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Keeping the workforce happy has always been a critical concern for business owners and supply chain leaders. In this context, finding and securing the right carriers forms a significant portion of managing truckload carriers. Meanwhile, above-average truckload demand, notes Inbound Logistics, will push available truckload servicers to the tipping points. As a result, shippers will find themselves with fewer carriers available to move freight and higher costs, especially for spot rates. To keep freight spend under control, shippers need to understand why truckload carriers avoid them, how truckload can benefit an operation, and a few tips to secure more truckload capacity.
The problems associated with keeping and finding truckload carriers are simple. Shippers have a perception that truckload drivers exist only to move freight. While this notion is partially true, shippers must realize truckers have much more bargaining power than they realize. Failure to meet trucker expectations, including loading trucks on time, permitting entry to the yard as expected, keeping truckers informed of potential delays and other factors, may lead to a refusal to service your dock. This problem is amplified for shippers that are “out of the way.” In other words, shippers that are less likely to offer return hauls for delivered freight will fall to the bottom of the list.
Full truckload remains a mode of transportation that’s in high demand. According to FreightWaves, the 2019 shipping market deepened the divides between large enterprise carriers and smaller, regional carriers. In response, spot market rates have grown more inconsistent, following changes in demand. It is a precarious situation. Volumes were close to 2018 Peak levels through May, and volumes have remained within 3% of 2018 values. At the same time, fears over the capacity shortage and the driver shortage led to the investment in more capacity. Unfortunately, available capacity does not equal available drivers. More importantly, spot rates for full truckload have dwindled through the summer months, but those rates will bounce back in response to the coming peak season. Another factor affects rates, as well.
Increasing oil barrel averages, 32%, have pushed retail diesel prices upward. This will catalyze an increase in general rates, as well as peak season surcharges. However, truckload remains the most cost-effective means of moving freight, especially when using freight consolidation and deconsolidation to take advantage of lower costs. In other words, the available drivers and expenses associated with full truckload are much less stressful than relying solely on parcel or LTL carriers. Remember, LTL carriers and parcel servicers may add additional surcharges for moving freight that goes beyond their typical limits.
Instead of resorting to leveraging LTL and parcel carriers exclusively, shippers need a few tips to attract and retain truckload carriers:
Truckload carriers have ample capacity, but they may lack the drivers to move your freight. Unfortunately, failure to take advantage of carriers that leverage full truckload will result in higher freight spend and even the threat of freight pickup refusal. Instead of risking your enterprise on the uncertainties, secure more truckload carriers within your supply chain. Above all else, consider investing in an all-mode capable TMS. This is of the utmost importance for those that routinely send large volumes of freight through both parcel and LTL carriers, as well.
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