The great sourcing dilemma for shippers in a disrupted global economy
The soaring costs of shipping are prompting companies to reconsider their supply chains and look ...
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The unaudited annual results of FedEx (FDX), released this week, were nothing short of disheartening – but it’s precisely at times like these, as we approach the point of maximum pessimism for FDX, that the bravest corporate moves are likely being prepared.
In Tuesday’s management call with analysts, chief executive Fred Smith stressed that, in order to succeed in the e-commerce game, “we have to be very efficient in delivering to residential or making residential deliveries, which are an increasing part of the traffic ...
Comment on this article
Jonathan Holmes
July 01, 2019 at 4:02 amThe entire point of so-called “eCommerce” is to demonetize and dematerialize logistics. One can call it value destruction or whatever, the effect is the same. Carriers will not be able to make money off of free rapid shipping offered by the eCommerce giants who own all the traffic.
Downward price pressure will continue, the big players will bring more logistics in house and the carriers will have to find new ways to generate profits. This will happen much faster than carriers can realize efficiencies from reforming their networks, unfortunately.
Alessandro Pasetti
July 01, 2019 at 7:01 amMany thanks, j.holmes. The “value destruction” bit in the story specifically referred to FDX share price, but what you suggest makes a lot sense. RE “the carriers will have to find new ways to generate profits”… you think they have options?