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How Ecommerce Network Design Is Being Reshaped

| Mike O'Brien

A recent trend in ecommerce network design supports a strategy of “getting product closer to the customer,” a more efficient model that delivers on service-level promises. Then came COVID-19, upending everything and accelerating the pace of change in inventory and supply chain strategy, in turn affecting network design. Retailers and analysts discuss the current state and where it’s headed.

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REI Ups Circular Efforts With Second New Store for Old Gear

| Ian McRae

Outdoor retailer giant and sustainability market leader REI announced plans to open a new circular Re/Supply location in Clackamas, Oregon in late August 2023.  The new store follows REI’s Re/Supply store in Manhattan Beach, California, which opened in 2020. The new store location will feature lightly used gear and apparel that REI receives through its returns and trade-in programs.

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Nearshoring Leads to Inbound Boost from Mexico, Canada

| Mike O'Brien

Mexico and Canada are seeing an increase in manufacturing and shipping to the U.S. as nearshoring takes hold in the face of uncertainty over trade with China and more businesses adopt a “plus one” strategy regarding the country’s largest trading partner, maintaining their base while diversifying their sourcing strategy. Inbound freight from Mexico outstripped China by 15%, while Canada was 5% higher.

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MyFBAPrep Sees Major Expansion in 3PL Brokering

| Mike O'Brien

MyFBAPrep, one of several companies brokering warehouse space and fulfillment services between shippers and 3PLs, has expanded its network from 15 million to 85 million square feet in the past four years to meet demand, increasing coverage in the UK, Germany, Canada and Mexico as well as the U.S. Expansion to Australia is on the company’s roadmap as well.

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FedEx Sees 10% Revenue Drop, Plans to Consolidate Canada Operations

| Mike O'Brien

FedEx reported a 10% drop in Q4 revenue as demand remains challenged and cost-cutting initiatives continue in an effort to boost the balance sheet, including idling more planes, while announcing it is folding Ground operations into Express in Canada, the first step in a much broader consolidation outlined in April. It’s a radical departure from the operating model of retired founder Fred Smith.

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Prepping for Peak in DTC Fulfillment Calls For a Holistic Approach

| Mike O'Brien

Preparing for peak season volumes in DTC fulfillment requires not only cooperation among partners but scheduling stress tests, ensuring sufficient server capacity and nailing down carrier commitments well in advance, attendees were told during a panel discussion at Home Delivery World in Philadelphia.

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Workers Strike Amazon Contractor in California

| Mike O'Brien

More than 80 delivery drivers and dispatchers for an Amazon contractor who just joined the International Brotherhood of Teamsters in April have initiated the first strike against Amazon at a hub in Palmdale, CA, saying the company needs to address wages and working conditions. Amazon begs to differ, saying it terminated the contract with the DSP, and that the Teamsters are making up facts.

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Forward-Looking Supply Chain Data Provided by DOT’s FLOW Program

| Mike O'Brien

A Department of Transportation program that aggregates forward-looking supply chain data from various stakeholders to help identify volume and capacity issues, including shippers, carriers, chassis and drayage and port operators, will begin providing insights to participants this summer. The FLOW program uses booking information 60-90 days out, helping improve planning and forecasting.

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Parties to West Coast Ports Reach Tentative Agreement

| Mike O'Brien

A tentative contract agreement has been reached between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA), easing concerns about a strike at 29 West Coast ports disrupting incoming freight from the Asia-Pacific region ahead of the fall and Q4. The deal ended 13 months of negotiations, but still requires ratification by both parties.

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UPS, Teamsters Agree on Key Points

| Mike O'Brien

After a strike authorization vote, the International Brotherhood of Teamsters said it reached agreement on a couple key points with UPS, including increasing the number of grievance arbitrators and the amount due in penalties for errors in pay, according to a report in Scripps News. Meanwhile, a separate 8-1 U.S. Supreme Court ruling against the Teamsters was seen as weakening the right to strike.