Dive Brief:

• Retailers’ logistics costs may be poised to rise on a number of fronts, according to the annual State of Logistics report from the Council of Supply Chain Management Professionals.

• The inventory carrying rate—the ratio of the cost of holding inventory to the value of the inventory—has stayed at its historic low of 19.1% as the 2009 recession eased, according to the report. Inventory costs have been at 2.6% to 2.8% of GDP since 2009, below the 3% and more before the recession.

• Warehouse storage, truck transportation, and other shipping costs are likely to rise due to capacity and driver shortages, and that could be exacerbated by any rise in interest rates, according to the report.

Dive Insight:

The report measures total transportation costs and logistics spending and found that the focus from businesses on keeping costs down has meant a dearth of investment that may soon haunt them. The trucking business in particular has a driver shortage, and that may mean increasing compensation to attract more workers.

“We’re going to have a total massacre in freight pricing if demand rises in a serious way and the capacity remains where it is,” report author Rosalyn Wilson told the Wall Street Journal. She also said that freight companies will have no choice but to raise rates by 10% and more to get the job done.