Special Notice – Transport Capacity Crisis

Severe winter weather; ELD (electronic logging device) mandate; driver and equipment shortages; and the upcoming Lunar New Year.  You might ask: what do all of these things have in common?  Well, all you have to do is remember the first lesson you learned in economics class to identify the common theme:  Supply and Demand!  When there is a plethora of demand and an extreme lack of supply, issues will indeed surface.  Then if you add additional obstacles and pressures to the supply that does exist you begin to face a crisis situation.  This could also be labeled as a “Perfect Storm” and that is exactly what is occurring in the US Inland/Domestics Surface Transportation Market.

We at RCL Agencies currently see this US surface transport capacity issue as one of the biggest challenges the US Supply Chain Industry will face in 2018.  Not to mention, all of these factors affecting the US Surface Transport Market are going to put

major upward pressure on the pricing associated with these moves, as well. Some of you are already feeling the impact of this. In many instances, we are seeing carriers booked out up to two weeks in advance, and we don’t see this letting up anytime soon.  We are also starting to see price increases in the neighborhood of 20% in some US regions.

So this might raise the question:  What can we do to help lessen the impact these capacity issues may have on our business?  When thinking through the best answer to this question, two prominent words come to mind:  Planning and Collaboration!

To elaborate on these two words a little further and put it into context based on the scenario at hand:

  • Plan internally to reexamine budgeting throughout your organization. In order to ensure that you budget for the cost associated with these higher US surface transport cost.
  • Plan and collaborate with your production and supplier networks to work towards increasing your production lead times, in order to be as prepared as possible for any delays and capacity issues that may arise.
  • Openly communicate with your customers about these issues and your contingency plans, in order to minimize any last minute surprises (such as delayed order deliveries).
  • Collaborate with us and any of your other brokers and/or carriers to provide us/them with the most accurate projections for your freight volume needs.  Providing as much advance notice as possible for your freight volumes will help you capture more successes than failures, when securing domestic/inland transport capacity.

All of these important tasks will assist your organization in becoming more flexible when it comes to moving your US surface freight.  Flexibility will become one of the most important factors as capacity grows tighter.

To recap, if you are able to plan and collaborate through budgeting, increasing production and order lead time, openly communicating with your customers about the current US surface transport issues and collaborating with your US surface transportation vendors, by providing as much advance notice and analysis on your freight volume requirements, then you will be in a much more competitive position to weather this domestic/inland US surface transport capacity storm!

RCL Agencies is here to support you, so rest assured that we will continually and tirelessly do everything in our power to ensure that your loads get covered so that you can continue to focus on growing your core business.  That is exactly why we define our mission as follows:  To provide the most efficient, reliable, personalized supply chain solutions and information to our customers, allowing them to focus on further development and growth of their core business.

Here are just a FEW examples of why partnering with us is the right decision to help minimize the impact this capacity crunch may have on your organization:

  • We always strive to be the “Shipper of Choice” for our diverse group of core domestic carriers, by providing them with year-round volumes, consistency and a partnership approach.  In order for us to maintain these strong partnerships though, we must rely on the information our customers provide us in regards to their freight volume needs. So we urge you to please communicate this information to us, as soon as possible.
  • We are a true multimodal supply chain service provider, so we can provide our many different types of customers with a full arsenal of options to assist them with getting their product delivered.

Hopefully, this has given you a little further insight into the current US supply chain challenges at hand, as well as provided your organization with some potential solutions to assist in working through this US domestic/inland surface transportation capacity crisis.  We are here to help, so please do not hesitate to reach out to our sales team, www.oceanfreight.com , if a need arises.

Additionally, we would like to thank our current customers and international partners in advance for your continued patience and support. As we work through these capacity challenges to find the most fitting solution for moving your freight.