With the new Trump administration come expectations of regulatory changes, including potential shifts at the Federal Trade Commission, that could unlock M&A activity. These shifts could mean promising activity in retail and e-commerce, as well as greater investment in supply chains.
Lower interest rates may also drive fresh investment in housing and retail, benefiting brands like The Home Depot and Lowe’s, while new entrants such as Temu, leveraging social commerce models, intensify competition in grocery and affordable retail.
In FreightTech, AI and machine learning are becoming essential as logistics companies optimize assets and improve fleet efficiency under what is expected to be a more pro-business environment. Stakeholders in the industry face pressure to adopt advanced technologies or risk being left behind, and strategic acquisitions — such as a potential C.H. Robinson-Uber Freight merger — could accelerate digital transformation across the supply chain.
In a recent interview on FreightWaves Radio on SiriusXM’s Road Dog Trucking Channel, consultant Brittain Ladd discussed these topics and made predictions for FreightTech investment and M&A as the Great Freight Recession comes to an end.
FREIGHTWAVES: What are the key drivers behind the rapid growth of online retailers like Shein and Temu?
LADD: Well, primarily it comes down to the low prices and fast fashion.
They can turn around new garments in just a matter of weeks … and there’s a lot of companies out there that are struggling [to compete] and my advice to them is, don’t try to compete.
You should partner with them and actually have them become your provider of fast-fashion designs – even do some exclusive designs for you.
I think Shein is going to continue to do well because these influencers are really leveraging social media to come up with their own designs. It’s not unusual for Shein to say we’re only going to do a run of maybe 10,000 garments … and they’re sold out sometimes in minutes. But it’s a new way of doing fashion.
Temu is really the company that I think is most interesting. I have conversations with individuals over at Temu … and what I stated to [them is], “I think the big opportunity for you in the U.S. is food and groceries.” The reason why I say that is because consumers really are still looking for ways to reduce their grocery bills in the U.S.
Temu is owned by a company in China called Pinduoduo, and they have a really unique model they use [called] social commerce. In China, we could invite all of our friends and our family and buy products in bulk, and we’ll get a discount because so many of us are buying the same product. You could use that model in the United States for grocery shopping.
I really think Temu is going to move in that direction. This is something that the grocery retailers in the U.S. could have done years ago, and I actually designed a model back in 2013 and I presented at Amazon and Kroger.
If Temu launches the Pinduoduo grocery model in the U.S., it’s going to be another one of those things where we see Temu taking market share and generating billions of dollars in revenue. So I say to people, don’t ignore Temu at all. Don’t ignore Shein.
But most of all, don’t ignore TikTok. Although there is a threat that TikTok can be banned, I don’t foresee that happening. … What we are really witnessing is the future of retail, and I think it’s going to be quite fascinating to watch.
FREIGHTWAVES: Are there any retailers you have in mind that understand the potential of TikTok or companies you’d like to see take advantage of TikTok more?
LADD: In 2019 I had recommended that Walmart and Microsoft partner and acquire TikTok. They all laughed. They said it was stupid.
One year later, they announced they were going to do it. The problem was they couldn’t do it in 2020 because of politics and the election.
I won’t be surprised if Amazon makes a play for TikTok. I won’t be surprised if Walmart makes a play for TikTok. The challenge is going to be the politics of what’s going on with TikTok, but we have a new president and I think President Trump is going to be much more receptive to keeping TikTok.
I think that there’s a way for the Trump administration to work with TikTok to find a solution. When we have an economy as challenged as we do today, the last thing we want to see is [them] shutting down an app that generates billions and billions of dollars for sellers in the United States and globally, and that is used by millions of Americans to buy products.
The other company that I think could really do something unique with TikTok is X, which used to be Twitter. I believe the future of X is going to be an app that’s really more similar to the way TikTok operates today.
FREIGHTWAVES: What other impact do you expect the Trump administration to have on the retail industry and mergers and acquisition activity in logistics?
LADD: The first thing I believe he’s going to do is let it be known that Lina Khan, the chair of the Federal Trade Commission, is gone. Her term is actually up [and] he’s going to replace her with someone who will not be as restrictive on M&A.
I think there will be an explosion in M&A activity. I believe Uber is going to acquire Instacart. I think DoorDash is going to acquire Lyft. I certainly think it’s plausible that Amazon could acquire Publix. Those are just a few off the top of my head.
There is an appetite out there for big things to start happening in retail, and the reason for that is everyone’s been sitting on the sidelines for the last three and a half, almost four years. There’s a lot of capital just sitting there doing nothing.
I think the Trump administration is going to be great for business. It’s going to be great for retail, because more retailers are going to be able to merge, and other companies are going to be able to invest in retail and invest in technology.
The Federal Reserve is lowering interest rates, and I think they’re going to become much more aggressive in 2025 to lower interest rates more and get mortgage rates lower to spur more investment in housing.
That’s a great thing for Home Depot and Lowe’s and companies that sell furniture and home furnishings.
The only challenge will be this. Does China do something foolish like make a move against Taiwan? Does it result in some type of a sanction that would shut down a lot, that would greatly harm the economy.
But remember this, no matter what goes on with the Trump administration and retail, we have to remember that we’re now to the point where we’re spending nearly a trillion dollars a year just to service the debt on our national debt and that could quickly spiral out of control, and that could actually put a damper on some of the things going on in retail.
So I’m super bullish on the future, but I’m smart enough to pay attention to the things out there that might put a damper on the enthusiasm.
FREIGHTWAVES: What trends do you anticipate in FreightTech investment for 2025?
LADD: I think that trucking companies have to pay attention to leveraging AI and machine learning as much as possible – specifically leveraging AI to really help improve the ability of optimizing the assets of these companies including the tractor, trailer, driver and doing a much better job of matching the right freight to their company.
The problem I see with too many trucking companies is they still use old school financials to run the company. … I think what the trucking companies of today should be doing is saying, “What technology is going to allow us to enter new markets? What new technology is really going to allow us to scale our business, to be able to invest more and more assets, to bring on more trucks, more trailers and more drivers? And where does it really make sense for us to make a change in our business model completely?”
Overall, I think the time has come for trucking companies to step back and say, “Are we a trucking company or are we a technology company?” And if they can’t say we’re a technology company, I think they’re really in for a world of hurt.
I also think they need to be looking at M&A much more. … If I was going to choose one thing that I want to see happen, I think C.H. Robinson (NASDAQ:CHRW) should acquire an Uber Freight (NYSE:UBER).
C.H. Robinson is a major brokerage company but their technology is old, and I pointed this out to them several years ago. I told them, “You guys have your own platform. You’ve been investing millions of dollars [in it], but it’s still Stone Age in my opinion.”
I evaluated it, and I wasn’t that impressed, and I stated to them that I think you need to make an acquisition of a company that has a completely different point of view on technology than you do. And that, to me, was UberFreight.
The analogy I use is this: Walmart was really bad at e-commerce until they acquired a company called Jet.com. Walmart acquired Jet.com for a little over $3 billion. That $3 billion investment has allowed Walmart to become the second-largest e-commerce player in the U.S. They have generated billions and billions of dollars as a company through that initial investment.
That’s what [Uber Freight] would do for C.H. Robinson.
The full interview is available on demand on SiriusXM’s app here. You can also check out live episodes Monday thru Friday at 5pm EST on SiriusXM Ch. 146
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