2014 Traffic Costs Industry $49.6 Billion. US highway traffic congestion added billions of dollars in operational costs for the trucking industry. More than a dozen states experienced congestion costs of more than $1 billion. 89% of the congestion happened on 12% of roads. The ATRI’s analysis showed that trucks were delayed more than 728 million hours.
7 in 10 to Accelerate Warehouse Technology. More than 40% of IT and operations decision makers cite shorter delivery time as a key measure to wanting warehouse technology. By 2020, respondents plan to make investments in increasing the volume of items shipped (76%), equipping staff with technology (73%), and Internet of Things (62%). (Read why warehouse technology is the first step to fast shipping here.)
Climate Change and Transportation. Datamyne is encouraging logistics managers to consider the effects of climate change as rising temperatures change products and shift import-export volumes. (Find out more about potential climate change disruptions here.)
FDA Issues Rule to Prevent Food Spoilage. The rule on Sanitary Transportation of Human and Animal Food is final, advancing efforts to protect foods by keeping them safe from contamination during transportation. The goal of the rule is to stop practices during transportation that create food safety risks.
How the ELD Mandate Challenges Truck Leasing and Rentals. The FMCSA stated it doesn’t regulate truck leasing and rental businesses, but drivers will still be obligated to use ELDs to record their HOS if they fall under the purview of the agency’s final rule. (Learn how the ELD mandate will benefit shippers by reading this.)
Are you overpaying for inbound shipments? Should you switch from LTL to truckload shipments? Are your supply chain and dock loading processes proficient?
Understanding costs in the supply chain is just as important as reducing them. In order to enact profitable change, TMS reports provide insight into trends, inefficiencies, support and monetary KPIs. With actionable data, businesses are enabled to make better, faster decisions for transportation and supply chain optimization.
A transportation cost analysis will help you analyze efficiency and reduce transportation spend.
Here are 3 reports that are customized for shippers from a transportation management system (TMS). These reports can be compared over time and filtered to show exact locations or facilities, so that you can see the ROI of decisions and impact of pain points and/or opportunities.
Light Load Detail and Cost: Light load details vary across customers. Once the weight is defined, then a report is generated showing how much of the designated weight the customer uses and how much unused space is being paid for.
For example, a flatbed load is defined at 46,000 lbs. Your company consistently ships freight that weighs 36,000 lbs. in this scenario, you’re paying for unutilized trailer space. Seeing this data might encourage you to change shipment patterns, increase lead times, and ask operations why you’re not using all the available space.
Average Length per Haul vs. Cost per Pound: Distance and weight matters when moving goods. The more miles you ship freight, the less cost per pound.
For example, after seeing this report, you might recognize the value of building heavier loads or to add lead time so that a lighter shipment can be moved by partial TL. While reading the report, you can identify any abnormalities in payments and figure out what the driving factors are – usually these factors are fuel related.
Cost Summary: Cost summary reports contain all the averages of freight prices. Everything from load count, total miles, average miles per load, and average weight per load are included. This report is especially effective for customers looking for ways to make shipments run more cost effectively.
All the data provided in these reports is generated from a TMS. Without TMS data, you may see the effect of poor transportation performance, but you won’t be able to determine the cause. A TMS enables smart, profitable supply chain change.
TMS data also generates these reports:
Executive reports contain quarterly business reports, shipment summary, top carrier summary metrics, and core carrier compliancy.
Safety reports include carrier incident tracking and safety trends.
Distribution reports include service by weight, service by state, and service by zone.
Ancillary reports include accessorial charge summary, dim detail, and shipment consolidation.
Tracking reports contain time in transit, delivery performance and shipment exception detail.
Accounting reports include invoice status, payment cycle, and audited savings detail.
Service quality reports contain shipment detail, client report card, claims status, and vendor compliance.
Businesses are woefully unprepared for disasters and disruptions in their supply chain. In fact, two-thirds of employees say their businesses have not reassessed safety and crisis plans since the last time they faced a natural disaster.
In the first half of 2014, the U.S. lost $50 billion in productivity due to natural disasters. Much of the disruption is from delayed or stopped transportation, which is particularly susceptible to poor weather conditions and natural disasters.
Some companies are reactive and agile during a disruption or disaster – using a transportation management system (TMS) to reroute freight in transit and schedule alternative modes for inventory on hand. But, most companies aren’t able to be proactive when disruptions occur, and many find it difficult to be reactive in these situations.
It is likely your company will be hurt by the next potential disruption in your supply chain. Often times, natural disasters and disruptions are unavoidable, and all you can do is limit the damage done to your supply chain.
Climate change is the biggest looming disaster facing businesses today, and fortunately, you can prepare for it.
Climate Change is a Major Threat to Supply Chains
Climate change poses a major threat to all modes of transportation. Elevated temperatures, increased rainfall, frequent flooding and landslides can damage infrastructure, creating serious disruptions, or worse, creating large-scale natural disasters.
A recent survey found 97% of the scientific community believes that humans are causing global warming, so from a supply chain perspective, the safest thing to do is to assume there will be increased instances of disruptions and natural disasters. How can you prepare for the effect climate change will have on transportation?
First, it’s best to know how each mode will be affected.
How Climate Change Affects Each Transportation Mode
Over-the-road (OTR) transportation will be significantly affected by flooding, storms and rising sea levels. The structural integrity of roads, bridges and tunnels will be damaged which will create severe accidents and disruptions. There are approximately 60,000 miles of coastal roads in the U.S. that are highly susceptible to flood damage. Events like the 1993 flooding of the Mississippi River, which halted east-west truck traffic for six weeks, can reduce economic activity nation-wide, alter production schedules and can even cause manufacturing plant shutdowns.
Elevated temperatures are a major problem affecting OTR and rail transport. During prolonged exposure to high temperatures, asphalt softens, rails buckle and steel structures expand, all leading to rapid road degradation, train derailments and transport interruptions. Bridges are also compromised in high heat due to thermal expansion, which creates safety issues. High temperatures ruin infrastructure and stop transportation in its tracks.
High temperatures combined with low precipitation will lead to frequent droughts in some areas. This will have a major impact on barge transport. Water levels will significantly decrease and limit or halt barge traffic. It’s estimated that by 2050, decreased water levels in the Great Lakes and the Saint Lawrence Seaway could increase shipping costs by 13 – 29%. The Mississippi River experienced a prolonged drought in 2012 which severely affected grain and coal exports.
The increased frequency and intensity of storms also poses a severe threat to waterborne transportation. Ports are located at low-lying areas and are at extreme risk of damage from flooding, sea level rises and hurricanes. Six of the nation’s top 10 freight ports are threatened by climate-induced sea level rises. Imports and exports of food, petroleum products and nearly all other goods are at risk. Rising sea levels can also lower bridge clearances, potentially further limiting waterborne traffic.
Many climate change-related events pose threats to airborne transportation. Efficient aviation relies on strict schedules with thousands of aircraft aloft at the same time. Delays in one part of the system could have national or even international repercussions. Air freight is very sensitive to supply chain disruptions due to the extreme safety conditions required for flight.
Changes in the incidence of thunderstorms, tornados and snow will affect flight schedules. Many of the nation’s major airports are located in low-lying areas at risk of climate-induced flooding: New Orleans, New York City, Miami and San Francisco. High temperatures can damage runways, leading to frequent repairs and more congestion.
Using Climate Change Knowledge to Prepare
Different modes are affected differently by climate change. Now that you understand the threats each transportation mode faces, you can determine the most likely disruptions your freight might encounter.
No company can entirely avoid all disasters, but when you’re prepared, you can significantly reduce the number and severity of disruptions that affect your supply chain. How can you be proactive about natural disasters?
Know Your Disaster Risk Management Plan
If you want to minimize the impact of climate disruptions, then you’ll have to plan ahead and be ready to act on your risk mitigation plan.
First, assess the likelihood of a disruption happening, what part of the supply chain it would impact, and how badly it would be impacted. Then, determine a level of preparedness based on the likelihood and severity of the particular event. This could mean anything from knowing the best alternative transport mode to training employees for emergency situations.
This part of the overall plan addresses the way you will immediately respond to an event. What will be your first step: redirecting drivers or pilots out of danger or to a quicker route, canceling shipments headed towards a dangerous or congested region, or notifying customers of delayed freight? The goal is to minimize or avoid damage to the supply chain as much as possible.
After a disaster, how will operations proceed in the short-term? In this portion of the plan, you’re looking at a few weeks or months after the disruption and attempting to keep productivity high. You can determine what routes, modes, additional equipment and extra service will be needed to stay profitable.
The last step of the plan involves recovering assets lost to the disaster. What services can be resumed; what can be repaired and what can’t; and how will customers get their lost goods? In the recovery phase, you are moving away from short-term survival and returning to normal operations. How can it be done most cost-effectively? This may involve considering many different potential scenarios and valuing certain equipment and services so you can quickly determine the best course of action should a disaster occur.
Climate change will increase the occurrence of weather-related disruptions and natural disasters. It’s important to prepare now before your supply chain is damaged or your business has to close.
Have you had a natural disaster drastically affect your supply chain? Let us know in the comments below.
The loading dock is the access point for shipping and receiving. Well-designed loading dock procedures minimize delays, reduce damage to cargo and optimize productivity.
Here are 3 quick ways to improve loading dock processes:
Enhance Dock Safety
Loading and unloading trailers presents safety risks for operators, attendants, drivers and employees. Injuries on loading docks account for 25% of all reported injuries within supply chain facilities, according to Material Handling and Logistics.
In order to increase productivity and reduce injury at the loading dock, follow these tips:
Examine safety before someone gets hurt and evaluate security at the facility.
Create a maintenance schedule. Dock levelers, lights, seals and overhead doors should be tested regularly to ensure reliability.
Keep docks dry. Water on the loading dock creates a dangerous situation.
Upgrade equipment and replace equipment as necessary.
Bottlenecks occur when the flow of goods from the warehouse or distribution center is slowed on its way to the customer. Often, inbound material comes faster than can be unloaded, or products and equipment aren’t properly labeled, creating delays. Identify any bottlenecks in your supply chain to avoid employee stress, wasted costs, delayed shipments and unhappy customers. Long wait times and piles of papers are common bottlenecks.
When bottlenecks are identified and effective solutions are applied, companies see a major improvement in inventory management and load times, which in turn reduces detention charges and improves shipper status.
Take Advantage of Technology
Dock management systems and transportation management systems help identify problems inside and outside the facility by using RFID and GPS technology to track the movement of every trailer. This results in real-time performance reports and the opportunity to reduce delays, improve staffing and better utilize equipment. These systems capture dock status, average length of a driver’s haul and loads built by hour. These metrics help you make the best use of your driver’s time.
Maximize the efficiency of loading and unloading at the dock with safer operations, more technology and fewer bottlenecks.
PLS Ranks for 9th Consecutive Year on Transport Topics List
CRANBERRY TOWNSHIP, PA – April 13, 2016
PLS Logistics Services (“PLS”), a leading provider of technology-enabled transportation management and freight brokerage services, has been named to the top 25 on Transport Topics list of Top 50 Freight Brokerage Firms for 2015.
The annual list ranks freight brokerage firms based on net revenue. The Top Brokerage Firm list is part of Transport Topics’ Logistics 50, a yearly review of the largest logistics companies.
This marks the 9th consecutive year that PLS has ranked in the top 25 of the list. “We’ve built strong partnerships with carriers and shippers. Their confidence in PLS has been a fundamental reason for our market growth,” says Greg Burns, PLS President and CEO.
“We are especially gratified to have achieved our results through organic growth, which remains a critical differentiator for PLS,” added Burns.
PLS Logistics Services is a leading provider of logistics management, brokerage and technology services for shippers across all industries. PLS handles millions of loads annually across all major freight modes: flatbed, van, LTL, rail and barge, air and ocean. The PLS carrier network consists of over 20,000 trucking companies along with Class-1 railroads and major barge companies. To learn more visit www.plslogistics.com.
A common transportation challenge of B2B and B2C businesses is lack of supply chain visibility. Without visibility, deliveries are slower, inventory management suffers and it’s more difficult to manage risk. These challenges are linked to additional costs and unhappy customers.
This PLS client was able to find cost savings, visibility and gain control of transportation: Without a transportation department, this mining and exploration company decided to look for a strategic partnership with a 3PL because they needed a competitive advantage. Like many companies that outsource, they hoped to gain strategic cost savings and operational visibility that would put them ahead of their competitors.
Most companies outsource to:
1) Acquire experts, knowledge and resources that are not available internally
2) Let company management focus on core competencies
3) Cut costs and enhance operations
As a leading mining and exploration company, this PLS client needed to increase visibility into overall transportation strategy and spend. The client relied on vendors to manage transportation of supplies and equipment for its multiple locations. Since the vendors were arranging and billing the shipments, the client didn’t realize that they were overpaying 15-50% on every inbound shipment.
PLS’ account management team analyzed the situation and delivered solutions that would provide lasting results. First, PLS procured highly capable and cost effective carriers for inbound and outbound shipments. Then, the PLS team evaluated the market and provided insight to the company about best practices, metrics and performance so they could implement strategic operational changes that would boost productivity and create a more efficient supply chain process. PLS sends this client daily updates on all shipments, segmented by projects, and codes invoices so they can be allocated to transportation budget.
More than 10% cost savings on LTL shipments, inbound shipments and truckload lanes.
Control over transportation processes and transportation spend through detailed cost reports and TMS reports.
Visibility across all transportation decisions and spend.
More bandwidth and resources.
Accurate budgeting based on capital expenditure projects and transportation costs.
Sending LTL or truckload shipments to Canada from the U.S. doesn’t have to be difficult. In fact, when you work with the right partner, it can be relatively easy. Here’s everything you need to know about shipping to Canada:
Shipping freight to Canada requires a lot of paperwork. Three pieces of paperwork you will always need are a bill of lading (BOL), a Canada Customs Invoice and a NAFTA certificate of origin. It is important to ensure all of your documentation is done correctly to avoid delays in transit. Working with a customs broker or logistics provider on this paperwork is common – some carriers even require it before they will accept your freight.
Since 2013, Canada customs has required all shipment information prior to freight arriving at the border. This way, at the point of crossing, the driver doesn’t have to wait and can simply present an Advanced Commercial Information (ACI) eManifest card to cross the border. For a shipper, this means shipments must be scheduled in advance and collaboration with the carrier is required to ensure all paperwork is done and completed properly.
Cross border freight quotes can be tricky – there are numerous cost factors to take into account. It’s quickest and easiest to request several quotes through an online platform, preferably with companies who offer simple rate structures like uniform pallet pricing. This works especially well with small and light freight and can save you a lot of hassle in the shipping process.
If your freight is palletized, which it should be whenever possible, there are a few requirements for the pallets. The wood must be either heat treated or chemically treated with methyl bromide and it must be marked with an ISPM 15 stamp. This may seem unimportant, but the regulation is designed to keep out wood-boring pests or seeds that could harm a new environment. Freight shipped on improper pallets will be denied or could even be destroyed.
Shipping freight to Canada is expensive – it’s worth it to pay a little extra to insure your freight and protect yourself from fines and damage. Many carriers include basic insurance in their base rates, but if not, extra insurance is easily available from an independent provider. In addition to insurance, most carriers or logistics companies provide online tracking services so you can monitor your freight in transit. This way, should something happen to your freight, you can notify your customer, make alternative shipping arrangements and assure them they will still get their freight in a timely manner.
These are the main things you need to know to easily ship your freight to Canada and avoid delays, fines or damaged freight. However, even an experienced shipper is still at risk when cross border shipping. Working with a customs broker or a logistics provider can make the process even easier.
Many businesses want to leverage big data in supply chain initiatives to drive efficiency, cost savings and unparalleled operational visibility. In order to do this, however, a business must have enterprise-wide infrastructure for information gathering. Only 35% of organizations use a transportation management system (TMS), meaning most companies do not have much visibility into shipping processes, but more importantly, don’t have access to data that’s part of the end to end supply chain insight that’s necessary for big data initiatives.
Use a TMS for Data Collection First
There’s more data available now than there’s ever been, and the potential applications are endless. The problem comes in collecting and analyzing all this data in a timely manner. The first and easiest step is to collect the information, but many companies overlook the impactful data available from transportation.
A TMS will constantly monitor shipping processes and gather data for analysis. Typically, a cloud-based TMS is best for data gathering, as many shippers and carriers are providing information through the same portal, making data collection easier and more accurate.
TMS software is great for cost savings, even immediately after implementation, but its true value comes in the data it provides. It collects information from a variety of internal and external sources, enabling historical data analysis and optimization in freight transport. But most importantly, it contributes a crucial portion of data for end-to-end visibility.
With the help of a TMS, any business can begin collecting transportation data. There are numerous metrics available for analysis and it can be difficult to decide which is most important, especially for those companies still building a foundation of data collection in freight transportation.
What are the best metrics to collect and analyze?
Start with the Basics
It’s best to start with simple data collection – large amounts of information can be overwhelming to manage at first, and you’ll want to take the time to ensure you’re gathering quality data. Most shippers, even with manual processes, will collect some information from the shipping process. Usually, they know overall freight costs, on-time pickups and freight cost by location.
These metrics provide you with an idea of overall performance in transportation, but not much else. You know something is wrong if your overall transportation costs skyrocket for a few months, but you probably won’t know why.
There are a few simple TMS metrics that can expand your understanding of your transportation processes. These 3 reports are the building blocks of transportation visibility:
Light Load % – This metric reveals what percentage of shipments are sent under the minimum weight requirement of a truckload trailer. If there’s a minimum of 40,000 lbs. on a trailer and a company consistently only loads 35,000 lbs., they will still be charged for a 40,000 lb. shipment. A TMS collects this information through its automated billing features. With this data, you can better understand freight costs and focus your attention on trailer utilization. Light load percentage can be a starting point to start tracking other related metrics like the efficiency of truckload versus less-than-truckload (LTL) shipping, or the effectiveness of freight consolidation.
Total Loading Time – This metric refers to the amount of time it takes for a trailer to be loaded, starting the second a truck enters a facility’s gates and ending the moment it leaves. A TMS collects this information through EDI scans at a loading facility. Total loading time is important because it provides insight into the efficiency of the loading dock and the entire facility. A company may be efficient at the dock, but could keep a driver waiting for hours before they actually start loading. This metric is a foundation for creating more efficient facility procedures, staff scheduling and can help you leverage lower costs since carriers prefer working with shippers who get their drivers in and out of a facility quickly.
Fuel Detail Reports – Fuel, either calculated as a cost per mile or percentage of freight costs, is a major cost component in transportation. A TMS captures this information through automated billing procedures. Visibility into fuel costs helps create a clearer picture of overall costs, but can also go hand in hand with light load percentage, as fewer trucks will use less fuel. Fuel surcharges and pricing structures are not the same between carriers and across the industry. Consistently reported fuel costs help you compare carriers pricing methods and can even help you leverage lower base rates in the future.
Tracking these metrics will enable you to branch out into more data, and gain close visibility into a crucial aspect of the supply chain.
Collecting this type of information in transportation is not technically a Big Data initiative, but can provide a foundation for more intensive data gathering in the future.
Choosing a transportation management system (TMS) for your company is a huge decision because there are a variety of providers and features.
A TMS helps companies move freight efficiently, reliably and at lower rates. Implementing a TMS drives value by monitoring and evaluating processes, analytics and optimization. The technology routes drivers, schedules deliveries and reports business KPIs.
If only 35% of shippers are using transportation management systems, so choosing the right system positions you to be a market leader in logistics. These 6 questions will help you discover what kind of TMS you need.
What’s My Plan of Attack?
It is important to choose a TMS that meets your immediate business needs so that implementation is successful and there is quick ROI. However, don’t ignore long-term business goals. As a shipper, consider the likelihood that you’ll eventually operate in a different region, with different modes or ship different freight. Looking toward the future is important – you’ll want your TMS to be a long-term investment, not just a short sighted solution to save money.
What’s Important to My Business?
You’ll need a TMS with the capabilities to handle all of your freight, but you don’t want to pay for features that you don’t need. Ask yourself what functionalities a TMS must provide to improve processes. Think about if your company needs close inbound and outbound shipment visibility. Are cross-border capabilities crucial? Does the size of the carrier network matter? The answers to these questions often depend upon the provider of the TMS, but it is important to understand your business’s needs compared to the features of the TMS.
What’s the True Price of the System?
Get detailed, line by line pricing from a TMS provider. Installation, training, reports and notifications may cost you 25 – 30% more than anticipated. You also need to know how much it will cost you to operate the TMS long-term. Are there charges for technical support, system updates and software upgrades? The cost to operate a TMS overtime may end up being more money than the original purchase price.
What Billing Capabilities Does the TMS Have?
Your TMS needs to be able to handle the different ways you bill your clients. This information is not always immediately available to a logistics or supply chain professional, but it’s worth looking into. If the TMS does not support the billing functions you need, you will be missing out on a crucial benefit of a TMS. Automated billing and administrative duties are more accurate and much faster than manual processes.
How Does the System Handle Spot Market Freight?
Scalability is a crucial feature of a TMS. You won’t always be shipping the same loads over and over, sometimes you need to send one last minute, or make an infrequent LTL move. Your TMS needs to operate within the range of freight volume you ship. Accessibility to a carrier network is a crucial feature of a TMS, not just for handling diverse and/or infrequent loads but for moving freight quickly.
How Well Can the System Integrate with Other Systems?
To get the most value out of your TMS and other internal systems, such as your ERP software, your TMS should integrate seamlessly. One of the most powerful benefits a TMS provides is visibility into logistics. Visibility is one piece of a much larger puzzle and is crucial in providing end-to-end visibility in a supply chain. End-to-end visibility may not be a priority for your organization now, but someday it will be, and then you’ll need a TMS that can support such a venture.
Buying a TMS can be overwhelming. A TMS becomes an extension of your business – it evaluates ongoing performance metrics and enables productivity and service – so it’s important you evaluate the options and variables to make the best decision.
You need to send your freight quickly but don’t want to pay for expedited freight – it’s a dilemma all shippers face. Many companies rely on expedited shipping, but, with some simple operational changes, you can contain transportation costs and meet service expectations at the same time.
Expedited shipping services are a sure way to consistently provide high service levels, and in some scenarios it makes sense to pay extra for fast delivery, but expedited shipping will quickly blow a hole in your transportation budget.
So, how can you improve shipping speed without paying extra for expedited services? Follow these 5 tips:
Standardize Dock Procedures. Truck drivers are often forced to wait a few hours at a loading dock because companies aren’t ready to load or unload freight. You can speed up the shipping process by preparing freight for loading before a truck arrives and by ensuring crews are ready to load/unload freight when a truck is scheduled to pick up or drop off. Standardizing dock procedures will cut a driver’s wait time and will benefit your customers and carriers.
Communicate with Carriers. Use a small number of carriers for regular lanes and inform carriers of your schedule. This way, carriers can schedule accordingly and you can request the same driver per lane. Using preferred drivers allows them to become familiar with your origin facility, the route, the freight being hauled and the destination facility. This will improve service and speed by reducing delays due to mishandled freight or truck drivers taking slower or wrong routes.
Ensure All Information is Correct. Double checking your bill of lading (BOL) only takes a minute and could save you a lot of time. Misinformation about the weight, density or classification of freight can have financial consequences – not only in fines but in lost time due to carriers reweighing, reclassifying or refusing to carry mislabeled freight. Accurate BOLs ensure your freight won’t incur fines and will be carried and delivered properly.
Employ Just in Time (JIT) Shipping. JIT shipping most commonly refers to receiving inbound freight just at the time it is needed, although it can also refer to outbound shipping that’s highly coordinated with production schedules. JIT is very common in the industrial sector, and successfully creates much needed operational efficiencies. JIT saves shippers’ money by reducing inventory costs. It keeps employees working on profitable activities such as loading and unloading freight. JIT shipping keeps products moving through your organization efficiently and regularly, which helps with pickup and delivery schedules. Ultimately, it increases the speed of outbound freight through more efficient handling and scheduling.
Use a Transportation Management System (TMS). A TMS helps you ship freight cheaply and quickly. It is necessary for optimization of transportation. The most important benefit of a TMS is visibility into operations. With TMS software, you can see which parts of your shipping processes are inefficient and slow. You’ll gain access to data on loading and unloading times, average length per haul, carrier performance metrics, and average times in transit. This data enables you to make informed decisions on which lanes, modes and carriers to use to find the best combination for speed and efficiency.
Poor planning, lack of communication and overlooking data can result in rushed shipments at a high price. Keep expedited costs down with these 5 methods, along with the commitment to implement them over time, will enable you to ship freight efficiently and quickly without relying on expedited shipping.
Have you used other ways to boost shipment speed? Let us know in the comments.