As the old-timers of the global logistics industry, parcel carriers like FedEx, UPS, and the U.S. Postal Service struggle to keep up with innovative strategies from retailers like Walmart and Amazon. The logistics industry is taking notice. While the old guard focuses on labor issues and struggles with an ongoing worker shortage, retailers and e-commerce businesses are building supply chain strategies to tackle the latest industry challenges. Here are some of the topics making news in an industry that's always moving.
GoLocal, retail mega-store Walmart's foray into white-label delivery, has surpassed 5,000 delivery locations. This number far exceeds company expectations, which were tempered by declining volumes and unpredictable rates among major carriers and logistics providers.
In a recent interview with Supply Chain Dive, Harsit Patel, Vice President and General Manager of GoLocal, said, "We're not going to constantly want to renegotiate rates, or we're not going to have constantly changing personnel, and we can be able to provide you that consistent experience and create more of a trusted, reliable experience for clients they can bank on."
As GoLocal continues to provide same-day service to local delivery customers, Patel says the company will intensify its focus on building route density within established markets.
FedEx hopes to resolve potential labor issues within its pilots union; however, the FedEx Airline Pilots Association clarified that, though both sides hope for a speedy resolution to current pension disputes, a seamless resolution isn't guaranteed. As Capt. Chris Norman, chair of the union, recently told Supply Chain Dive, "Even though we are looking for expediency, we are not going to settle for anything other than fixing our issues. Do I think we will fix the retirement? Absolutely. The problem is, how long will this take? Will it be dragged out past this expedited session?" With peak season rapidly approaching, FedEx hopes for a simple, fast negotiation process.
As Amazon has grown, some logistics industry experts have wondered when or whether Amazon would use its growing distribution network to begin to compete with UPS, one of the e-commerce giant's most prominent vendors.
FreightWaves reports, "The catalyst is Amazon Logistics, the company's delivery arm, expanding its operations amid a slowdown in e-commerce volumes that has left it with excess capacity. One way to fill it, the theory goes, is to begin insourcing volumes that have traditionally been handled by UPS."
As Amazon continues to grow — their Prime Day sales event in July did a staggering $7.77 billion in sales — it remains to be seen whether they'll continue partnering with traditional logistics providers or go their own way.
With the holiday season rapidly approaching, major logistics providers struggle to find the extra help they need to meet seasonal demands. Logistics Management reports, "Labor availability, going back to the onset of the Covid-19 pandemic more than 2.5 years ago, is far from a slam dunk, what with many people leaving the workforce, and in some cases, not coming back to it, or, in many cases, not to the same pre-pandemic levels, which were once viewed as typical."
As logistics experts wonder what a holiday season during a labor shortage might look like, major logistics and eCommerce businesses are calling for seasonal help. Amazon recently announced its plans to hire 150,000 additional workers to meet seasonal demand.
As the breadth of destruction caused by Hurricane Ian becomes clear, carriers are doing everything they can to restore service to regions affected by the Category 4 storm. According to Forbes, Hurricane Ian caused between $41 and $70 billion in damage, including significant damage to logistics hubs. Despite this damage, logistics providers are beginning to resume normal operations, with the Port of Jacksonville resuming normal operations on Saturday and parcel carriers — including UPS, FedEx, and USPS gradually resuming service in the region, Supply Chain Dive reported.
In a huge step forward for aspiring drone delivery service providers within the United States, California-based health services company Intermountain and Bay-area drone designers Zipline have announced the first drone delivery service in the Western US. The service will provide customers access to specialized pharmaceuticals and over-the-counter medications.
While drone service has been accessible in other nations for some time, "a stringent US federal regulatory system has contributed to a lag in adopting the new technology domestically; Intermountain's program is the first of its kind west of the Mississippi," the Desert News reported.
Early this month, retail giant Walmart announced that it had purchased Alert Innovation, an e-grocery automation firm specializing in automation and intelligent fulfillment. Supply Chain Dive reports, "Alert Innovation's Alphabot system is designed to store, retrieve and dispense orders by using robots that move omnidirectionally without lifts or conveyors — providing fewer space constraints and making the tech easier to scale."
Walmart's purchase of Alert Innovation reflects a growing trend in the retail logistics industry; as retailers and shippers struggle to find the labor they need, more and more are turning to automation strategies to access on-demand services.
Today's logistics industry is in a state of flux. As retailers implement innovative supply chain strategies to compete with shippers, and labor unions keep logistics giants on their toes, today's shippers face a complex, fast-moving logistics landscape. That's where Intelligent Audit comes in. With Intelligent Audit, shippers can access the freight auditing, anomaly detection, and logistics industry expertise they need to survive and thrive in a rapidly evolving industry. Start a conversation with Intelligent Audit today, and see what smarter, more efficient shipping can do for your business.
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President Biden is hopeful that the recently signed Ocean Shipping Reform Act of 2022 (OSRA) will be a turning point for "the consumer price that hit a new 40-year high this month," according to Supply Chain Dive.