Cold storage firm Lineage is preparing to go public in what many expect to be the largest IPO in 2024. The news comes amid a fluctuating and unstable freight market, and the IPO will be expected to bring some relief to the market, proving that there is light at the end of the tunnel. But the freight market is not the only industry beaming with excitement. The e-commerce industry continues to grow, and online sales continue to break records, with reports and market researchers now expecting it to reach $1.2 trillion in 2024.
This newsletter explores the latest news and trends across North American freight, CPG, and retail markets. Continue reading to find out more:
In a blockbuster initial public offering that could be the largest in 2014, Lineage, the world’s largest refrigerated storage by capacity, plans to raise $3.85 billion.
The move comes after a streak of rapid expansions that now sees the company boasting a vast network of warehouses. However, the icing on the cake is that the company has also recently enjoyed a surge in demand for cold storage space due to increased consumer purchases of fresh and frozen food. The Novi, Michigan-based company said on July 16 that it plans to offer 47 million shares for $70 to $82 each, which would raise between $3.29 billion and $3.85 billion.
And by all accounts, the move is good news for the logistics sector, considering it has had its ups and downs recently. Achieving the IPO’s objective will boost the industry, signaling a turn in the tide.
According to a new report from FTI Consulting, online retail sales in the U.S. are predicted to grow 9.8% to $1.2 trillion in 2024 as the e-commerce industry matures and returns to pre-pandemic levels.
It will also make up 22.7% of the overall retail market share this year, up from 21.6% last year. So far, online sales growth accounted for 57% of total U.S. retail sales in Q1 and is expected to stabilize at around 35% of total retail sales in the next decade, with some product categories already reaching that point. Businesses are adapting to the evolving landscape by focusing on omnichannel integration, technological innovation, and meeting shifting consumer demands. Other research predicts further growth in e-commerce sales in the coming years.
The U.S. retail industry is already responding to these market changes by shifting stores to fulfillment centers, closing underperforming locations, and leveraging AI, among others.
The e-commerce fervor powering the air cargo market shows no signs of slowing down, but that does not mean other market drivers would not, which is why experts are wondering if the current surge could be at the expense of peak season growth.
Although the demand is strong now, absolute demand is not as strong as the numbers suggest. Growth this year is off a low base in the first half of 2023, when cargo volumes were down 10% from the same 2022 period because wholesalers and retailers were cautious about ordering as they drew down inventory. The demand surge is primarily because of e-commerce growth and disruptions in maritime shipping; however, no one can say for sure if this growth will continue through the peak season due to potential shifts in demand drivers.
Although global manufacturing has expanded, the growth isn’t uniform, prompting experts to wonder whether cargo demand will hold up.
Amazon’s Prime Day 2024 was a huge success. Online sales reached $14.2 billion, an 11% increase from the previous year, although the average household spending slightly decreased to $152. Industry research firms like Emarketer report that consumers spent $8.2 billion on Amazon during the event, up 5.5% from last year.
Reports from Adobe, which tracks online spending, suggest consumers took advantage of the steep discounts to update their electronics, apparel, and small home appliances. However, top-selling products included protein shakes, Amazon’s Fire TV Stick streaming device, and Glad brand trash bags. The data was tracked by Numerator, a market research firm that tracked spending from 35,588 households.
Competing retailers also offered deals, contributing to the overall online spending during this period. Amazon did not release specific sales figures but stated that the event set a new record for the number of items sold.
As various markets across the freight industry continue to break records, your business will need the right technological solutions to capitalize on the momentum. With technology in the logistics operation, you can mitigate potential disruptions and complexities that threaten operations and prevail with a flexible and agile supply chain.
If you want this, work with Zengistics. With us, you have:
Zengistics is the smarter option for getting logistics done more efficiently. Connect with us today.
Operating on the world’s first collaborative logistics platform, Zengistics is a technology company that executes freight.
