Reasonably Interesting Week

September 22nd, 2024

Happy Monday! It's all eyes on the holiday season as big announcements this week rebalanced the weights of expectations (see below): 1. The White House is putting new restrictions on low cost goods coming from Temu and SHEIN that will slow down imports and raises prices (but only slightly) right before the shopping season. 2. Retailers like Target, Walmart and Amazon gear up for the October sales events to kick off the elongated holiday shopping season. 3. Fedex earnings came in soft for the quarter with plans to offset this softness with increased pricing on holiday related buying and delivery. 4. The Fed cut interest rates (finally!), but don't expect this to change anything until 2025. Buckle up your seats because Peak Season 2024 will be a doozy. And now, the newsletter. . .

Interesting Retail

• The Biden administration is enforcing stricter rules to curb the exploitation of the de minimis trade exemption by Chinese-linked e-commerce retailers like Shein and Temu. (LINK)
• A Coveo survey of U.S. and U.K. consumers found that 76% plan to spend the same or more on holiday gifts despite cutting back on everyday purchases. Retailers can boost online sales by offering free shipping (62%), relevant offers (48%), and item recommendations (26%). (LINK)
• Target plans to hire 100,000 seasonal workers for in-store and supply chain roles, with wages ranging from $15 to $24 per hour. Existing employees will have opportunities for extra hours, and new hires will support high holiday demand. (LINK)
• Amazon's Prime Big Deal Days will return on October 8-9, 2024, offering exclusive sales for Prime members in 19 countries. This fall event follows the July Prime Day, featuring discounts across categories such as electronics, toys, and apparel, with deals dropping every five minutes. (LINK)
• Walmart is launching its holiday shopping season earlier than usual, running a "Holiday Deals" event from October 8-13, with early access for Walmart+ members. The move is in response to price-conscious consumers, with nearly half planning to shop before Halloween. (LINK)

Interesting Logistics

• FedEx reported a significant drop in quarterly profit and lowered its full-year revenue forecast, attributing the decline to customers shifting from premium, fast deliveries to cheaper, slower options. (LINK)
• FedEx will implement a 5.9% general rate increase starting January 6, 2025, impacting U.S. deliveries, imports, exports, and specific services. The rise mirrors past adjustments and aims to support business investments. (LINK)
• Amazon is launching a fully managed option for its Supply Chain by Amazon service, automating logistics, warehousing, and distribution for sellers. Sellers only need to provide product quantities and pickup locations, with Amazon handling the rest, including cross-border logistics and warehousing. (LINK)
• Amazon is launching a fully managed option for its Supply Chain by Amazon service, automating logistics, warehousing, and distribution for sellers. Sellers only need to provide product quantities and pickup locations, with Amazon handling the rest, including cross-border logistics and warehousing. (LINK)

Interesting Bonus

• The Federal Reserve cut the main interest rate by 0.5% to a range of 4.75%-5%, reflecting confidence in reducing inflation while maintaining a strong labor market. Fed Chair Jerome Powell emphasized balancing inflation control with employment stability. (LINK)
• China's export slowdown has led to a significant drop in container freight charges. The Shanghai export container index for North America has fallen nearly 40% since July. Despite early shipments for the Christmas season starting in April, container volume is expected to decline from September to November. (LINK)

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