Freight shipping is, necessarily, a year-round business, but the summer season brings with it some unique elements. Summer freight shipping presents the somewhat obvious environmental challenge of hotter temperatures, but it also includes heavier produce, food and beverage volumes both due to growing/harvest seasons and typical higher demand, plus the specter of the general peak freight season toward the second half of summer. Add to that external factors still weighing heavy on the freight industry like a potential dock worker strike threatening west coast ports, the situation in Russia/Ukraine, COVID-19 port shutdowns in China, soaring gas prices and general equipment and capacity issues, and this summer freight season promises to be an interesting one.
With inflation persisting and gas prices at all time highs, costs for just about anything seem to be up these days. Yet perhaps surprisingly, summer freight rates are actually more of a mixed bag. The idea that freight rates are down in many instances seems to fly in the face of both ongoing supply chain issues and the generally higher cost environment of the world these days. But there is evidence across the board of at least a temporary decline in freight rates as the summer season kicks into gear.
Everything you need to know about domestic intermodal and how to be successful implementing it into your logistics strategy. Gives tips, tricks and insights on intermodal and what to watch out for when converting from truckload to intermodal.
While some issues that slowed supply chains beginning last year have eased, new ones keep popping up, with the looming cloud of a dockworker strike at U.S. west coast ports including Los Angeles and Long Beach on the horizon. Labor talks between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) began in earnest in May with a July first deadline for a new contract. Without an agreement sometime this month, the ILWU - and its approximately 22,000 dockworkers - could go on strike, leaving the PMA and its employers at 29 ports without staff to handle loading and unloading cargo, preparing docks for incoming ships, mooring ships correctly and maintaining records among other responsibilities. However, the July 1 deadline should be taken with a grain of salt according to negotiators, as both sides have indicated a willingness to avoid any interruptions as long as negotiations are proceeding well (though the ILWU reportedly paused talks for the final part of May). Maintaining operations would be welcome news for supply chains, as about 60 percent of all imports coming from Asia are handled by ports on the West Coast.
The term 'milk run' has a number of meanings. In World War II, pilots used a milk run to describe a routine mission with a low chance of danger. More literally, a milk run described a train that made frequent stops to pick up farmers' milk cans for shipment to local dairies for processing and bottling, and later, a milk man's route delivering milk bottles to customers. Today, a milk run is a term commonly associated with logistics, tracing closest to that train with multiple stops origin. A milk run in logistics describes the idea of one truck making an often circular route to pickup loads from multiple suppliers and bring them to a company's warehouse, distribution center or manufacturing facility. This concept saves time, equipment, labor, money and energy over the alternative of each supplier sending their own individual trucks separately.
Carb Day is a major event in the Month of May as part of the leadup to the Indy 500. It traces its name to Carburetion Day - which referred to the last day race teams could tune their carburetors in conditions similar to the race itself. The thing is, cars racing in the Indy 500 haven't used carburetors since 1963 - and Carb Day is more of a pre-race party these days anyway. Yet the name remains. That got us thinking, freight and logistics has a few terms originating a long time ago as well that have stuck in every day usage today - even though their meanings may have evolved a bit...
They say it takes 10,000 hours practice to achieve mastery of a skill or field. But practicing good logistics is less about the amount of time spent, and more about ensuring best practices. Here are seven easy to remember logistics best practices: Evaluate market and internal data Determine whether in-house or outsourced logistics management is a better fit Make a plan Establish relationships with logistics service providers (LSPs), suppliers and carriers Purchase and correctly implement a TMS Optimize routes, transportation modes and capacity usage Ensure visibility into all operations, shipments, etc. Why did we choose the number seven? Because there's a certain mantra known as the 7 Rs of Logistics that dovetails nicely with the idea of practicing good logistics (though it's really just one R repeated seven times). The Rs are encompassed in the idea of getting the right product, in the right quantity, in the right condition, at the right place, at the right time, to the right customer, at the right price. And there are plenty more "rights" to add if one wanted to extrapolate it further - like working with the right partners, establishing the right relationships, using the right mode, etc.
Those involved in the freight shipping and logistics process have a need for speed - not just any speed, but efficient speed as fuel usage comes under stricter scrutiny. One way carriers are working to achieve this is to emphasize aerodynamics advances in their freight shipping modes. While it may seem as if semi trucks and railroad cars haven't changed much in their design over the years, that's not entirely true. But most of those fancy, futuristic-looking concepts have yet to reach the road. Still, with fuel accounting for the second largest cost center for trucking companies, and a significant one for railroads as well, maximizing fuel efficiency through aerodynamics is a growing area of focus in freight shipping. And often, the best way to get there is by making incremental tweaks to vehicles and containers already in operation.
As graduation season hits its peak, high school and college seniors are thinking about their future line of work. And one path worthy of heavy consideration is a career in logistics. U.S. News and World Report has logistician as number eight on its list of Best Business Jobs. And the Bureau of Labor Statistics projects 30% growth through 2030. If a soon-to-be graduate - or current pro in another field - wants to move in the logistics direction, then - just like a race car entering the Indy 500 - qualifying for a logistics career is the next step. Having the right qualifications - just as in any other field - leads to the best, most lucrative long-term logistics job prospects.
Transportation has many facets, whether it's a bicycle heading down a trail, a truck making a delivery to complete a supply chain or a souped up race car whizzing around a track - all involve transportation. Since Indianapolis knows a thing or two about races, and InTek Freight & Logistics knows a thing or two about supply chains, how about a closer look at the comparison between a race and a supply chain. Beyond the transportation parallel, here are five ways a supply chain is like a race, with a bonus number six if you make it to the end...
The status of major ports and the supply chain situation has evolved a bit since the last check-in published here. And while some of those changes can be counted as improvements - with more capacity generally available and better rates for shippers - there are plenty of issues pointing the opposite direction as well. You've probably heard most of the examples of negative pressures, but in case you haven't - a potential California port strike, Covid-19 lockdowns in China, gas/oil prices and Russia's invasion of Ukraine count as a few of the major ones. For the latest on the good news/bad news combination of leveling off to lower spot rates and considerably higher diesel prices, check out our Intermodal Spot Rate Pricing Trendline Analysis updated every week. Let's go into more depth on some of the other supply chain and port status updates of the day.