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As calendars flip to another month, it can be hard to believe that the first half of 2022 is already over. While many had their eyes set on fireworks and a three-day weekend this July 4th, others hustled toward end-of-quarter goals. The following seven stories will recap business moves, innovative ideas, and industry insight to guide supply chain professionals into the launch of the next quarter.
On June 22, 2022, FedEx and FourKites announced a joint initiative to develop an end-to-end intelligence platform called FourKites X. "Large shippers and logistics providers can use the tool to track orders, manage delivery providers and find alternate routes in the case of weather delays or other disruptions," FourKites CEO Matt Elenjickal wrote in an email to Supply Chain Dive. Current plans foresee a FourKites X pilot within the next few months, whereas the complete tool will be available before the end of 2022.
As diesel prices keep climbing and home-delivery demand declines, FedEx CEO and President Raj Subramaniam explained the company's strategy for the new fiscal year during FedEx's Q4 earnings call. While focusing on revenue quality and minimizing operational costs, an article by Supply Chain Dive noted that the parcel giant may even allow further collaboration between FedEx Express and FedEx Ground which have been historically separate until 2020. Time will tell if these efforts will be enough as daily revenue averages for FedEx Express, FedEx Freight, and FedEx Ground display negative year-over-year KPIs.
In a continued effort to grow its presence in the North American market, DB Schenker announced the $435 million purchase of USA Truck on June 24, 2022. While the transaction is still awaiting shareholder discussion and regulatory approvals, the deal includes the cash purchase of all remaining USA Truck common stock. Supply Chain Dive reported that the company's buying binge has not been exclusive to the U.S., as "DB Schenker announced in January that it purchased two transport companies in Spain as part of a plan to build out its European network."
As shippers continue to look for logistics cost-saving opportunities, low spot rates have challenged the loyalty to higher long-term contracted rates. When discussing the topic, Splash 247 saw that "short-term rates are now 2.7% lower than contracted agreements, with the former sitting at $7,768 per feu and the long-term rates at $7,981, having shot up an incredible 159.9% year-on-year." Shippers who remain in current contracts will be on the lookout for freight invoice errors, whereas many will likely opt to renegotiate contracts which will cause the rate gap to diminish.
In a continued effort to achieve carbon neutrality by 2050, UPS has chosen to test out an electric cargo bicycle within crowded urban cities. The pedal-powered "E-Quad" resembles a miniature version of the traditional brown boxy cargo vans that UPS is known for, without the size that makes navigating urban areas difficult. CBS News reported that this new sustainable freight transport option is one of over 1,000 electric vehicles employed by the shipping giant.
After struggling through countless issues procuring essentials and other commodities over the last two years, many supply chains have now built inventory levels that are too large for current consumer demand. Despite national employment levels at major highs, Freight Waves reported that this unfortunately timed consumer pullback is from "Inflation, crashing stock markets, higher interest rates, and economic uncertainty [that] are sapping any confidence that full employment should offer." As shippers deal with massive inventories, many are looking at innovative freight cost management strategies to offset increased warehousing expenses.
While the vegan diet is older than most sustainability initiatives, many have avoided the meat industry to minimize their contribution to an emissions-heavy industry. However, Supply Chain Brain reported that new research has discovered that the global transportation of fresh food "produces up to 7.5 times more greenhouse-gas emissions than previously estimated." The same data revealed that first-world countries, such as the United States, are responsible for 46% of international food transport emissions.
While many looked to 2022 as the start of a new supply chain environment, the last six months have proven that the global supply chain will continue to face disruption and significant changes for years. However, with the right team and tools in your corner, summer freight risks don't have to hold your company back from letting sparks fly with artificial intelligence exception management and other automation optimization. Don't let this opportunity fly by; start a conversation with Intelligent Audit today.
Set up a call with one of our experts to discuss how Intelligent Audit can help your business uncover opportunities for cost reduction and supply chain improvements through automated freight audit and recovery, business intelligence and analytics, contract optimization, and more.
