This Week in Logistics News (December 5 – 11)

The holiday shopping season is in full swing, and retailers are doing everything they can to lure consumers to stores, websites, and mobile apps. However, this holiday shopping season is being regarded as “lukewarm” so far by many analysts. In fact, recent surveys have shown that over a quarter of Americans still have not started their holiday shopping. This is partly due to “extended Black Friday” sales which last all month. For me, I have one definitive moment when I know that I can start my shopping – hearing a specific song on the radio that makes me feel the holiday season is here. I finally heard that song earlier this week, and immediately jumped online to do my holiday shopping. Within a few hours, I was done. I’m so thankful I do not have to go to a physical store anymore.

So what song is it that puts me in the holiday spirit? Check out the song of the week at the bottom of today’s post. And now, on to the news:

• Sears incentivizes app downloads with free in-store shipping perk
• Amazon buys thousands of branded truck trailers
• Investors hover as e-tailers boost demand for Indian warehouses
• E-log mandate set to take effect Dec. 2017
• Shipping imports end the year on a high note
• Global air cargo remains flat
• Reefer spot-market-volume surge follows Thanksgiving holiday week

Sears is working hard to bridge the gap between the digital and physical store this holiday season, and in the process, driving downloads for their mobile app. The retailer is asking in-store shoppers to enable location settings on their smartphones, select and pay for out-of-stock items within the app and receive complimentary shipping. This is helping Sears to boost digital sales while serving their in-store customers. So far, customers seem to be happy with the program; the big test will be to make sure customers receive their orders in time.

Amazon is ramping up for the holiday season. The company’s latest move is the addition of thousands of branded trailer trucks in its delivery fleet that will be driven by third-party carriers. Amazon has long had strong partnerships with third party carriers. However, in a move designed to increase capacity, Amazon is equipping their carriers with their own trailer equipment just in time to make those holiday deliveries. The company will be using the Amazon-branded trailers to make its U.S.-wide deliveries for the first time. The third-party truck companies will still provide the drivers and the actual trucks while Amazon will provide the actual branded trailers. The use of trucks will be utilized to transport items to and from Amazon warehouses, sorting facilities and delivery stations, not to the actual end consumer.

As more Indian consumers shift to online shopping, the country’s $110 billion logistics and warehousing sector is stretched. As a result, overseas investors are looking to invest in India’s warehouses, hoping to cash in on demand for modern and efficient storage space from growing online retailers. Existing spaces, known as “godowns” – low-rise sheds with poor ventilation and only a shutter to ward off heat and dust – are too old and cramped for large global firms. To modernize warehouses, companies need to invest in fire sprinkler systems, climate control, levelled loading bays, and paved roads, which can raise rents by as much as 20%. However, with the ongoing e-commerce boom, investors are lining up to make these investments, and the supply of modern warehouses is expected to double by 2020.

A federal rule to require truck operators to use electronic logging devices to keep records of duty status is slated to be published in the Federal Register today, the Federal Motor Carrier Safety Administration has announced. The rule will take effect Dec. 10, 2017, giving carriers and drivers a two-year window to comply with the rule’s requirements. Upon beginning use of an ELD, drivers will no longer be required to keep and maintain paper logs. They will, however, be required to maintain supporting documentation and submit them to their carrier or, for owner-operators, keep them on file.

Retailers predict that import volumes at the nation’s major container ports will finish the year on a high note despite weak demand during this year’s traditional peak shipping season. September’s volume of 1.62 million import containers at the nation’s biggest import gateways was up 2.2% from last year and October’s 1.56 million containers was essentially flat, down 0.1% from the same period in 2014, according to the Global Port Tracker report by the National Retail Federation and Hackett Associates LLC. This is a good trend to see following the extensive work stoppage at West Coast ports, when many shippers were shifting to air cargo to make up for the massive delays.

On a related note, global air cargo volumes remain flat. The International Air Transport Association (IATA) released data for global air freight markets showing that air cargo volumes rose just 0.5% in October compared to a year ago. Year-over-year expansion fell back from September’s faster growth rate, and total cargo volumes in October stand 1.1% lower than the peak of the uptrend at the end of 2014.

And finally, the national all-in average reefer rate, including fuel surcharges, rose a cent to $1.95 per mile last week despite a cent decline in the average fuel surcharge. That average was up from a mid-November $1.93 per mile, and it followed a concurrent 39 percent boost in load availability nationwide on DAT Load Boards, the company said. Rates trended up in Los Angeles and Fresno, Calif.; Grand Rapids, Mich.; Rock Island, Ill.; Philadelphia; and Miami. In other key reefer markets, rates declined, including: Twin Falls, Idaho; Dallas; Green Bay, Wis.; and Atlanta.

That’s all for this week. Enjoy the weekend, and the song of the week, Christmas Eve / Sarajevo by the Trans-Siberian Orchestra.