The Logistical Lowdown

It can be challenging to find a quality truckload carrier, but having trusted partners is a pivotal part of every shipper’s logistics operation. You must choose well as their ability to get the job done directly affects your company’s service to customers and your profitability – two crucial things.

As industry giants like Walmart and Amazon respond to rising consumer demand for instant shipments with free one-day shipping and same-day delivery options, the delivery window for suppliers and logistics providers is growing smaller and smaller. With less time to meet these shorter windows and generally tighter regulatory guidelines for carriers, manufacturers are facing some serious pressure to perform.

In an ideal world, every one of a shipper’s loads would all be the same weight, have the same pickup times each day, and be between a very limited number of origin and destination pairs. Carriers love transporting this type of freight because it’s predictable. “Regular” lanes give carriers the ability to plan better, and as a result, earn consistent revenue and better manage their equipment and driver resources.

Ultimately this helps them manage their costs better, which can then lead to lower rates for their customers, too. Regular lanes also increase a carrier’s familiarity with the locations and products, which introduces more efficiency and better service to the entire logistics process.

As a mid-size trucking company that has been around for over 40 years, Keller has experienced our fair share of ups and downs in the industry. Through it all, we have been able to increase our diversification and expand our services for our customers. This diversification and expanded services have been critical in weathering the tough times. The current situation is unique in many ways and we all are affected, regardless of industry, and certainly some worse than others. With no real answers or experience on how a global pandemic will ultimately affect the supply chain in terms of longevity or what the “new normal” will look like, we can only share our experience with key patterns in uncertain financial times that diminish trucking capacity.

For the first time since 1938 when the hours-of-service (HOS) laws initially went into effect, the Federal Motor Carrier Association (FMCSA) temporarily exempted truck drivers transporting essential medical equipment and supplies on a federal level. This response is typical on a state or local level for emergency situations, like the current COVID-19 pandemic, because of the sheer amount of goods trucking companies are responsible for moving.

Many shippers question whether or not they should leverage the resources of a freight broker. But the answer is never simple because it will depend on several different factors.

What the truck is going on? 

Trucking bankruptcies have been a hot topic over the past year, with several larger carriers such as New England Motor Freight, Falcon Transport, and Celadon ceasing operations and in some cases stranding drivers out on the road. In addition to these larger carriers, every week there seems to be another longstanding carrier with 30-plus years in business deciding that the business just wasn’t worth it anymore. What is going on and what do things look like moving forward?

A fuel surcharge is a way of adjusting the amount paid to move freight by considering significant variation in fuel prices, compared to historical data. Fuel has a major impact on the supply chain and as a trucking company, we must be cognizant of what the market is doing and how it is going to affect the cost of diesel. There are four main components that contribute to the retail price of a gallon of diesel fuel:

The topic of dedicated logistics operations, whether in transportation or warehousing and distribution, typically elicits an array of responses ranging from “why wouldn’t we just do it ourselves” to “I can’t imagine trying to do this ourselves”.

Truth is, dedicated operations aren’t for everyone, but for many small and mid-size manufacturers outsourcing these logistics functions to a 3PL allows the manufacturer to work on growing its core business and increasing the value provided to their customers.