Inside the trends affecting logistics management

The new year will introduce a bevy of challenges for shippers' logistics strategies.

President-elect Donald Trump's push for higher tariffs, potential labor disruptions and pricing pressures are among the developments supply chain managers will have to navigate in 2025. No transport mode will be spared, with carriers in the ocean, air, rail, truck and parcel delivery spaces all grappling with their share of complexities.

Supply Chain Dive spoke with several experts about 2025’s logistics risks and how shippers can prepare. Here's what we found.

ILA-USMX contract ratification, tariffs cloud ocean shipping

The ratification process for the tentative six-year union contract for East and Gulf Coast port workers will be top of mind for ocean shippers.

The deal, announced Jan. 8 by the International Longshoremen's Association and the United States Maritime Alliance, averts the risk of a potential Jan. 15 port strike. But it still needs to be approved by rank-and-file workers and port employers to take effect, and contract rejections have happened before in the supply chain world.

If a strike threat emerges again, companies can prepare by actively monitoring goods going through affected ports, balancing existing inventory levels and exploring West Coast alternatives, Brian Pacula, supply chain partner at West Monroe, told Supply Chain Dive in an email. Shippers also would also have the option of shifting to air freight if they're willing to swallow the added cost, he added.

Beyond planning contingencies for port disruptions, shippers should consider how Trump's proposed tariffs would impact ocean shipping lanes if they're implemented, according to Pacula. Some companies are frontloading imports and stockpiling inventory ahead of Trump’s return to office to minimize any new tariff impacts to their bottom lines.

"At a minimum, supply chain teams should gather and organize relevant data sets, explore alternative options, and create a shortlist of strategies to assess the impact on costs, lead times and suppliers," Pacula said.

Mexico demand could spur rail hurdles

Labor disputes and tariffs could also influence rail shippers' 2025 strategies. Companies are likely to pull forward some rail volume to reduce their exposure to broader logistics risks, according to Jay Cushing, senior bond analyst at bond research firm Gimme Credit.

"For the railroads, customers, and investors we think intermittent labor disruptions and tariff uncertainties should be viewed as a 'cost' of doing business — less of a non-recurring item," Cushing said.

CPKC is particularly exposed to potential Trump tariffs in North America, as its network connects the U.S., Canada and Mexico, Cushing noted. But CPKC is also poised to benefit from growth in cross-border freight activity between the U.S. and Mexico amid ongoing efforts to nearshore supply chains, he added.

Elevated U.S.-Mexico trade activity has strained available rail capacity and disrupted trade flows at times. The agriculture industry felt the pinch in 2024 as major U.S. railroads paused grain shipments into Mexico. Outbound rail activity has been in a similar boat.

"There has been a significant increase in outbound demand from Mexico over the last 18 months," said Paul Brashier, ITS Logistics' VP of global supply chain. "Capacity has not kept up with the growing demand."

Brashier added that Mexico will need to bolster its infrastructure to meet heightened activity. Rail transportation is a key piece of Mexico's infrastructure improvement plans under President Claudia Sheinbaum, according to ProTrans, a transportation and supply chain management provider.

"Mexico’s infrastructure, while improving, faces many needs and challenges that contribute to current gaps and are driving new requirements for investment," per ProTrans.

De minimis uncertainty looms over air cargo

Regulatory uncertainty around low-cost imports and tariff risks are two potential headwinds in the air cargo space for 2025, according to Madhav Kurup, COO of air freight, sea freight and contract logistics at Hellmann Worldwide Logistics.

The de minimis exemption, which allows companies to avoid duties and taxes on U.S. imports below $800, has encountered increased scrutiny in recent years. U.S. Customs and Border Protection announced a plan to implement strengthened data collection requirements around those imports. The provision has been a key tool in direct-to-consumer supply chains, with e-commerce shipments that leverage de minimis helping to fuel the air cargo industry's resurgence.

"Any changes to this could affect the flow of e-commerce shipments, which would have an impact on the air cargo sector," Kurup said in an email. "While the industry has shown resilience in the face of geopolitical and economic changes, navigating these challenges will require agility and strategic planning."

Meanwhile, new tariffs could cause air cargo demand to climb just before they take effect, Judah Levine, Freightos' head of research, said in a November email. If importers aren’t able to receive all their needed inventory via ocean shipping prior to new tariff implementation, they may briefly ramp up their air cargo usage to secure goods and avoid higher customs costs, he explained.

But overall, shippers have had plenty of notice to push forward inventory before the next Trump administration, providing a short-term boost to ocean activity rather than air cargo, Levine said.

"So with the anticipation that the new Trump administration will implement tariff hikes at some point in 2025, many shippers have already started increasing their ocean volumes, as there will probably be at least several months until any change actually goes into effect," he said.

Trucking rates may be less shipper-friendly

For truckload shippers, 2025 is unlikely to provide the same soft rates as the past two years, according to Chris Caplice, DAT Freight and Analytics' chief scientist.

Since the spring of 2022, average long-haul dry van contract rates have plummeted 23% while spot rates have dropped by 36%, Caplice said in an email. But signals in the latter half of 2024 indicate pricing power might finally swing back in carriers' favor soon.

Due to the potential climb in costs such a swing could create, supply chain professionals need to clearly communicate expectations regarding 2025 trucking rates to higher-ups, according to Calpice.

"If your C-suite thinks your bid events in 2025 will keep generating year-over-year savings, introduce them to truckload pricing analysis for the decade or so before the pandemic," Caplice said. "Benchmarking rates against the broader market is a much better performance measure than year-over-year comps."

With trucking rates currently low, shippers are trying to secure prices at longer durations than they have historically pursued, said Jeremy Nolt, VP of brokerage at Zipline Logistics.

"Customers are hedging their bets, saying, 'I don't know if it's going to get any better than this, and the rates might not be this low for a while, so let's try to lock in our brokerage partners to rates essentially where they're at now,’" Nolt said in an interview.

Strike risks in parcel delivery operations

Further downstream, several parcel carriers are exposed to potential labor disruptions in 2025.

Teamsters-organized Amazon warehouse workers and contracted delivery drivers went on strike in December during the thick of the peak holiday shipping season. Although the strike is over, a union spokesperson told Supply Chain Dive in December its push to unionize Amazon workers hasn't ended.

Meanwhile, FedEx and its pilots union still haven't reached a new contract agreement since employees rejected a tentative deal in 2023. The union pushed to be released from supervised negotiations in 2024 in a bid to expedite talks, but a federal mediator rejected the request. A release is a necessary step before pilots can strike.

Perhaps the top threat to parcel shipping reliability in 2025, at least in North America, is another Canada Post strike if union contract negotiations sour.

Employees shut down the government-owned carrier for more than a month in 2024, with operations finally restarting on Dec. 17 after the Canada Industrial Relations Board ordered them back to work. The board’s action has given Canada Post time to reach a deal with the Canada Union of Postal Workers before May 22, the revised contract expiration date.

Canada Post customers could be at risk for more delays if an agreement isn’t reached by then, pushing shippers to diversify further with alternative carriers. However, other delivery providers often count on Canada Post to make deliveries to far-flung addresses, Alison Layfield, director of product development at ePost Global, said in an interview during the December strike.

"There's so many remote areas that only Canada Post is going to deliver to," Layfield said. "You have carriers such as UPS and Purolator, they have contracts with Canada Post for those specific areas. And so they don't have anyone else to hand those shipments over to, either.

Whether dealing with an upset customer or a delayed shipment, logistics managers spend a lot of their time putting out fires. 

But spending the day overcoming hurdles becomes time consuming, especially when logistics managers have to get product “where it needs to be, regardless of the fires that are burning around us,” said Mike Reiss, managing director of supply chain at consulting firm EY. In turn, logistics professionals must step back to review strategy and the best ways to use data, technology and talent to best manage their supply chains.

Here are four ways logistics managers can gain control of their supply chains to keep cargo moving.

1. Closely watch freight market indicators

Market conditions have never been static for logistics managers, said Bryan Gross, principal of operations transformation at consulting firm PwC. Pandemic-related disruptions, rising costs and tariff impacts are just a few of the challenges logistics managers have had to overcome in recent years.

To mitigate these hurdles, it is vitally important to keep customers informed of marketplace developments, according to Doug Frank, SVP of transportation management and procurement at Geodis Americas.

Frank said that Geodis keeps a close eye on available freight capacity and rates and provides monthly updates to shippers. If Geodis gets word from a carrier that a rate increase is imminent, the 3PL aims to give shippers ample notice so they can forecast and budget for the rate hike. 

Some shippers use market intelligence to balance spot and contract rates. 

“There's a lot better discipline on playing the spot,” Reiss said, noting that some shippers have a portion of freight never put on contract. For instance, dry van spot rates have trended down since January due to excess capacity, creating appealing rates for shippers.

Shippers are also considering contract renewals more frequently. Instead of securing a one-year contract and not reconsidering until it’s time for renewal, shippers may look at the contract three to six months ahead of its expiration to think about the next cycle, Reiss said.

2. Optimize networks and routes more frequently

Network optimization isn’t a new practice for supply chain leaders, but it’s currently “top of mind” for logistics managers as global trade trends continue to impact logistics management faster than ever before, said Reiss.

In the past, companies used to optimize their networks about every five years. Now, logistics managers should examine networks, production locations and the physical infrastructure of their companies every six months, Reiss advised. Using technology, such as digital twins, can help execute the task more frequently.

Similarly, freight rates are also changing at an accelerated pace. It used to take six months to a year for market pressure to spike rates, but now, the market changes within weeks, Reiss said. 

Rapid change means shippers need to assess and own their route networks, regardless of whether they have a private, dedicated or for-hire fleet, or use a 3PL, he added.  

Depending on what’s discovered during network and route optimization, it may make sense to ship or consolidate freight in different ways. Shippers could consolidate parcels into less-than-truckload shipments, or from LTL to truckload to save costs, Frank said. A shipper could also use cross-docking to reduce freight handling and mitigate costs, or transport cargo via rail instead of truck. 

Regardless of the choice made, it’s essential for shippers to have a plan B baked into the network, said Paolo Nibioli, VP of supply chain at MacDermid Enthone Industrial Solutions.

“These last few years have taught us that even the best plans tend to fail,” Nibioli said.

3. Have real-time and predictive freight visibility

Many businesses have adopted real-time transportation visibility since the pandemic, with others doing so even earlier with the proliferation of e-commerce. The transparency allows logistics managers to spot any potential issues in real time, "but this reactive approach offers limited long-term value,” Gross said.

Instead, Gross advises companies to take historical cost and movement data, analyze it to identify trends and then use the information to forecast. 

With predictive visibility, logistics managers can anticipate challenges that may arise in the future, like a shipment delay due to weather or a bottleneck creating delays at the loading dock. 

Being proactive rather than reactive is essential for logistics managers, Frank noted, adding that its “a lot easier said than done.”

4. Develop a tech-savvy logistics workforce

Leveraging data and technology in logistics is no longer optional, as evidenced by a McKinsey report.

According to a McKinsey & Co. report published in 2023, which surveyed 250 logistics leaders, 56% of CPG and retail shippers expect to increase their investments in logistics tech. The figure is even higher for advanced industries at 72%. 

But shippers need a workforce to support those tech advancements, Gross said, recommending hiring talent with technological expertise and upskilling current employees. Companies can also offer mentoring programs that pair tech-savvy employees with non-technical staff.

Meanwhile, tech tools, such as transportation management systems, are “making logistics management easier and faster for industry leaders,” Nibioli said. TMS’ help by consolidating logistics data and reducing interfaces when booking transportation.

When it comes to more advanced tech, “we're going to have to rely on AI,” Frank said. For 3PLs or shippers contracting fleets directly, AI can help assign carriers, receive and enter orders, and plan shipments — possibly without human intervention, according to Frank. 

“It’s a very powerful tool,” he said. 

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By Averitt

The National Motor Freight Classification (NMFC) is central to less-than-truckload shipping, affecting pricing and logistics decisions across numerous industries. Significant updates set for July 2025 will simplify freight classifications, shifting the focus primarily to density-based measurements.

This significant industry-wide transformation will directly impact businesses that depend on LTL shipping, influencing operational efficiency, cost management, and regulatory compliance.

Understanding the New NMFC Rules

The upcoming NMFC revisions emphasize simplifying freight classifications, primarily focusing on shipment density rather than the extensive range of traditional commodity classifications. According to Mark Davis, Vice President of Pricing and Traffic at Averitt:

“This is probably the biggest change since deregulation because it’s affecting how customers are classifying their freight… it simplifies the process, moving to a more density-based approach.”

This density-based approach requires precise and accurate measurements. Davis underscores the importance of accuracy:

“Getting the right density is critical now more than ever because your freight charges will be directly tied to it.”

The Importance of Accurate Density Measurement

With density now central to determining freight class, accuracy in weight and dimensions will become critical. Greg Hallmark, Averitt’s Weigh and Research Area Leader, outlines the implications of inaccuracies:

“Inaccurate freight dimensions or weights lead to incorrect classifications. That causes adjustments to charges, potential delays, and even regulatory noncompliance.”

To mitigate these risks, Hallmark recommends practical strategies:

“Make sure you have accurate weights, dimensions, and detailed descriptions on your bills of lading. Investing in measurement tools or training can save substantial costs and headaches later.”

Take advantage of online resources, such as Averitt’s Density Calculator, to accurately determine your freight’s density.

Navigating the Risks of Reduced Packaging

A potential unintended consequence of the new density-based rules might tempt shippers to reduce packaging to lower shipment density and thus costs. Jason Brewer, Averitt’s Loss Prevention Leader, strongly advises against such shortcuts:

“Reducing packaging materials might lower your density, but it significantly increases the risk of damage claims. The cost of damaged goods, customer dissatisfaction, and supply chain disruption far outweighs any immediate freight savings.”

Brewer further highlights the value of robust packaging:

“Proper packaging protects your products and your reputation. Ensuring rigid exterior protection, proper cushioning, and secure wrapping are essential to minimize claims and ensure freight integrity.”

For additional information on proper packaging, download Averitt’s Freight Protection Guide.

Taking Action Now

The NMFC 2025 updates mark a significant shift affecting all LTL shippers. Businesses must prepare through accurate freight classification, appropriate packaging practices, and adopting integrated logistics solutions. Taking proactive steps today will help ensure seamless transitions, operational efficiency, and controlled costs tomorrow.

For additional information and preparation resources, consult industry publications such as NMFTA’s official NMFC 2025 information and practical guidance on Averitt’s NMFC updates page.

Additionally, be sure to check out the debut episode of Averitt’s Beyond Point to Point podcast, “Navigating the 2025 NMFC Freight Classification Updates,” where industry experts break down what’s changing, why it matters, and how shippers can start preparing now.

Your proactive approach today ensures a resilient and efficient supply chain in the future.

The de minimis exemption: An amendment to U.S. trade law written nearly 100 years ago that has become a key fixture in cross-border e-commerce supply chains.

But how much longer it will exist in its current state is anyone's guess.

For now, the provision allows companies to avoid duties and taxes for imports below $800. Utilizing the exemption aids fast-rising e-commerce marketplaces like Temu and Shein's efforts to sell products at ultra-low prices. It can also help companies address consumer trends quickly and ship a wide range of SKUs while mitigating inventory glut, experts say.

That's why companies in a wide range of sectors — from apparel and consumer goods to health and beauty — have embraced de minimis, said Brian Bourke, global chief commercial officer at Seko Logistics. Consumers, meanwhile, reap its benefits because they can select from a variety of options at nominal cost.

However, changes may come for de minimis regulations in the near future, as U.S. lawmakers and officials look to curb China's influence and combat contraband entering the country via low-cost packages. While this could complicate cross-border e-commerce operations, consumer behavior will ultimately dictate how much supply chains adjust, industry observers say.

"These regulations will continue to change," Bourke said. "What won't change is the demand for international postal shipping."

De minimis evolves with e-commerce's rise

Section 321 of the Tariff Act of 1930, known as the de minimis exemption, permits merchandise shipments with a retail value below a certain dollar amount to be imported duty and tax free. Originally introduced as an amendment to the act in 1938, the exemption allowed a person to bring up to $5 worth of goods into the U.S. for personal use without having to pay duties.

"The provision over the years was really intended more for the individuals who go on a cruise or fly to Europe, and they come back with their souvenirs or that beautiful new leather purse or belt from Italy," said Lenny Feldman, general counsel and customs counsel to the National Customs Brokers and Freight Forwarders Association of America.

Lawmakers raised the $5 threshold incrementally over the years until it jumped from $200 to $800 in 2016 under the Trade Facilitation and Trade Enforcement Act. The new law expanded the scope of what could be shipped duty-free as Americans became more accustomed to ordering goods from around the world. The COVID-19 pandemic further entrenched those habits.

Currently, companies typically leverage the de minimis exemption for direct-to-consumer parcels transported via air cargo to limit their costs while meeting sustained e-commerce demand. This can potentially lead to millions of dollars in savings for larger retailers and marketplaces, Feldman said.

Temu and Shein have emerged as go-to examples of companies with de minimis-reliant supply chains amid the e-commerce outlets’ rising popularity among American consumers. The companies are likely responsible for more than 30% of all U.S.-bound daily volume that falls under the provision, according to a 2023 report from the House of Representatives' Select Committee on the Chinese Communist Party.

Even Amazon has taken notice of the direct shipping model, with The Information reporting in June that the e-commerce giant plans to launch a discount section on its website that will ship from warehouses in China directly to customers.

Plenty of other brands are also using the de minimis exemption to their benefit, said Izzy Rosenzweig, founder of e-commerce fulfillment company Portless, which helps shippers utilize a Shein or Temu-like model by providing direct cargo flights from China to last-mile fulfillment centers in the U.S.

Rosenzweig says the model's advantage goes beyond avoiding added costs — businesses can respond quickly to consumer trends and keep inventory lean by shipping products straight from the factory to end customers. It's one leveraged by Shein, which minimizes the supply-demand gap by manufacturing new products in small initial batches of 100 to 200 items, according to its website. It then produces more of the products that receive high customer interest.

How much supply chains have embraced the low-cost and streamlined model of de minimis shipping is evident in CBP data. The number of such shipments the agency processed in 2023 reached 1 billion, more than six times the volume it handled in 2015, it said in March.

"Fundamentally, this model is run by efficiency of inventory management," Rosenzweig said, adding that "the reason why Shein has grown to a $30 billion business is not because there's any magic in their clothing. It's because they run the most efficient supply chain in the world."

Political pressure rises around de minimis enforcement

Several groups have emerged pushing back against the growing wave of shipments utilizing the de minimis exemption.

U.S. CBP officials are cracking down on de minimis shipments filed with vague and inaccurate data as part of their efforts to prevent illegal substances, counterfeit goods and products made with forced labor from entering the country. This enforcement push led the agency to suspend multiple customs brokers from a key import program for de minimis shipments in May.

While the CBP's crackdown may slow down cross-border flows for impacted brokers, it's needed for an agency that doesn't have an extensive history monitoring lightweight e-commerce packages, said Cindy Allen, CEO and managing director of Trade Force Multiplier, an international trade consultancy. Thorough inspections on de minimis packages today could help the agency develop more precise targeting against illegal shipments over the long term.

"This is kind of a necessary step, as painful as it may be, to allow CBP the intelligence and the understanding of the environment that allows them to be more effective in their job," said Allen, a former VP of regulatory affairs and compliance at FedEx Logistics.

The amount of narcotics, controlled substances and other contraband that officials have discovered in de minimis packages at airports and mailing facilities "is stunning," according to Homeland Security Secretary Alejandro Mayorkas. The secretary said during an event in July that his department is "hoping to receive a legislative fix" that will give it more authority to address de minimis-related exploitation.

The secretary may get his wish soon. Lawmakers fretting over China's influence and its impact on the American economy have introduced bills in Congress that seek to scale back the current flow of de minimis shipments. 

The Import Security and Fairness Act, introduced in July 2023, proposes to end de minimis treatment for imports from China and Russia while strengthening customs screening, and the End China’s De Minimis Abuse Act would prevent more than 60% of China-based goods from utilizing the exemption. A bipartisan group of senators unveiled another proposal to crack down on de minimis shipping in August.

None of the bills have made much progress yet, but House of Representatives Speaker Mike Johnson said in July that the House plans to rein in the de minimis privilege of products subject to Section 301 tariffs. 

A coalition of 25 domestic manufacturers, nonprofit groups, labor unions and law enforcement organizations are supporting Congressional reform of de minimis through the Coalition to Close the De Minimis Loophole, which launched in March. Members say the exemption has hurt American businesses' competitiveness while letting illicit drugs like fentanyl enter the country undetected.

But not everyone in the U.S. is on board with the potential changes. The National Association of Manufacturers, U.S. Chamber of Commerce and four other groups have come out against its potential elimination. In a letter to members of President Joe Biden's administration, the organizations warned that removing the provision could lead to additional processing and brokerage fees that could more than double the price of a de minimis package.

"Eliminating de minimis is the equivalent of a tax hike that would disproportionately impact small business owners and low-income consumers who purchase affordable goods online," the groups said.

Changes could spur supply chain shifts and longer shipping times

Experts told Supply Chain Dive they believe some sort of change to the law will happen soon. But the exact form that change will ultimately take — and when it will take effect — remains uncertain.

A straightforward path for Congress to take would be to lower the U.S.'s $800 threshold, which is a relatively high amount compared to other countries, according to Global Express Association data. Canada, for example, has a customs duty and tax remission value of up to $20 Canadian dollars (approximately $15 USD), save for certain U.S. and Mexico shipments.

Industry observers interviewed by Supply Chain Dive think the U.S. could lower the threshold significantly before most businesses would notice the impact, since the average de minimis shipment value is $54. If the next threshold is lower than that, or doesn't exist at all, the added costs likely won't be enough to significantly dampen import activity, they added.

However, consumers may see higher prices as a result of tax and duty-related expenses being passed onto them.

De minimis-reliant shippers may respond by ramping up production in countries not targeted by bills like the End China’s De Minimis Abuse Act. After all, shipping from a manufacturing facility directly to an end consumer doesn't have to involve China — it can apply to countries like India, Mexico and Canada as well.

Products with parts still made in China could be assembled elsewhere before entering the U.S. and avoid possible de minimis scrutiny, Audrey Ross, import and export compliance manager for Orchard Custom Beauty, said during a Home Delivery World 2024 panel in June.

Another legislative possibility is strengthening U.S. CBP's ability to screen shipments. The Biden administration is proposing legislation that would grant the agency the authority to demand additional documentation on de minimis packages — and add a user fee for those shipments — to better detect and identify packages from drug traffickers.

If a more stringent customs process holds up shipments for prolonged periods, that could compromise the value of the direct shipping model, according to John Lash, group VP of product strategy at supply chain software provider e2open. While Temu and Shein aren't known for fast delivery times, testing consumers' patience further is risky as other retailers continue to improve domestic shipping speeds.

"The model breaks, because you as a consumer would say, 'Maybe I can save 20% from buying it in China, but it's not worth waiting for it,'" Lash said.

Whether or not the Biden administration's proposal becomes law, Feldman of the National Customs Brokers and Forwarders Association of America said all parties in the supply chain — not just the customs brokers filing the information — should work to supply accurate and thorough shipment data. That will help them stay within the good graces of customs officials while keeping de minimis shipments moving.

"There needs to be accountability throughout the supply chain, if the supply chain is going to become what I like to call a 'comply chain,'" Feldman said. "You know the old adage: The supply chain is only as strong as its weakest link."

Edwin Lopez, Phil Neuffer and Kelly Stroh contributed to this story.

Amazon’s reported interest in entering the LTL market quickly captured carriers’ attention — and not just because a potential acquisition by the retail giant could be the latest consolidation to upend the industry.

Retail volumes have helped LTL carriers weather a freight recession marked by stagnant industrial demand better than their truckload counterparts over the past two years.

If Amazon pursues an acquisition to handle LTL shipping in house, it would provide a windfall for the acquired carrier while removing a sizeable chunk of retail demand from the rest of the market, said Scooter Sayers, an industry consultant.

Amazon moves a staggering number of shipments through carriers’ LTL networks, said Sayers, Cubiscan’s director of business development for LTL solutions and founder of Sayers Logistics, in a LinkedIn message. 

“Even if they never open up their LTL capacity to the open market, they are a threat to the LTL carriers as they can pull business away from them over time,” Sayers wrote. 

The ground shift, which could also have implications for the truckload market, would happen as the trucking industry awaits a freight rate rebound after a drought followed a COVID-19-induced boom.

But Amazon joining the LTL sector would represent “good disruption” for an industry in which the incumbent carriers generate great profits and strong pricing power, Sayers said.

“Seems ripe for a large player with new ways of doing things,” he said.

An Amazon entrance into LTL would be far from the first supply-chain expansion for the online retail goliath, and just the latest in a slew of recent shake-ups for the trucking industry sector.

Since 2021 alone, such shifts have included XPO’s transformation into a pure-play U.S. LTL carrier, Yellow Corp.’s bankruptcy, Knight-Swift Transportation Holdings’ move into LTL, and FedEx Freight’s planned spinoff.

The upcoming FedEx spinoff has caused some in the industry to wonder if Amazon might go after LTL’s largest carrier.

FedEx Freight hauls twice the daily volumes of its biggest competitors, meaning such a move would likely require it to shed freight to make room for more of Amazon’s, said Bobby Russell, EVP of MyCarriers, on a March 5 episode of the “Ship Talkers” podcast. 

If that happened, though, it would bring a benefit to the rest of the market, he pointed out. 

“Other carriers would pick up that business,” Russell said. “So if it went that way, I could see it being very beneficial for the LTL game.”

LAS VEGAS — Unilever wants to leave no stone unturned when it comes to implementing artificial intelligence throughout its ice cream supply chain, executive Sandeep Desai said during a panel at Manifest 2025.

The CPG giant currently uses AI to analyze weather data to develop more accurate volume forecasts and limit waste, as ice cream demand is influenced by temperature, according to a January news release. It also leverages AI in its freezer cabinets for real-time inventory updates and in its factories for more efficient production.

"We're trying to integrate it end to end, so all the way from suppliers to the consumer," said Desai, EVP and chief product supply chain officer for the company's ice cream business.

But emerging technologies haven't solved every supply chain challenge for the ice cream supply chain. One area the company is still trying to improve its visibility is in the final mile of delivery, typically from a customer's distribution center to a freezer, according to Desai. He said the company could gain that additional tracking capability via connected sensors "that can talk directly to the cloud," but a cost-effective deployment of that technology remains a hurdle.

"If we were transporting diamonds, it's cheap, the technology is available, it's there. We can do it," Desai said. "When you're transporting ice cream, where every mom and pop believes they can make ice cream too, it's quite a margin-sensitive game, and so the cost of the technology is what needs to come [down]."

Fleet management remains "the trickiest aspect" of integrating AI capabilities into supply chains, according to Desai. Implementing real-time monitoring across all trucks hauling Unilever's ice cream means collaborating with a fragmented mix of both large trucking carriers and owner-operators, he noted.

"If you look at ocean freight today versus what it was a few years ago, significant strides have been made,” Desai said, adding that the company hasn’t seen the same in trucking.

Even with cost and integration challenges, Desai said experimenting with and piloting new technology is important. Costs will fall as those initial programs progress and scale, the supply chain executive said, using Unilever's work with machine learning and AI for demand planning as an example.

"We've got to have faith in that process. We can't give up on piloting. We can't give up on scaling. And I think the key is partnerships," Desai said. "You really need to find the right partner that also sees a longer-term vision. It's not a short-term game. It's about the long term."

One long-term priority for Unilever's ice cream business is more automation within its network of warehouses. Highly automated "dark" warehouses using technology like drones for stock management will become increasingly important in cold chain logistics, particularly to offset recruiting challenges tied to work in low-temperature environments, Desai said.

Within Unilever's ice cream business, about 10% of its warehouses are currently dark, and the company is pushing to grow that percentage in the next several years, he added.

"My vision is all warehouses should be 100% dark," Desai said.

Unilever's ice cream business is slated to be spun off from the rest of the CPG giant by the end of 2025, a move that could introduce supply chain efficiencies. In 2024, the segment's underlying sales grew 3.7% due to "strong innovations and operational improvements," according to an earnings release.

Dive Brief:

• Best Buy customers can now access live tracking of product deliveries and in-home installation services. The new features are enabled by AI technology, the consumer electronics retailer said in an Aug. 15 news release.
• The tracking feature is available for large items, like big-screen TVs and refrigerators. On the day of a delivery, once a driver begins their route, the app will use real-time traffic data to provide views of drivers along their delivery route.
• When a customer’s house is next on the list for a delivery or installation, Best Buy says the tracking map will zoom into a street-level view, providing an up-to-the-minute estimated time of arrival. The app will send a notification just before the driver arrives.

Dive Insight:

Best Buy is among a growing list of retailers — Amazon and Walmart among them — that are using AI in some capacity to enhance the customer-facing side of the shopping experience.

“Our new live-delivery tracking experience removes the frustration so many of us have felt when we’re given a window of time to wait around at home for an appointment or a larger delivery to arrive,” Brian Tilzer, the company’s chief digital, analytics and technology officer, said in a statement. “We know our customers’ time is extremely valuable, and we’re proud to bring a level of convenience to technology delivery and installation that nobody is currently providing.”

Best Buy joins other retailers, like Target, that are also putting AI tech into employees’ hands to enhance customer support or supply chain operations. In April, the company announced a partnership with Google Cloud to introduce an AI-powered virtual assistant this summer.

The tool will allow customers to troubleshoot product issues, manage deliveries and manage their Best Buy memberships. AI will also be used to give customer service agents real-time recommendations. In May, Best Buy said it was updating its mobile app to offer more personalization, including personalized video content.

And as part of a brand refresh announced in July, the retailer also leaned into personalization features. The initiative includes more in-store experiential spaces and a new hologram spokesperson. The company also plans to add more in-store staff in its computer, appliance and home theater departments.

Consumer electronics sales rose 7.2% in July after months of softness, the U.S. Commerce Department reported Aug. 15. Best Buy has felt the impacts of that softness. “I think we're just seeing a little bit more trade down, a little bit more purchasing for duress, and certainly much more value hunting,” CEO Corie Barry said during a June investors’ conference.

“So I think you're just continuing to see a consumer that slowly, way more slowly than any of us expected, continues to pull back and make very explicit decisions based on value and perceived value of whatever the items are that they're looking for,” Barry said.

Mattress maker Purple Innovation realized a “significant breakthrough” in Q2 2024 gross margin from multiple supply chain improvement initiatives, COO Eric Haynor said on an Aug. 9 earnings call.

The company’s efforts have included diversifying its supplier base, optimizing its logistics network, implementing a systematic planning capability and improving manufacturing efficiency.

Focusing on improving the company’s gross margin has been a priority for Purple’s supply chain management team, Haynor told Supply Chain Dive in an interview. The mattress maker has been pulling out of a financial slump in 2024, with net revenue up 2% year over year in Q2 while its gross margin rose to 40.7%, up from 30.1% in Q2 2023.

Diversifying the supplier base

Purple started accelerating its supplier diversity efforts in 2023, shifting from a sole supplier model for materials such as the chemicals used in the manufacturing of its GelFlex Grid.

Purple analyzed what Haynor calls “the should cost” by asking determining the proper price for materials based on marketplace metrics such as commodity indexes. This was particularly critical when evaluating chemical suppliers, as Haynor’s team noticed chemical commodity indexes were going down but supplier costs were not.

When the company evaluates quotes from suppliers for its manufacturing chemicals and other materials, it also makes sure to assess each potential candidate’s qualifications and product quality, according to Haynor.

“The primary thing is, you need to make sure you have competition battling for your business, and that comes down to having more than one supplier for the items,” Haynor said, noting that having a more diverse supplier base has also helped Purple improve its resilience.

Altering its supplier base has not had a negative impact on Purple’s supplier relationships, Haynor said, noting that there are some forms of contractual relationships in place wherein the company makes volume assurances.

“So I haven't found any problems in having those discussions. And usually suppliers are happy to fight for the business, earn the business, and they're really happy when they win it,” Haynor said.

Purple has also evaluated its internal capabilities through a “make versus buy analysis,” Haynor said. This process has led the company to vertically integrate and bring sourcing for pillow assemblies in-house, for example.

“We're not asking our suppliers to lower their price; we're changing the supply chain to take cost out,” Haynor said.

Purple is still working on supplier diversification and expects its efforts to deliver further savings later in 2024, Haynor said on the Q2 earnings call.

Even as it benefits from reducing its reliance on single suppliers, Purple is still finding the right balance in its production footprint. The company announced plans to close two manufacturing facilities by Q1 2025 in August. Despite the closures, Haynor said the company’s deployment of lean manufacturing across the organization has driven efficiency improvements.

Fill the truck

Optimizing its logistics network has been an exercise in simplification for Purple, according to Haynor.

“Where you save money in logistics is by filling up the truck and driving less miles,” Haynor said.

To cut costs and mileage, Purple introduced what it calls its scheduled delivery program. Instead of shipping individual orders via an less-than-truckload carrier, the company now takes multiple orders and combines them into a single trip with multiple stops.

Haynor said the program “has been hugely successful,” adding that the company’s delivered in full on-time performance is now hovering near 95%.

Haynor also said that Purple has evaluated its partial network to improve shipping efficiency and reliability. For example, it may combine two sets of sheets into one box rather than shipping them separately.

Taking things a step further, Haynor said the mattress maker has changed its inbound network so that product coming from overseas goes straight to destination warehouses, which ship to customers directly.

“There's a ton of little pieces that you do with optimizing your logistics network to figure out what the best way to get to your customer at the lowest cost,” Haynor said.

Pushing planning performance

For years, Purple conducted its supply chain planning on disconnected spreadsheets, so what it bought didn’t always line up with what it expected to sell, according to Haynor.

To solve the issue, the company deployed material requirements planning (MRP) modules in its existing enterprise resource planning (ERP) system. The nine-month project required extensive data collection and testing, but now Haynor is more confident that the company’s forecasts translate into production and purchasing plans.

“It's been a big win for us,” Haynor said. “And this is the sort of thing that is transformational for a small company.”

Since the system was deployed in May, the company has reported lower inventory and higher levels of service, according to Haynor.

“The best part is, is that the team can now pull the levers,” Haynor said. “They can decide what their inventory is. Instead of the inventory being an outcome, what they did without information, they're setting parameters that allow us to determine what the outcome is.”

Dive Brief:

• Trade upheaval spurred by the Trump administration’s tariff strategy are prompting air cargo players to reassess their market strategies, according to a March 6 report from Xeneta.
• Freight forwarders are delaying Block Space Agreement negotiations until they receive more clarity. Shippers, similarly, are opting for short-term agreements while postponing annual contract discussions slated for Q2 2025.
• Meanwhile, carriers are assessing freighter capacity strategies as summer schedule planning approaches, Xeneta reported. Many airlines may move routes away from China and toward other parts of Southeast Asia or shift capacity to the Transatlantic market.

Dive Insight:

In January, Xeneta forecasted a 4% to 6% year-over-year increase in 2025 global air cargo demand, following a year of double-digit demand growth. Growing trade uncertainty has now clouded that outlook.

In early March, the Trump administration upped its tariffs on China by 10%, building on the initial 10% increase it implemented Feb. 4. Trump has also vowed to introduce universal reciprocal tariffs on April 2, creating further uncertainty.

The shifting tariff landscape is creating headwinds for several industries, prompting businesses to adjust supply chains to offset the impact.

“From the conversations we are hearing, some shippers are clearly looking for ways to minimise the impact of US tariffs, while others will be anticipating lower airfreight rates if e-commerce volumes show a sustained dip,” said Xeneta Chief Airfreight Officer Niall van de Wouw in the report.

The state of e-commerce

E-commerce volumes have been a primary driver of air cargo activity over the past few years. But the regular seasonal e-commerce demand slowdown at the start of the 2025, paired with the U.S.’ brief pause of the de minimis exemption on China-based shipments, may indicate “regulatory/political conversations are starting to affect the air cargo market,” van de Wouw said.

“With general cargo demand in the doldrums in recent years, the surge in e-commerce has been the saviour of the air cargo market performance. If this now takes a significant hit, if that happens, it will have a profound effect on airfreight rates around the world,” he said.

In February alone, spot rates from Shanghai to the U.S. dropped 29% month over month to $3.23 per kilogram, Xeneta reported. For comparison, February rates from Shanghai to Europe only experienced a 2% month-over-month decline.

According to van de Wouw, when the outbound e-commerce surge started a few years ago, it “clogged” the market in Hong Kong and southern China. In turn, the e-commerce market shifted toward Shanghai — despite it being a “less desirable” destination to ship from due to higher costs.

“If a fall in e-commerce volumes means there’s currently more available capacity to do business out of Hong Kong and southern China again, we would expect Shanghai to be the first market to feel this impact, and that’s what we saw in February,” the chief airfreight officer said. “This may be short-term, but the uncertainty around e-commerce is impacting the market.”

Xeneta further reported the Trump administration’s proposal to charge additional port call fees on China-built ships may temporarily drive up ocean container freight rates and prompt a modal shift from sea to air.

Some global brands are pausing ocean shipments from China for the next couple of weeks as shippers assess how trade lanes may evolve, the Port of Los Angeles Executive Director Gene Seroka said during an April 11 press briefing.

“Folks are not shipping out of China right now because they're not going to pay two and a half times for those goods that are coming in, until we get some assemblance of a plan,” Seroka said.

Shippers and other supply chain stakeholders have battled severe trade uncertainty as the back-and-forth tariff exchange between the U.S. and China escalates. Most recently, the Trump administration announced plans to hike duties on imports from China to 125%, building on the several tariff increases implemented since February. China retaliated by upping its tariff on U.S. imports to 125%, effective April 12. 

“When you have tariff rates [of] 125% to 145%, it effectively shuts down trade, to some extent,” Joe Kramek, president and CEO of the World Shipping Council, said during the meeting.

Seroka confirmed about 12 canceled or voided sailings at the Port of Los Angeles for the month of May. Last year, labor negotiations on the East and Gulf Coast ports, security concerns in the Red Sea and the ending of drought conditions at the Panama Canal led to the same number of voids in May, he added. 

In the meantime, companies are looking to steady themselves by running various scenarios to see what these tariffs and trade policies mean for them, financially, Seroka said. He noted that there will likely be a price spike from retailers and parts suppliers in the manufacturing industry, leading to three possible mitigation measures.

“Can I negotiate with my manufacturer to mitigate some of the effects of these tariffs — and that's had very little success,” he said. “Can I take the margin hit, absorb some of this cost, which will lead to a freeze in hiring and a lack of capital investment immediately, or do I pass this on to my buyer?”

March volumes

In March, the Port of Los Angeles processed 778,405 total twenty-foot equivalent units, up 4.7% year over year, according to the Port of Los Angeles. By the end of the quarter, the port handled more than 2.5 million TEUs, up 5.2% YoY.

On the loaded exports side, the port handled 122,975 TEUs, down 15% compared to the same month in 2024.

Meanwhile, cargo frontloading continued to drive loaded import volumes, Seroka said, noting that the Port of Los Angeles handled 385,531 TEUs in March.

“Our volume remained strong throughout the first quarter, and we’ve now seen year-over-year growth in 18 of the last 20 months,” Seroka said at a media briefing. “The start of the second quarter looks encouraging as importers begin to plan for spring and summer fashion, as well as back to school.”

But while the next three weeks of loadings “look decent,” it may mark the end of the port's inventory surge. In February, cargo frontloading buffered the impact, driving the Port of Los Angeles to its second-best February on record.

However, because many importers brought in their goods early, the Port of Los Angeles will see an at least 10% YoY drop from July to the end of the year, starting as soon as May, Seroka said.

“It may be more than that,” he said. “We just don’t know.”