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DHL Supply Chain's Jim Monkmeyer on current logistics trends and the future of freight

The industry did not like what it saw from the final retail holiday revenue figures for 2022 which sets up a rough yr for stores, but e-commerce is continuing to boom, together with in parts exterior the core retail buyer.

Trucking data shared by DHL with CNBC reveals that while the core consumer market has pulled back again, in numerous types e-commerce sales continue being potent.

“E-commerce is continuing to increase,” stated Jim Monkmeyer, president of transportation for DHL Provide Chain, North America.

DHL described significant development in e-commerce and the logistics firm is investing greatly in that segment.

“I would say the other areas that are however rising quite fast for us are automotive and higher engineering, production as properly as higher-conclusion buyer products and spirits. Foods merchandise and daily life sciences regions are also doing properly,” Monkmeyer claimed.

Amid weak holiday getaway product sales 12 months above yr, it was on line and nonstore revenue that observed the greatest calendar year-more than-yr gains, jumping 9.5% in the course of the holiday break season, according to the National Retail Federation knowledge produced on Wednesday.

But Monkmeyer explained DHL is seeing a ongoing downturn of the main retail buyer, with the in close proximity to-record inventories a stark reminder of the pullback. As a consequence, far more vendors are slashing costs to get rid of their inventory.

In December, Scott Sureddin, CEO of DHL Source Chain, advised CNBC he predicted extra discounts post-holiday break. “I have under no circumstances observed stock ranges like this and following the first of the 12 months, stores can’t carry on to sit on this stock so the special discounts they have been pushing will have to continue,” he stated.

Inflation is just one of the explanations driving frugal customer vacation investing.

Retail gross sales info introduced on Wednesday showed a decrease of 1.1% in December, a little bit more than the 1% forecast, reflecting tepid client need during the holiday getaway shopping period.

The holiday gross sales period was dealing with hard yearly comparisons given the Covid growth, and Monkmeyer is self-assured there will be a turnaround as provide chain inflationary pressures, this kind of as freight rates, tumble back again below pandemic peak stages. Recent inflation readings, both equally the Shopper Selling price Index and Producer Selling price Index, have presented affirmation of inflation easing.

“I believe we’ll see the turning level come sometime in mid to late 2nd quarter,” he claimed. “The price tag of the ocean containers moving from $20,000 a container to $3,000 will push down prices to a ton of diverse products and solutions. And on top of that, you have fuel charges coming down, and they’re projected to continue to go down gradually but steadily for the rest of this year. I assume shoppers will notice that suitable absent and we will ideally get back again to some of that paying that we had been observing in the final two years.”