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John’s Blog 4-13-11
Proving Our Mettle, Earning Our
Stripes
Dear Friends,
With the jobless
numbers slowly getting better, there is yet another
sign that the economy continues its baby-step recovery. Each bit of
positive economic news helps the consumer to feel
better and more secure. That drives spending on retail
and other durable goods, fueling manufacturing, retail and
transportation.
It’s hardly a boom, but things are
headed in the right direction. We’re at a point now that even
slight declines are now being viewed as what they really are: part of
the normal ebb and flow of business, not cause for another round of
hand-wringing and doubt.
For example, the services sector took a
small Spring break in March. The Institute for Supply Management
Services
Index showed a slight decline from 59.7 in February to
57.3 in March. There was similar slippage in manufacturing as the ISM
manufacturing purchasing manager’s index
declined to 61.2 in March from a February reading of 61.4.
Keeping in mind that any reading over
50 in either index signifies expansion, we continue to be in positive
territory.
In transportation, the TransCore
Truckload
Rate Index reported that pricing in the spot market
increased in March month over month. Dry van rates were up 4%, reefer
was up 2.2% and flatbed increased 2.5%. As capacity constraints get
worse, expect this trend to continue. The Cass
Freight Index also rose, showing shippers freight
costs increased by 6.3% month over month. Volume was up by 6.9% in
March and year over the year the increased volume was 13.8%.
Our activity level is reflecting this
renewed consumer demand. Our transportation
group is very busy, inventory growth is coming back
and we are bullish about 2011.
Now that consumers are spending
again, this is no time to be caught with empty
shelves. When demand surges, that’s when supply chain reliability
and performance matter most. At Wagner,
we live for times like this, when we really get a chance to prove our
value to our customers.
If you are experiencing a problem lane
or need to begin a stocking program, give us a call. We’re ready to
collaborate on a solution with you.
Have a great day!
John Wagner Jr
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