%) lead the way in increases in international CTKs.

  • Air Cargo Capacity increased by 6.4% compared to a year ago.

Road Freight

Trucking demand and rates to remain down this year, but increases may be coming

Analysts anticipate that trucking rates and demand will remain subdued through the end of 2024, with both less-than-truckload (LTL) and truckload rates expected to stay relatively flat in the fourth quarter. Despite some indicators suggesting a potential market rebound, a significant uptick in demand is necessary to lift the trucking industry out of its prolonged freight recession.

And despite a potentially quiet end to the year on the trucking front, some LTL carriers are preparing for a potential rate increase in 2025. With inventories adjusting to a more cautious spending climate, demand is likely to remain soft through the holidays. Keep a close watch on LTL lanes, though—they may be the first to see rate hikes next year.

Warehouse Tech

AI to the rescue for sleepy drivers

AI is making inroads into fleet management, with new technology allowing managers to detect signs of drowsiness among drivers. This innovation could significantly reduce accidents and improve driver safety.

Meanwhile, drone deliveries are expanding across multiple networks, including Wing, Matternet, and DroneUp. You might want to look up the next time your order says “out for delivery.”

However, the push for electric vehicle (EV) mandates is stirring up tension in the trucking industry. Some companies are feeling the strain of regulatory demands, with concerns that the transition may disrupt supply chains. The road to electrification could be bumpy.

Warehouse Quick Deliveries

Logistics and politics intersect…

“It was sort of a niche area, supply chain risk management, and then came Covid, and then really it became a backroom-to-boardroom issue.

- Mirko Woitzik, Everstream Analytics.