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This Week in Logistics News (January 14 – 20)

For the first time since 2020, I was back in New York City for the NRF Big Show. And a big show it was, with over 35,000 people on hand to see the latest innovations in retail technology. One of the more interesting things about NRF is the large-scale displays on the exhibitor floor. There were multiple booths showcasing robots that could navigate through the crowd, hauling totes for picking orders. I will cover this in an article next week. But speaking of robots, the coolest robot I saw in New York this week was the life-size, and life-like, Yayoi Kusama robot at the Louis Vuitton store on the Upper East Side. Yayoi Kusama is a 93-year-old Japanese contemporary artist. Louis Vuitton has transformed many of its shops into enormous homages to the artist and her fabulous polka dots. At the Upper East Side location, the robot Kusama paints polka dots on the inside of a picture window. After looking at pictures of the real Yayoi Kusama, it was eerily realistic. And now on to this week’s logistics news.

Amazon in the news:
Amazon is moving to a single monthly storage cap for FBA sellers
Amazon testing “Prime Lite” in India

Macy’s paying more attention to responsible sourcing
California Trucking Association makes new pitch for AB5 injunction
Just Eat partners with Sainsbury for 30 minute delivery
Cargo theft increased by 15% in 2022
Carriers continue to fold as pandemic freight boom recedes

Amazon is offering Fulfillment by Amazon (FBA) sellers a single monthly limit on the amount of inventory they can send to and store in its fulfillment centers, as the company looks to better monetize its excess storage capacity. According to a company blog post, Amazon will also now provide sellers with an estimated capacity limit “for the following two months to help sellers plan over a longer time horizon.” Lastly, sellers can also now request more capacity, by providing a reservation fee per cubic foot that they are willing to pay. Amazon will grant these excess capacity requests based on which sellers submitted the highest bid, until it runs out of available space. This new system of inventory management will go into effect on March 1, and will replace weekly restock limits that Amazon used for calculating FBA storage. Directors at Amazon agencies and accelerators said that these new changes will help sellers forecast inventory better.

Amazon is quietly piloting a new tier for its Prime membership in India, providing customers with access to popular benefits such as free two-day delivery and ad-supported Prime Video in standard definition at a lower price.The new tier, called Prime Lite, is currently available to select customers at a discounted annual price of $12 (999 Indian rupees). This is a cost-effective alternative to the regular Prime membership, which is priced at $18 (1499 Indian rupees) per year, or $2.20 (179 Indian rupees) per month. Amazon’s Prime membership has been available in India since 2016. It was priced at $12 a year for some time, though the company increased its pricing to $18 in December 2021. The new offering comes just weeks after Amazon launched Prime Gaming in India. The gaming-focused service is complementary to Amazon Prime and Prime Video subscribers.

In September 2022, Macy’s rolled out its first-ever wood-sourcing policy for its furniture sales after more than 150 years in business. It requires the use of responsibly sourced wood or recycled or reclaimed materials. And it also prohibits the use of timber that has been harvested illegally or from threatened areas, among other restrictions. At the outset, the policy covers wood-based products in Macy’s private labels, while buyers will use the policy as a guide for onboarding new suppliers and brands. The policy follows Macy’s $5 billion commitment announced in March 2022 to become more sustainable in its policies and practices. It also rolled out a new cotton sourcing policy to ensure cotton isn’t harvested by underage workers or those in forced conditions. Macy’s also doubled its score from 9 to 18 on the Sustainable Furnishings Council and National Wildlife Federation’s 2022 Wood Furniture Scorecard — it was among 37 percent of companies on the list that scored higher than they did the year before.

The California Trucking Association (CTA) has filed its request for a new preliminary injunction to block AB5 from the state’s trucking sector — again — using an argument that at times seems more economic than legal: The law won’t work. CTA’s 32-page brief with the U.S. District Court for the Southern District of California was filed Wednesday. The request for a new injunction against independent contractor law AB5 in trucking was made in front of the same court and judge, Roger Benitez, that handed down a temporary injunction on New Year’s Eve 2019 that later morphed into a temporary injunction in January 2020. That injunction kept AB5 out of trucking, though it was followed by an appellate court overturning it. That ruling was stayed while the CTA appealed to the U.S. Supreme Court, which denied certiorari — a process to seek review of a lower court decision — and led to AB5 being implemented in the state’s trucking market. The CTA’s latest injunction request visits familiar territory, which makes sense since it is the same case. The original case was never adjudicated. The only court ruling was the initial injunction, the appellate court overturning that injunction and the Supreme Court denial of certiorari. The legal arguments have not otherwise seen their day in court.

Everybody wants their groceries delivered faster. Just Eat Takeaway.com NV is teaming up with UK supermarket operator J Sainsbury Plc to drop off groceries in under 30 minutes in the latest tie-up in the rapid-delivery space. Customers using the app will be able to choose from over 3,000 food, drink and other everyday products from Sainsbury starting this month. Just Eat will deliver from 175 Sainsbury stores including in London, Edinburgh and Bristol, with plans to expand further this year. Sainsbury already offers same-day delivery as well as its one-hour service, Chop Chop, and the UK’s second-biggest supermarket also partners with Deliveroo and Uber Eats. Amsterdam-based Just Eat is the UK’s largest food delivery platform, reaching 97% of post codes. The company started out in takeaway food and has expanded into grocery delivery with partnerships with Co-op and Asda in the UK as well as Ahold, Carrefour and Spar elsewhere in Europe.

Instances of cargo theft increased markedly in 2022, driven in large measure by thieves using fictitious pickups. CargoNet recorded 1,778 supply chain risk events across the United States and Canada in 2022, an increase of 15 percent from 2021.  They estimate $223 million in cargo was stolen across all theft events in 2022. CargoNet’s 2022 data shows events that involved the theft of at least one heavy commercial vehicle such as a semi-truck or semi-trailer increased by 17 percent year-over-year. Events that involved the theft of cargo increased by 20% year-over-year. The average value of cargo stolen in an event was $214,104. Increases in theft activity around major intermodal hubs were significant, according to CargoNet. California remained the top state for reported events in 2022; theft in the state increased 41 percent year-over-year. Computer and green energy components were some of the most frequently stolen items. California is a major logistics hub for these items. Household items were the most stolen commodity in 2022. CargoNet said this is a diverse category that includes appliances and furniture which often get targeted during long haul and final mile distribution. There was also a notable increase in the theft of shipments of tools and toys.

As freight truck utilization continues to fall from pandemic-era capacity, more small carriers are giving up for-hire authority as equipment and other carrier costs remain higher at the start of 2023. This could be a slow, messy year for freight. The trucking industry lost more carriers in December than any month since Hurricane Katrina disrupted much of the over-the-road freight industry, according to data from FTR Transportation Intelligence. This followed months upon months of more new motor carriers trying to get in on the raging freight market. The booming freight market born out of the pandemic that began nearly three years ago created a market for new for-hire carriers within a thriving spot market. During most of 2020 and 2021, hundreds to thousands of companies established for-hire authority each month. While there were fits and starts through much of 2022, the industry started losing “a pretty substantial number” of carriers in October.

That’s all for this week. Enjoy the weekend and the song of the week, Robots by Dan Mangan.

The post This Week in Logistics News (January 14 – 20) appeared first on Logistics Viewpoints.

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