July Supply Chain News Roundup

This month in supply chain news…

Hot Times for the U.S. Warehouse Market…
Real-estate brokerage firm Cushman & Wakefield reports that 70.1 million square feet of industrial space—a significant portion of which is distribution centers—was leased nationally in the second quarter of 2016. This is the most in over 30 years of data, up 6 percent from this quarter last year.

• Year-to-date absorption has 132.2 million square feet.
• 38 U.S. markets saw more than one million square feet of absorption during Q2 2016, and 11 markets actually registered more than two million square feet of quarterly net occupancy growth.
• Top 10 strongest markets for the second quarter of 2016 in terms of demand for industrial/warehouse space were the Inland Empire—with 8.2 million square feet (msf) of absorption; Chicago (7.3 msf); Dallas/Ft. Worth (4.5 msf); Atlanta (3.6 msf); Greenville, South Carolina (3.6 msf); the Pennsylvania I-81/I-78 distribution corridor (3.6 msf); Indianapolis (2.7 msf); Phoenix (2.2 msf); Central New Jersey (2.2 msf); and the East Bay (2.2 msf).
• Warehouse availability declined to just 8.8 percent that quarter—the 25th consecutive quarter of decreasing availability, making this the longest stretch recorded.

What will the first transit through the updated Panama Canal be?
According to Bloomberg, the first cargo of liquefied natural gas is slated to pass through the recently renovated Panama Canal locks will be from the U.S. Gulf Coast aboard Royal Dutch Shell Plc’s Maran Gas Apollonia vessel. The multibillion-dollar expansion sought to open up the canal for these exact tankers, so U.S. shale gas exports have a huge opportunity to cut shipping costs and times to and from Asia and the west coast of Latin America.

The Energy Department has approved 13.22 billion cubic feet a day of natural gas exports to countries that don’t have free-trade agreements with the U.S., including an approval this month for an expansion project at Cameron LNG—one of the new liquefied natural gas export terminals in North America—in Louisiana.

The Energy Department also noted that they have gotten applications to export a total of 46.56 billion cubic feet each day, clearly benefiting from the new access provided to 90 percent of the world’s liquefied natural gas tanker fleet. By 2021, the Gulf Coast alone could be responsible for shipping 35 to 38 million tons on roughly 550 tankers through the Panama Canal each year.

Prime Day ‘16: Biggest e-commerce day ever for Amazon…
Orders shot up 60 percent globally for the online retailer, despite the dreaded checkout glitches, making Prime Day 2016 “the biggest day in the history of Amazon.”

Amazon’s discounts included many of the company’s own devices, “Lightning deals”, and more special offers throughout the day—a different strategy from last year.

• The retailer said that it sold over 2.5 times more Fire TV devices compared with last year.
• Fire TV Stick was the best seller globally of all Amazon’s devices.
• Amazon said it sold hundreds of thousands of Kindle devices on Prime Day, as well.
• In the U.S., Amazon device sales were up by three times, compared with Prime Day 2015.
  
• The biggest day ever for Amazon’s smart connected speaker Echo, which was also up over 2.5 times from last year.
  
• Prime members bought on average one Alexa-exclusive deal per second via voice.
• Over 90,000 TVs sold, more than two million toys, over one million shoes, 14,000+ Lenovo laptops, 23,000+ iRobot vacuums, and over 200,000 headphones were bought.

Adobe Digital Insights tracked over four million social engagements by online consumers and noted that people were significantly happier this year with Prime Day than last year.

See you next year, Prime Day! (Oh, it’s definitely happening again.)

UPS expanded Worldwide Express services abroad…
This week, UPS has included Myanmar, Albania, and the Dominican Republic in its UPS Worldwide Express (WWE) package service.

After the service was introduced in 2007, UPS has given customers guaranteed delivery on the next possible business day by 10:30 a.m., noon, or 2 pm, depending on the destination.

Ventures with time-sensitive shipments international shipments now stand to benefit from the service’s availability in 117 countries and territories. UPS has expanded Worldwide Express to 52 new regions so far this year.

Pros to these latest three additions include:

• The Dominican Republic has recently become a strong market for U.S. exporters with a Free Trade Agreement between the two countries.
• Albania and seven additional countries in Europe provides businesses more options and demonstrates UPS’s commitment to facilitate growth in the region.
• Myanmar has a unique geographical position between India and China, and has benefitted from improved accessibility to the global marketplace, with average economic growth was boosted by increased trade and investments by more than seven percent annually.

P&G has jumpstarted the “uberization of laundry”…
Procter & Gamble Co., the consumer-products company is looking for innovative ways to cut out the middleman in their supply chain and connect directly with their consumers. P&G is testing efforts like the Tide Wash Club in Atlanta, an online subscription service for consumers who love the dissolvable Tide Pods capsules—the company’s highest priced laundry detergent. Perks often include free shipping.

Also being tested: Tide Spin, where Chicago residents can use a mobile app to demand laundry pickup and delivery with Tide-branded couriers for $1.59 a pound for wash-and-fold laundry services. Welcome to the “uberization of laundry” age.