Supply Chain by the Numbers

- Feb. 22, 2019 -

  Supply Chain by the Numbers for Feb. 22, 2019

Countries with Lowest Manufacturing Costs; Amazon Going Green; Truckload Rates Show No Signs of Slowing; Walmart Sees Huge eCommerce Gains



That was the rank of the United States – near the bottom - in the annual list of countries with lowest manufacturing costs from US News & World Report. The report was conducted with the help of over 20,000 respondents, who were asked to score 80 countries for several cost attributes. The overall country ranking system rates all countries worldwide according to broad essentials as well as intangible benefits such as freedom and security. The top 10 lowest  manufacturing cost countries? (10) Myanmar; (9) Sri Lanka; (8) Pakistan; (7) Malaysia; (6) Philippines; (5) Indonesia; (4) Thailand; (3) Vietnam; (2) India; and again number 1 China. However, the report says that after China's long run on top, "experts are now talking about a shift to India as the next factory to the world."


$1 Billion

That's the percent of its ecommerce shipments that Amazon intends to make carbon neutral by 2030. That as part of an ambitious new "Shipment Zero" initiative announced this week on the company's blog. Also included was an update on its previously announced long-term goal of using 100% renewable energy for all Amazon infrastructure globally, saying it was making "solid progress" towards this target, without giving more detail. The company will also release details of its company-wide carbon footprint later this year. "With improvements in electric vehicles, aviation bio fuels, reusable packaging, and renewable energy, for the first time we can now see a path to net zero carbon delivery of shipments to customers," the company said in the blog post. It added that the CO2 goal setting followed "an extensive project over the past two years to develop an advanced scientific model to carefully map our carbon footprint to provide our business teams with detailed information helping them identify ways to reduce carbon use in their businesses." Ambitious goals for a company not long ago thought to be a Green laggard.



That was the year-over-year rise in the January Cass Linehaul Index, which measures per mile truckload rates before fuel surcharge and other accessorials. Cass Information Systems can do that rate calculation with great credibility, as it pulls data from some $20 billion dollars in freight bills it pays for shippers annually. Despite some indications of a flattening freight environment, the January rise was again substantial, and marks the 16th consecutive month of year-over-year gains of at least 5%. In another bullish sign for truckers, the January Freight Tonnage Index from the American Trucking Associations was up 2.3% versus December and 5.5% over January 2018. Is there any relief in sight for shippers? Doesn't look that way.



That was the increase in Walmart's US on-line sales in its fiscal quarter ending in January, driven by the expansion of on-line grocery pickup services across more of its US stores. That compares to a 13% rise in on-line sales for Amazon in 2018 – though that lower growth rates is off a much higher base. Still, as with Amazon the growth comes at a price – Walmart profit margins declined in the quarter, thanks in part to higher transportation costs and more sales of lower margin ecommerce goods. Walmart also expects on-line losses to increase this year, suggesting there's still work to do solving the ecommerce economic puzzle. All told, US comparable store sales in the US – which includes commerce - were up a strong 4.2%, one of Walmart's biggest quarterly gains in a decade.