Today's Top Supply Chain and Logistics News From WSJ
October 11 2017 - 6:50AM
Dow Jones News
By Paul Page
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Wal-Mart Stores Inc. is shifting its growth strategy from
storefronts to the web. The retailer will open fewer than 25 new
U.S. stores in its next fiscal year and undertake other
cost-cutting measures aimed at freeing up funds to go in part
toward building up its e-commerce capabilities. The actions at a
company that opened more than 200 stores two years ago mark perhaps
the strongest statement yet about the direction of Wal-Mart's sales
and signal that the company is building new distribution channels
to meet the growing e-commerce market. The WSJ's Sarah Nassauer and
Austen Hufford write that Wal-Mart's investment in e-commerce
infrastructure have grown more urgent since Amazon.com Inc. bought
Whole Foods, creating more direct competition for Wal-Mart's big
grocery business. The retailer is adding new delivery and
click-and-collect options for groceries, and it expects recent
acquisitions to boost online sales some 40% next year. The new
cost-cutting shows that serving those customers while maintaining
profit margins remains a challenge.
IKEA is looking at bolting a new distribution channel onto its
supply chain. The icon of assemble-it-yourself furniture will test
selling its Klippan sofas, Norden tables and other goods on
third-party online marketplaces, the WSJ's Saabira Chaudhuri
reports, a big step in IKEA's bid to make its furniture more
accessible to more people. The company is in the midst of
overhauling its strategies both online and for its stores by
scaling up delivery options and placing more stores closer to urban
customers. It also bought online marketplace TaskRabbit last month
to help customers assemble its furniture. IKEA so far has resisted
third-party sales channels but growing competition is wearing down
its do-it-yourself approach. Furniture is already one of the
fastest growing categories for Amazon.com Inc., and the e-commerce
giant is adding warehouses and logistics operations for bulky items
to reach further into consumers' homes.
Drone deliveries are stuck in a holding pattern, at least in the
U.S. An advisory panel meant to recommend rules for operating drone
couldn't agree on proposals, the WSJ's Andy Pasztor reports, a
potentially serious setback for efforts to expand commercial drone
operations. The committee couldn't reach consensus on basic
questions over the categories of drones that should require remote
monitoring and tracking. That will make it more difficult for
federal regulators to set rules that would satisfy law-enforcement
agencies, hobbyists and companies that are looking to add drones to
their business mix -- including delivery operators. There's some
consensus on smaller drones, but it may take two or three more
years to develop technical standards for communication links and
collision avoidance technology for larger drones flying at higher
altitudes. That's raising concerns in business and among policy
makers who worry that big operators are looking overseas to test
package delivery and other applications that promise major economic
boosts.
E-COMMERCE
Meal-kit makers are making big inroads with consumers, but
they're still trying to convince investors they can deliver
profits. HelloFresh SE aims to be the latest company to test the
market on with an initial public offering in Frankfurt, the WSJ's
Cara Lombardo reports, with a goal of raising up to $354 million.
The IPO follows this year's offering in New York by Blue Apron
Holdings Inc., which has seen its shares lose nearly half their
value since their debut in June. There's no lack of growth:
HelloFresh's revenue grew nearly 50% in the first half of the year,
but losses also expanded to $67 million, a measure of the tough
logistics challenge the companies face. Meal-kit operators also
face growing competition as supermarkets and food-delivery
companies enter the market. The WSJ's Heather Haddon reports that
expansion by Amazon adds new wrinkles, bringing in an entrant that
delivery services worry will be more focused on market share than
profits.
QUOTABLE
IN OTHER NEWS
The International Monetary Fund raised its global economic
outlook for 2017 and next year amid accelerating growth this year
ahead of earlier expectations. (WSJ)
Honeywell International Inc. plans to spin off its
transportation and home businesses into separate companies by the
end of next year. (WSJ)
Canadian housing starts fell in September for the first time in
nine months. (WSJ)
The Sears Canada Inc. board approved the liquidation of most of
the insolvent retailer's assets after rejecting a private
equity-backed takeover plan. (WSJ)
The European Union will seek to slash carbon-dioxide emissions
from cars and vans by about a third in the decade starting 2021.
(WSJ)
Pfizer Inc. is exploring a sale or spinoff of its Consumer
Healthcare division, the producer of Advil. (WSJ)
British weapons maker BAE Systems will eliminate almost 2,000
jobs as it streamlines operations. (WSJ)
United Parcel Service and the Teamsters union opened talks on a
new five-year contract covering 250,000 workers. (Atlanta
Journal-Constitution)
Vietnam's apparel shipments to the U.S. rose 5.6% in the first
eight months of the year. (Sourcing Journal)
Canadian Pacific Railway Ltd. struck a deal with Genesee &
Wyoming to connect U.S. Midwest agriculture exporters to Canada's
Port of Vancouver. (Journal of Commerce)
The amount of crude in floating storage on tankers has fallen
sharply amid tighter oil supplies. (Lloyd's List)
Deutsche Post DHL is working with technology group Nvidia to
roll out self-driving package delivery vans next year in Germany.
(CNBC)
The U.S. Postal Service is working with the University of
Michigan on development of a self-driving mail van for rural
operations. (Wired)
JPMorgan Chase & Co and Singapore's Temasek Holdings are
leading a $100 million investment round in business-to-business
digital payments startup Bill.com. (Reuters)
Store owners in India say big e-commerce companies are violating
guidelines on sales and competition. (Times of India)
UPS is building a packaging sorting center in northwest Houston.
(Houston Chronicle)
A Pennsylvania garment wholesaler will pay $1 million to settle
charges that its Chinese supplier made false declarations to avoid
customs duties. (American Shipper)
ABOUT US
Paul Page is deputy editor of WSJ Logistics Report. Follow him
at @PaulPage, and follow the entire WSJ Logistics Report team:
@brianjbaskin , @jensmithWSJ and @EEPhillips_WSJ. Follow the WSJ
Logistics Report on Twitter at @WSJLogistics.
Write to Paul Page at paul.page@wsj.com
(END) Dow Jones Newswires
October 11, 2017 06:35 ET (10:35 GMT)
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