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Supply Chain by the Numbers

- Dec. 2, 2021

  Supply Chain by the Numbers for Dec. 2, 2021

Sales actually Fall on Cyber Monday; US Purchasing Managers Index Remains Strong in November; Severe Truck Trailer Shortage; Demand for Warehouse Space will Continue to Grow



That’s how much on-line sales in the US actually fell on so-called Cyber Monday this week, according to estimates from Adobe Analytics. This year’s result marks the first time that Adobe has tracked a slowdown in ecommerce spending on major shopping days versus the previous year. Despite the decline that day, Adobe expects the entire holiday season will see record-breaking ecommerce activity, as shoppers spread out their dollars over more days. From Nov. 1 through Cyber Monday, US consumers have spent $109.8 billion on-line, up 11.9% year over year, Adobe said. Adobe anticipates digital sales from Nov. 1 to Dec. 31 will hit $207 billion, which would represent record gains of 10%.


That is by how much production of truck trailers in the US is down versus 2019 levels, according to a report this week in the Wall Street Journal. And that is in part why delivery lead times for trailers from carriers and private fleets are now crazy long, about 8 months after peaking at 13 months earlier this year, according trucking analyst firm ACT Research. What is going on? The same type of supply chain shortages so many other sectors are experiencing, with trailer makers such as Wabash National struggling to find materials from foam insulation to suspension components and taillight wiring. Demand was also soaring with increase freight movement earlier in the year, adding to the backlogs, though new orders have recently slid in the face of the huge delays. Adding to the troubles: Many older trailers are sitting idle due to a lack of replacement parts.




That was the level of the US Purchasing Managers Index for November, according to the usual monthly report from the Institute for Supply Management on Wednesday. That was up just a little (0.3 percentage point) from the October level), and still well above the 50 mark that separates US manufacturing expansion from contraction. The November reading also indicated growth in the overall economy for the 18th month in a row after the last contraction in April 2020. Additionally, the New Orders Index registered 61.5%, up 1.7 percentage points compared to the October and a positive sign for future US manufacturing activity. But supply chain inflation is still with us – though the Prices Index registered 82.4, down 3.3 percentage points compared to the October figure of 85.7, it still means 82.4% of companies are seeing higher costs for materials, components and other inputs.



1 Billion

That’s how many square feet of new industrial space – nearly all of it warehouse facilities – the US will need by 2025. That according to a new report from real estate firm JLL this week. “The industry is effectively sold out through the next year,” Chris Caton, managing director of global strategy and analytics at Prologis, told CNBC on Monday, in good news for warehouse developers and operator but not so good for shippers looking for new distribution space. Given the supply and demand situation, lease rates are at all-time highs and pre-leasing rates – in which warehouses are leased before construction is even complete – have also soared. Most of the demand growth has come from – what else – ecommerce, as retailers seek to position inventory closer to customers. Amazon by itself is adding huge numbers of logistics facilities and square footage.

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