A few days into 2022, I’d like to reflect on the past year and what’s ahead for shipping. Last year continued to be tumultuous as major supply chain issues remained, but for some, those challenges led to opportunities to reset and adjust. To remain agile as backlogs and capacity issues tightened, many shippers and 3PLs turned to their technology partners for help.
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Technology and automation have helped make significant advancements in the supply chain and shipping industry. However, shippers and 3PLs need to understand that a human touch remains a critical element in keeping a supply chain functioning properly. The two must work together in a hybrid approach.
The ever-changing landscape of the transportation industry continues to force shippers and 3PLs alike to, once again, evaluate their processes, efficiencies, and business objectives for the coming year. With little to no relief in sight to help manage the growing supply chain challenges, it’s critical now more than ever to look to technology solutions to help streamline efficiencies and manage costs to combat the most basic of industry challenges… labor shortages and rising costs.
Rising carrier costs directly related to capacity constraints and elevated fuel costs are making it difficult for 3PLs and shippers to control shipping costs. The Journal of Commerce says shippers are preparing for another year of elevated less-than-truckload (LTL) rates and tight capacity, as a 2022 surge in demand from consumers, retailers, and manufacturers looks increasingly likely.
With great challenges comes the opportunity for change and growth. It forces you to think outside the box and deploy new tactics to overcome disruptions. With no end in sight for the current challenges in the supply chain, you may want to take another look at implementing a technology solution that will help you conquer those issues. Technology can enhance your visibility and efficiency while helping to control your freight costs to more effectively manage your shipping needs.
In what’s considered a “carrier’s market”, Shippers and 3PLs are scrambling to secure carriers to pick up and deliver their freight. Many are paying premiums in tight capacity lanes because carriers can be selective in what they move and how much they charge.
Wouldn’t it be nice if we could see what the future of freight and the supply chain will be in 2022? Industry experts predict that we will still see backlogs of shipments, labor shortages, capacity issues, rate increases, and lack of warehouse space at least within the first few months of the year. If only we had a way to determine how to navigate these issues or some type of crystal ball that we could use to help us predict where we will be six months or a year from now, we could more efficiently and effectively plan for the course ahead.
This year remains a challenge for the supply chain. Labor shortages and carrier capacity are ongoing issues, and lane restrictions and rates continue to steadily increase with no end in sight. According to The Washington Post, fallout from the COVID-19 pandemic exacerbated increases in freight bills and delivery delays throughout 2021.
Shippers and 3PLs have welcomed the transparency offered to the freight management industry through pricing APIs, particularly the savings they get when taking advantage of real-time carrier rates rather than relying on dated methods for securing pricing. There’s also the hidden benefit of an instant competitive advantage when competitors using outmoded legacy processes secure outdated rates from carriers. This means pricing API users are spending less on shipping and increasing profit margins while gaining a competitive edge with freight costs.
