Welcome to the January edition of Zengistics Monthly Insider! As we step into the new year, our commitment to keeping you informed about the latest industry trends and insights remains unwavering. In this edition, we present a curated selection of news highlights for navigating the complex landscape of logistics this month. Whether you’re in (Consumer Packaged Goods) CPG Logistics, Beverage Logistics, or just interested in general supply chain news, we’ve got you covered. Let’s dive into the key events shaping the logistics landscape this month.
Many carriers and brokers hobbled through 2023, and are anxiously awaiting any sign that pricing power is swinging back in their favor.
There are some indications that it’s starting but not yet on a widespread or dramatic basis. The first quarter of every year is historically a difficult one for freight. Adding to that is the fact that the final months of 2023 continued the tumult for the trucking and brokerage sectors, highlighted by a number of bankruptcies in both. So will 2024 bring a definitive end to the current freight recession?
The Q1 2024 Freight Sentiment Indexes reveal a surge in shipper confidence, climbing to a record-high 13.58 from 9.79 in the preceding quarter. Dive into the latest Freight Sentiment Indexes for the first quarter of 2024. Learn about the industry’s pulse and how it may impact your logistics strategies.
Many large food and beverage manufacturers will need to double down on an often-overlooked part of their business: innovation, in order to grow. Analysts who follow the sector told Food Dive that under the current environment, innovation is more important than ever for companies to attract and retain consumers who are curtailing their spending, pushing for products that better meet their needs, and navigating through a seemingly endless array of choices in the marketplace.
This year is forecasted to be challenging as inflation, consumer fatigue over price increases, and other factors weigh on companies, placing pressure on producers to upend their usual way of thinking. For many companies, however, paying more attention to innovation and investing extra money to bulk up that side of their business means upending an inherently conservative culture that has been largely risk-averse for much of its history.
Explore the innovation landscape in Consumer Packaged Goods (CPG) with insights from major players like Nestle and Mars. Gain foresight into the trends shaping the industry in the coming year.
Some hardline retailers could face elevated costs and delays due to conflict on the Red Sea, according to a note from Jefferies analysts. Wayfair, RH, Beyond Inc. (formerly Overstock), and Best Buy are a few retailers cited, with them being affected by shipping disruption in the Middle East due to their “elevated global sourcing exposure.”
Others, such as The Home Depot, Lowe’s, and Tractor Supply Company, are insulated by their reliance on domestic sourcing. Investors should expect temporarily higher inventory levels from transit delays and higher costs from air freight, according to the analysis. The Jefferies team cited home furnishings giant Ikea, whose executives have said they expect delays and possible availability constraints for certain products and is evaluating other supply routing options.
Armed conflict on the Red Sea has slowed ocean shipping in the region as carriers avoid the Suez Canal, forcing many shippers to find alternative routes or sources to avoid the trade lane. Ocean shipping rates have already spiked considerably amid the disruption. Get insights into how retailers are coping with higher costs and supply shortfalls, exacerbated by the ongoing crisis.
2023 will go down in the books like 2019 did – an unprofitable year for carriers with the usual twists and turns. Unlike 2019, though, we have not seen anywhere near the level of carrier bankruptcies reported despite the number of long-haul carriers exiting the market. To put 2023 into context, we must go back five years and start with the 2018 bull market.
The first half of 2018 was an excellent year for carriers, especially flatbed ones, boosted by a robust industrial economy, rising oil prices, and significant rebuilding efforts following hurricanes Irma and Harvey in late 2017. Changes in the tax code also benefited carriers that placed a record number of orders for new trucks later that year. Owner-operators and small fleet carriers made, on average, $24,000 gross profit after all expenses were considered during that year; by all accounts, it was a good year in trucking.
But as demand cooled in 2019, the industry became increasingly oversupplied, as new trucks hit the road following the frenzied buying spree of new trucks and trailers six to nine months earlier. Downward pressure on spot rates ensued, resulting in many bankruptcies in the second quarter of that year, including some mega-carriers – Falcon, Celadon, and New England Motor Freight (NEMF). Delve into the retrospective analysis of the 2023 freight market, understanding how trends and challenges from the past year have shaped the industry.
As we reflect on these industry developments, it’s clear that staying informed is key to success. At Zengistics, we offer more than just information; we provide strategic advantages that empower your business to thrive in a rapidly changing landscape. Our services include:
These and other services, seamlessly integrated into Zengistics, ensure that you stay informed and gain a competitive edge in the market.
Ready to revolutionize your logistics operations and enhance your strategic decision-making? Speak to one of our experts today and discover how Zengistics can elevate your shipping and tracking capabilities. Don’t just navigate your industry; lead it with Zengistics. Keep track of our newsletters for a monthly dose of industry insights, and don’t hesitate to reach out to our experts for personalized assistance.
Thank you for choosing Zengistics. Together, let’s navigate the future of supply chain management!
Operating on the world’s first collaborative logistics platform, Zengistics is a technology company that executes freight.