Victoria Kickham started her career as a newspaper reporter in the Boston area before moving into B2B journalism. She has covered manufacturing, distribution and supply chain issues for a variety of publications in the industrial and electronics sectors, and now writes about everything from forklift batteries to omnichannel business trends for DC Velocity.
It’s a high-cost world, and getting pricier all the time.
Businesses have been feeling the pinch of inflation for two years, and recent interest-rate increases are compounding the problem. Borrowing is becoming more expensive, which may lead companies to think twice about new investments in capital equipment, infrastructure, or business development projects.
Consumers are likewise feeling the effects of a challenging economy. Inflation hit a 40-year high one year ago (June 2022) and remained near record-high levels through the first four months of this year. Early reports showed that consumer sentiment slipped to a six-month low in May, reflecting widespread concerns about inflation, rising interest rates, and political squabbling over government spending that had garnered headlines during much of the month.
These sentiments were reflected in an industry report released this spring that pointed to new trends in consumer buying habits—trends that reveal an increasingly cost-conscious consumer who nevertheless continues to place high demands on retailers, brands, logistics companies, and others across the supply chain. International e-commerce and mail delivery company Asendia surveyed 8,000 consumers worldwide in February, asking about their buying decisions and outlook for the year ahead. More than 1,000 of those surveyed were U.S. consumers. The results showed that more than half of consumers (52%) cited price as a top consideration in their buying decisions in 2023, a factor the researchers attribute to cost-of-living pressures. At the same time, three-quarters of consumers said they remain “sustainability-minded” in those decisions—and that they’re willing to pay the price. More than 20% of respondents said they would pay more for 100% carbon-neutral deliveries, for example, and 23% said they would pay more for greener fulfillment options—even if it meant the item took longer to arrive.
A separate survey of retailers underscored the trends.
“[Fifty-eight percent] of retailers surveyed by Asendia said that in the last year, shoppers were buying less frequently, and that basket sizes are down,” according to the report. “This trend will continue. Looking ahead, 70% of U.S. shoppers said they planned to cut back on spending in 2023 due to economic uncertainty, yet they are also re-evaluating how and what they buy to minimize their environmental impact.”
So maybe consumers will purchase less but pay a little more for it to stick to their principles. Time will tell, but one thing seems clear: Consumers have long been driving the sustainability trend, and it looks like that will continue, even in a tough economy. According to the survey, shoppers expect retailers to ship with reusable-only packaging (more than a third said so), provide carbon-neutral delivery on international orders (23%), and use electric vehicles for domestic fulfillment (24%). Such demands are raising the stakes for retailers, according to Renaud Marlière, Asendia’s global chief of business development.
“This is creating what we’ve [termed] the ‘conflicted shopper’: consumers who seek value for money—acting with price-sensitivity and spending caution—on one hand, but want to consume in line with their values on the other, opting for eco-conscious decisions across their buying journey, from product choice to fulfillment methods,” he said in a statement announcing the report’s findings. “Retailers now need to cater to both ends of the conflicted shoppers’ value spectrum if they are going to win customers, loyalty, and lifetime value.”
That may be tough at a time when retailers are facing many of the same cost pressures in their own businesses. Many large retailers have announced layoffs and other cost-cutting measures recently, including Walmart’s move in April to slash 2,000 jobs at five of its e-commerce warehouses in the United States. Online retail giant Amazon has cut about 27,000 positions this year alone, including jobs in its e-commerce business and its brick-and-mortar stores.
All of this may represent a streamlining effect, with companies adjusting to slower conditions following a ramp-up in hiring to accommodate growth during the pandemic. But it’s a slowdown nonetheless, and one that comes amid ever-increasing consumer demands.
Nearly one-third of American consumers have increased their secondhand purchases in the past year, revealing a jump in “recommerce” according to a buyer survey from ShipStation, a provider of web-based shipping and order fulfillment solutions.
The number comes from a survey of 500 U.S. consumers showing that nearly one in four (23%) Americans lack confidence in making purchases over $200 in the next six months. Due to economic uncertainty, savvy shoppers are looking for ways to save money without sacrificing quality or style, the research found.
Younger shoppers are leading the charge in that trend, with 59% of Gen Z and 48% of Millennials buying pre-owned items weekly or monthly. That rate makes Gen Z nearly twice as likely to buy second hand compared to older generations.
The primary reason that shoppers say they have increased their recommerce habits is lower prices (74%), followed by the thrill of finding unique or rare items (38%) and getting higher quality for a lower price (28%). Only 14% of Americans cite environmental concerns as a primary reason they shop second-hand.
Despite the challenge of adjusting to the new pattern, recommerce represents a strategic opportunity for businesses to capture today’s budget-minded shoppers and foster long-term loyalty, Austin, Texas-based ShipStation said.
For example, retailers don’t have to sell used goods to capitalize on the secondhand boom. Instead, they can offer trade-in programs swapping discounts or store credit for shoppers’ old items. And they can improve product discoverability to help customers—particularly older generations—find what they’re looking for.
Other ways for retailers to connect with recommerce shoppers are to improve shipping practices. According to ShipStation:
70% of shoppers won’t return to a brand if shipping is too expensive.
51% of consumers are turned off by late deliveries
40% of shoppers won’t return to a retailer again if the packaging is bad.
The “CMA CGM Startup Awards”—created in collaboration with BFM Business and La Tribune—will identify the best innovations to accelerate its transformation, the French company said.
Specifically, the company will select the best startup among the applicants, with clear industry transformation objectives focused on environmental performance, competitiveness, and quality of life at work in each of the three areas:
Shipping: Enabling safer, more efficient, and sustainable navigation through innovative technological solutions.
Logistics: Reinventing the global supply chain with smart and sustainable logistics solutions.
Media: Transform content creation, and customer engagement with innovative media technologies and strategies.
Three winners will be selected during a final event organized on November 15 at the Orange Vélodrome Stadium in Marseille, during the 2nd Artificial Intelligence Marseille (AIM) forum organized by La Tribune and BFM Business. The selection will be made by a jury chaired by Rodolphe Saadé, Chairman and CEO of the Group, and including members of the executive committee representing the various sectors of CMA CGM.
The global air cargo market’s hot summer of double-digit demand growth continued in August with average spot rates showing their largest year-on-year jump with a 24% increase, according to the latest weekly analysis by Xeneta.
Xeneta cited two reasons to explain the increase. First, Global average air cargo spot rates reached $2.68 per kg in August due to continuing supply and demand imbalance. That came as August's global cargo supply grew at its slowest ratio in 2024 to-date at 2% year-on-year, while global cargo demand continued its double-digit growth, rising +11%.
The second reason for higher rates was an ocean-to-air shift in freight volumes due to Red Sea disruptions and e-commerce demand.
Those factors could soon be amplified as e-commerce shows continued strong growth approaching the hotly anticipated winter peak season. E-commerce and low-value goods exports from China in the first seven months of 2024 increased 30% year-on-year, including shipments to Europe and the US rising 38% and 30% growth respectively, Xeneta said.
“Typically, air cargo market performance in August tends to follow the July trend. But another month of double-digit demand growth and the strongest rate growths of the year means there was definitely no summer slack season in 2024,” Niall van de Wouw, Xeneta’s chief airfreight officer, said in a release.
“Rates we saw bottoming out in late July started picking up again in mid-August. This is too short a period to call a season. This has been a busy summer, and now we’re at the threshold of Q4, it will be interesting to see what will happen and if all the anticipation of a red-hot peak season materializes,” van de Wouw said.
The report cites data showing that there are approximately 1.7 million workers missing from the post-pandemic workforce and that 38% of small firms are unable to fill open positions. At the same time, the “skills gap” in the workforce is accelerating as automation and AI create significant shifts in how work is performed.
That information comes from the “2024 Labor Day Report” released by Littler’s Workplace Policy Institute (WPI), the firm’s government relations and public policy arm.
“We continue to see a labor shortage and an urgent need to upskill the current workforce to adapt to the new world of work,” said Michael Lotito, Littler shareholder and co-chair of WPI. “As corporate executives and business leaders look to the future, they are focused on realizing the many benefits of AI to streamline operations and guide strategic decision-making, while cultivating a talent pipeline that can support this growth.”
But while the need is clear, solutions may be complicated by public policy changes such as the upcoming U.S. general election and the proliferation of employment-related legislation at the state and local levels amid Congressional gridlock.
“We are heading into a contentious election that has already proven to be unpredictable and is poised to create even more uncertainty for employers, no matter the outcome,” Shannon Meade, WPI’s executive director, said in a release. “At the same time, the growing patchwork of state and local requirements across the U.S. is exacerbating compliance challenges for companies. That, coupled with looming changes following several Supreme Court decisions that have the potential to upend rulemaking, gives C-suite executives much to contend with in planning their workforce-related strategies.”
Stax Engineering, the venture-backed startup that provides smokestack emissions reduction services for maritime ships, will service all vessels from Toyota Motor North America Inc. visiting the Toyota Berth at the Port of Long Beach, according to a new five-year deal announced today.
Beginning in 2025 to coincide with new California Air Resources Board (CARB) standards, STAX will become the first and only emissions control provider to service roll-on/roll-off (ro-ros) vessels in the state of California, the company said.
Stax has rapidly grown since its launch in the first quarter of this year, supported in part by a $40 million funding round from investors, announced in July. It now holds exclusive service agreements at California ports including Los Angeles, Long Beach, Hueneme, Benicia, Richmond, and Oakland. The firm has also partnered with individual companies like NYK Line, Hyundai GLOVIS, Equilon Enterprises LLC d/b/a Shell Oil Products US (Shell), and now Toyota.
Stax says it offers an alternative to shore power with land- and barge-based, mobile emissions capture and control technology for shipping terminal and fleet operators without the need for retrofits.
In the case of this latest deal, the Toyota Long Beach Vehicle Distribution Center imports about 200,000 vehicles each year on ro-ro vessels. Stax will keep those ships green with its flexible exhaust capture system, which attaches to all vessel classes without modification to remove 99% of emitted particulate matter (PM) and 95% of emitted oxides of nitrogen (NOx). Over the lifetime of this new agreement with Toyota, Stax estimated the service will account for approximately 3,700 hours and more than 47 tons of emissions controlled.
“We set out to provide an emissions capture and control solution that was reliable, easily accessible, and cost-effective. As we begin to service Toyota, we’re confident that we can meet the needs of the full breadth of the maritime industry, furthering our impact on the local air quality, public health, and environment,” Mike Walker, CEO of Stax, said in a release. “Continuing to establish strong partnerships will help build momentum for and trust in our technology as we expand beyond the state of California.”