E-commerce Impact on Logistics and Government Shutdown Essays edxample

Government Shutdown

A government shutdown is the closure of nonessential offices of the government. Federally-run-operations that lack funding is forced to close and the federal employees unless essential are not allowed to work. The shutdowns occur when the Presidents and one or both the chambers of Congress are unable to resolve disagreements over budget allocations before the current budget cycle ends. The US shutdowns are unusual in that; though payments are delayed to as much as 1.3 million workers, confidence in the job market decreases and slower GDP growth recorded, there are no major market reactions (Li, 2018).

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Research tracking over 20 government shutdown since 1976, including the recent one in January 2018, shows that the impact of shutdowns has amounted to a mere shoulder shrug. During this span the median performance of Standard and Poor (S&P) 500 has been zero percent, that is, stocks rose half the time and fell have the time (Li, 2018). LPL Research shows that on average, the S&P 500 has posted an average decline of 0.4 percent during the government shutdowns over the past four decades (Randall, 2018). Randall argues that the partial shutdown of these regulating bodies, Securities and Exchange Commission and The Internal Revenue Service, could explain the confidence exhibited in the markets.

The lack of market reactions to shutdowns in the past 20 shutdowns goes to show that Wall street care more about the economy than it does about politics. Additionally, it shows investors are concerned more about whether corporate earnings will rise or fall. Perhaps it could be an event with a lot of media hype but no meaningful impact. Future government shutdown's and their impact on the market or long term effect on the psyche of investors will likely have no consequences.

References

Li, Y. (2018, March 28). A government shutdown typically doesn't hurt the stock market, history shows. Retrieved from https://www.cnbc.com/2018/12/21/a-government-shutdown-typically-doesnt-hurt-the-stock-market-history-shows.html

Randall, D. (2018, December 21). Global stock indexes slide as U.S. government shutdown looms. Retrieved from https://www.reuters.com/article/us-global-markets/global-growth-worries-u-s-government-shutdown-threat-hit-stocks-idUSKCN1OK02P

E-commerce Impact on Logistics

The 2016 movie, Storks, is about the storks of the Stock Mountain that deliver babies to families around the world. The movies feature a giant baby factory that makes babies and sorts them out for delivery to orders made via the online platform Cornerstore.com. What evokes much interest is the package delivery business favored by the CEO character stork Hunter. Comparison of the sheer size of the stork's delivery business with today's online e-commerce platforms and how they accomplish their delivery to all corners of the world is mind-boggling. How is the logistics landscape in air, ocean, and rail changing in the wake of e-commerce growth and transformation?

The growth of e-commerce, though welcomed by manufacturers and retailers, has introduced more risks and complexity in the logistics industry. Amazon announcement of its intention to become a non-vessel operating common carrier rearranges the ocean logistics matrix (Burnson, 2016). Amazon strategy for international freight involves buying space from common-user ocean carriers. This avoids the need for operating their containerships. E-commerce businesses today are outsourcing their logistic requirements to service providers. Third-Party logistics is responsible for supply chain management, warehousing, consolidation services, and order fulfillment. The leading companies in the global logistics market include DHL International, FedEx, and United Parcel Service, among others (Burnson, 2016). Other methods in logistics include "postal injection" and the e-commerce own logistics department (Sahiner, 2015).

The delivery of an item to a customer is a complex process compared to the order placement which occurs in a click of a button (Sahiner, 2015). Whether delivered by air, sea or rail, fulfillment of an order is a critical event in the e-commerce industry. Therefore, it is essential that the complexity of the logistics between the click and delivery be handled with care.

References

Burnson, P. (2016). E-Commerce Reshaping the Logistics Landscape - Supply Chain 24/7. Retrieved from https://www.supplychain247.com/article/ecommerce_reshaping_the_logistics_landscape

Sahiner, O. (2015). E-Commerce Impact on Logistics. Retrieved from https://www.morethanshipping.com/e-commerce-impact-on-logistics/