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Five steps to improving warehouse efficiency
Companies are always on the lookout for ways to improve their supply chain and warehouse operations. Here are some tried-and-true methods.
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Colliers: warehouse construction rates return to pre-pandemic levels
Feb 11, 2025
It’s getting a little easier to find warehouse space in the U.S., as the frantic construction pace of recent years declined to pre-pandemic levels in the fourth quarter of 2024, in line with rising vacancies, according to a report from real estate firm Colliers.
Those trends played out as the gap between new building supply and tenants’ demand narrowed during 2024, the firm said in its “U.S. Industrial Market Outlook Report / Q4 2024.” By the numbers, developers delivered 400 million square feet for the year, 34% below the record 607 million square feet completed in 2023. And net absorption, a key measure of demand, declined by 27%, to 168 million square feet.
Consequently, the U.S. industrial vacancy rate rose by 126 basis points, to 6.8%, as construction activity normalized at year-end to pre-pandemic levels of below 300 million square feet. With supply and demand nearing equilibrium in 2025, the vacancy rate is expected to peak at around 7% before starting to fall again.
Thanks to those market conditions, renters of warehouse space should begin to see some relief from the steep rent hikes they’re seen in recent years. According to Colliers, rent growth decelerated in 2024 after nine consecutive quarters of year-over-year increases surpassing 10%. Average warehouse and distribution rents rose by 5% to $10.12/SF triple net, and rents in some markets actually declined following a period of unprecedented growth when increases often exceeded 25% year-over-year. As the market adjusts, rents are projected to stabilize in 2025, rising between 2% and 5%, in line with historical averages.
In 2024, there were 125 new occupancies of 500,000 square feet or more, led by third-party logistics (3PL) providers, followed by manufacturing companies. Demand peaked in the fourth quarter at 53 million square feet, while the first quarter had the lowest activity at 28 million square feet — the lowest quarterly tally since 2012.
In its economic outlook for the future, Colliers said the U.S. economy remains strong by most measures; with low unemployment, consumer spending surpassing expectations, positive GDP growth, and signs of improvement in manufacturing. However businesses still face challenges including persistent inflation, the lowest hiring rate since 2010, and uncertainties surrounding tariffs, migration, and policies introduced by the new Trump Administration.
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Survey: both shippers and carriers see need for standard KPIs
Feb 11, 2025
Both shippers and carriers feel growing urgency for the logistics industry to agree on a common standard for key performance indicators (KPIs), as the sector’s benchmarks have continued to evolve since the COVID-19 pandemic, according to research from freight brokerage RXO.
The feeling is nearly universal, with 87% of shippers and 90% of carriers agreeing that there should be set KPI industry standards, up from 78% and 74% respectively in 2022, according to results from “The Logistics Professional’s Guide to KPIs,” an RXO research study conducted in collaboration with third-party research firm Qualtrics.
"Managing supply chain data is incredibly important, but it’s not easy. What technology to use, which metrics to track, where to set benchmarks, how to leverage data to drive action – modern logistics professionals grapple with all these challenges,” Ben Steffes, VP of Solutions & Strategy at RXO, said in a release.
Additional results from the survey showed that shippers are more data-driven than they were in the past; 86% of shippers reference their logistics KPIs at least weekly (up from 79% in 2022), and 45% of shippers reference them daily (up from 32% in 2022).
Despite that sharpened focus, performance benchmarks have become slightly more lenient, the survey showed. Industry performance standards for core transportation KPIs—such as on-time performance, payables, and tender acceptance—are generally consistent with 2022, but the underlying data shows a tendency to be a bit more forgiving, RXO said.
One solution is to be a shipper-of-choice for your chosen carriers. That strategy can enable better rates and more capacity, as RXO found 95% of carriers said inefficient shipping practices impact the rates they give to shippers, and 99% of carriers take a shipper’s KPI expectations into account before agreeing to move a shipment.
The research provides an update to “The Metrics That Matter”, a research study published by Coyote Logistics (now part of RXO) in 2022. The update reveals how shippers and carriers have changed their approach to evaluating and managing KPIs in the past few years.
“KPIs are essential for effective supply chain management and continuous improvement, and they’re always evolving,” Steffes said. “Shifts in consumer demand and an influx of technology are driving this change, in combination with the dynamic and fragmented nature of the freight market. To optimize performance, businesses need consistent measurement and reporting. We released this study to help shippers and carriers benchmark their standards against how their peers approach KPIs today.”
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Capel steps down as CEO of Manhattan Associates after 25 years
Feb 11, 2025
Supply chain technology firm Manhattan Associates, which is known for its “tier one” warehouse, transportation, and labor management software products, says that CEO Eddie Capel will retire tomorrow after 25 total years at the California company, including 12 as its top executive.
Capel originally joined Manhattan in 2000, and, after serving in various operations and technology roles, became its chief operating officer (COO) in 2011 and its president and CEO in 2013.
He will continue to serve Manhattan in the role of Executive Vice-Chairman of the Board, assisting with the CEO transition and special projects. Capel will be succeeded in the corner officer by Eric Clark, who has been serving as CEO of NTT Data North America, the U.S. arm of the Japan-based tech services firm.
Texas-based NTT Data North America says its services include business and technology consulting, data and artificial intelligence, and industry solutions, as well as the development, implementation and management of applications, infrastructure, and connectivity.
Clark comes to his new role after joining NTT in 2018 and becoming CEO in 2022. Earlier in his career, he had held senior leadership positions with ServiceNow, Dell, Hewlett Packard Enterprise, Arthur Andersen Business Consulting, Ernst & Young and Bank of America.
“This is an ideal time for a CEO transition,” Capel said in a release. “Our company is in an exceptionally strong position strategically, competitively, operationally and financially. I want to thank our management team and our entire workforce, which is second to none, for their hard work and dedication to our mission of advancing global commerce through advanced technology. I look forward to working closely with Eric and continuing to contribute to our product vision, interacting with our customers and partners, and ensuring the growth and success of Manhattan Associates.”
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SG Holdings acquires high-tech logistics specialist Morrison Express
Feb 11, 2025
The Japanese logistics company SG Holdings today announced its acquisition of Morrison Express, a Taipei, Taiwan-based global freight forwarding and logistics service provider specializing in semiconductor and high-tech logistics.
The deal will “significantly” expand SG’s Asian market presence and strengthen its position in specialized logistics services, the Kyoto-based company said.
According to SG, there is minimal overlap between the two firms, as Morrison Express’ strength in air freight and high-tech verticals in its freight forwarding business will be complementary with SG’s freight forwarding arm, EFL Global, which focuses on ocean freight forwarding and commercial verticals like apparel and daily sundries.
In addition, the combined entity offers an expanded geographic reach, which will support closer proximity to customers and ensure more responsive support and service delivery. SG said its customers will benefit from end-to-end supply chain solutions spanning air, ocean, rail, and road freight, complemented by tailored solutions that leverage Morrison's strong supplier and partner relationships in the technology sector.
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J.D. Power: EV growth to stagnate in 2025 due to federal policies
Feb 11, 2025
The growth of electric vehicles (EVs) is likely to stagnate in 2025 due to headwinds created by uncertainty about the future of federal EV incentives, possible tariffs on both EV and gasoline-powered vehicles, relaxed federal emissions and mileage standards, and ongoing challenges with the public charging network, according to a report from J.D. Power.
Specifically, J.D. Power projects that total EV retail share will hold steady in 2025 at 9.1% of the market, or 1.2 million vehicles sold. Longer term, the new forecast calls for the EV market to reach 26% retail share by 2030, which is approximately half of the market share the Biden administration targeted in its climate agenda.
A major reason for that flat result will be the Trump Administration’s intention to end the $7,500 federal Clean Vehicle Tax Credit, which has played a major role in incentivizing current EV owners to purchase or lease an EV, J.D. Power says.
Even as EV manufacturers and consumers adjust to those new dynamics, the electric car market will continue to change under their feet. Whereas the early days of the EV market were defined by premium segment vehicles, that growth trend has now shifted to the mass market segment where franchise EV sales rose 58% in 2024, reaching a total of 376,000 units. That success came after mainstream franchise EV sales accounted for just 0.8% of total EV market share in 2021. In 2024, that number rose to 2.9%, as EVs from the likes of Chevrolet, Ford, Honda, Hyundai and Kia surged in popularity, the report said.
This growth in the mass market segment—along with federal and state incentives—has also helped make EVs cheaper than comparable gas-powered vehicles, J.D. Power found. On average, at the end of 2024, the average cost of a battery-electric vehicle (BEV) was $44,400, which is $1,000 less than a comparable gas-powered vehicle, inclusive of hybrids and plugin hybrids. While that balance may change if federal tax incentives are removed, the trend toward EVs being a lower cost option has correlated with increases in sales, which will be an important factor for manufacturers to consider as they confront the current marketplace.
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