Retailers are gearing up for the upcoming holiday season. While most stores are currently decked out in Halloween gear, come November 1, that will all change. Cue the Christmas trees, lights, and music, because the holiday season is fast approaching. I can’t say that I’m looking forward to it. But the retailers sure seem ready. Macy’s recently announced that they will open stores at 6 pm on Thanksgiving, two full hours earlier than last year. And stores will stay open until 8 pm on Black Friday. That is 26 full hours of Black Friday shopping. This week’s news is dominated by more holiday logistics, so enjoy!
- Amazon plans to add 80,000 temps for the holiday season
- Target eyes holiday turnaround on free shipping
- FedEx, UPS make plans for better holiday season
- Container ships still backed up at LA-LB
- APICS Honors BASF and GE Oil & Gas
Amazon is planning to increase its seasonal workforce by 14% this coming holiday season. That equates to 80,000 workers. The employees will have temporary jobs at Amazon’s more than 50 U.S. warehouses. The company will also place some seasonal hires at its newly created “sortation” centers, where Amazon collects parcels from the fulfillment centers to sort them by ZIP codes for delivery to local post offices. The seasonal hiring spree comes a week after the National Retail Federation forecast $617 billion in holiday spending this year, a 4.1 percent jump from last year. Major rivals including Wal-Mart and Target are also planning to up their seasonal workforce.
Target has a three-pronged approach to improving its holiday season: free shipping, more advertising, and 35,000 new items. Currently, Target offers free shipping for customers who use its branded payment cards. As of today, that offer has been extended to all purchases through Dec. 20. With Amazon and other competitors offering free shipping for price threshold purchases, it is not surprising that Target is adding free shipping as well. The big question is whether the free shipping on holiday items can drive enough volume to offset the logistics costs.
To say that last year’s holiday season was a disappointment from a logistics standpoint is an understatement. Last year, a combination of last minute shopping and bad weather led to an estimated 2 million packages arriving late for Christmas. This year, FedEx and UPS are planning ahead to make sure this doesn’t happen again. FedEx plans to hire 50,000 seasonal workers, up from 40,000 last year. United Parcel Service Inc. says it will add up to 95,000 people, up from 85,000. Last year, both companies wound up scrambling to hire more seasonal employees than they had planned, which increased costs and cut into profits. FedEx also expects to invest $1.2 billion in its ground-shipping network in its current fiscal year, with most of that going to increase capacity and automation. The company said that the improvements have sped up ground delivery by a day or more in more than two-thirds of the U.S. UPS has also invested to boost shipping capacity during the holidays, said the company’s chief commercial officer, Alan Gershenhorn. He said that UPS had improved it forecasting and package tracking.
Vessels are still backed up off the ports of Los Angeles and Long Beach as gridlock at the Southern California ports continues. Container ship traffic and volume at the LA-Long Beach port complex has been relatively high, contributing to the terminals’ congestion. Other reasons for the gridlock include the increasing sizes of ships in the trans-Pacific trade lane, which require longer times as berth, as well as a shortage of chassis and drayage drivers, and more recently, slowdowns by members of the International Longshore and Warehouse Union.
BASF and GE Oil & Gas were honored today at the APICS 2014 conference in New Orleans, LA, with APICS Corporate Awards of Excellence in recognition of their commitment to continuing education and innovation in the field of supply chain and operations management. BASF received the 2014 APICS Award of Excellence in Education for its commitment to worker education and training. By paying for employee membership, seminars, meetings, classes, and exams, BASF is emphasizing the importance of continued education and certification. GE Oil & Gas was honored for its multi-year supply chain improvement and innovation project that included establishing a materials management organization based on APICS principles, making significant changes in their organizational structure, and shifting from ‘product supplier’ to ‘solutions-oriented’ partner.
That’s all for this week. Enjoy the weekend and the song of the week, The Trans-Siberian Orchestra’s Christmas Eve / Sarajevo.