When the council of Supply Chain Management Professionals got its start in 1963 as the National Council of Physical Distribution Management (NCPDM), man had not yet landed on the moon. Personal computers did not exist, and bar codes had not yet been invented.
That's all changed, of course. And over the past 50 years, the discipline of supply chain management has changed along with the technology that supports and enables it. When NCPDM was formed, the focus was on the movement of goods or materials from one location to another. Today, by contrast, the flow of information from one computer to another is just as important to a company's success as the physical movement of goods from a factory to the warehouse.
Since the information flow must run parallel to the flow of goods, software facilitates the supply chain processes of plan, source, make, and move. Indeed, given the complexities of global operations in a volatile business climate, I would argue that no company today could implement any modern supply chain strategy without extensive use of computers and software. And although many supply chain managers take software's capabilities for granted these days, to be effective in their jobs they must be as knowledgeable about the workings of information technology as they are about warehousing and transportation.
Globalization has also reshaped supply chain management over the past 50 years. The earth has become "flatter," to use a term popularized by The New York Times writer Thomas Friedman. In a "flat" world, national economies have become entwined with one another, due in large part to the existence of the Internet, which makes it possible to create complex flows of data and information reaching across the globe.
Globalization requires supply chain managers to abandon their parochial perspectives and adopt more cosmopolitan and holistic views. Today supply chain managers have to understand not just procurement, manufacturing, and distribution, but also national cultures and markets.
If the past 50 years are any indication of what's ahead, then you can expect to see even more change, and at a faster pace. Indeed, tomorrow's supply chains will be vastly different from those of today. We will see new technologies, such as additive manufacturing and nanotechnology, making new demands on supply chain managers.
You can also expect supply chain boundaries to expand. I would not be surprised to see companies transporting goods and raw materials in outer space, perhaps using some kind of "warp drive" technology like that envisioned in the television series "Star Trek." When supply chains do extend to outer space, supply chain managers will still have to make sure that the right goods are produced for consumption, and that shipments arrive on time and damage-free regardless of how many miles (or light-years) they travel. It's not hard to imagine that 50 years in the future, CSCMP may have to change its name to CISCMP—the Council of Interplanetary Supply Chain Management Professionals.
Logistics service provider (LSP) DHL Supply Chain is continuing to extend its investments in global multi-shoring and in reverse logistics, marking efforts to help its clients adjust to the challenging business and economic conditions of 2025.
The company’s focus on improving e-commerce parcel flows comes as a time when retailers are facing an array of delivery challenges—both international and domestic—triggered by a cascade of swift changes in reciprocal tariffs, “de minimis” import fees, and other protectionist escalations of trade war conditions imposed by the newly seated Trump Administration. While business groups are largely opposed to those policies, they still need strategies to accommodate those rules of the road as long as the new rules remain in place.
Accordingly, DHL last week released a new study on the growing importance of multi-shoring strategies that go beyond the classic “China Plus 1” philosophy and focuses on diversifying production and supplier locations even further, to multiple countries. This expanded “China Plus X” strategy can help companies build resilient supply chains by choosing more diverse production locations in response to global trade disruptions. The study offers five criteria for sourcing goods from countries outside China such as India, Vietnam, Hungary, and Mexico, depending on the procurement needs of each particular industry.
As the Trump Administration threatens new steps in a growing trade war, U.S. manufacturers and retailers are calling for a ceasefire, saying the crossfire caused by the new tax hikes on American businesses will raise prices for consumers and possibly trigger rising inflation.
Tariffs are taxes charged by a country on its own businesses that import goods from other nations. Until they can invest in long-term alternatives like building new factories or finding new trading partners, companies must either take those additional tax duties out of their profit margins or pass them on to consumers as higher prices.
The Trump Administration on Thursday announced it may impose “reciprocal tariffs” on any country that currently holds tariffs on the import of U.S. goods. That step followed earlier threats to apply tariffs on the import of steel and aluminum beginning March 12, another plan to charge tariffs on the import of materials from Canada and Mexico—now postponed until early March—and new round of tariffs on imports from China including a 10% blanket increase and the elimination of the “de minimis” exception for individual items under a value of $800 each.
Various industry groups say that while the Administration may have legitimate goals in ramping up a trade war—such as lowering foreign tariff and non-tariff trade barriers—applying a strategy of hiking tariffs on imports coming into America would inflict economic harm on U.S. businesses and consumers.
“This tariff-heavy approach continues to gamble with our economic prosperity and is based on incomplete thinking about the vital role ethical and fairly traded imports play in the prosperity,” Steve Lamar, president and CEO of The American Apparel & Footwear Association (AAFA) said in a release. “Putting America first means ensuring predictability for American businesses that create U.S. jobs; affordable options for American consumers who power our economy; opportunities for farmers who feed our families; and support for tens of millions of U.S. workers whose trade dependent jobs make our factories, our stores, our warehouses, and our offices function. Sweeping new tariffs — a possible outcome of this exercise — instead puts America last, raising costs for American manufacturers for critical inputs and materials, closing key markets for American farmers, and raising prices for hardworking American families.”
A similar message came from the National Retail Federation (NRF), whose executive vice president of government relations, David French, said: “While we support the president’s efforts to reduce trade barriers and imbalances, this scale of undertaking is massive and will be extremely disruptive to our supply chains. It will likely result in higher prices for hardworking American families and will erode household spending power. We encourage the president to seek coordination and collaboration with our trading partners and bring stability to our supply chains and family budgets.”
The logistics tech firm Körber Supply Chain Software has a common position. "The imposition of new tariffs, or the suspension of tariffs, introduces substantial challenges for businesses dependent on international supply chains. Industries such as automotive and electronics, which rely heavily on cross-border trade with Mexico and Canada, are particularly vulnerable,” Steve Blough, Chief Strategist at Körber Supply Chain Software, said in an emailed statement. “Supply chains that are doing low-value ecommerce deliveries will have their business model thrown into complete disarray. The increased costs due to tariffs, or the increased costs in processing time due to suspensions, may lead to higher consumer prices and processing times.”
And further opposition to the strategy came from the California-based IT consulting firm Bristlecone. “Tariffs or the potential for tariffs increase uncertainty throughout the supply chain, potentially stalling deals, impacting the sourcing of raw materials, and prompting higher prices for consumers,” Jen Chew, Bristlecone’s VP of Solutions & Consulting, said in a statement. “Tariffs and other protectionist economic policies reflect an overarching trend away from global sourcing and toward local sourcing and production. However, despite the perceived benefits of local operations, some resources and capabilities may simply not be available locally, prompting manufacturers to continue operations overseas, even if it means paying steep tariffs.”
New Jersey is home to the most congested freight bottleneck in the country for the seventh straight year, according to research from the American Transportation Research Institute (ATRI), released today.
ATRI’s annual list of the Top 100 Truck Bottlenecks aims to highlight the nation’s most congested highways and help local, state, and federal governments target funding to areas most in need of relief. The data show ways to reduce chokepoints, lower emissions, and drive economic growth, according to the researchers.
The 2025 Top Truck Bottleneck List measures the level of truck-involved congestion at more than 325 locations on the national highway system. The analysis is based on an extensive database of freight truck GPS data and uses several customized software applications and analysis methods, along with terabytes of data from trucking operations, to produce a congestion impact ranking for each location. The bottleneck locations detailed in the latest ATRI list represent the top 100 congested locations, although ATRI continuously monitors more than 325 freight-critical locations, the group said.
For the seventh straight year, the intersection of I-95 and State Route 4 near the George Washington Bridge in Fort Lee, New Jersey, is the top freight bottleneck in the country. The remaining top 10 bottlenecks include: Chicago, I-294 at I-290/I-88; Houston, I-45 at I-69/US 59; Atlanta, I-285 at I-85 (North); Nashville: I-24/I-40 at I-440 (East); Atlanta: I-75 at I-285 (North); Los Angeles, SR 60 at SR 57; Cincinnati, I-71 at I-75; Houston, I-10 at I-45; and Atlanta, I-20 at I-285 (West).
ATRI’s analysis, which utilized data from 2024, found that traffic conditions continue to deteriorate from recent years, partly due to work zones resulting from increased infrastructure investment. Average rush hour truck speeds were 34.2 miles per hour (MPH), down 3% from the previous year. Among the top 10 locations, average rush hour truck speeds were 29.7 MPH.
In addition to squandering time and money, these delays also waste fuel—with trucks burning an estimated 6.4 billion gallons of diesel fuel and producing more than 65 million metric tons of additional carbon emissions while stuck in traffic jams, according to ATRI.
On a positive note, ATRI said its analysis helps quantify the value of infrastructure investment, pointing to improvements at Chicago’s Jane Byrne Interchange as an example. Once the number one truck bottleneck in the country for three years in a row, the recently constructed interchange saw rush hour truck speeds improve by nearly 25% after construction was completed, according to the report.
“Delays inflicted on truckers by congestion are the equivalent of 436,000 drivers sitting idle for an entire year,” ATRI President and COO Rebecca Brewster said in a statement announcing the findings. “These metrics are getting worse, but the good news is that states do not need to accept the status quo. Illinois was once home to the top bottleneck in the country, but following a sustained effort to expand capacity, the Jane Byrne Interchange in Chicago no longer ranks in the top 10. This data gives policymakers a road map to reduce chokepoints, lower emissions, and drive economic growth.”
It’s getting a little easier to find warehouse space in the U.S., as the frantic construction pace of recent years declined to pre-pandemic levels in the fourth quarter of 2024, in line with rising vacancies, according to a report from real estate firm Colliers.
Those trends played out as the gap between new building supply and tenants’ demand narrowed during 2024, the firm said in its “U.S. Industrial Market Outlook Report / Q4 2024.” By the numbers, developers delivered 400 million square feet for the year, 34% below the record 607 million square feet completed in 2023. And net absorption, a key measure of demand, declined by 27%, to 168 million square feet.
Consequently, the U.S. industrial vacancy rate rose by 126 basis points, to 6.8%, as construction activity normalized at year-end to pre-pandemic levels of below 300 million square feet. With supply and demand nearing equilibrium in 2025, the vacancy rate is expected to peak at around 7% before starting to fall again.
Thanks to those market conditions, renters of warehouse space should begin to see some relief from the steep rent hikes they’re seen in recent years. According to Colliers, rent growth decelerated in 2024 after nine consecutive quarters of year-over-year increases surpassing 10%. Average warehouse and distribution rents rose by 5% to $10.12/SF triple net, and rents in some markets actually declined following a period of unprecedented growth when increases often exceeded 25% year-over-year. As the market adjusts, rents are projected to stabilize in 2025, rising between 2% and 5%, in line with historical averages.
In 2024, there were 125 new occupancies of 500,000 square feet or more, led by third-party logistics (3PL) providers, followed by manufacturing companies. Demand peaked in the fourth quarter at 53 million square feet, while the first quarter had the lowest activity at 28 million square feet — the lowest quarterly tally since 2012.
In its economic outlook for the future, Colliers said the U.S. economy remains strong by most measures; with low unemployment, consumer spending surpassing expectations, positive GDP growth, and signs of improvement in manufacturing. However businesses still face challenges including persistent inflation, the lowest hiring rate since 2010, and uncertainties surrounding tariffs, migration, and policies introduced by the new Trump Administration.
As U.S. businesses count down the days until the expiration of the Trump Administration’s monthlong pause of tariffs on Canada and Mexico, a report from Uber Freight says the tariffs will likely be avoided through an extended agreement, since the potential for damaging consequences would be so severe for all parties.
If the tariffs occurred, they could push U.S. inflation higher, adding $1,000 to $1,200 to the average person's cost of living. And relief from interest rates would likely not come to the rescue, since inflation is already above the Fed's target, delaying further rate cuts.
A potential impact of the tariffs in the long run might be to boost domestic freight by giving local manufacturers an edge. However, the magnitude and sudden implementation of these tariffs means we likely won't see such benefits for a while, and the immediate damage will be more significant in the meantime, Uber Freight said in its “2025 Q1 Market update & outlook.”
That market volatility comes even as tough times continue in the freight market. In the U.S. full truckload sector, the cost per loaded mile currently exceeds spot rates significantly, which will likely push rate increases.
However, in the first quarter of 2025, spot rates are now falling, as they usually do in February following the winter peak. According to Uber Freight, this situation arose after truck operating costs rose 2 cents/mile in 2023 despite a 9-cent diesel price decline, thanks to increases in insurance (+13%), truck and trailer costs (+9%), and driver wages (+8%). Costs then fell 2 cents/mile in 2024, resulting in stable costs over the past two years.
Fortunately, Uber Freight predicts that the freight cycle could soon begin to turn, as signs of a recovery are emerging despite weak current demand. A measure of manufacturing growth called the ISM PMI edged up to 50.9 in December, surpassing the expansion threshold for the first time in 26 months.
Accordingly, new orders and production increased while employment stabilized. That means the U.S. manufacturing economy appears to be expanding after a prolonged period of contraction, signaling a positive outlook for freight demand, Uber Freight said.