Annual state of logistics report shows spending up in US

by Array

LOMBARD, Illinois: US businesses spent more on logistics in 2011 compared with the previous year.

According to the 23rd Annual State of Logistics Report, published by the  Council of Supply Chain Management Professionals (CSCMP), in 2011 business logistics costs rose to US$1.282 trillion, which is a 6.6 percent increase from 2010. That figure represents 8.5 percent of the US gross domestic product (GDP).

The report, which was compiled by transportation consultant Rosalyn Wilson of Delcan Inc, concluded:

  • railroads gained market share—especially their intermodal services—with revenue increases of 15.3 percent over 2010
  • trucking companies increasingly used intermodal rail to help offset effects of driver and equipment shortages and still had a growth in trucking rates between five and 15 percent in 2011
  • US domestic air cargo revenue was down more than three percent while international air cargo revenue declined less than one percent
  • ocean carriers saw growing excess capacity, rate erosion, service declines and operational losses.

It also warned that inventory levels may prove problematic since “inventory carrying costs in 2011 continued their rising trend and overall inventories have returned to pre-recession levels, which could be a cause for concern for the economy. The growth has occurred among wholesalers and manufacturers while retail inventories remained flat, indicating that inventory management processes have changed.”

On the more positive side, the study reported US exports of manufactured goods hit a record level in 2011, reaching US$1.27 trillion, a 15.1 percent increase from 2010.