Domestic Freight Transportation Today: A Shipper's Guide to the Market

Domestic Freight Transportation Today: A Shipper’s Guide to the Market

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The transportation market is constantly changing. In the first nine months of 2017, the logistics industry has already undergone a number of changes including various NMFC shifts, ongoing carrier mergers and extremely severe weather. Additionally, the ELD (Electronic Logging Device Mandate), an industry wide regulatory change, will take effect at the end of this year and is expected to create further supply chain impacts.

Collectively, these factors have created what is known as a “carrier’s market.” This is expected to persist over the coming months and possibly well into 2019. So how can businesses make smart shipping decisions? 

Unfortunately, there’s not a one size fits all solution. However, there are ways shippers can mitigate pressures within the market.

1. Understanding the factors that can impact shipping rates is extremely important.

Ultimately, supply and demand dictates fluctuations within the transportation market. While the demand is commonly associated with the overall economy, the ‘supply’ can be impacted by various things including:

  • Capacity (space on a truck for your freight)
  • Equipment (trucks, trailers, chassis)
  • Labor (drivers)
  • Fuel

2. It is important for shippers to understand where the current market is.

In a snapshot of today’s freight market, there is more freight that needs transported than there are trucks and drivers. Capacity within the Truckload spot market, a key indicator used across the industry, has steadily gained momentum over the past year. The capacity limitations skyrocketed after a majority of the South was impacted by back-to-back hurricanes and the subsequent need for humanitarian aid. This has created the so-called “carrier’s market.”

3. Aligning with a strong logistics partner can help shippers minimize the challenges faced during a “carrier’s market.”

A logistics partner can provide shippers with a number of benefits including:

  • Direct contracts with numerous carriers to provide a vast network of local and national carrier options.
  • Leveraged buying power to more effectively negotiate rates and GRI?s (General Rate Increases).
  • A solution mindset that yields out of the box alternatives (mode, route, timing shifts).

The dynamic nature of the transportation market can present a myriad of challenges for shippers and ultimately their end customers. However, with a knowledgeable and experienced partner, shippers don?t have to navigate the complexities alone. Click here to contact our team to learn more about our domestic freight management solutions or for a custom quote.


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