Trouble viewing this email?  View in web browser ›

The Wall Street Journal. The Wall Street Journal.

LogisticsLogistics

Sponsored by
Blue Yonder

Making More Marketplaces; Beware the Bullwhip Effect; Fluffy Tariff Fiasco

By Paul Page

 

An Amazon fulfillment center in Robbinsville, N.J. PHOTO: MARK MAKELA/GETTY IMAGES

Some traditional retailers are trying to use Amazon’s own model for its third-party marketplace to compete with the e-commerce behemoth. Apparel merchant Express recently began testing selling merchandise from other brands on its website, the WSJ’s Charity L. Scott and Sebastian Herrera write, joining retailers like Urban Outfitters and J. Crew that are exploring ways to reap the benefits of listing products sold and shipped by other sellers. It’s the latest sign of how Amazon has fractured familiar patterns of sales and distribution. The e-commerce leader has long leveraged the power of third-party sellers, and big retailers including Walmart and Target have created their own marketplaces. Smaller chains had been more reluctant to take the marketplace path, in part from fear of losing their brand identities in a virtual bazaar. But technology and logistics capabilities have blurred labels, and making sales without holding the inventory has become more fashionable.

 
Advertisement
LEAVE THIS BOX EMPTY
 

Supply Chain Strategies

An Associated Foods warehouse in Farr West, Utah. PHOTO: RICK BOWMER/ASSOCIATED PRESS

Caution signals are spreading across supply chains, and many of them are warning of the “bullwhip effect.” The phenomenon is the result of a big gap between market information and execution, and it is a threat for businesses preparing for a post-pandemic economy, supply-chain academics Ted Stank, Tom Goldsby and Lance Saunders of the University of Tennessee write in a commentary for the Logistics Report. Companies are seeing demand surge with the end of restrictions that have disrupted normal supply-and-demand patterns. The bullwhip effect takes hold when long lead times are required to build output to meet strong new demand. But forecasting has also been thrown off balance during the pandemic, and the authors write that new demand signals can take too long to move upstream in supply chains. The result can be excess inventory and a steep decline in pricing.

 
Share this email with a friend.
Forward ›
Forwarded this email by a friend?
Sign Up Here ›
 

Quotable

“Amazon is still the powerhouse.”

— Ken Zhang of premium whiteboard company Think Board, on the growth of competing online marketplaces
 

Economy & Trade

Down-lite’s bedding factory in Mason, Ohio. PHOTO: HAIYUN JIANG for THE WALL STREET JOURNAL

The White House’s long-awaited review of tariff policy can’t come soon enough for one Ohio bedding maker. Down-lite International says it’s being priced out of the U.S. market, the WSJ’s Josh Zumbrun reports, because an exemption that let the company off tariffs on Chinese imports has expired, while finished bedding made by Chinese companies was never subject to the tariffs. Down-lite says China controls “the vast majority of the global supply chain” for feathers used in bedding, leaving the company at a cost disadvantage. The exclusions that were granted to Down-lite and thousands of other U.S. companies expired by late last year, and the U.S. government says it won’t consider granting new exclusions until it completes a policy review, leaving many importers in a kind of limbo. 

 
Advertisement
LEAVE THIS BOX EMPTY
 

Number of the Day

930,302

Empty containers exported from the Port of New York and New Jersey in the first four months of the year, 39.8% more than the year before and more than twice the number of outbound loaded containers.

 

In Other News

Crude prices hit their highest level in more than 2½ years. (WSJ)

More U.S. workers are quitting their jobs than at any time in at least two decades. (WSJ)

Lordstown Motors’ chief executive and top financial leader resigned amid disclosures of inaccurate reports from the electric pickup truck startup. (WSJ)

The U.S. is offering financial incentives and other enticements to countries willing to shun telecom gear from China’s Huawei Technologies. (WSJ)

The average age of vehicles on U.S. roadways rose to a record 12.1 years last year. (WSJ)

Jet-engine makers General Electric and Safran are jointly exploring next-generation engines that would sharply reduce fuel consumption and emissions. (Financial Times)

U.S. liquefied natural gas exports exceeded those from Australia in May for the first time ever. (TradeWinds)

FedEx Freight is reducing service to about 1,400 customers because of congestion in its less-than-truckload network. (FreightWaves)

A sharply divided International Maritime Organization panel agreed that ships must reduce their carbon “intensity” by 2% annually through 2026. (Lloyd’s List)

Japanese vessel operator Nippon Yusen is ordering 12 vehicle carriers with LNG-fuel capability. (Nikkei Asia)

Sri Lanka is making an initial claim of $40 million in damage from the owners of the burned and sunken X-Press Pearl container ship. (Maritime Executive)

Brazil’s government approved plans to build a $355 million container port in the southeastern part of the country. (Port Technology)

Spanish police arrested 29 people in dismantling a cocaine trafficking ring at the Port of Algeciras. (Lloyd’s Loading List)

Air Canada will focus initially on Latin America flights as it rolls out freighter operations. (The Loadstar)

U.K. logistics operator Kammac more than tripled pre-tax profit last year on a 70% revenue gain boosted by pharmaceutical business. (Motor Transport)

 

About Us

Paul Page is editor of WSJ Logistics Report. Write to him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage, @jensmithWSJ, @CostasParis. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

 
Desktop, tablet and mobile. Desktop, tablet and mobile.
Access WSJ‌.com and our mobile apps. Subscribe
Apple app store icon. Google app store icon.
Unsubscribe   |    Newsletters & Alerts   |    Contact Us   |    Privacy Policy   |    Cookie Policy
Dow Jones & Company, Inc. 4300 U.S. Ro‌ute 1 No‌rth Monm‌outh Junc‌tion, N‌J 088‌52
You are currently subscribed as [email address suppressed]. For further assistance, please contact Customer Service at sup‌port@wsj.com or 1-80‌0-JOURNAL.
Copyright 2021 Dow Jones & Company, Inc.   |   All Rights Reserved.
Unsubscribe