Connections 2025 day two recap

After a packed opening day of SMC³ Connections, day two grabbed the baton and kept the momentum going with standout leadership talks and expert panels covering everything from supply chain resilience to AI innovation and the evolving dynamics of global trade. As LTL and logistics professionals gathered for another round of revealing discussion and fresh insights, the focus sharpened on how many industry players are adapting to uncertainty while preparing for what’s next.

Below are some top takeaways from the day’s sessions.

How Target builds flexibility into its global supply chain

Tim Hotze, SVP of Operations Planning and Network Steering at Target, kicked off the day’s Leadership Series by offering a special glimpse into how one of the country’s largest retailers navigates global supply complexity in the face of the ever-discussed tariffs, shifting sourcing strategies, and increasing AI adoption.

“We looked at a more diversified global sourcing strategy,” Hotze explained, noting that Target had begun diversifying its sourcing from an over reliance on China even before COVID-19. Building dual sourcing models and leveraging the rising manufacturing capacity in Southeast Asia has been key to Target’s strategy.  

A central theme of Hotze’s talk was scenario planning. “A lot [happens] before anything physically moves or comes out of a factory,” Hotze said in response to how Target keeps things running smoothly amidst all the noise and confusion. “We do a lot of different scenario planning.” That includes overlaying production volumes by location, responding to seasonal cues like back-to-school, and weighing decisions such as whether to land goods early or delay to reduce duties and fees.

AI has also emerged as key enabler for Target. Hotze described how Target is leveraging AI not just for business intelligence, but to support frontline workers with tools like StoreCompanion, an AI-driven model that helps over 300,000 team members operate more efficiently.

Looking ahead, Hotze is bracing for an uncertain future: “the size of the disruptions are probably going to go up, [and] the time between these disruptions actually is coming down.” To prepare, Target is building supply chain systems with resilience and flexibility in mind, designing redundancy and avoiding single points of failure.

US-China trade and the future of freight

Next up was a lively discussion featuring trade experts Liz Lowe, Partner, International Trade and Logistics Group at Venable LLP, and Jon Monroe, Founder of Jon Monroe Consulting, who dissected the state of U.S.-China trade and its ripple effects across sectors.

“Right now, for goods coming into the U.S., we’ve got basically a minimum of 30%,” Lowe said, when asked about where things stand with U.S.-China tariffs. “But that can go all the way up to 145% for an electric vehicle,” showcasing the current volatility. Despite a recent “pause” in some tariff activity, uncertainty remains high, especially as key dates approach.

Instability like this is reshaping the structure of global sourcing. Monroe described today’s environment as a reset, one marked by nearshoring, reshoring, and changing global carrier strategies. “Everybody thinks they’re going to go to Vietnam or India,” he explained, “but the reality is Chinese companies are going to Vietnam and India.” Even as sourcing shifts, many companies are still working with the same suppliers—just in new countries.

Monroe also noted the impact of new shipping capacity—2.9 million TEUs added last year—and how carriers are responding. “Carriers are rethinking their vessel deployment, and they will deploy them wherever they can get the highest dollar.

FedEx’s strategic realignment

Day two’s sessions wrapped up with Mike Lyons, SVP at FedEx Freight, taking the stage to talk sweeping changes in the LTL market and how FedEx is refining its strategy and position in the competitive landscape.

“The most notable shift would be the announcement we made in December 2024 that we’re going to send FedEx Freight out on its own to become a separate entity,” Lyons said. With a singular focus, the new standalone entity will have more flexibility for capital investments and strategic growth “based solely on the direction and the needs of where freight is going.”

As market conditions remain soft and inflationary pressures persist, Lyons noted a shift in how customers evaluate speed vs. cost. “You’re going to see downshifting…Can I trade speed for cost? Or [move] out of some national carrier into regional-based carriers?” For FedEx Freight, Lyons emphasized that their ability to offer both priority and economy services under one national network puts them in a strong position. “Being the only national carrier that offers that ability…puts us in a unique perspective to be able to weather some of those longer periods of time when you have softening in the marketplace.”

Turning to tech and optimization, Lyons highlighted DIM and motion technology as one of their biggest technological advances. “You think about a forklift driver going down the dock at full speed and being able to pull the dimensions of that shipment…not having to stop, not having to get out.” Advancements like these have helped produce data that drive better costing, better pricing and, ultimately, revenue generation.

That data is now being pushed further upstream to help with strategic planning, including linehaul routing and network design. The goal? To be “more efficient and lower cost than what we were historically.”

Much more to come on day three

Another day brought another round of big ideas, thoughtful discussions, and meaningful connections for attendees—but we’re not done yet. Be sure to check back soon for our final recap from day three of Connections 2025.