Sent Items #146: Monday, December 11, 2023

Happy Hanukkah! Happy Winter (check out this cool video of snow removal in Montreal)

There has been a longer lapse between Sent Items issues than I like. But between the conflict overseas, winding down a few larger client engagements, a new business I am starting (see more below), and honeymoon planning (I leave Wednesday), life has been busy.

This may be the final Sent Items of the year. I am leaving on my (belated) honeymoon on Wednesday, headed mostly to Japan with a couple days in South Korea. We are excited.

This has been a crazy year. There is so much noise out there. So many opinions - many of which are ill-informed. So much hate. I’ve been writing this newsletter since 2017. I should’ve started writing publicly earlier, but most of my musings were contained within internal email, G-Chat, and later, Slack. This is my 146th issue. I believe everyone should have a newsletter - it is an ultimate display of voice and your freedom of speech.

Onwards…

Sneak peak: My partner Ryan and I are launching a new web-based version of our core service of helping brands find the right 3PL. We are currently testing on our website (link), and have a small team aggressively working towards a product launch in Q1. Will have more exciting updates to share early in the new year!

Let’s dive into news:

Shopify Merchants Drive Record-High $9.3 Billion in Black Friday-Cyber Monday Sales (link)

• Shopify merchants reached a record $9.3 billion in sales over Black Friday Cyber Monday (BFCM) weekend - a 24% increase from last year.

• 61 million consumers globally purchased from Shopify-powered brands.Hottest product categories: apparel and accessories, health and beauty, and home and garden. Average cart price: $108.12 

• What surprised me most was that Shopify’s BFCM performance indicates strong market share gain, both in terms of new merchant adds, as well as growth of existing merchants. Shopify’s Black Friday +24% growth compares with Salesforce reporting +9%, Adobe highlighting +7.5%, and Mastercard reporting eCommerce sales on Black Friday +8.5%.

• Here are a few informative graphs of Holiday Sales from Adobe (to all the naysayers, Black Friday remains an important event!)

Flexport is launching a 1.1 Million SQF fulfillment hub in NJ in January to fuel growth (link)

• While I’ve written much about the demise of overly capitalized fulfillment companies, it sounds like the beat goes on for Flexport (nee Shopify Fulfillment, nee Deliverr) as they are investing in a 1 Million+ square foot fulfillment center in Phillipsburg, NJ. My guess is this is a consolidation of the several owned facilities and the many more third-party (i.e. 4PL) partners that were part of the Deliverr network. 

• I am more optimistic with owned-operated facilities (than 4PL), but I continue to struggle endorsing a partner that is stretched so thin across such a broad spectrum of services in supply chain. Any one of their suite of offerings would be a great business independently, but together creates noise, distraction, and a fight for resources

The Biggest Delivery Business in the U.S. Is No Longer UPS or FedEx (link)

• The Seattle e-commerce giant delivered more packages to U.S. homes in 2022 than UPS, after eclipsing FedEx in 2020, and it is on track to widen the gap this year, according to internal Amazon data and people familiar with the matter. The U.S. Postal Service is still the biggest parcel service by volume; it handles hundreds of millions of packages for all three companies. 

• UPS has said that its domestic volume this year is unlikely to exceed last year’s 5.3 billion, which includes packages delivered to customers through the postal service. In the first nine months this year, UPS handled around 3.4 billion parcels domestically. FedEx’s domestic Express and Ground parcel volume reached around 3.05 billion for the fiscal year ended May 31, 2023. Before Thanksgiving this year, Amazon had already delivered more than 4.8 billion packages in the U.S., and its internal projections predict that it will deliver around 5.9 billion by the end of the year. Last year Amazon shipped 5.2 billion packages. 

US E-Commerce to Exceed $1.1 Trillion in 2023 (link)

• Continuing on the theme of eCommerce growth over this year, eCommerce sales in the U.S. are on target to exceed $1.1 trillion in 2023. But it will be the slowest year of growth since the 2009 recession. In 2023 eCommerce is set to grow 7% to hit $1.1 trillion, which would put it about 14% above the pre-pandemic trendline. However, at 7%, 2023 will be the slowest year of growth since 2009. This year, with 7% growth, as likely the bottom, eCommerce should accelerate to the expected 9-10% growth over the upcoming years.

A Happy Hanukkah, Happy early Kwanzaa, Festivus, and Merry Christmas, and Happy New Year to all!

- Matt

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