The times are changing. The announcement of New England Motor Freight's (NEMF) bankruptcy brings attention back to the volatility of the transportation industry. The transportation industry is complex, ever-evolving, and currently facing many hurdles. No matter how lean your manufacturing processes are or how well you manage your inventory, none of it matters if your products can't reach consumers. Whether you're shipping food, beverages, or consumer packaged goods, navigating the transportation market can be a difficult endeavor for even the most experienced logistics managers. To help guide you through the current state of the transportation industry, here's a breakdown of the factors affecting the transportation industry and what you can do to avoid negative consequences:
Factors affecting transportation availability:
Driver and Equipment Shortages - The shortages currently affecting the transportation industry have been long developing and require major time and effort to course-correct. Arguably the most impactful shortage has been the declining interest in truck driving as a career. This issue has led to rising rates, capacity crunches and in some cases, played a part in carriers shutting-down all together (See: New England Motor Freight Files for Bankruptcy). Government regulations - New government regulations can totally change the game and force carriers to alter their service strategy. A recent example of this is the ELD mandate which requires drivers to log their hours and take breaks in specified intervals. The entire industry has no choice but to evolve when a new government regulation is enacted. Port Congestion - Congestion is affecting ports worldwide and requires constant adaptation to combat. All of the previously mentioned points help to increase port congestion, and all of these issues are intertwined with one another creating a transportation market that requires major planning to navigate. (See: Port Congestion: How to Avoid the Headache).
How to ensure that you have transportation coverage for your shipments:
Forecast - The previous section should make it clear that forecasting is essential for ensuring your transportation needs are covered. Don't ignore increasing port turnaround times or wait until the last minute to request service from a drayage provider. Plan ahead and anticipate any peaks and valleys that may delay your products from reaching consumers. Work with multiple carriers (or a transportation management provider with a large carrier network) - Don't put all your eggs in one basket. The more carriers you utilize, the better you'll be able to shift freight to another provider if necessary. Work collaboratively and provide consistent shipments to form solid relationships with carriers. Unfortunately, building a reliable carrier base takes time and expertise, so it may be in your best interest to...Partner with a transportation management provider - Even better than working with multiple carriers, is working with a reliable transportation management provider. A good transportation management provider will do everything mentioned in the previous point, and will do it on your behalf, eliminating much of the work that goes into effectively managing multiple carriers. Acting as your representatives, your transportation management provider will handle your shipments through their network of qualified carriers. You don't have to worry about sourcing carriers, managing driver relationships or tracking shipments, it's all handled by your transportation partner .Utilize different modes of transportation - With so many transportation modes available, you may be able to save money and increase shipment efficiency by utilizing a different method of shipment. There are many viable options for shipping to distribution centers and consumers, it's just a matter of comparing the advantages and disadvantages of each. Some viable modes of transportation to consider are:
At Continental Logistics, we have processes and partnerships in place to help insulate your business from transportation disruptions. Throughout our 35 year history, we've continually adapted our offerings to maintain consistent transportation service. If you're struggling to secure transportation for your shipments contact our transportation operation, Continental Logistics, before the situation becomes worse.
