With the impacts of looming trade wars filling our newsfeeds, our team at TOC Logistics International is keeping a close eye on creating a strong end-of-year (and beyond) for our clients.
Decisions and trends happening now help us understand potential challenges and opportunities down the road. The holiday season will be here before we know it; here are some of the key developments we are watching:
Early Projects Were Positive
In 2017, the National Retail Federation reported that holiday sales were up 5.5% over 2016, and Small Biz Daily projected in April another year of growth with an estimated 3.7% increase. This was positive news at the time, but, as we all know, a lot has happened since April.
Trade May Slow Down due to Tariffs
The Port of Los Angeles was America’s number one port in 2017; executive director Gene Seroka recently shared, “…imports from China coming through U.S. ports have slowed over the last two months and are down 3.8 percent in April and 8.7 percent in May.” Seroka was quick to point out that he is not able to accurately name the reason for the decline.
However, this is a key point in the year to evaluate trends, with Seroka also stating, “Mid-year is typically the start of the Port of Los Angeles’ peak season ahead of major U.S. retail events including ‘Back to School’ sales promotions and holiday marketing in December.” A slow down at this port at this time of year could be telling of future pace.
Spending Power May be Affected
At this time, experts share that, “There are still a few things that need to happen for the trade war with China to escalate to the point of hitting retailers and consumer goods.” However, another unintended potential consequence will actually affect jobs, and in turn, spending power.
The Detroit News reports, “Hun Quach, vice president of international trade for the Retail Industry Leaders Association, said the ‘barrage of tariffs coming from all directions’ between the U.S. and China, the European Union and NAFTA partners are a threat to U.S. prosperity and ‘will imperil millions of jobs if allowed to persist.’” Loss of jobs will directly impact holiday, and overall, spending within our economy.
The international logistics industry is one of constant change. As the impacts of tariffs, trade agreements, and more, unfold, we are hard at work creating the best solutions for our clients.