Researchers shared the preliminary
results of their deep dive into 21st century freight transportation challenges
last fall in a panel at CSCMP’s annual conference. They were joined
by representatives from several
major shippers, who shared stories about how they survived the
stormy supply chain weather
of 2018. And to no one’s surprise, the first topic was the
trucking capacity crisis.
COPING WITH THE
CAPACITY SQUEEZE
Anyone who managed
freight transportation in 2018
felt the pain of the capacity
crunch, exacerbated by both
the driver shortage and the
initial fallout from the federal
electronic logging device (ELD)
mandate, according to panelists
at the CSCMP event. The shortage
sent shipping rates soaring, left loads
sitting on docks waiting for a truck,
and even stranded some cargo altogether, said John Janson, global logistics
director at SanMar, an apparel and fashion
retailer based in Issaquah, Wash.
“There has been an immense capacity challenge
in the truckload industry, spilling down into the less-than-truckload (LTL) [sector] and moving all the way
down into parcel. And I think it really has changed how
we as a company go to market, how we contract with
truckers, and how we deal with our carriers,” Janson
said. “For the past year, my domestic team has literally
had their sales hats on; we’re out calling on the carriers,
saying ‘Wouldn’t you like to do business with SanMar?
Here’s why we’d make a great customer for you.’ You
want to be a shipper of choice.”
SanMar’s efforts to expand its carrier base haven’t
stopped there. “We’ve gone out to several of the confer-
ences. Anywhere where there’s been trucking companies,
my team has been walking around with a sign saying ‘We
spend millions of dollars; will you be my friend?’” Janson
said. “And for the most part, we’re doing OK. But we’re
having to work a lot harder at it. Nobody’s back here just
tapping a button and booking loads.”
As for other coping strategies in play, some shippers
are stockpiling inventory across their DC networks in
a bid to reduce their reliance on trucks, said panelist
Russell Verhovec, senior vice president, supply chain,
at Seal Shield, a Jacksonville, Fla.-based manufacturer
of infection control devices and antimicrobial science
products. Still others are fine-tuning their DC loading
and unloading operations in an effort to get drivers in
and out faster, or even outsourcing some transporta-
tion functions to a third-party logistics service provider
(3PL), he said.
Another panelist noted that when it comes to man-
aging transportation challenges, the venerable trans-
portation management system (TMS) remains one of
the most effective tools available today. “A robust TMS
is still a good tool and a necessary tool for managing
transportation operations, in everything from tendering
[freight] to carriers to communicating delivery delays,”
said Terri Reid, director of transportation at Caleres
Inc., an apparel and fashion retailer based in St. Louis,
Mo. “But one caveat is it can’t stand alone. It has to be
integrated with all of your other visibility and operating
systems in order to really be [effective].”
In the coming years, shippers expect to have more
digital tools at their disposal. These include visibility
dashboards with predictive indicators, blockchain data
sharing to streamline business processes, and cloud-
based software integration to simplify the adoption of
the new technologies, the panelists said.
In fact, predictive visibility tools are already proving
their value in some operations, according to the panelists. Verhovec cited Seal Shield’s experience with them as
an example. “When we were moving our first container
from Taiwan to the U.S., we could tell that the ship was
going to be delayed at the Panama Canal about seven
days before it arrived in Jacksonville,” he said. That
advance knowledge enabled the company to take steps
to mitigate the effects of the delay, he added.
WHAT’S ON THE HORIZON
In the meantime, the search for longer-term solutions
is already under way, according to Auburn University’s
Gibson. As part of the Logistics 2030 study, researchers
