Making Acquisitions to Control the Supply Chain

Just about anything that could go wrong with global supply chains has gone wrong in the past two years: There’s been a pandemic, volatile swings in demand, an unrelenting wave of extreme weather events, shortages of workers and cargo space—even a giant container ship lodged in the Suez Canal. It’s an operating environment that executives have taken to comparing to a game of whack-a-mole. The term has been used at least 30 times on investor calls in recent months, according to data compiled by Bloomberg.

Now a growing number of companies are deciding if they want something done right on their supply-chain management, they’re going to have to do it themselves. Walmart Inc. and Home Depot Inc. are among the U.S. retailers who’ve chartered their own container ships to try to speed deliveries. Specialty retailer American Eagle Outfitters Inc. has acquired a pair of logistics companies—AirTerra and Quiet Logistics Inc.—to help manage inventory between stores and e-commerce fulfillment and compete with larger companies in offering affordable same-day or next-day delivery. American Eagle also expects these logistics operations to be a revenue-generating business in their own right: Quiet has previously provided services to fitness-attire retailer Outdoor Voices, Birdies shoes, and other brands, according to its website. American Eagle paid $350 million for the business—its largest ever acquisition, Bloomberg data show.