Transportation Trend Manifest

2018 Transportation Trend Manifest

Predictions about the truck freight industry can often wind up as flattened debris under the variable forces that both drive and put the brakes on our business. Next Exit Logistics is in the business of planning and preparing for both the seen and the unforeseen, executing the shipping of what many would believe to be impossible loads. Therefore, it would be an oversight to not offer a few broad stroke divinations that we believe you should at least keep an eye on, if not include into your coming year’s calculations.

Logistics Labor Shortages Will Continue

Just after the turn of the new year, the US Bureau of Labor Statistics reported that the December 2017 unemployment rate remained unchanged at a 17-year low of 4.1 percent. Economists polled by Reuters warned that roughly a million jobs would need to be created every month to keep pace with the growing working-age population. The year’s long logistics labor shortage shows nary a signs of abating. Here’s why:

In 2015, the authors of the 19th Annual Third-Party Logistics Study reported that over the next decade 60 million employees will leave the US supply chain industry, from warehouse to trucking, but that only 40 million were expected to join. To compound the challenge, supply chain jobs are not only forecast to increase by 25 percent, but they will need to be filled by candidates with digital skills. Make no mistake. This is not simply a shipper-side issue, as big motor carriers have seen their driver turnover rate rise to 95 percent in the third quarter of 2017, according to the American Trucking Association’s latest report.

Rising Trucking Spot Market Rates

The above-described labor shortage is leading all in the supply chain industry to offer higher wages and look for recruits in underrepresented labor pools, such as women and military veterans. Seeing the opportunity, venture capitalists are backing startups that are developing warehouse robots, while more established technology leaders and truck manufacturers are investing heavily in driverless technologies. Until either these technologies are market ready, more people join the industry, or both, available freight spot market rate will rise.

In 2017, van load-to-truck spot rates shot north by 22 percent, according to DAT, which closely monitors freight market trends. Labor costs are only part of the picture: the ELD (Electronic Logging Device) mandate, the skyrocketing e-commerce shipping volumes (Walmart just announced it’s converting 63 Sam’s Club stores into distribution centers), and an increase in activity in the construction sector has intensified competition for capacity. Shippers should expect to pay a premium for capacity assurance and reliability.

Digital Technology – Believe the Hype

Forget the idea that digital technologies are “emerging.” They’re here, invading every aspect of our industry, and setting the conditions for an industry-wide disruption that will decide winners and losers no less efficiently than Hogwarts School of Witchcraft and Wizardry’s Sorting Hat.

Tesla’s Class 8 Semi, in which auto-drive is standard, already has orders from UPS, Budweiser, Sysco and more. Blockchain software is expected to combine with digital transmitting sensors to track goods, containers, and available space, and monitor weight distribution and control temperature from a variety of devices. And then there are autonomous robots, machine learning, and the Internet of Things (IoT). Resistance is futile.

Physical Internet

While this will not affect our industry this year, it is worth getting this on our collective radars and in some cases getting involved in shaping the Physical Internet or PI. Benoit Montreuil, who coined the term PI, leads the International Physical Internet Initiative. He describes PI as, “ a global logistics system based on the interconnection of logistic networks by a standardized set of collaboration protocols, modular containers, and smart interfaces for increased efficiency and sustainability.”

What Benoit is describing is a systematic logistics network through which loads packaged in standardized modular containers, equipped with sensors, Blockchain computing power, and wireless communications, will become semi-autonomous and self-directing. With machine learning these containers will be able to identify onboard cargo, navigate through the warehouse, and connect with transportation to reach a designated destination. There’s already an ongoing trial in Austria, which has no shortage of logistical challenges.

How to keep control over shipments? Because Blockchain’s data encryption is unassailable, not only will all logistics collaboration and transactions be secured, the actual shipment cannot be hijacked by a kid sitting at his home computer. BitCoin employs Blockchain specifically because of the strength of the data encryption. In the US, the Blockchain in Transport Alliance (BiTA, formerly called the Blockchain in Trucking Alliance) has assembled a membership to include leaders in trucking, shipping, logistics brokers, warehousing, technology and more. TransRisk’s CEO and BiTA’s Managing Director Craig Fuller says, “BiTA’s mission is to solve industry pain points.”

At Next Exit Logistics, our entire business model is focused on relieving shippers of transportation pain points now, in the coming year, and in the future. We can arrange the shipping of any item; we specialize in providing freight services for unusual and impossible oversize or overweight shipments! Our customers say that time and again, Next Exit Logistics eliminates frustration by managing the freight shipping process from beginning to end.

Our seasoned background as a freight management brokerage is backed by our safety and on time track record for organizing the movement of heavy haul freight quickly and efficiently. What’s more, we are certified to arrange the shipment of hazardous materials.

To learn more about our services, call Next Exit Logistics at 866-624-2661. You can also contact us via e-mail.

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