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This Week in Logistics News (August 27 – September 2)

By September 2, 2022Uncategorized

A few weeks ago, I wrote that Hershey would fall short of meeting demand for the Halloween and Christmas holiday seasons this year, blaming a scarcity of raw ingredients and difficulties in securing suppliers. Well, it’s not the only chocolate producer facing a shortfall. Mars Wrigley has confirmed that it is facing a temporary shortage of Mars bars in UK supermarkets due to production issues. A Mars spokesperson said that while the company is indeed facing high levels of demand, the company is producing significant quantities and wants to reassure the British public that its candy bars are still available nationwide. It will be interesting to see how long this shortage will last. And now on to this week’s logistics news.

Walmart in the news

Walmart brings in-home delivery options to more shoppers
Walmart invests in ranchers’ company

UPS peak surcharges to affect large shippers expecting strong holiday demand
Carbon dioxide shortage leaves food and drink makers scrambling
Federal government to halt free COVID-19 at-home tests by early September
North American companies send in the robots
Food Lion expands grocery pickup service to 15 additional locations
Pilot Co. invests in Kodiak Robotics to develop autonomous trucking hub

Walmart is looking to expand its grocery delivery with the help from smart garage technology developer myQ. The tech company currently allows users to monitor, control, and secure their garage door through its app, and its partnership with Walmart+ InHome will let members of that service have all of their purchased products and even their returns from Walmart delivered and picked up through their garage. According to myQ, one in five households is already equipped with its smart garage technology. The tech is embedded in LiftMaster and Chamberlain smart garage door opener brands and can be integrated with other brands of garage door openers via a myQ Smart Garage Control device. The option for garage delivery will be available when shoppers check out on the Walmart app. Walmart associates will undertake the deliveries and will be given one-time access to the garage via a myQ connected device.

As more grocery shoppers opt for higher quality meats, Walmart said this week that it is investing in a company led by ranchers and beef producers to bulk up its supply. The retailer is taking a minority stake in Sustainable Beef, which plans to open a processing facility in North Platte, a small town in west-central Nebraska that is home to the former ranch of storied Western showman Buffalo Bill Cody. It expects to break ground next month and create 800 jobs. Walmart declined to disclose the specific amount of its investment. As part of the deal, however, the retailer will get the majority of beef produced at the facility, which is expected to open by late 2024. It will also get representation on the company’s board.

UPS announced its surcharges for the 2022 peak season late last week. The surcharges will impact high-volume shippers expecting elevated home delivery demand during the holidays. Beginning October 30, customers billed for more than 20,000 packages any week after October will see a “Peak/Demand Surcharge” applied to certain UPS Air Residential, Ground Residential and SurePost shipments, according to the carrier. The fee will be active until January 14, 2023. The surcharge is applied on a weekly basis to all packages over 105 percent of the baseline volume for each service. The baseline volume is the customer’s average weekly volume from June 5 through July 2 for the applicable shipping service. But UPS will use the average weekly volume from September 4 to October 2 instead if it is less than 80 percent of the June-July period’s volume.

Carbon dioxide is widely used throughout food and beverage industries, including to stun animals before they are slaughtered and to chill and process meat. The gas puts the pop in soft drinks and the fizz in beer and is turned into dry ice to keep food frozen. Well, there is now a shortage facing US food and beverage companies. Supplies of carbon dioxide, a byproduct of industrial processes such as ethanol and fertilizer production, have been tight since early 2020, when many Americans stopped driving due to the Covid-19 pandemic, slashing ethanol demand. Now, shortages of the gas have grown acute in parts of the country, according to carbon-dioxide suppliers and food industry officials, as production disruptions coincided with strong summer demand. Maintenance shutdowns at industrial facilities that produce the gas this fall are expected to keep supplies tight. Some major suppliers have limited deliveries to their customers, gas-industry officials said, touching off a race by meatpackers, brewers and others to find alternatives.

The federal government is set to suspend its offer of free at-home COVID-19 tests today, without congressional authorization for an extension. The US Postal Service’s page for ordering the tests states that orders will pause by next Friday “or sooner if supplies run out.” “Ordering through this program will be suspended on Friday, September 2 because Congress hasn’t provided additional funding to replenish the nation’s stockpile of tests,” a message on the federal government’s COVID-19 website reads. The Biden administration originally announced that it would offer 1 billion free at-home COVID-19 tests in January. The federal government used COVID-19 funding from the American Rescue Plan, President Biden’s $1.9 trillion economic stimulus and COVID-19 recovery package that he signed into law last year.

North American companies snapped up a record number of robots in the first half of this year as they struggled to keep factories and warehouses humming in the face of an extremely tight labor market and soaring compensation costs. Companies ordered a record 12,305 machines in the second quarter valued at $585 million, 25 percent more units than during the same period a year ago, according to data compiled by the industry group the Association for Advancing Automation. Combined with a strong first quarter, the North American robotics market notched its best first half ever, the group said. The incentives for companies to pursue a robot-enhanced workforce are obvious in the current tight labor market. With nearly two open jobs for every unemployed worker, employers are bidding up wages: Total U.S. labor costs – covering wages and benefits – surged 5.1 percent year over year in the second quarter, the most since the Labor Department began tracking it in 2001.

Beginning earlier this week, Food Lion expanded its Food Lion To Go grocery pick-up service to 15 more stores across the Carolinas, Georgia and Tennessee. In addition, the retailer is offering shoppers their first pickup for free. Customers can confirm availability and place orders through the Food Lion To Go website or the Food Lion To Go app. With just the click of a button, shoppers can place an order, pick up their groceries on the same day and experience the same low prices and fresh food items they have come to expect without ever leaving their car. Food Lion said that it continues to expand this new service across the towns and cities it serves, highlighting its commitment to making grocery shopping easy, fresh and affordable. Where allowed by law, customers aged 21 years old and older can also purchase their beer and wine through To Go, making it an actual one-stop shopping experience.

Kodiak Robotics is developing a highway-adjacent autonomous trucking hub in Atlanta with Pilot Co. that could foreshadow the startup’s approach to eventual long-haul driverless freight movement using an undetermined number of Pilot and Flying J locations. Knoxville, Tennessee-based Pilot operates 750 truck stops and travel plazas in 44 states and six Canadian provinces. It made an undisclosed “strategic investment” in privately held Kodiak. Pilot will have a seat on the Mountain View, California-based startup’s five-member board of directors. The Pilot investment is its second big move into addressing the technology-driven changes coming to the trucking industry. In July, Pilot announced a cross-country network of high-speed charging stations for electric vehicles in partnership with General Motors.

That’s all for this week. Enjoy the weekend, and the song of the week, Big Black Furry Creature from Mars by Phish.

The post This Week in Logistics News (August 27 – September 2) appeared first on Logistics Viewpoints.

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