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Supply Chain by the Numbers

- Nov. 12, 2020

  Supply Chain by the Numbers for Nov. 12, 2020

Jobs in Warehouses and with Parcel Carriers Keep Soaring; Costs for Ocean Shipping Containers Jump on Shortage; Single's Day Sales Leap for Alibaba; Walmart Adding Dozens of Pop-Up eFulfillment Areas



That is the number of new US jobs added in October for workers in the warehousing, trucking and delivery sectors last month, as efulfillment growth continues to drive job creation. That according to data this week from the Bureau of Labor Statistics, in seasonally adjusted numbers, meaning the 46,000 new positions is above the increase that would normally be expected in the month. Warehousing accounted for about 28,000 of the new jobs. Parcel carriers added another 8,300, and have seen employment rise just under 100,000 positions since February, as carriers react to a huge jump in demand that has some parcel firms not accepting new customers until next year. Meanwhile, last mile delivery firm Shipt (owned by Target) said that it wants to add 100,000 additional workers to help during the holidays, which would triple its number of workers from the beginning of the year.




That is what Chinese manufacturers, which dominate the market, are now charging for a standard 40-foot shipping container – up from $1600 a year ago. Why the price spike? Because of a current huge shortage of existing containers stemming from a surge of imports from Asia to the US. In fact, the shortage is so significant leading containers shipping lines don't even want US export business right now. Why? Because that involves extra time to get the containers back to China, and rates for the backhaul of US exports are low, while soaring on container moves from Asia to the US. In fact, German carrier Hapag-Lloyd decided to suspend US agricultural export service for the foreseeable future – which could be a real problem for American farmers. Hapag-Lloyd wrote in a note to customers that the limited supply of 40-foot containers is "an enormous unseen challenge." Steve Ferreira, the CEO of New York-based consultancy Ocean Audit, wrote over the weekend that some large American retailers such as Walmart, Home Depot, Lowes and Target are shipping 300% of their normal peak volumes from China to the US remains as consumer demand for many goods remains very high.




$75 Billion

Incredibly, that was that was the value of products purchased on China's Alibaba's ecommerce platform over a few days this week during what has become known as "single's day." The idea started years ago as a sort of symbolic protest against Valentine's by unattached young people, but now has become an on-line shopping mega-event in the country. Normally conducted in a single day, this year Alibaba held the event over several days, driving the total value of purchases to event record highs. SCDigest cannot yet find any data on sales totals from Alibaba rival, but it was certainly a huge number too. By comparison, so-called Cyber Monday sales in the US in 2019 were a paltry $9.4 billion. The 2020 singles day festivities kicked off with a marathon stage show Tuesday night in Shanghai, with US pop star Katy Perry performing via live stream.



That's how many "pop-up" efulfillment areas Walmart is creating inside its traditional regional distribution centers that normally only replenish stores, the company announced this week. In total, the pop-up sites are expected to ship as much as 30% of its total ecommerce business for the 2020 Christmas season. Walmart currently ships ecommerce orders from dedicates efulfullment DCs or from its stores. The move adds to total capacity and may reduce shipping costs, as the 42 pop-up sites will often be closer to the customer than are the relatively small number of ecommerce DCs. Walmart added that it is hiring more than 20,000 seasonal workers at ecommerce facilities. Those numbers include new workers to support the pop-up sites, with the areas also leveraging existing regional distribution center associates. To support the work at the pop-ups, Walmart developed a warehouse management app for order picking that employees can use their smartphones.

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