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management-transportations Pro Tips Urgent News - COVID-19 Updates

Is COVID-19 Still Affecting our Supply Chain?

In last month’s newsletter, we resurrected the infamous philosophy of former heavyweight boxer Mike Tyson, as so many of us are feeling how he did in the ring. Since then, we’ve had both a holiday and a DOT week — oh, and two hurricanes. A remote workforce and decreased labor supply continue to compound the most recent disruptions by adding more friction. To continue with last month’s metaphor, we’re only in the middle rounds of this heavyweight fight. Now is the time to encourage everyone in the industry to adapt as necessary and to keep looking for ways to minimize the impact of disruptions. Read more to see our recommendations on navigating these tumultuous times.

Current Transportation Markets

Domestic

TL

Based on recent statistics published by FreightWaves SONAR, it’s safe to assume that you are paying at least $3/mile to move your TL freight. Last month, we reported an unheard of DHL Carrier Power Index of 80. This month? It’s at 85. Everyone is aware that trucks are tight and are likely to remain tight until the end of peak shipping season. The question is, what do you do?

Our Recommendation: Carriers and brokers are in business to service the customer. This month, it’s all about how you can help carriers and brokers do that even better. For shippers that want to save money, we recommend helping the carriers and brokers that you have established relationships with over the years. By giving them advanced shipment notice, more complete shipping details in fewer emails, favorable load and unload times, and more flexibility, you’re giving them the best chance to save you money; notice and flexibility allow them more time to find the right driver for your freight and reduces the number of costly last-minute shipments that other carriers are waiting patiently to exploit.

 

You can also seek ways to provide more visibility to your customers. Most likely, customers are anxiously awaiting your product so that they can get it on their shelves or to their customers. Reduce any anxiety by giving them visibility.

Take this time as an opportunity to make investments into your digitization efforts, or partner with someone that has. At a minimum, they should allow for carrier waterfall tendering for quick and complete communication to your carriers, access to a digital marketplace in order to expand your reach, quick onboarding apps with compliance monitoring that allows you to expand your carrier base, strong API capabilities for real-time tracking, rate and route optimization capabilities for lower freight rates, and a secure customer portal access that increases customer visibility. These tools make it easier and faster to communicate with your carriers, brokers, and customers. Use this opportunity to make your company both more efficient and transparent. Otherwise, you could lose ground to a competitor who capitalized on where you didn’t. See if a transportation portal can help your organization take a step towards digitization.

LTL

Many LTL carriers are experiencing higher than normal volumes, and they’re being crushed by a workforce that has been hit hard by COVID-19. As a result, we’re seeing issues that are unfamiliar to the LTL industry. Our once smooth flow of supply chains and networks are being disrupted with missed LTL pickups, later than usual delivery times, and more damages. Our recommendations are brought to you by our Barak Frydman who works for our key strategic partner, DLS Worldwide.

  • Be Observant: Give the carriers that are doing a great job in your network more freight. If you see another carrier struggle, give them a chance to get out from under their backlog and wait to use them again until some time has passed.
  • Reduce Multiple Carriers For Your Pickups: When possible, reduce the number of LTL carriers coming into your facility. If you ship long-distance, consider using one national or super-regional carrier. If you ship regionally, consider keeping all of your regional freight with one regional carrier; this will decrease the number of times your freight gets handled while making the carriers operate more efficiently. This will help improve your carrier of choice status.
  • Use Direct Carrier Services: Instead of interlining your freight, use direct carrier services in order to reduce the number of times your freight is handled.

If your contact carriers are struggling, don’t be afraid to reach out to a transportation management company that has access to a large number of carriers with competitive rates. They can help by providing you with competitive rates and the knowledge of which carriers are struggling the most.

International

Ocean

Making sense of how we’re dealing with capacity issues in the middle of a pandemic is a little like trying to figure out what happens when an ocean line cancels a blank sailing. Easier to understand is how ocean spot rates continue to rise as carriers blank sailings in order to decrease supply and maximize profits. For once, it seems as if ocean lines are operating intentionally and effectively. As companies and U.S. importers struggle to find equipment, pay premiums in order to prevent getting bumped to the next sailing and for faster routes. Zim posted its strongest quarterly results in a decade; Evergreen, the strongest in three years. According to JOC, Wan Hia’s net profit is up over 139% when compared to the second quarter of last year. Many shippers have verbalized their displeasure as ocean lines schedule GRI’s that are expected to drive rates even further. Their voices have been heard by the FMC, and they have put TranspPac Carriers on notice that they are being monitored for potentially anti-competitive behavior. Whether or not TransPac Carriers are shaking in their boots, it’s at least a start.

Our Recommendation: Route containers with a final destination to the eastern U.S. to an eastern seaport, where delays are less likely. When you consider the unreliable and unpredictable costs of shipping to west coast ports, in addition to chassis shortages, booked dock schedules, overcommitted drayage companies and transload facilities, rail capacity issues, and high truck rates, shipping to east coast ports remains a better option. If purposefully taking on a “longer” transit time to the east coast has you biting your nails, consider splitting your freight between the east and west coast ports until we are through peak shipping season. And if you were wondering — plan on peak season lasting longer than last year.

Additionally, seek assistance in finding the right forwarder. Be adaptable. What worked last year may not work this year. Be sure to consider all the costs associated with getting your freight delivered to its destination, including your time. If managing your freight has become a bigger part of your day than you planned for, consider teaming up with an international freight specialist. Determine what it is costing you to focus on freight instead of other key areas of your business. If you want some relief, reach out to an objective transportation management company that can be your advocate.

Air

Tight container capacities appear to be spilling over into the air freight market as decreased passenger flights are still impacting capacity for airfreight. Freighters are simply maxed out. According to Eric Kullish, Air Cargo Editor, while more charters are being scheduled and more passenger planes are hauling freight as freight-only flights, overall capacity is still 30 to 40 percent below last year. Many are expecting air rates to continue to increase well into December.

It’s clear by now that our supply chains are more fragile than we care to admit. Seeing delays or higher freight costs is enough to make anyone frustrated. While we will see the impact of the past two hurricanes pass, there is more to come. We can be sure the timing will be horrible during the next DOT week. And while we know this peak season won’t last past December, we will have another one next year. A lot of what we are feeling is a result of a “more efficient” supply chain that is serviced by fewer providers. However, the capacity of service providers is so tight that even the smallest bump in the road can feel like a huge pothole. We need to adapt and be able to do more with what we have. We have to be faster and more agile than ever. Taking even a single step towards a digitization effort can make a huge difference. From there, you will gain both the experience and confidence to continue to move forward. Learn more about ShipTransportal’s services by giving us a call at (704) 892-0531. We can help you navigate these murky waters.

Categories
management-transportations Pro Tips Urgent News - COVID-19 Updates

Transportation Management – July Freight Management From Shiptransportal

The current pandemic has affected the entire world, including both domestic and international global transportation services. In our July freight management update, we discuss what changes have occurred and where the industry may be heading.

Domestic Freight Management:

TL Freight Management: 
Many shippers are seeing and feeling a tighter domestic carrier market. Currently, carriers are showing a strong pricing position. As of July, the DHL Carrier Power Rating is at 65 — its highest level since its inception 10 months ago. Likewise, the outbound tender volume index is continuing to explode. Currently, the volume index is 20% higher than it was during the infamous summer of 2018. Additionally, carriers are rejecting more tenders than they were at any point since 2018; current numbers are over 16% and only trending upwards.

When put together, these data points prove that the domestic TL market is truly tighter. Using the DHL Carrier Power example, where the pricing power index can range from 0 (shipper) to 100 (carrier), we can truly begin to grasp how much has changed. Before COVID-19, the index was as low as 10; currently, we are at 65.

What Caused the Shift
In January, the index was averaging about 40, and the following month, it dropped to about 25. In March, we began to see the effects of the pandemic. Because of panic buying, the index averaged at 40 but, at points, was as high as 65. While it began to level out again at 10 during April, we have seen a steady increase of about five points per week through the first week of July. The July 4th holiday saw the index hit 55 — a number that has only continued to increase.

What to Expect
Based on conversations with trucking companies, this trend is expected to continue for several more weeks before settling down again. If we continue on this current trend, carrier rates will escalate at a level not yet seen this year. In order to keep rates in check, it is crucial for shippers to continue working on their preferred shipper status with carriers; carriers are currently making pricing decisions based on their past experiences at shipper locations. Other ideas to consider include giving at least one day notice with tenders and shifting your TL to Intermodal.

 

LTL Freight Management:
To put it lightly, LTL carriers are simply swamped. Some, such as UPS, have experienced significant disruption to their normal service times into New York and other locations that have been hit hard by COVID-19.  In fact, many LTL carriers have modified services, such as inside delivery and guaranteed delivery, with an asterisk (*). When using these services before, the carrier would honor them, But with every carrier network being impacted differently, it is important to do what works for you in this current environment, removing any known risks based on prior poor performance. We recommend doubling down on both communication and shipment monitoring.  Schedule your pickups with local terminals as early in the day as possible.   Start confirming their capacity before you finalize your selection and tender to the carrier.

International Freight Management:

Ocean
There is still a high demand for faster transit services, such as 12-day transit, from Shanghai to Long Beach. Ocean carriers continue to do a great job perpetuating higher ocean rates from China with lower volumes.

Air
The air rate from China is currently down 60% from peak for PPP products. With many charters in place, it has become easier to get capacity for even large cargo moves.

Categories
Urgent News - COVID-19 Updates

COVID-19 UPDATE 03-27-2020 – Isolate and Operate, 3 Ways to #Thank a Trucker, Impact by Mode, Local Updates

COVID-19 Freight Update – 03/27/2020

COVID-19 has severely disrupted many segments of the economy – but while we are continuing to prioritize the health and wellbeing of all stakeholders, Shiptransportal remains 100% operational and prepared to serve current and future customers.

Communication

As you may already know, our phones and emails continue to work perfectly without any interruption, and we are looking for ways to make communication easier and faster for those working remotely and their customers. To help our customers easily track their freight in one place, both Managed and Brokerage, we are giving you access to the Control Tower solution at no charge through May 1st.

Our internal systems were all built to support working remotely. We have split our workforce between remote and corporate. We can each be reached via our main office phone line, email or even chat from our website. We will be available to help coordinate shipments for all customers.

Stay at Home or Shelter in Place strategy shifting to Isolate and Operate strategy for essential businesses. 

As you can imagine, this crisis has dramatically impacted the transportation environment in the United States and around the world. We do see businesses changing their processes to adapt to the CV-19 with an Isolate and Operate strategy to minimize the risk of exposure.  Below are a few key updates and recommendations:

1) Domestic Less than Truck Load Shipping – There are some new limits being placed on inside deliveries and guaranteed delivery services. Otherwise, LTL seems to be operating efficiently with minor interruption. Drivers have been given the discretion to determine what is a safe delivery location and what is not. Therefore, if the driver refuses to deliver after we called and confirmed delivery with the consignee and the carrier’s dispatcher, we cannot do anything about it. We will not be able to force the carrier or dispute charges like storage, detention, etc.   While we have not seen this happen yet, I expect it is possible we will.

2) Domestic Truck Load – Supply chain disruption is contributing to an increase in tender rejects and thus an increase in spot market rates.  According to DAT, truckload rates are up in 63/100 key lanes that they track. Inbound rates to major consumption markets and those with large number of DC’s are increasing the fastest.

Outbound rates from Laredo/McAllen have jumped as MX imports increase. Major hubs in TN have seen increases of .25/mile.

Try to arrange bookings in advance to avoid paying a significant premium for same day pickup requests. Please confirm the consignee is open to receive the freight before you load the truck.

Maintain your shipper of preference status. You will want to be considered shipper of preference as capacity tightens more after the first containers start to arrive from China and produce hits.

We’ve seen more well deserved meme’s to #thank a trucker than I can ever recall. We’ve seen the public join in and offer praise and free boxed lunches, but drivers still need your help. Please continue to provide hot water, soap and clean facilities to drivers. With many of the restaurants and public facilities closed, they need you to help them help you!

Here are 3 things anyone can do to say thanks (from Jesse L. Douglas, Truck Driver):

  1. Stick your hand out the window and wave or give us the thumbs up.
  2. Turn your hazards on, let them flash 3 times then cut them off.
  3. Install a CB radio in your car and say “thanks big truck (or company name on side of truck)” and hope he’s got a radio in his truck and it’s on (rare these days).

3) Air Freight – Passenger flights in and out of Europe / Asia have been drastically reduced.  As a result, many passenger airlines are offering dedicated charter flights by turning their aircraft into cargo-only planes.

4) Ocean Freight – Freight is still moving, but port hours are being impacted. Port of Savannah had its busiest month ever last month, up over 17% same month previous year. Even so, they are suspending Saturday gate receiving through 04/04. Other ports like Baltimore, Miami, Seattle, Long Beach have also announced changes to their operating schedule. RORO volumes are way down in Charleston, due to decreases in demand from German auto manufacturing relationship in SC.

Port operations in China are resuming, but volumes to east and west coasts from March to May are expected to be down about 15%.  This should put some downward pressure on rates in short term and increases financial pressure on ocean carriers. Especially those that also provide cruise services.  Keep the ocean carriers’ financial health in mind when selected your provider.  You don’t want to be apart of what we saw when Hanjin became insolvent.

Consider Implementing a COVID Policy

Many manufacturers and distributors are implementing COVID policy as it relates to “visitors” being allowed into their facilities.  As it relates to trucking, most are asking the drivers to fill out a questionnaire based on recommendations from the CDC and WHO.

For example, many manufacturers are implementing a policy along these lines:

Only business critical visitors are permitted into the facilities – this can include drivers. Drivers are asked to disclose whether:

  • They have traveled to level 2 or 3 countries (per CDC) in the last 14 days;
  • Been in contact or cared for someone diagnosed with COVID in last 14 days, been in close contact with anyone that has traveled to any countries listed by CDC travel page; or
  • Experienced flu-like symptoms in last 14 days.

If drivers fail to fill out the form or select yes to any of the questions, you may choose to not allow them inside the facility. Most should be loaded or unloaded, but not allowed inside.

Stay at Home or Shelter in Place Updates. (Thank you to our DLS partners for providing us with daily updates!!!)

MAKE SURE THAT YOU CONTACT THE SHIPPER OR CONSIGNEE TO INSURE THEY ARE OPEN FOR SHIPPING AND OR RECEIVING, IF THEY ARE IN ONE OF THESE AFFECTED AREAS.

Virginia – Governor has declared that non-essential business close for the next 30 days

Minnesota – Stay at home and limit movement unless for essential items this goes into effect on Saturday 3/28/20

Wisconsin – Safer at home and limit non-essential travel went into effect on Wednesday 3/25/20

Washington – Stay home, stay safe, travel for only essential items went into effect on Wednesday 3/25/20

Colorado – Stay home unless absolutely necessary goes into effect on Thursday 3/27/00

Texas counties that have followed Dallas counties lead – Harris (Houston), Bexar (San Antonio), Collin (Northern Suburbs of Dallas), El Paso, Tarrant (Fort Worth Area), Austin (E of Houston), Hunt (NE of Dallas) – appears the new counties have gone in effect yesterday or Tuesday night.

Harris County Zips – http://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?FIPS=48201

Dallas County Zips – https://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?FIPS=48113

Bexar County Zips – http://ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?ClientCode=capitolimpact&State=tx&StName=Texas&StFIPS=48&FIPS=48029

Collin County Zips – http://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?FIPS=48085

El Paso Zips – http://ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?ClientCode=capitolimpact&State=co&StName=Colorado&StFIPS=08&FIPS=08041

Tarrant County Zips – https://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?zip=760&stfips=48&state=tx&stname=Texas

Austin County Zips – http://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?ClientCode=capitolimpact&State=tx&StName=tx&StFIPS=&FIPS=48015

Hunt County Zips – http://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?ClientCode=capitolimpact&State=tx&StName=texas&StFIPS=&FIPS=48231

Atlanta (GA) County Zips – http://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?FIPS=13121&stfips=&state=ga&stname=

Saint Louis (MO) County Zips – https://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?zip=631

Kansas City (MO) County Zips – https://www.ciclt.net/sn/clt/capitolimpact/gw_ziplist.aspx?zip=631

Already announced

Oregon

California

Texas

Louisiana

Illinois

Ohio

Pennsylvania

New York

New Jersey

Connecticut

Delaware

Kentucky

Michigan

Massachusetts

Indiana

Dallas County (Only)

Atlanta, GA

St Louis, MO

Kansas City, MO

We’re 100% Operational and Ready to Serve! 

 

At Shiptransportal, we remain fully operational and committed to serving our customers. Please don’t hesitate if you have any questions or would like to learn more.

 

704-892-0531 | www.shiptransportal.com | [email protected]

Categories
Urgent News - COVID-19 Updates

COVID-19 UPDATE 03-25-2020 – Open Up Chat for Even Faster Communication

While our phones and emails continue to work perfectly without any interruption, we are looking for ways to make communication even easier and faster for those working remotely.  If this sounds like something for  you, please feel free to chat with anyone in our office using the Chat icon at the bottom right corner of our website (www.shiptransportal.com) or use this link Shiptransportal Chat to start a chat.   You will get a live response from the same office staff  that you can reach by phone or email. Chat works well for quick communication that does not contain attachments or must be privately directed at one person. Chat is often brief and to the point but does not lend itself to archiving.  It works great for quick questions or requests without tying up your phone line.

We must bring your attention to some changes in the industry as more and more states lend themselves to “shelter in place” / “stay at home” orders following the examples of (PA, CA, NY and IL).   Most all carriers are operating and need to continue to operate to support the US Supply Chain.  In line with this, any cargo that can not be delivered will be the returned at the cost of the “ordering” party.  Some carriers like FedEx Freight are no longer asking their drivers to review restricted states, essential business or commodities. Shiptransportal will communicate and confirm both pickup and delivery for all partial and truck loads. However, should the consignee not accept the cargo it will need to come off the trailer.  We will work with you to minimize the cost and ensure the best possible service.

As of 03/25 – The recent states / cities have announced changes to “Stay at home” or “Shelter in Place”.

Hawaii – Starts Wednesday 3/25/00 @ 0001

New Mexico – Started Tuesday 3/24/00

West Virginia – Started Tuesday 3/24/00 @ 2000

Mecklenburg Country (NC – Charlotte Area) Approx 87 zips – link below.

https://northcarolina.hometownlocator.com/zip-codes/countyzips,scfips,37119,c,mecklenburg.cfm

 

Already announced:

Oregon

California

Texas

Louisiana

Illinois

Ohio

Pennsylvania

New York

New Jersey

Connecticut

Delaware

Kentucky

Michigan

Massachusetts

Indiana

Dallas County (Only)

Atlanta, GA

St Louis, MO

Kansas City, MO

We will continue to monitor the situation including advisements from CDC, Local, State and Federal governments.  Our focus, dedication and support to our customers will maintain the standards you have grown to expect from ShipTransportal.

Sincerely,

Michael Osborne