November Freight Activity Higher than Expected

The November Cass Freight Index showed a drop in total freight expenditures of 0.7 percent and a corresponding decline in shipment volumes of 0.2 percent, however this was not unexpected given that retailers stocked up early in anticipation of problems at the West Coast ports.

The number of freight shipments slid 0.2 percent from October to November, but November shipment levels remained 4.2 percent higher than the same month a year ago and represents the highest point on the firm’s shipment index since the Great Recession.

Cass further noted that inventories remain high, as many retailers placed orders early to avoid expected transportation problems with ports and truck capacity.

Not all shippers were able to avoid deliveries to West Coast ports in November and they are experiencing three week – or longer – delays in receiving their goods.

In addition, early price discounting made a dent in traditional Black Friday sales figures and traffic.

Early estimates show that store traffic was down 5.2 percent compared to last year’s Black Friday totals and sales are expected to be 11 percent lower than last year.

Lower gas prices were expected to fuel more spending, but consumers are still behaving conservatively and holding out for even further discounting.

Cyber Monday sales soared again this year, rising between 8.5 and 16 percent depending on the measure you follow, with the top 25 retailers experiencing bigger increases than their smaller competitors.

The National Retail Federation still predicts overall holiday sales will rise 4.1 percent, and small package and parcel shippers, such as UPS and FedEx, have dramatically expanded their capacities to avoid the spate of late deliveries experienced last year.

Category: Featured, General Update