Transportation TIP List: Week of March 19th, 2017

As the spring season begins, shippers are adjusting to the seasonality of produce and retailers are incorporating warmer-weather wares into their stores. And this week’s TIP List is also in “full bloom” with stories about transformational industry trends like the launch of UberFreight and the impact of wind power on shipping. Spring into all of the stories below!

  • Uber: The Newest Entry on Your Carrier Scorecard: Uber officially launched UberFreight right after Christmas last year, but there still isn’t much information on the homepage other than its creative tagline: “We’re in for the long haul.”
  • The Next Innovation in Shipping: Wind Power: More than a century after shifting away from wind power, the shipping industry is looking at ways to harness ocean breezes once again—this time to reduce reliance on fossil fuel.

As you see new industry technologies emerge, which would you consider adopting in your organization?

Going Beyond Brokerage: How North American Capacity Solutions Can Go to Work for You

Matthew Menner
Brian Kenney

By: Matthew Menner, SVP, Strategic Account Management and Brian Kenney, SVP, Truck Brokerage, Capacity Solutions

 

With 2017 now in full swing, many companies are evaluating their current logistics strategies and looking to make structural improvements in the new year and beyond. In order to see the best return, some shippers immediately look to making significant changes such as implementing new technology solutions or redesigning their distribution network. But is your organization thinking more strategically about its capacity strategies?

It may be time to evaluate your transportation network and approach to procurement and make the move from simply fixing logistics problems as they present themselves, to a more strategic, scalable model derived from analytics and not simply rates. Don’t view procurement as a tactical, annual exercise routine (how is your new year’s resolution coming along?) item that must be completed quickly in order to meet your current customer demand at the lowest possible cost. Getting ahead of the game with creative, tailored and comprehensive capacity solutions is going to give your business the supply chain edge it needs as we head into the increasingly-uncertain future.

Your organization needs to be agile and resilient to take on the challenges of an ever-evolving industry – instead of simply moving freight at the best possible price. Here are some key questions for shippers to consider when it comes to their freight solutions:

  • Maximum modal optimization: are you using the right mode on each and every order you ship, regardless of freight flow type?
  • Do you have a resilient and “stress-able” routing guide?
  • Have you thought through your sourcing strategy to make certain you have the necessary elasticity within your capacity network employing asset, non-asset-based, dedicated fleets and opportunistic backhaul carriers?
  • Are you looking beyond the readily-available traditional truck brokerage solution? This could be more sustainable over the long run, successfully weathering the continual ebb and flow of the transportation industry cycles tied to both controllable as well as non-controllable circumstances.

It’s important to ensure that your organization has access to the transportation solutions that it needs to succeed. And with ongoing additional pressures on line-haul costs (drivers, ELDs, potential economic growth due to infrastructure spending, etc.), you also must to be able to find untapped market capacity and leverage it to your distinct advantage. Working with a partner that provides you access to carriers that compliment your network and make moving your freight faster and easier, and also has the ability to handle expedited, urgent and last-minute needs, is essential. Thinking more strategically and deploying a scalable, long-term solution is going to allow your business to go that much farther.

For example, brokers typically sell on price and will generally price every lane that a shipper has, whether they can actually service it or not – and this creates a potential exposure in a shippers’ routing guide. In contrast, a 3PL partner will be constantly looking for matches within their own dense freight network. This type of data-driven approach will ultimately identify complimentary network freight flows or fits and deliver value for both participating shippers and hauling carriers.

At Transplace, we are always looking to earn a long-term, collaborative relationship with our customers in order to provide them a customized transportation management solution that is truly tailored to their needs. Our comprehensive capacity expertise allows us to leverage our entire North American network to solve large-scale, complex supply chain problems for each and every one of our customers. Whether domestically, cross-border, collaboratively or via intermodal transportation, we can create unique, flexible capacity solutions that deliver meaningful benefits to shippers throughout all of North America.

Our experts can tap into our full-spectrum, vast network in order to craft a strategic solution tailored to each individual business, uniquely fusing together the best of our managed services and capacity solutions. Our goal for 2017 is to push even farther beyond a traditional truck brokerage services to deliver a better transportation network to our customers.

Big or small, capacity solutions are not one-size-fits-all. We’re committed to taking the building blocks of your unique business and creating a customized solution that is truly tailored to the needs of your organization. We’re working hard to leverage our actionable data and transportation management expertise to go beyond traditional brokerage and craft dynamic solutions that work for your business – today, tomorrow and beyond your expectations.

Is your organization ready to #GoBeyondBrokerage?

Transportation TIP List: Week of March 12th, 2017

With supply chain operations and logistics, sometimes you just need a little luck of the Irish – especially for those who find themselves transporting Guinness to local pubs during the week of St. Patrick’s Day. Some of the treasures highlighted in this week’s TIP list include the newest FMCSA report and a look at cross-border shipping in light of recent Mexican fuel price volatility. Grab yourself a pint and dive into the stories below!

  • Cross-border Shippers Confront Volatile Mexican Fuel Costs: As Mexico rolls out its fuel price liberalization scheme, shippers moving goods across the border and within the country are dealing with a new problem: determining the impact of fuel price volatility on their transportation costs.

As the supply chain continues to evolve, how are you adjusting your operations to best fit this dynamically-changing marketplace?

Transportation TIP List: Week of March 5th, 2017

This Sunday, Daylight Saving Time begins and we will turn the clocks ahead to “spring forward” one hour. And as we look towards the warmer weather that is soon to follow, we’re also looking ahead to the future of the transportation and supply chain industry. This week’s TIP List showcases the current status of NAFTA, President Trump’s infrastructure investment plan and more. Don’t waste any time – check out all of the articles below!

  • 5 Supply Chain Trends Happening Now: The world of supply chain management is exciting, challenging and rapidly changing. According to supply chain managers and executive leaders at a Fortune 50 company, these five trends are affecting the design and management of supply chains.
  • Robots Will Be In Retail Stores Sooner Than You Think: One of the biggest problems in retail today is what to do with the brick-and-mortar store, and retailers are facing the challenge of adding more labor into stores to offer differentiating services that can’t be meet online. Could robots be the answer?
  • 3PLs Up The Ante: Shippers rely on their 3PLs for visibility, operational control, fulfillment support, supply chain data, end-of-life product management and more. A good 3PL can be the ace in the hole to keep supply chain operations running straight and the bottom line flush.
  • 2016 North American Freight Numbers: Four out of the five major transportation modes – truck, pipeline, vessel and air – carried less U.S. freight with NAFTA partners Canada and Mexico in 2016 than in 2015. Rail is the only major mode to carry more freight with an increase of 0.2%.
  • Reverse Logistics Gets Less Reactive: Logistics professionals are realizing that a product’s journey no longer stops at the consumer’s front porch or loading dock. Now, the “U-turn” has become a vital part of every company’s revenue model.

What industry trends are you looking ahead to?

NAFTA and Mexican Free Trade: Aiding Our Neighbor to the South

By: Troy Ryley, Senior Vice President,  Mexico, Transplace

*Note: A version of this article previously appeared in the Adam Smith Project, a new initiative on trade from the publishers of American Shipper.

The North American Free Trade Agreement (NAFTA) and its effect on the United States has been a much-talked-about topic recently, and there exists a desire to either renegotiate or terminate NAFTA and implement additional taxes on goods that are made in Mexico and sold in the U.S. However, this would be an economic mistake for North America.

While there are some improvements that can be made to NAFTA, it’s on the right track to promoting free trade and driving economic growth for all of North America. Terminating NAFTA would not only eliminate the ultimate objective of free trade between the countries and increase the cost of goods, but would further damage Mexico’s already fragile economy and ultimately damage our entire North American “neighborhood.”

Ending NAFTA Destabilizes a Friendly Neighbor

Due to factors such as recent fuel price hikes and the continued devaluation of the peso, Mexico’s rather fragile economy is at a tipping point. U.S. goods are currently more expensive for Mexicans, and it is cheaper for U.S. companies to produce goods in a devaluated economy, which is why some companies have moved production to Mexico. In many ways, this has helped support the development of Mexico’s infrastructure in recent years, and hindering trade would undo the progress that has been made.

The U.S. should be looking at Mexico as our friendly neighbor down the street, and our domestic economy would be much better off with a strong middle-and-upper-class neighbor in the south, much like the one we have in Canada to the north. Doesn’t having a strong neighbor with a stable economy and growing workforce benefit all of North America?

While U.S. safety and economic stability are important, fundamentally destabilizing Mexico does not meet our objectives as a country. Free trade is the key to continued economic growth in North America. If we can make strong strides in Mexico by investing in its infrastructure and helping to create successful trade, we insulate ourselves economically and create our own successful North American trading bloc.

The Path to a Successful North American Economic Bloc

Mexico is on the path to becoming a fully modernized nation. According to the International Monetary Fund, Mexico has the 11th-highest GDP in the world based on purchasing power parity. If the U.S continues to help Mexico on this path, it could become one of the top economies in the world – assisting us in creating a solid, successful economic bloc.

This would help us be on an even plane with the European economic bloc, which has been able to accomplish much more than North America in terms of free trade. The European Union (EU) allows transportation, people and jobs to flow freely across borders – and although the EU has certainly had its problems – there is an enhanced level of sophistication in the EU trade bloc, and it is a respected competitor in innovation, design and sales merchandise across the world.

If North America could mirror this type of free trade model, more consumers would be freely purchasing goods and stimulating the U.S. economy. Ending NAFTA would dismantle the progress we’ve already made toward this type of free trade system. And for the U.S., the more stability within Mexico, the better. With a stable economy, more Mexican people will stay and work within their home country – increasing trade and the buying power on the part of Mexicans to consume U.S. goods. We’re not going to be able to sell our goods to a nation with crumbling infrastructure, devalued currency and lack of jobs. Let’s not be shortsighted. Let’s keep developing a North America that supports trade and builds a strong infrastructure and economy for Mexico, Canada and the U.S.

How would continued free trade with Mexico impact your organization?

Transportation TIP List: A Presentation of This Week’s Top Industry Trends

Week of February 26th, 2017

Over the weekend, the film industry celebrated this past year’s greatest pictures at the Oscars. In this week’s TIP List, let us present you with the supply chain and transportation trends you need to know – including articles that address new clarifications for implementing ELDs, supply chain automation trends and a new trade agreement from the WTO. Grab a bag of popcorn and let’s start the show!

  • States Push to Raise Gasoline Taxes: Nearly 20 states with both Republican and Democratic governors have raised gas taxes or recalculated gas-tax formulas in recent years to generate funds for upgrades to aging roads and bridges.

What transportation trends are you watching this week?

Transportation TIP List: This Week’s Leading Transportation Industry Trends

Week of February 19th, 2017

The celebration of President’s Day this week was the perfect time to recognize the country’s most inspirational leaders. And the holiday had us thinking about the nation’s top visionaries as we curated this week’s TIP List, which showcases trends that are influencing and shaping the transportation industry. Read on to see what’s leading the way, including stories about the future of retail brick and mortar stores, the growth of drone technology and the uncertainty of NAFTA.

  • What if Retail Traffic Declines Last Forever?: The results keep pouring in, and they don’t bode well for brick and mortar retail. Across just about every sector and virtually every time period, physical store traffic continues to decline.
  • Mexican Trucking Past U.S. Border in Crosshairs: A controversial NAFTA plank allowing Mexican truckers to haul goods deep into the U.S. is in the crosshairs as the Trump administration prepares to redo the trade agreement and a court challenge proceeds next month.
  • Making a Run for the Border: Although the future of NAFTA is uncertain and trade challenges remain, Mexico continues to attract foreign companies looking for easier access to the huge U.S. consumer base.
  • Panama Canal Sets New Monthly Tonnage Record: In January 2017, the Panama Canal set a new monthly tonnage record of 36.1 million Panama Canal tons, with the transit of 1,260 ships through both the original and expanded locks.
  • Hanjin Shipping is Declared Bankrupt: All that remains of the stricken Hanjin Shipping Co. will be liquidated after a court order confirmed the demise of the former giant that helped drive South Korea’s economic rise, but has finally succumbed to its ocean of debt.

What transportation trends do you think are leading the charge this week?

Supply Chain 2017: Important Transportation Trends and Challenges

By: Frank McGuigan, President & Chief Operating Officer, Transplace

There’s never a dull moment in the supply chain. That statement seems especially true thus far in 2017. We’re just over a month into the new year and there is already a myriad of questions about the market, the business landscape and how companies will be affected going forward. With issues such as changes to global trade deals, regulations and fluctuating capacity, we are quite certain that there will be an impact on the supply chain in 2017, and beyond, making it is vital for shippers, carriers and logistics service providers to keep a pulse on what’s going on in the industry.

The New Administration and Trade

There was a lot of talk leading up to the presidential election concerning changes that would be made to the United States’ trade agreements with other countries. And within the first week of the new administration, we have already started seeing those changes come to fruition. The U.S. pulled out of the Trans-Pacific Partnership (TPP) and has escalated talks around renegotiating NAFTA or implementing a border tax.

Pulling out of TPP was not a surprise, but it doesn’t mean that the U.S. won’t be trading with partners in Asia, it just means that we won’t be signing a large and comprehensive trade pact with that region and we’ll rely on individual relationships with trading partners in that part of the globe. That might happen with NAFTA as well, but it’s far too early to tell. Right now, it appears that we’re examining all of our trade agreements to see if there are better deals out there for the U.S.

While some of the rhetoric is disconcerting, I don’t anticipate a significant near-term impact. Mexico and Canada are our two largest exporting partners, and those relationships create a significant number of jobs in the U.S., so maintaining trade relationships is in the best interest for everyone involved.

So as we’re all eagerly watching to see how the process takes shape, supply chain leaders are beginning to think about the potential impact of tariffs on their goods and evaluating their networks. They’re considering questions such as: Could my current supplier network be exposed? Do I need to reengineer my supplier network? What are the corresponding logistics issues that would accompany the reengineering of my supplier base?

While it will likely take some time before there is any immediate impact on U.S. logistics networks, it’s prudent for shippers to be proactive and walk through “what if” scenarios if tariffs come into play, or more manufacturing comes back to the US.

The Impact of Regulations

Regulatory change has been at the forefront of the transportation industry in recent years. Whether it’s CSA, HOS, ELDs, and now obstructive sleep apnea, these issues seem to leave more questions than answers. While we can all align in the pursuit to make the transportation industry safer, we must also recognize the overall impact of these regulations on the industry. Can carriers afford the change? Will drivers and carriers leave the market? What is the impact to capacity?

While the new administration appears to be pro-business, it remains to be seen what stance they will take related to transportation. As in previous years, it’s important for shippers to keep an eye on the regulations and proactively plan for the potential impact they could have on productivity and capacity. It is important to look at strategies to diversify your carrier base or modal mix to be able to adjust to changes in capacity.

Shippers have benefited from lower fuel costs and abundant capacity over the last 18 months, but many indicators suggest that there is a tightening of capacity in the coming year. If the economy and industrial production, specifically, continues along the trend line that we saw in Q4 2016, we can expect capacity to tighten and place upwards pressure on rates.

Technology Innovation is Enabling Visibility and Optimization

Innovation in logistics never stops. While autonomous trucks and “Uber of Trucking” companies have dominated the headlines, the exact impact has yet to be seen. We will actually have a chance to monitor the service and cost impact of some of these innovations in our network this year, so stay tuned. Last, though driverless trucks are likely closer than we think (plus/minus 5 years), it is too early to understand how they will be used and the resultant impact on the transportation networks of our shippers.

While there is an appetite for information on those emerging trends, shippers are placing even greater focus on expanding the capabilities and functionality of their transportation management system (TMS). Specifically, gaining real-time visibility of shipments and access to real-time data and reporting. Shippers want to see live performance on what is going on in their network – both inbound and outbound. This is especially true in service intensive industries, where visibility is critical for effective planning, communication and inventory management.

Regional control towers provide shippers the level of visibility – across North America or globally – that enables them to really “see” their network and make data-driven decisions regarding inventory, mode, lane, carrier selection and cost. Understanding all of those modes and hand-offs enables network optimization, effective procurement and with a greater level of data and engineering, the best possible service-cost logistics network.

Now is the Time to Plan Ahead

Although we are planning for measured capacity tightening, we don’t expect the market to take significant twists and turns this year. And with the uncertainty around the exact impact that changes to trade agreements and regulation will have on the supply chain, if you haven’t already, now is the time to evaluate your supplier base and transportation network and collaborate with your strategic partners in order to ready your supply chain for a period that will be leaner than it has been over the last 18 months.

How has your organization proactively planned for possible transportation challenges in 2017?

Transportation TIP List: This Week’s Industry Trends You’re Sure to Love

Week of February 12th, 2017

With Valentine’s Day taking place yesterday, sweets, greeting cards and roses are just a few of the highlights that Cupid has in store for this week’s loving holiday. And along with all of those charming holiday gifts, this week’s TIP List is here to embrace the latest transportation industry trends. With stories on recent transportation regulations, the future of the TMS market and much more, we’re sure you’re going to love all of the articles below!

  • Trump Reg Rollback Could Derail Switching Rule:The Trump administration’s recent regulatory rollback has thrown into question the future of a long-standing push by shippers seeking to move their freight from one rail line to another nearby network.
  • A Sneak Peak Into the Future of the TMS Market: Alternative solutions for a traditional TMS, including the use of LSPs, transportation execution systems and “free” TMS, are just a few factors that could inhibit the long-term future of the TMS market.
  • Diesel Price Holds: The price of diesel fuel remained flat during the week ending Feb. 6, dropping by just four-tenths of a cent. The average price of a gallon of on-highway diesel is now $2.558 nationwide following the fourth consecutive week of falling prices.

What top industry trends are you embracing this week?

TransMATCH Success: SMC³ Alliance Award 2017

There is an enormous amount of collaboration and planning involved when implementing a seamless multi-stop truckload solution across numerous shippers – but when done right, it can yield some stellar results. Transplace is honored to have been awarded the 2017 SMC³ Alliance Award at the Jump Start 2017 Conference last month for the results it has seen from its TransMATCH program, in partnership with Best Solution Express and Glanbia Performance Nutrition.

The Alliance Award recognizes successful partnerships that use innovative problem-solving and continuous improvement tactics to achieve valuable results. Alliance is unique in that it measures collaboration and partnership, recognizing each individual player contributing to overall supply chain excellence.

 

The Transplace TransMATCH team, pictured from left to right (Greg Umstead, Kurt Hepker (Glanbia) and Matt Lowery). Also on the team (not pictured) Jack Dierks, Phil Golike and Zachary Chopp.

 

To celebrate this award, we wanted to share some of the key challenges and results of the successful partnership between Transplace, Best Solution Express and Glanbia:

The challenge that led to the formation of the partnership: As Glanbia’s 3PL provider, Transplace determined that Glanbia’s claims ratios were greater than the industry average, which offered a starting point to help reduce its overall transportation costs and enhance efficiency.

Transplace immediately enabled processes to help reduce the claims ratio – and implementing its TransMATCH program helped to reduce it even further. With TransMATCH, Transplace created multi-stop shipments within Glanbia’s network and determined opportunities outside of Glanbia’s network to achieve the benefits of multi-stop truckloads. Best Solution’s network and service was quickly identified as a premiere carrier to partner with for this program.

The specific goals of creating this project:

  • Reducing cost
  • Reducing claims ratio
  • Reducing handling and exposure to outside risks.
  • Improving transit time and on-time percentage to consignees

Collaboration among Transplace, Glanbia and Best Solutions was critical to achieving the goals set for the program, but there was additional collaboration needed with other shippers within the TransMATCH program. Using its enhanced visibility of Glanbia’s entire transportation network, the Transplace team determined eligible shipments and identified viable candidates for those shipments. Then, a multi-stop truckload solution was created with Transplace’s proprietary transportation management solution (TMS).

Best Solution’s nationwide carrier network was able to support Transplace and Glanbia’s unique needs, and their driver base is able to accommodate the necessary numerous stops and handling – a unique service that is not typical among truckload carriers.

The proven results and benefits of this partnership: The positive results of the collaboration have been realized through reduced transit time, improved on-time percentage, reduced damage and a decrease in costs. The program saw immediate success in terms of improved visibility across shipments with all parties collaborating and consolidating efforts within Glanbia’s network. Additionally, as the program progresses, more of Glanbia’s shipments will be included within the project, leading to greater improvements.

Transplace has helped Glanbia reduce its overall transportation network costs and improve customer satisfaction, ultimately leading to improved sales and growth. Glanbia’s supply chain has been positively impacted through this program and it has been able to deliver to customers faster and more efficiently while providing security to its products.

There were many lessons learned throughout the development of this program, but open and honest communication among all partners was certainly the most significant aspect its success.

A special thank you to Best Solution Express, Glanbia and SMC³ !