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Supply Chain by the Numbers
   
 

- July 14, 2016 -

   
  Supply Chain by the Numbers for Week of July 14, 2016
   
 

Amazon Prime Day Drives Record Sales; US Distribution Space Being Leased is Soaring; Diesel Prices Expected to Stay Low in 2017; Container Volumes Out of China are Really Slumping

   
 
 
 

60%

That was the global rise in sales for Amazon's "Prime Day" event earlier this week over 2015 numbers, driving the largest one-day sales total in its history, the company said. In the US, sales were up 50% on the day, it which Amazon offered sale prices on a large number of items here in July similar to a Black Friday or Cyber Monday type of event. While Amazon did not release the specific sales total in dollars, it did announce that on Prime Day it sold more than 90,000 TVs worldwide, and in the US over 200,000 headphones, 23,000 Roomba vacuum cleaners and 215,000 Instant Pot 7-in-1 Multi-Functional Pressure Cookers. "Prime Day is now solidified as an annual shopping holiday," Piper Jaffray analyst Gene Munster said in a research note this week. Walmart.com has been running a similar and longer sale in July, but would not provide any specific sales numbers.

 
 


 
 
 

15%

That is by how much US diesel fuel prices are expected to rise on average in 2017 versus the 2016 average, according to new estimates from the US Energy Department. Still, that will take the average to just $2.71 cents per gallon, versus an estimated average of $2.36 this year. Currently, diesel is about $2.40 nationally. By comparison, the average price in 2014 was $3.83, a level which seems just crazy high right now. The low diesel prices and resulting fall in fuel surcharge costs have led to a partial shift back away from rail and towards trucking, with the Association of American Railroads just announcing that once high flying intermodal container volumes actually fell 2.1% in the first half of the year. Good news for consumers too, as the Energy Dept. forecasts the average cost of regular grade gasoline will rise just 7.6% in 2017 to $2.28 per gallon, following an expected average this year of $2.12.

 
 
 
 
 
70.1 Million

That is how many square feet of industrial space – most of its distribution centers - was leased in the US in the second quarter of 2016, the most in over 30 years of data and up 6% from the same quarter last year, according to a new report from real-estate brokerage firm Cushman & Wakefield. In a separate report, broker CBRE Inc. said warehouse availability declined for a 25th consecutive quarter, falling to just 8.8%. Retailers have been renting DCs space faster than developers can build it, as they race to build facilities to fulfill surging ecommerce orders. The latest trend of opening smaller distribution centers near cities to improve delivery times and accept returns is driving vacancy rates into the low single digits in some areas, the reports say.

 
 
 
 

2.5%

That was the weak rise in container volumes through Chinese ports in the first half of 2016, according to new analysis from the researchers at Alphaliner. That is the slowest pace of growth since container traffic in China declined in the recession year of 2009. Container volumes at the ports in Shanghai and Shenzhen were down 1% from the first half of 2015, Alphaliner said. What is going on? Well, the UK's Financial Times reported just this week that global trade volumes have been flat for the past 18 months, well below world economic growth of about 3.2%, as globalization comes under a level of attack in many nations. China recently reported that its trade slump is continuing, with exports down 4.8% in June in dollar terms from a year earlier, after falling 4.1% in May. Despite good news on some fronts in the US, we are in some wobbly economic times globally.

 
 
 
 
 
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