On-time delivery of land freight despite labor shortage!

The pandemic may be over, but its effects may linger well into the years to come.

One of the biggest challenges of the pandemic is the labor shortage and its impact on multiple industries, including logistics companies. Manufacturers and shippers face enormous hurdles due to supply chain disruptions, low capacity and skyrocketing fuel costs.

Luckily, strategic planning can help you deliver your land freight on time despite the copious labor shortage.

Understand the labor shortage

Job openings peaked at 11.5 million in March 2022, according to the Bureau of Labor Statistics. Among these job vacancies, durable goods manufacturing is one of the sectors with the most unfilled jobs compared to skilled workers – a shortage that creates challenges for supply chains.

Technology and innovation can help meet the demands, but that creates other jobs that require skilled labor to fully exploit them.

The domino effect of the shortage is affecting other industries. Employers need to offer higher wages to attract in-demand talent, which in turn increases the prices of products. Demand is still high, but employers lack the necessary manpower to meet them, increasing lead times.

Low land freight capacity

Low capacity is an ongoing problem for shippers, but the ongoing impact of the pandemic, current labor shortages and driver shortages make that clear. There is an increasing demand for raw materials and products and insufficient drivers to ship products.

These challenges are detrimental to on-time deliveries. Consumers want fast, accurate and direct shipments, leading LTL carriers to adapt their distribution networks to better address multi-location fulfillment.

LTL networks need to improve efficiency and reduce costs without sacrificing customer service. Consumers have high expectations for order fulfillment, shipping, and delivery, and LTL can meet those expectations with small freights.

Fuel prices are also increasing, increasing the price of goods and shipping costs. These fuel price increases are expected to continue in the near future, hence commodity prices are expected to follow suit.

Solutions for on-time delivery of land freight

Adapting to challenges and requirements is part of the logistics industry. Despite rising prices, labor shortages and limited freight capacity, shippers and freight forwarders can increase efficiency and provide better service to customers with the right planning.

Optimize routes

Road freight transport can be too complex, time-consuming or expensive given the current challenges in the supply chain. If this is the case, shippers can combine land delivery with other freight options, e.g. B. Rail freight for shipments with lower demand.

These options have their pros and cons. For example, rail freight is slower but often cheaper than land freight. Air freight is ideal for high-value and time-sensitive goods, but can be too costly for some shipments.

Creating a bespoke combination of LTL, PTL, air and rail provides a flexible, optimized route for on-time deliveries with fewer disruptions. It is important that the solution maximizes opportunities within your network while minimizing challenges and costs.

consolidate shipments

Freight consolidation provides a solution for storing and shipping freight. A manageable supply chain offers more efficiencies than a distributed network of partner warehouses, suppliers and shipments.

Supplier and vendor consolidation reduces the number of suppliers required to source and purchase goods or materials. This can be done by reducing the total number of suppliers in the network or by choosing local suppliers. Both options create opportunities for better consistency, improved risk management, and better professional relationships.

LTL and part truck (PTL) shipments also contribute to on-time deliveries, efficiency and shipping costs. LTL shares space with other companies while PTL keeps all goods on the same load. A tailored solution that includes both options means fewer truckloads go out and high-value shipments get priority.

Shippers can also consolidate warehouses to ensure efficiencies across operations. Less warehouse space reduces overhead, while shipments coming in and going from a single location improve efficiency. This option also improves quality and consistency.

Development and maintenance of strong carrier partnerships

Shippers and carriers can develop and maintain strong professional partnerships to manage supply chain disruptions and contribute to each other’s success. Shippers benefit from new freight options and better negotiations.

However, these partnerships should not be taken lightly. The benefits in terms of cost, time and effort should outweigh the cost and effort. Partnership development or reconfiguration should improve inventory distribution, the shipping process, cost, or any other aspect of the network without sacrificing efficiency, reliability, or customer service.

Contact an external logistics provider

Supply chain disruptions are likely to persist for now, forcing companies to find innovative solutions to deal with them. Partnering with an external logistics provider gives you access to best-in-class technology solutions and a vast network of carriers and warehouses to improve efficiency, reduce costs and stay agile.

Author Bio: Bill Heaney

“Bill Heaney is CCO of DB Schenker USA, a 150-year leading global freight forwarder and 3PL provider. Bill Heaney is responsible for all commercial strategy and operations in the United States, which consists of over 7,000 employees at 39 trucking locations and 55 fulfillment centers.”

Land Freight article and permission for publication here provided by Bill Heaney. Originally written for Supply Chain Game Changer and published on May 19, 2022.

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