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Supply
Chain by the Numbers |
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- June 6, 2019 -
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US Purchasing Managers Index Falls Again in May; Contract Driver Status in Jeopardy in Golden State, and Maybe Beyond; Mall-based Retailers Continue Stuggles; Uber Freight Lowers Rates to Gain Share |
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52.1 |
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That was the measure of the US Purchasing Managers Index for May, in data released earlier this week from the Institute for Supply Management. While still above the 50 mark that separates manufacturing expansion from contraction, the measure has been drifting towards that 50 level in recent months, with the May number down from 52.8 in April and at its lowest level since October 2016. The New Orders Index registered 52.7, an increase of 1 percentage point from the April reading of 51.7, but still not much above the 50 level. "Respondents expressed concern with the escalation in the U.S.-China trade standoff, but overall sentiment remained predominantly positive. The PMI continues to reflect slowing expansion," ISM noted. Is that a precursor to recession, or simply a pause in growth levels? |
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That is the share of the revenue it received from shippers that Uber Freight is giving to its truckload carriers, according to a new research note from Morgan Stanley. The Morgan Stanley research says Uber is using low pricing to undercut its brokerage competitors to gain market share. The Wall Street Journal notes this research highlights concerns some freight-industry executives have raised about impact technology-focused freight brokers with lots of investment from private equity firms may have on the freight market. Uber Freight says it has some 36,000 carriers in its network along with more than 1,000 shippers that booked $359 million in freight business last year. The company is competing with freight brokers that Morgan Stanley writes typically share between 80% and 85% of the gross revenue with truckers hauling the goods – at higher rates to shippers. But Uber can lower prices by forgoing profits, at least for now. |
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26% |
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That is the percentage drop in its share price Abercrombie & Fitch saw the last week in May, the biggest percentage decline since the company went public. PVH Corp., owner of brands including Van Heusen, Tommy Hilfilger, and Calvin Klein, dropped 10% the same day. Also that week, women's wear chain J.Jill was down an amazing 53% and the Gap Inc.'s stock price slid 9%. What do all of these retailers have in common? They are mall-based. The simple fact is that department stores and mall-based retailers continue to lose share to discount stores and on-line merchants. Lots of these retailers are announcing restructuring plans, closing the worst performing stores, etc., but whether any of that can stem the move away from shoppers going to malls is doubtful at best.
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That is the number of criteria a company in California must show are met for a worker to be an independent contractor, according to the worker-friendly "ABC test" the California Supreme Court's adopted last year to determine employee classification in the Dynamex Operations West v. Superior Court decision. Now, the California state assembly has just passed a bill basically encoding that court decision into state law, if it is also passed by the state senate. The ABC tests says companies must show: workers perform their work free of the company's "control and direction," complete work that is "outside the usual course of the hiring entity's business," and that the worker is "engaged in an independently established trade" – a very high bar that would likely eliminate contractor status for any truck drivers in the state – and for Uber and Lyft drivers. The ATA is challenging the court decision, saying it countermands long settled Federal control over rules for trucking. This is a big deal that could expand to other state legislatures.
