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As the year 2013 winds down, it is time to reflect on the major transportation trends of the past year.  While I saw and read about a wide range of developments, these are the ones that resonated most with me.

1.Technology Comes to Freight Transportation

Last year I predicted that we would see a flurry of new technologies come to freight transportation.  They did and I wrote about some of these new companies on several occasions during the year.  Technology was successfully applied to the freight brokerage business, freight portals, LTL density calculations and to other segments of the industry.  Buytruckload.com, PostBidShip, Freightopolis, QuoteMyTruckload,  and Freightsnap were featured in various blogs during the year.  They are changing the way business is done in freight transportation.  Watch for more of these companies to surface in 2014.

2013 has been called the Year of the Network by numerous supply chain and transportation industry thought leaders.  Companies that built a successful supply chain trading partner network focused on three elements:

Connectivity— unite disparate systems and trading partners

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At the end of each year, I like to take stock of the major freight transportation stories of the past twelve months and look ahead to the trends that will drive the industry in the coming year.  The two blogs that I write are prepared from my perspective as a consultant to shippers and carriers.

This year I would like to hear from you.  Those of you who follow this blog observe trends in your segment of the industry.  Please take a minute to share them with me.  Please post them on this blog or send a private e mail to dan@dantranscon.com

Please feel free to select any major trend or trends that are having or will have a major impact on our industry, whether regulatory, economic, technological, demographic, consumer behavior, environmental, modal shifts or business strategy.

To broaden the range of inputs and perspectives, I will also post this request on Facebook, LinkedIn and Twitter.  In the coming weeks I will be preparing my two lists.  The lists will include a blend of my observations and yours.  Look for these two blogs in mid-December.  Thank you to those of you who take the time to share your observations with me.

 

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One of the most enjoyable aspects of our work as consultants is that my colleagues and I have an opportunity to visit companies in a variety of industries.  We typically are engaged to help businesses that have issues with freight management.  While some of our clients may be Best-in-Class when it comes to manufacturing or retail, they are often not as skilled in managing freight transportation. 

We often notice that their freight strategies are not aligned with their business strategies.  In fact, they often inhibit these companies from achieving the bottom line results that they are so desperately seeking.  Here are some of the things that we commonly observe.

Many companies focus on the outbound movement of their freight to their DCs, retail stores or customers.  They let their vendors control all or some of the deliveries of raw materials or finished products to their main manufacturing or distribution facility.  This can produce several negative financial impacts. 

For many vendors, freight is a profit centre.  They mark up their freight costs and include the inflated cost in the landed cost.  By not having control of inbound freight movements, this restricts the leverage a company can have with its carriers when it comes time to negotiate freight rates.  It also limits the opportunity to perform consolidations to further reduce freight costs.

We also observe that a number of companies are not providing their clients with the level of service they require.  This can occur for several reasons.  The carrier may be picking up or delivering the shipper’s products at the wrong time.  Their transportation network is not aligned to the needs of some of its customers.  A late pickup or delivery, on a consistent basis, can mean the loss of customers.  It may result in wasted warehouse or store expense as the crews stand around waiting for the freight to arrive.  In addition, carriers may be holding freight on their docks to build better loads to certain destinations.   They do this in the hope that shippers that do not carefully track the on-time service performance will not notice these late deliveries.

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