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Supply
Chain by the Numbers |
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- Feb. 23, 2023
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Target Continues to Invest in eFulfillment; FedEx Pilots Authorize Strike Vote; Freight Tonnage Index Rises Modestly in January; Retail Store Closings Announced thus Far in 2023 |
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$100 Million |
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That is how much Target stores said this week it is investing to build a larger network of supply chain hubs to speed up and lower the cost of delivering on-line orders. The retailer plans to have at least 15 of these hubs, or what it calls sortation centers, by the end of January 2026. It already has opened nine of them, after testing the concept in its hometown of Minneapolis. The company is betting on ecommerce growth, despite struggling with a noticeable pullback in sales, including on-line, which increased less than 1% in Target’s most recently reported quarter, which ended in late October. That compares to nearly 29% growth in the year-ago third quarter. Amazon saw its on-line sales fall 2% in its recently ended Q1 2023. To that end, Gretchen McCarthy, chief global supply chain & logistics officer at Target, said regardless of factors of the macroeconomy, Target has to keep up with customer expectations, which includes receiving on-line purchases quickly.
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| That was the month-over-month gain in the January Freight Tonnage Index from the American Trucking Association (ATA), as trucking volumes continue to quietly advance despite economic hurdles such as inflation. Tonnage was also up 1.5% on a seasonally adjusted basis versus January 2022. That January year-over-year gain marked the index’s 17th consecutive increase versus the prior year. The ATA index measured 117.1 in January, meaning tonnage was up 17.1% versus the baseline of average month in 2015, when the index is set at 100. ATA calculates the tonnage index based on surveys from its membership and has been doing so since the 1970s. |
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50% |
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That is how many retail stores in the US are set to close in 2023. That according to an article this week in the UK’s Daily Mail on-line. The 803 number is just what has been announced thus far – more will surely be announced, as continued inflation takes its toll. But the number is a little deceiving, as 416 of the 803 closures are coming from home retailer Bed Bath & Beyond, which recently filed for bankruptcy protection. Tuesday Morning stores add another 216 to the total. GAP is next at 74 stores. The Daily Mail headline cites Walmart as part of the closure mix, but Walmart has apparently announced just seven store closing thus far. The number of store closings from the pandemic in 2020 was closer to 12,000 by way of comparison. |
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That was the percentage of the FedEx Express Master Executive Council of the Air Line Pilots Association International, leaders of the union that represents FedEx pilots, who voted last Friday to authorize a strike vote among pilot members. A press release from the union said that negotiations with FedEx have stalled, with no future talks scheduled. FedEx pilots have been in negotiations with company management on a new contract since May 2021. However, a strike would occur only if negotiations break down further, and the federal government authorizes a walkout following required procedures of the Railway Labor Act. Both sides would have to be released from mediation by the National Mediation Board, which was brought in to assist with contract negotiations in October. So no strike appears imminent.
