Those were just some of the trends we saw mark the transportation industry in 2019. But what’s ahead for 2020 and how can you prepare? In a recent webinar, industry experts Tom Valentine from Valentine Solutions, Derek Browning from LeanCor Supply Chain Group, along with Steve Prince from LeanCor Supply Chain Group dove into what to expect and how shippers are hedging their bets by executing a clear strategy and best practices.
We've summarized the information into seven key things to know about transportation management in 2020.
1. Truckload shipments will cost more in 2020.
We expect to see mid to high single-digit increases in rates starting late in the first quarter or early in the second.
"Capacity drives truckload prices, and since truck availability is expected to be more constrained in 2020 compared to 2019, we anticipate spot market rates to rebound after a down year" - DAT, 2020 Freight Focus
2. It's more important now than ever to understand your transportation needs as a shipper.
Which modes make sense for your business? How do you rank cost vs. service when it comes to transporting your product? These are factors that will drive your transportation model for success.
3. Shippers with a plan will get ahead of the spot market.
In our world we see two kinds of organizations. Some prioritize stable costs, and on-time pickup and delivery performance; they proactively secure a large portion of freight in the long-term contract market. Others are more transactional: they want the best price they can get at any given time and are more reactive. While there's more stability in the former situation, sometimes it just depends on the nature of the business. In either situation, it's important to understand the market cycles and how they can impact your strategy.
4. Making your freight more attractive to carriers can go a long way.
Since we know capacity will be constrained in 2020, it's important to note that shippers can take measures to make their freight more attractive in order to retain long-term carrier relationships. Examples of this include reducing carrier dwell time for loading and unloading, as well as investing in a solution that allows a carrier to maintain a pool of drop trailers at a facility. Carriers are also investing in dimensional technology that can potentially penalize a shipper for things like a haphazardly-packed skid.
5. Real-time visibility to freight is the new standard.
The need for real-time freight visibility now the critical standard, not a nice-to-have. Choosing a platform that allows you to always know where your freight is — and when it will arrive - can be a major competitive advantage.
6. Technology is changing at a rapid pace.
In the webinar, we explored some technology developments such as collaborative robots, augmented intelligence (AI) and reality (AR), synchronous resource enablement (SRE) and self-healing warehouses. These things are here to stay and will make very real impacts on transportation and the workplace at large.
7. No industry is immune to the law of supply and demand.
Whether you're private or public, profit or non-profit, shippers that have the foresight to invest in long-term, strategic partnerships will be less affected by erratic spot market cycles.
About LeanCor Logistics:
Whether it’s simply moving your freight or managing your supply chain, we have a suite of solutions to advance your company’s performance and reduce cost.
You can focus on your core competency while our Logistics Control Center, strategy managers, and next-level technology serve as a seamless extension of your operations. Your network will be planned, controlled, and improved at the right level to best serve your customers, and your data will be leveraged in new ways for profitable decision making.
If you make it, order it, or ship it, our people, processes, and technology will ensure it’s fully visible as it arrives on time, in full, and at the right total cost.
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