This fireside chat recap is from Tuesday, the first day of FreightWaves’ Global Supply Chain Week.
FIRESIDE CHAT TOPIC: Geopolitical pressures on freight transportation.
DETAILS: When the COVID-19 pandemic hit, spending on many products surged while spending on services dropped. The market is now shifting back to normal, and Walter Kemmsies, the managing partner of the Kemmsies Group, shared his observations on the economic impact of those shifts.
KEY QUOTES FROM KEMMSIES:
“In the second quarter of 2020 there was massive panic and there was massive overreaction. All of these companies that benefited from people who were doing more from home overinvested.”
“A lot of these e-commerce companies forecast off the peak and one of the biggest things you can do wrong is forecast off a historical peak. It resulted in way too much investment by tech companies, bicycles and trading companies.”
“The smaller retailers are not the ones who over-ordered. We still have not seen the smaller retailers rebuild their inventories to where they need to be. But it is not surprising to see reports that the larger retailers are still canceling purchase orders from Asia.”
“The inflation problem was always a supply problem.”
“When the pandemic started, we fired a lot of people. Now they overhired them and we’ve seen some of the bigger retailers out there laying off staff and we’ve got the service sector struggling to hire enough people so we can get back to flying the same number of airplanes and running the same number of trucks.”