Blog postsAugust 02, 2019
FLEXE Hub: Life after the mall
A roundup of the latest news on logistics, retail, and industry trends
Keeping up with the latest store closures, emerging tech, and what Amazon is doing could easily be a full-time job. Luckily for you, it’s ours.
We’re looking at the biggest retail and logistics headlines from the past few weeks, including:
- Retailers seeking help with their eCommerce fulfillment
- The latest tariff update
- Where stores go after they leave the mall
Let’s talk logistics
Retailers need help with their eCommerce fulfillment
More and more, retailers are seeking outside help to handle their eCommerce fulfillment. A new survey from DHL polled 900 "decision-makers responsible for logistics/supply chain management and e-commerce distribution strategy." They found that 18% of retailers expect to fully outsource their fulfillment in the next 3-5 years, a 6 percentage point increase from the 12% who currently report doing this.
The reason retailers are looking to outsource is likely because of how complex the fulfillment process has gotten. eCommerce and continuously increasing shipping standards are creating new logistics challenges that retailers' owned networks just aren’t equipped to handle. Companies have to sell online, but they have to do it quickly too. To manage both well, in many cases requires some outside help.
Those tariff tweets
The tariff wars continue. On Thursday, the president announced via Twitter his intention to extend the tariffs on Chinese imports to an additional $300 billion worth of goods, on top of the already imposed $250 billion. These new tariffs would take effect on September 1st and would charge an import tax of 10% to 15% on all Chinese goods.
Where have we heard this before? As Supply Chain Dive reports, “The tranche four tariffs on $300 billion worth of goods has been in limbo for several months.” In May, the “USTR released a 136-page list of products to face tariffs up to 25% and held a comment period plus seven days of public hearings on the matter.” Then in June, it was announced the U.S. would not be imposing them “for the time being.” It seems that time is up.
Life after the mall
It’s no secret that malls have been on the decline in recent years. There have been 7,426 store closures to date. But as more and more retailers leave the mall, where do they go?
Retail Dive recently explored this, finding that there are, in fact, options for these displaced retailers and brands. Downtown retail districts, urban-centers, strip malls, airports, and partnerships are all lucrative possibilities for retailers looking to be rehomed.
The common thread among these new choices? Convenience. Rather than expecting customers to come to them, these new options instead go to where the customer already is. Inserting themselves into urban city centers where they work and live, strip malls next to where they do their grocery shopping, and other convenient locales like the airport. In the age of eCommerce, the customer doesn't come to you, you go to the customer.
Via Retail Dive
What’s Amazon up to?
Taking a profit hit
After reporting record profits for two years straight, Amazon’s latest earnings report revealed a significant dip. Why? Its $800 million infrastructure investment to make one-day shipping happen probably had something to do with it. According to Chief Financial Officer Brian Olsavsky, “Moving millions of products closer to customers to enable one-day delivery proved more costly and complicated than expected, driving up expenses and reducing efficiency in the second quarter.”
Fortunately for Amazon, they’re the one company in the world who can get away with this sort of thing. As Ron Josey, an analyst at JMP Securities points out, Amazon is known for making long-term investments that ultimately pay off.
FLEXE news & events
Gartner Supply Chain Brief
What is the world’s leading analyst saying about on-demand warehousing and fulfillment? Find out in the free Gartner report.
The 2019 State of On-Demand Warehousing
Our latest whitepaper covers everything you need to know about on-demand warehousing, including key industry trends and how your business can benefit. Download it here.
FLEXE will be making our way through the supply chain event circuit over the next few months. Here’s what’s coming up:
- CSCMP EDGE Conference: September 15-18
- Groceryshop 2019: September 15