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Supply
Chain by the Numbers |
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- Oct. 15, 2020
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Retail Holiday Sales will be Weak Despite ecommerce Surge; P&G Shareholders Say Go Green; IMF Says 2020 Global GDP Drop will be Less than Previous Forecast; No Wisconsin Subsidy for Foxconn |
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>2% |
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That is the projected growth in total US retail sales in November and December, according to new analysis from real estate firm CBRE. That less than 2% estimate compares to average growth of 4.1% since 2010, as the economy remains weakened from the virus pandemic. And the lukewarm forecast comes with the assumption that there is no major resurgence of the virus or mandated store closures. But of course ecommerce is a different story. CBRE is forecasting 40% growth in on-line sales during the two-month period, making the once seen as robust growth of 14% in 2019 seem lousy by comparison. A key question is how profitable on-line sales will be, as major parcel carriers raised peak season surcharges for home deliveries, with retailers generally unable to pass any shipping costs along to consumers. So the top line for etailers may surge, but the bottom line maybe not so much.
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That is the expected drop in global GDP in 2020, according to a new forecast from the International Monetary Fund this week. That would mark the biggest annual decline since the Great Depression, but actually is good news of sorts. The 4.4% decline is an improvement versus the 5.2% drop the IMF forecast in June. The IMF also expects world output will grow 5.2% in 2021, down from an earlier estimate of 5.4% - a decline in part the result of the better than previously expected fall in 2020. In the US, growth next year is projected at 3.1% after a 4.3% expected decline this year. World trade volumes are likely to rise by 8.3% in 2021 after falling 10.4% this year, the IMF also forecast. All told, the IMF figures indicate that a full recovery will take several years for most countries.
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$3 Billion |
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That's how much contract manufacturing giant Foxconn was supposed to receive in subsidies subsidies from state of Wisconsin over the next few years to support the construction of a massive LCD display factory in the Badger state. Announced with huge fanfare in 2017, the planned investment by Taiwan's Foxconn was touted as a key example of high tech manufacturing returning to the US. But it didn't turn out that way. In a Monday letter, the state informed Foxconn that the company wouldn't get the first installment of the $3 billion because it wasn't holding up its end of the deal. Under Foxconn's 2017 agreement with the state, Foxconn would be eligible for the first round of subsidies if it hired at least 520 full-time employees to work on the LCD panel factory by the end of 2019. Foxconn claimed that it had cleared this bar by hiring 550 employees in the state. But Wisconsin found that Foxconn had only 281 employees who counted toward the requirement. Foxconn was supposed to spend $3.3 billion on the project by the end of 2019. Instead, Foxconn had only spent around $300 million by the end of the year. The factory was expected to cost $10 billion to build and eventually employ 13,000 workers in Wisconsin. The state now says that Foxconn won't come anywhere close to meeting those targets. |
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That was the percent of Procter & Gamble shareholders who voted this week in favor of a resolution put forward by Green Century Equity Fund that calls on the company to report on how and whether it can eliminate deforestation and forest degradation from its supply chain. That despite management's opposition to the resolution. "We appreciate our shareholders' perspective on the topic of deforestation and will be responding in kind to the proposal," P&G said in a statement, after the vote was announced at P&G's virtual annual meeting. In recent years, it has faced increased attention on its continued use of unrecycled pulp to make toilet paper. Company officials say recycled paper is not as soft, strong or absorbent as virgin paper and consumers end up using more toilet paper per bathroom visit when using a recycled product. That didn't matter to shareholders.
