Hot Take
The current driver pool has drivers reaching retirement age or leaving the industry due to poor working conditions, concerns about their health, too many regulations — the list is endless. Being a truck driver is hard work. Young people are starting to get into the field, but many say it’s not fast enough to replace the number of drivers leaving the industry.
There are fewer drivers on the road every day, but the good news is more people are turning to the industry as a career. Women in trucking have increased their numbers, as well as younger adults in lieu of attending college. There are strong carrier networks to be had.
A strong carrier network with reliable carriers is going to be the key moving forward. The spot board and one-off loads will never disappear. That’s the money maker. However, to reliably serve customers long term, having that strong carrier network is going to reduce the insane rates to your customer and help with the bottom line.
Some jump right to a digital freight matching system that pairs available carriers in the same area as your freight. From there it’s up to the individual to form the relationship or treat it as a one-and-done load. The software from Parade, Carrier Direct, etc. can get you started on finding new carriers for specific lanes in your network. From there it’s about what you can offer. We are going to highlight some of the creative ways people are ensuring they have a strong carrier network.
We’re at a spot now where the power in supply chains lies in the carriers and drivers. That said, if you have a shipper that has developed a reputation for being difficult, you might have to have a conversation with the shipper about easing some of the driver frustrations or expect to pay more money to get carriers to go into its facilities.
If you have a shipper that is continuously keeping carriers for three to six hours to load, drivers don’t get to claim detention till typically two hours, meaning they are working for free for two hours, and they can’t turn another load that day since they’ve wasted time waiting to get loaded and scale out of a shipper’s facility.
We can’t do anything about the issues with state troopers looking for any reason to ticket a carrier, but what we can do is help our shippers be more efficient. Help stage shipments based on appointment times; stagger loading times so you don’t have 10 trucks show up at one time and the crew to only load four of them at once. Make it less of a hassle for drivers to check in at guard shacks. We can’t solve all the problems but we can cut down on time wasted at shippers’ facilities.
Quick Hits
Agriculture exporters have hit their frustration limit. Produce and protein shippers have lost business since the pandemic because shipping lines have stranded perishable cargo at the ports and inland ports. Imports are more profitable for carriers and exports are typically seen as something to cover the cost of going back to Asia. Unfortunately as a result of import shipping rates six to 10 times higher than normal, most carriers are skipping their export pickups on the West Coast in favor of getting reloaded faster in Asia.
The Port of Oakland is one of the largest U.S. gateways for agriculture exports. Pre-COVID there were 2.5-to-1 imports to export loads; that rate now is 4-to-1. Now Oakland isn’t quite the same as the ports of Los Angeles and Long Beach. It’s taking a new approach to get maritime shippers and domestic truck drivers interested in it. The hook? Turnaround time.
The Port of Oakland has set up a 25-acre staging area on port property for empty containers to be stacked and made available for those ag exporters. That combined with its little to no congestion for drivers to come into the port means we could really free up some space and get those agricultural exports out in a timely manner so McDonald’s doesn’t have to charter planes to get potatoes in its stores.
Market Check
Imports to the Port of Oakland are at the lowest for January over the past two years. Spiking in the middle of December to new heights, there is no doubt that the Port of Oakland is being underutilized and can be doing more to ease the West Coast port congestion.
If you have a shipper that imports into the U.S. on the West Coast, see if its carrier would be interested in Oakland instead of LA or Long Beach. It’s easier for drivers to get in and out of the ports, ships don’t have to wait for 40 days, and there are plentiful exports to be taken back to Asia, making it a win-win for everyone. In this market it wouldn’t likely warrant a backhaul discount, but it might not be as expensive as going into the port of LA/Long Beach … the keyword there is might.
Who’s with who
American Eagle Outfitters has acquired Quiet Logistics for $360 million. In an effort to overhaul its supply chain, the company is going for the transportation costs. This acquisition will help American Eagle offer same-day and next-day shipping to customers from American Eagle stores. Quiet Logistics operates in-market fulfillment centers across the country and will become a wholly owned subsidiary of American Eagle as the two run independently.
Schneider has acquired Midwest Logistics Systems for approximately $263 million. MLS operates a fleet of 900 tractors and generates $205 million in annual revenue. MLS will continue to run as an independent subsidiary through Schneider’s dedicated segment. This acquisition puts Schneider on track to generate $1 billion annually.
The more you know
Container shipping heads to court: Who’s suing whom?
Modern Shipper’s Top 10: E-commerce
Central Freight Lines truckers: Final paychecks came too late for Christmas
Colorado governor reduces truck driver’s sentence to 10 years