Commentary: How E-commerce and Millennials are Changing Retail and Trucking
Source: U.S. Census Bureau, Advance Monthly Sales for Retail and Food Services, Seasonally Adjusted
“>
Source: U.S. Census Bureau, Advance Monthly Sales for Retail and Food Services, Seasonally Adjusted
“>
Retail sales are important – not just to the overall economy, but also to trucking – and the game is changing big-time, possibly thanks to an entire generation.
About two-thirds of U.S. economy is driven by retail sales. Compare that to around 12% for manufacturing. As for why it’s important to trucking, surely you’ve heard the line, “If you bought it, a truck brought it.”
The good news is retail sales, including food service sales, were up 2.8% in July from a year earlier. The bad news is that when you compare July to the month before, sales were flat, following a second quarter in which sales increased at a 4.2% annual rate.
This could just be a blip, but others note this may be the beginning of a whole paradigm shift in American spending habits.
Online sales are booming, meaning the traditional patterns of distributing and selling goods isn’t the only game in town. In the second quarter, e-commerce sales totaled $97.3 billion, up 4.5% from the first quarter. And e-commerce sales were up 15.8% while total retail sales moved up just 2.3%. E-commerce as a percent of total sales was 7.5% in the second quarter versus 6.6% a year earlier.
In other words, people are still spending. They just aren’t doing it the same way they used to – and that has some retailers scared.
In August, department store giant Macy’s said it would close around about 100 stores, cutting its footprint by around 15%, to strengthen its presence as an “omnichannel shopping destination.” The move was greeted with a thumbs-up by many analysts. Retailing behemoth Walmart recently bought online retailer Jet.com for $3.3 billion to increase its e-commerce presence and broaden its audience.
There’s another way spending is changing. According to …Read the rest of this story
