We at OneRail are thrilled to kick off our new weekly newsletter, where we cover the latest news, reshaping logistics, retail and tech. This week’s lineup is a doozy, starting with Barclays’ eye-popping $615 million investment in last mile logistics, showcasing a massive endorsement of the sector’s potential. Not to be outdone, DP World is making moves with a new freight forwarding office, broadening its influence globally. On the omnichannel front, the grocery industry is going through seismic changes, led by giants like Walmart, Target and Kroger, while the logistics industry as a whole is having a much more active year of M&As led by PAR Technology and others throughout the last mile, freight forwarding and trucking industries. Let’s get started!
Barclays Pioneers with a $615 Million Investment in Last Mile Logistics
Barclays has taken a bold step, partnering with Blackstone Group to invest $615 million in commercial mortgage-backed securities (CMBS) focused on last mile logistics. As the first CMBS of its kind, it’s a statement-making move that signals a decisive vote of confidence in the space.
A Fresh Wave of Confidence in Last Mile Logistics
This upcoming launch, featuring Blackstone’s robust portfolio, is no ordinary deal. It represents a significant leap of faith in the resilience and potential of the last mile logistics market. Amidst a backdrop of financial markets finding their footing after previous uncertainties, the size and scale of this deal, compared to last year’s $322 million CMBS, speaks for itself.
A Sign of Growing Investor Interest
Last mile logistics is a hot sector, pulsing with activity and investor interest. With undeniable growth of e-commerce and surging demand for faster deliveries, Blackstone’s also placing strategic bets on last mile logistics solutions across Europe. Despite a slowdown in transaction volumes, there’s an undeniable demand for logistics real estate. Think rising rents, a premium on space efficiency and improved financial conditions, such as tighter spreads on triple-A notes.
DP World Expands Worldwide Freight Forwarding Operations
DP World recently launched a new freight forwarding office in Miami. Shunning an asset-light approach, this office joins an extensive network of over 100 offices worldwide and showcases a commitment to customer support and enhancing global trade resilience in the face of headwinds like climate change, geopolitics and macroeconomics.
Strengthening Supply Chain Resilience
As black swan events and disruptions have become more commonplace, businesses are reevaluating their supply chain strategies to bolster resilience, especially with research by Economist Impact revealing how traditional freight forwarding models are particularly susceptible to disruptions at important chokepoints. DP World’s expansion, especially in air and ocean freight, aims to mitigate these vulnerabilities. At the same time, it promises increased control and efficiency for clients by leveraging a comprehensive range of services, including ports, terminals, warehouses and digital technology.
Expanding Global Logistics Networks
DP World’s recent opening of a new office in Miami is a game-changer, pushing its global network to an impressive 430 units in 86 countries. At the same time, expansion is a big part of its strategic initiatives to cover 90% of global trade. Beat Simon and Marco Nazzar at DP World are excited about what this means for the future. They’re big on using digital tech and tapping into the talents of their team to shake things up in freight forwarding, making DP World’s operations even more dynamic and far-reaching.
Grocery Shopping’s New Era: Inside the Trend Toward Omnichannel
The latest big-box retail data unveils a significant trend in grocery shopping habits: omnichannel is everything. Currently, in food and beverage consumer spending, Walmart is leading the way, boasting a nearly 19% market share compared to Amazon’s 3%.
Embracing Omnichannel Shopping
The story behind Walmart’s grocery success isn’t just about what’s happening inside the stores; it’s about the blend of shopping avenues consumers are taking. Walmart saw a 4% year-on-year growth in same-store sales, driven partly by strong demand for fresh food. However, this growth in grocery sales goes beyond foot traffic in stores. It reflects a sophisticated mix of shopping methods, including online purchases, pickup and delivery services. With e-commerce sales jumping 23%, representing $30 billion and 18% of net sales, the preference for convenient shopping channels is straightforward. Consumers are buying groceries online and utilizing same-day services and express deliveries, signaling a significant preference toward omnichannel retail.
Digital Innovations Fueling Grocery Growth
Beyond Walmart. Target and Kroger are also making significant omnichannel strides, such as Target’s partnership with Shipt to roll out free same-day delivery and Kroger’s digital sales jumping by 10%. Additionally, the increased adoption of digital and physical shopping channels has led to innovations in loyalty programs and payment methods that aim to provide a seamless experience for the modern shopper. With 39% of consumers now considered ”Click-and-Mortar shoppers,” the message is clear: the future of grocery shopping lies in a unified online and in-store experience that prioritizes flexibility and convenience
PAR Technology Bolsters Its Unified Commerce Capabilities
Publicly traded PAR Technology is on the move, announcing the acquisition of TASK Group and the completion of its Stuzo Holdings purchase. These strategic moves, valued at about $396 million, will expand PAR’s offerings in cloud-based unified commerce software to convenience stores, fuel retailers and overseas markets.
Expanding Horizons with Strategic Acquisitions
With the TASK Group acquisition set to close in the third quarter of 2024 and the purchase of Stuzo Holdings already completed, PAR Technology is making serious moves. Not only is PAR expanding its presence in the unified commerce space, but it’s also catapulting onto the global stage. Beyond growing larger, these moves strategically boost PAR’s capacity to deliver innovative solutions to more diverse markets.
A Boost to Revenue and Engagement
These acquisitions could also supercharge PAR’s financial health. Projections estimate these acquisitions to add over $80 million in annual recurring revenue and more than $20 million in adjusted EBITDA. Nobody can predict the future, but it’s clear that PAR’s strategic vision to lead in digital engagement and transaction platforms could set a new industry standard for convenience and efficiency.
A Surge in Other Logistics Mergers and Acquisitions Signals Industry Growth
In addition to PAR Technologies’ acquisitions, 2024 is already heating up with a flurry of logistics mergers and acquisitions (M&As), bouncing back from a slow 2023 held back by high-interest rates. As we approach the end of Q1, this year is shaping up to be a hotspot of industry consolidation, featuring strategic moves in last-mile delivery, freight forwarding and trucking.
Expanding Service Offerings and Market Reach
The industry’s resurgence in M&A activity is about expanding service portfolios, entering new markets and enhancing global reach. For example, ADL Final Mile’s acquisition of Sonic Transportation & Logistics and Radiant Logistics’ purchase of Select Logistics and Cartage illustrate a clear strategy to amplify last mile delivery capabilities and bolster global freight forwarding services.
Accelerating Growth Through Strategic Acquisitions
Several other strategic growth initiatives and market consolidation moves point to a bullish outlook for the logistics sector. PS Logistics, for instance, strengthened its trucking and flatbed operations through the acquisitions of Buddy Moore Trucking and the flatbed division of ELS to solidify its industry standing. Furthermore, there’s the monumental merger of Forward Air with Omni Logistics for $2.1 billion, alongside Ceva Logistics’ acquisition of Wincanton for $716.3 million.
OneRail’s Solutions: Prepare for Tomorrow, Today
This week’s deep dive into the logistics’ latest reveals a thrilling narrative of innovation and growth. The industry’s pace is unrelenting, from Barclays’ bold bet on last-mile logistics to the omnichannel revolution in grocery shopping to the M&A craze. That’s why OneRail emerges as a key player, ready to empower businesses with cutting-edge, final mile delivery solutions:
- Courier Network: Place your deliveries in trusted hands by tapping into OneRail’s expansive national network, boasting over 12 million couriers.
- OmniPoint™ Platform: Leverage OneRail’s OmniPoint™ Platform for rate shopping, smart matching and real-time visibility to guarantee timely and cost-effective deliveries.
- Exceptions Assist™: Benefit from proactive monitoring, with a dedicated team of logistics experts ready 24/7 to tackle any challenges and disruptions.
Ready to see how OneRail can transform your logistics strategy? Schedule a demo today and take the first step.
