Rising Costs: An Outlook on Tariffs, Supply Chain and Logistics

Is your organization dealing with increases in spending?

You are not alone!

Spending on transportation, inventory-carrying costs and other shipping-related expenses as a share of gross domestic product last year reached its highest level since 2014.


  • Tariffs have created sourcing challenges and raw material price increases. While the trade war continues to create guessing for procurement departments, one thing that is certain is that material and input costs have gone up for many organizations. Over $200 billion worth of Chinese products are subject to a 25% tariff and are raising inventory carrying costs throughout the supply chain.

Supply Chain and Logistics

  • Businesses spent $1.64 trillion on transportation and logistics services in the United States in 2018, a jump of 11.4% from the prior year, as companies retooled supply chains in response to the growth in online sales and tight freight hauling capacity drove up shipping rates.
  • The market was also affected by government regulations on driver hours of service and labor shortages that boosted wages for truck drivers and warehouse workers, according to an Annual State of Logistics Report released June 18 by the Council of Supply Chain Management Professionals.
  • Logistics costs rose across the board in 2018, with inventory carrying costs leading the way with a 14.8% jump to $493.7 billion.

Citation: Bearth, Daniel P. (2019, June 20). US Logistics Costs Rise 11.4% in 2018, Report Says. Ttnews.com. Retrieved from https://www.ttnews.com/articles/us-logistics-costs-rise-114-2018-report-says

Rising costs to challenge supply chain in 2019

Rising Costs

Logistics Service Providers (LSPs) said in the survey conducted for the report that the most important logistical challenge by far for their customers was in reducing costs, at 61.7%. This was followed by visibility issues (46.8%) and achieving a good customer experience (33.3%). The percentage of LSPs that also said that the costs of cross-border trade were set to rise was extremely high, at 83.2% of respondents.

Citation: editor (2019, March 19). Rising costs to challenge supply chain in 2019. Eft.com. Retrieved from https://www.eft.com/supply-chain/rising-costs-challenge-supply-chain-2019

How do you deliver results when the industry at large is experiencing increases?

How do you present your organization with a plan to combat these challenges?

Fortunately, JRW has a solution. Our Inventory Management Platform. 

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