If you are a logistics manager or supply chain executive, it is vital you are aware of the logistics trends affecting your department in order to stay progressive, innovative, and remain proactive in your approach to mitigate increased costs each and every year. Additionally, as a logistics professional, you undoubtedly have little time each day to read and stay up to date on these logistics trends. Fortunately, for now the 24th year, Penske Logistics, the Council of Supply Chain Management Professionals, and more specifically, Rosalyn Wilson, put out the “State Of Logistics” report.
According to Rosalyn Wilson, this year’s report, which primarily covers the previous year, 2012, but also mentions briefly some logistics trends and activities in 2013, is strikingly similar to the previous two year’s “State of Logistics” report, concluding a common theme in the last three years of slow growth as the “new normal.” Rosalyn goes on to state she foresees the next 3 to 4 years also experiencing slow growth, but sustainable growth.
The “new normal” is characterized by slow growth, namely GDP growth hovering between 2.5 to 4 percent, higher unemployment levels, higher healthcare costs for businesses and less reliable or predictable freight service as volumes rise.
This year’s report was designed to measure the cost of moving goods in the economy and the results for 2012 looked very similar to 2011 including reports on trucking, rail, air, ocean, inland waterways as well as pipelines. This index of this measure of cost of moving goods increased by 3% which is half of last year, due to virtually no growth in volume. Rosalyn raises the point that you would think with the trucking industry is at capacity, 97% of utilization, that carriers would be able to raise their rates, but in this economy, carriers are not able to do so as shippers can afford to pay more, and there is fear that shippers will just find something else.
In Rosalyn’s “State of Logistics” report covering several logistics trends such as an overview of the economy during the past year, the logistics industry’s key trends, and total U.S. logistics costs for 2012. The report also offers findings in looking forward, inventory-risk trends, manufacturing trends, as well as trucking, rail, water, and air trends. We will focus on some key bullet points in general, as well as the looking forward, trucking, and manufacturing trends below. If you’d like to buy a copy of the report from the Council of Supply Chain Management Professionals, you can go to their periodicals section on the CSCMP website.
2012 was characterized by a lack of sustained growth in the economy and by extension, the freight sector.
We wrote extensively in a two part series on manufacturing issues and manufacturing industry trends that are affecting manufacturers currently, but here are the key findings on Manufacturing Trends Rosalyn found for 2012 and the early part of 2013:
As most in the transportation industry are aware of, the New Hours of Service rules, which we explained in a previous blog post, went into affect, and then also was confirmed after appeal, on July 1st of 2013, Rosalyn spoke about how trucking trends were realized in 2012 and touches on the New HOS for her trucking findings within the logistics trends publication:
Rosalyn Wilson’s logistics trends covered in this year’s “State of Logistics” report is 50 pages long, and if you are in transportation, freight management, supply chain, or work as a logistics executive, we highly encourage you to pick up a copy and stay as informed as possible. As they say, “knowledge is power”, and when looking through the myriad of data available, it’s helpful to have an expert guide you in to knowing what metrics you should look at for key findings. What logistics trends do you expect to see on next year’s report? An upswing in the economy and manufacturing? Capacity crunches as carriers and transportation professional adjust to the new Hours of Service? Weigh in below by leaving your comment!
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