Check Call: Small and medium-size businesses have strong feelings about 2025

Another year and another season of trying to keep a supply chain resilient and ready – and trying to figure out what the year will look like. Most recently DHL Express released a survey of what hundreds of small and medium-size enterprises are planning for a 2025 that promises to be unpredictable.

Overall everyone seems pretty optimistic as to the overall performance of 2025 versus 2024. Sixty-seven percent are anticipating better performance in 2025, despite the uncertainty of possible new regulations, policies and geopolitical factors.

The most-watched thing for small to medium-size enterprises isn’t a massive surprise, as it seems everyone from consumers to Fortune 500 companies are on tariff watch. The incoming presidential administration has talked at length about imposing tariffs, and with the actual percentages of tariffs still uncertain, it is the top focus of 67% of those surveyed.

The survey finds, “While 40% of businesses are still evaluating how regulatory and policy changes will impact their growth, there is a divided outlook on the potential effects. 24% believe regulatory changes could negatively impact growth, while 20% see these changes as having a positive impact. Notably, trade regulations (67%) are considered the most important area of regulatory change for businesses in 2025, signaling the ongoing importance of international trade considerations.”

It’s only two weeks into the new year, and 30% of those surveyed expect to make minor adjustments to their supply chain strategies for 2024. An impressive 13% are ready to significantly adjust their approach. That leaves 57% looking to keep strategies the same regardless of what may happen.

When it comes to growth, which is what everyone wants to hear about their shippers,40% of survey respondents said the biggest opportunities will be expansion into new markets. A substantial 31% said economic improvement and implementing new technologies (14%) are the top areas for growth.

2025 seems to be a year of testing the resiliency of the supply chain and shippers’ ability to adapt to new strategies. It will come down to how quickly logistics service providers are able to adapt to new policies, regulations and who knows what else.

TRAC Tuesday. This week’s TRAC lane goes from Philadelphia to Chicago – two large freight markets with a pretty tight load balance. The one good thing about this lane is that spot rates are relatively low compared to the National Truckload Index. The rate per mile for this lane is only $1.62 compared to the NTI, which is almost a dollar more at $2.55.

Both Philadelphia and Chicago have remained relatively stable in regard to outbound tender rejections – at less than a 30-basis-point change week over week. The long-haul lane has historically been one that carriers are a little more hesitant to accept. As a result, spot rates might have to come up a little bit to get carriers on board with the 758-mile trek.

Who’s with whom. The endless war rages on – namely, the war over whether brokers can be held liable when carriers they hire are involved in accidents or other incidents. The most recent update in the argument started with another tick in favor of 3PLs and freight brokers with a ruling from the 7th U.S. Circuit Court of Appeals. The issue was again brought to the Supreme Court, which, for the third time now, has declined to take it up.

The most recent rejection comes on the heels of both the plaintiff and the defendant in a case asking the Supreme Court to review the lower courts’ findings. In a FreightWaves article by John Kingston, he explains why: “In its request for certiorari, TQL said the 11th U.S. Circuit Court of Appeals was correct in its ruling protecting the 3PL. But with conflicting circuit decisions, TQL wrote in its request that ‘the question presented is one of considerable importance to the transportation industry.’”

The major sticking point seems to revolve around carriers being “agents” for brokers versus “independent contractors.” When a carrier can be classified as an agent for the broker, that’s when liability is more often found with the broker. The main test for the definition of the relationship is whether the broker retained the right to control the manner of delivery, as well as hiring decisions, and a host of other factors.

With two circuit courts in favor of 3PLs and one – the 9th Circuit – against, fault in instances like these is truly on a court-by-court basis. There is legal precedent for either outcome. So, while the Supreme Court doesn’t want to weigh in on this battle yet, someday I imagine it will have to.

The one consensus that the lower courts have identified is that it’s all in how the relationship is defined between carriers and brokers when the load is awarded.