Article by John Wagner Jr from Wagner Logistics published on November 22nd 2013
The weather is cooling off but consumer spending is warming up. The Commerce Department reports that retail sales (not including autos, building materials, gas) were up 0.5 percent in October on the heels of a 0.3 percent increase in September.
Electronics and appliance stores did the best (anyone get a new iPhone?) but there were also solid gains in other categories including sporting goods, apparel and furniture. While economists had predicted that the government shutdown would put a lid on sales, Commerce Department reporting shows there was little impact. Here’s to hoping this trend continues into the holidays!
Amazon and the United States Postal Service are working to develop a Sunday package delivery service. The program will be piloted in New York and Los Angeles with Dallas to follow. Package delivery volume is growing by double digits at USPS, even as letter volume falls. Package delivery is critical to making up the loss of letter revenue.
The Morgan Stanley dry van index is trending up in line with seasonal expectations, and other measures also show the uptick in freight. The Department of Transportation’s freight transportation services reached a historic high, rising 4.3 percent in September in a year-over-year comparison. This is the ninth month in a row this index has been better than the year before.
The American Trucking Associations’ October tonnage index was up 8 percent in year-over-year comparison; however, it was down 2.4 percent from September. That is the first decline since July. The railroads are doing well, with intermodal converting more highway freight to the rails. The Intermodal Association of North America said traffic rose 4.7 percent in the third quarter with railroads handling 4.01 million shipments. IANA also said that domestic shipments were up 7.6 percent over 2012 numbers. Second-quarter growth was 6.5 percent.
Lock up for the holidays
A word to the wise – pay close attention to security along your supply chain during the Thanksgiving holidays. The weekend is a feast for thieves. According to FreightWatch International there were 10.5 thefts per day the last three Thanksgiving weekends, more than three times the average during that three-year period.
Apparel, shoes, food, beverages, and electronics are high on the thieves’ wish lists. Make sure your trailers’ and distribution centers’ security protocols are especially tight during the holidays. Organized crime is alive and watching for opportunity.