Inbound Management Kuebix

What You Need for an Unbeatable Inbound Freight Management Strategy

Managing inbound freight is one of the most crucial parts of running a successful supply chain, but the fact is… it’s hard! Each supplier is likely to have different characteristics and the receiving company can be negatively affected by suppliers’ inefficiencies such as low levels of visibility, lack of standardization and poor communication.

When companies lack comprehensive strategies for obtaining the lowest possible shipping and unloading costs or a plan to improve supplier behavior, they leave money on the table and complicate their supply chain. To avoid this, a complete strategy for inbound freight needs to be created which encompass the following three aspects; visibility, collaboration and accountability.

Visibility

Although companies have complete control over outbound shipments, that level of control dwindles when it comes to inbound freight. When it comes down to it, the receiving company does not have full visibility or planning capabilities for shipment arrivals and dock reservations. To optimize their inbound, stakeholders can benefit from better visibility of information such as knowing which carrier is being used, the exact timing of deliveries, and how much labor is needed to load and unload shipments, etc. Real-time data sharing through a single platform can ensure that everyone has the information they need to work toward a common goal.

Collaboration

By using a comprehensive inbound freight plan based on a collaborative ecosystem of suppliers, shippers and carriers, companies can effectively establish a dynamic rating and unloading allowance program. As companies work together with their suppliers to determine the most cost-effective method to handle each shipment (customer pick-up (CPU) or vendor controlled (VDS)) the goal should be to reduce overall shipping costs.

By giving suppliers choices, they’ll be able to select the most effective service and billing procedure. Companies should convert inbound shipments from VDS to CPU only when it’s feasible, and then establish preferred rates with a select group of carriers to handle those inbound shipments. A set of mandatory carriers to be used for all VDS and CPU shipments can be established with a standard routing guide. This will enable LTL pricing improvements, superior service levels and maximize consolidation opportunities.

Accountability

While businesses can’t always control what their suppliers do or the efficiency of their suppliers’ operations, they can implement Vendor Inbound Compliance Standards (VICS) to help improve supplier behavior. A comprehensive set of vendor compliance procedures will establish rules and processes that suppliers will follow when making deliveries. These accountability levels should also extend to the company’s own teams to ensure that orders get quickly from their origin to the distribution center (DC). The goal is to improve supplier behavior so that their inefficiencies aren’t causing the receiving company to lose time and money.

By following this general recipe, companies can craft an unbeatable inbound freight management strategy that will not only save them time and money but also improve their supplier relationships.

Download the full Kuebix ebook The Art of Inbound to learn more about crafting an unbeatable inbound strategy.

Save Money on Truckload Shipping Kuebix

10 Ways to Save Money on Truckload Shipping

Let’s face it, freight costs are rising as a result of the capacity crunch and driver shortage. Even shipping full truckload isn’t as cost-efficient as it used to be. The dawn of e-commerce ordering has increased the number of shipments as well as made consumers’ expectations higher. Truck drivers are steadily aging out of the workforce as they hit retirement age and other generations aren’t taking up the mantle. The supply chain is one of the largest cost centers for any business, so finding ways to save on truckload freight is a top priority.

Here are 10 ways you can save money on FTL shipping:

 

1. Improve Internal Efficiency

You have the most control over your own internal processes, that’s why streamlining how you and your logistics team works is low hanging fruit for saving money on truckload shipping. Leveraging a transportation management system will help you save time rating, booking and tracking your TL orders. Less time spent will help you save on labor costs and let you reallocate your team’s time to other, more productive uses.

2. Increase Lead Time

Increasing the lead time of your full truckload shipments will help you save on shipping costs. If you work several days ahead, you won’t have to pay higher rates for last-minute capacity and will have a wider selection of carriers to choose from. It also helps your carriers better manage their time and plan routes more effectively. All of these positives trickle down to the end customer to meet their high expectations.

3. Reduce Manual Entry and the Paper Trail

Recording everything by hand and manually dialing up carriers for every truckload shipment is old-fashioned and inefficient. Not only that, it can cost a company when mistakes are made due to human error. If the order quantity or weight was entered incorrectly, the paperwork is likely to get messed up and getting paid can become a struggle. Instead, companies can integrate their TMS with their ERP system to automatically flow information between systems. This will ensure that documents like BOLs are correct every time. It also makes transportation professionals more efficient if they aren’t re-keying information back and forth between systems.

4. Collaborate with Carriers

By creating a way to communicate and collaborate more efficiently with carriers, companies can lower their overall freight spend on FTL shipping. Collaboration portals have become a popular way for companies and carriers to exchange information about order statuses and delays in real-time. Some even integrate with trucks’ internal ELDs or RFIDs to alert all stakeholders where the truck is at all times. Collaborating for a higher level of visibility will help companies save on detention charges, plan labor more correctly, and meet their customers’ expectations.

5. Treat Carriers Well

Besides creating a method for a heightened level of collaboration with your carriers, you should also treat them with the same respect you would any other partner. Make sure to pay your bills on time, work to get them in and out of the yard quickly, and make sure expectations are clear ahead of time (ie: who is unloading the truck). All of these actions will help you form a relationship where carriers want to do business with you. In a market where capacity is scarce, having first dibs on the best capacity will help you save money.

6. Monitor Accessorials

Accessorials are a tricky thing for most companies to manage, they’re hard to budget for and can often go unnoticed until it’s too late. In order to keep overall truckload costs down, you should be constantly monitoring and evaluating your accessorial charges. If you’re consistently being penalized for loads which are overweight, try to find the root cause and address why the carrier is being told the wrong weight. Communicating all unusual circumstances ahead of time will often lead to lower charges than if the carrier discovers them mid-trip.

7. Leverage Your Volume

As a truckload shipper, you are in a unique position to leverage your volume. Instead of working with dozens of different carriers and only giving each one a small percentage of your volume, identify your preferred carriers and establish routine, reliable lanes with them. They may be able to offer you a discounted rate based on the fact that it’s repeat business. This strategy is good for everyone involved – it helps you maintain enough capacity to ship your freight, lets the carrier plan their routes more efficiently, and results in better service to the end customer.

8. Leverage a Full Truckload Spot Market

There will always be circumstances where your regular or preferred carriers can’t fulfill a truckload you need shipped. Maybe it’s a last minute shipment or maybe it’s going to a new destination. Whatever the cause, sometimes you need to find truckload capacity fast. In these situations, it’s best to have a plan to access the spot market. Spot markets are places where companies can go to have different carriers bid on their freight. From there, they can select the best bid and book their freight. Kuebix Community Load Match is a spot market where shippers can discover additional savings on truckload freight by connecting with Kuebix’s vase broker network. If you have freight to ship and are looking for additional capacity, you can request and receive truckload quotes through Community Load Match!

9. Stay Flexible

The supply chain industry isn’t for the faint of heart. You need to be constantly ready for unforeseen events like inclement weather, mechanical failure, or anything else. Having visibility to all of your orders down to the SKU level will help companies react to situations that they can’t plan for. Having all of the information needed in one place will help companies answer questions like ‘Where’s my order?’ and ‘when is the truck arriving?’ Staying flexible doesn’t only mean reacting to negative events though. Companies should stay flexible when booking their truckload shipments too. Just because the due date on an order is a specific day doesn’t mean that there isn’t an opportunity to deliver earlier or later in the day. Work with all of your options to discover the best rates for each and every full truckload shipment. Just because ‘that’s how you’ve always done it’ doesn’t mean you can’t make a change.

10. Leverage Analytics

You’ve probably heard the saying that you can’t change what you don’t know. Tribal knowledge will only get you so far in this field. You might generally know that you’re being overcharged for a certain lane, or that a certain carrier seems to be late more often than not. Without analytics on your truckload shipments, however, it’s hard to make strategic changes. If you can see in a report that a carrier’s OTD percentage is low, you’ll be able to have a discussion with that carrier about the metrics. If you didn’t have those metrics, having that conversation would be much more one-sided. Analytics down the SKU level also helps companies calculate their freight cost per item and determine if they are making enough of a profit. With a TMS, all of these different metrics and many others are captured in one place for easy analysis.

In order to save money on truckload shipping, companies need to leverage technology to their advantage, communicate and collaborate with their external partners, and make a point of both planning ahead and reflecting on decisions made. Trends like the capacity crunch, driver shortage, and the increased popularity of e-commerce ordering aren’t going anywhere. It’s up to each company to figure out how they are going to save money on their truckload freight and turn their supply chain into a profit center.

Transportation Regulations Kuebix

A Look at Transportation Regulations in 2019

Many changes in transportation regulations are coming this year that we’d like to make sure you are aware of.

The Electronic Logging Device (ELD) mandate, which made it illegal for truck drivers to only use paper-logging books to record hours at work and mileage is now over a year old, but groups are still petitioning FMCSA for exemption from the rule. Since ELDs have been put to use, most companies have come to grips with the disruption, some even citing improved efficiencies within their transport operations.

By the end of 2019, the older generations of onboard recording devices will have to be replaced with newer versions. By December 16, 2019, all drivers and carriers subject to the rule must use self-certified ELDs that are registered with FMCSA.

The last major Hours of Service (HoS) revision occurred in 2004. This year the rules will be tweaked, focusing on 4 areas, which include:

  •      •     Expanding the current 100 air-mile “short-haul” exemption from 12 hours on-duty to 14 hours on-duty, in order to be consistent with the rules for long-haul truck drivers;
  •      •     Extending the current 14-hour on-duty limitation by up to 2 hours when a truck driver encounters adverse driving conditions;
  •      •     Revising the current mandatory 30-minute break for truck drivers after 8 hours of continuous driving; and
  •      •     Reinstating the option for splitting up the required 10-hour off-duty rest break for drivers operating trucks that are equipped with a sleeper-berth compartment.

In Congress, a bill that would lower the minimum age of 21 years for commercial truck drivers working in interstate commerce could emerge this year. The bill will allow people between the ages of 18 and 21 to get a commercial driver license once they have logged 400 hours of on-duty time and 240 hours of driving time with an experienced driver. When complete, young drivers can drive big trucks on the interstate, which will hopefully help with the driver shortage.

On January 6, 2020, a new drug and alcohol clearinghouse will go into effect. It is an electronic database containing alcohol and drug violations of commercial vehicle drivers. The clearinghouse will help to ensure that commercial vehicle drivers and the public that share the road with them are safe.

Top Challenges for Supply Chains in 2019 2

Driver Shortage/Capacity Crunch Voted Biggest Challenge for Supply Chains in 2019

In December, we polled industry professionals about what they foresaw would be the biggest challenge for supply chains in 2019. Over 550+ people voted and one trend received over 44% of the votes!

The driver shortage/capacity crunch will be the biggest challenge for supply chains in the new year.

The driver shortage and capacity crunch is a trend we’ve been following for some time. A combination of truck drivers from the Boomer generation aging out of the workforce coupled with an increased demand for shipping (read: e-commerce) has created a shortage of both truckers and capacity. New talent in the workforce is also steering clear of often lucrative trucking positions. Companies with freight to ship are pulling out all the stops to attract reliable capacity for their freight.

There is nothing to indicate that the driver shortage and capacity crunch trends are slowing down. In fact, customer expectations continue to increase. Consumers are demanding greater visibility to their orders en route and faster shipping at the fraction of the cost. The need for an increased amount of capacity and more drivers will continue to exacerbate an already tight market where capacity is scarce and drivers are in short supply.

Here are the results of the other supply chain challenges we surveyed in December 2018:

  • Rising freight costs – 24%
  • Managing customer expectations – 10%
  • Lack of visibility and collaboration – 8%
  • Final mile shipping – 7%
  • Implementing a TMS – 5%
  • Other – 8%

In the ‘Other’ category, our respondents were able to write in their own answer to what they believe will be the biggest challenge for 2019. Of the 8 people who chose to write in, two cited the tariffs imposed on Chinese imports in 2018. One person went on to explain that the challenge for supply chains will be “Reacting to volatile tariffs and their short and medium-term impact on planning, capacity and cost.”

Other write-in respondents noted issues such as damages to products in transit, temperature control shipping, optimized inventory management, and lead time reduction. Better supply chain control via transportation management technology can help to mitigate or avoid the negative impact of these issues.

We’re looking forward to a 2019 that will be full of futuristic technologies like automated intelligence, smart active safety features for trucks, and drone technology. The landscape is changing, and with change comes new and more complicated pressures on the supply chain. The driver shortage and capacity crunch aren’t going anywhere. It’s up to each company to strategically plan how they will find reliable capacity and drivers to transport their freight.

What's Your Supply Chain New Year's Resolution - Kuebix

What’s Your Supply Chain New Year’s Resolution?

Lots of us make personal New Year’s resolutions, and some even stick to them! You might decide to hit the gym, stop smoking or start a savings account. Whatever it is, the New Year offers a fresh opportunity to do some goal setting and put your best foot forward. New Year’s resolutions don’t only apply to your personal life though, logistics professionals should start thinking about their supply chain goals for the New Year and resolve to make positive changes in their processes.

Resolve to Get Tech-Savvy

We’re in the midst of an innovation storm where new technologies are emerging from all sides. These new pieces of tech are putting the pressure on supply chains to improve their operations in order to keep up with the competition. This can be a good place to start if you’re trying to think of a good supply chain New Year’s resolution. Think about how trends like automated intelligence (AI), machine learning (ML), Blockchain, transportation management systems (TMS), RFID and GPS, electronic logging devices (ELDs), and other technologies are impacting your current operations.

Think about whether you’re leveraging your current technology to its fullest capacity. Ask yourself whether you’ve been procrastinating implementing a piece of technology that you know is only a matter of time. Do you understand all the benefits different supply chain technologies can give you? These questions can get you started in finding the right supply chain resolution for 2019.

Resolve to Improve Customer Satisfaction

Rising customer expectations may also be a sticking point for your company. Resolving to improve customer satisfaction might be a great resolution for your supply chain! Customers are demanding cheaper (if not free) shipping, complete visibility to their orders, and deliveries in record time. What once passed for acceptable is no longer good enough for customers accustomed to special treatment from retail giants like Amazon who offer trackable, free, 2-day shipping to members.

Instead of only asking yourself, you can ask your customers if they are satisfied with your service. Keeping track of customer satisfaction scores can help you understand the areas of opportunity you have in your supply chain. Areas to consider include order processing time (from the time they place the order until it leaves the dock), how difficult it is for a customer to get answers about their shipments, and whether you’re charging your customers the lowest possible amount in shipping.

Resolve to Cut Costs

This is probably a goal that you have year-in and year-out, but that doesn’t make it any less important for 2019. With the capacity crunch and driver shortage, freight rates have been steadily rising for over a decade. It’s difficult to keep shipping costs low when there don’t seem to be a lot of options out there. Couple higher costs with the rising customer expectations mentioned above and you have a recipe for poor profit margins and dissatisfied customers.

If you resolve to cut costs out of your supply chain in 2019, you should start by determining where there is waste in your current system. Are you wasting time individually calling up carriers to ask for rates? Is your network of partners as large as it could be? Are you tracking KPIs to make sure that external partners aren’t costing you money? Could you be consolidating shipments into larger loads or combining several routes into one optimized lane? Could your AR/AP process due with a little streamlining to make sure dollars aren’t being missed? There are many ways supply chains can cut costs on freight spend and which make excellent supply chain New Year’s resolutions.

Your Supply Chain New Year’s Resolution

Whatever you choose as your supply chain New Year’s resolution, make sure that it is measurable and achievable. Keep yourself on track with analytics and make sure to consider the ramifications for the entire supply chain, not only your own department. Making goals and sticking to them can help you enter the modern age with technology, earn loyal and happy customers, and do it all with lower costs and less waste!

the ceos of tomorrow will have supply chain backgrounds - kuebix

The CEOs of Tomorrow Will Have Supply Chain Backgrounds

In the past, most big decisionmakers came from chief revenue officer or chief financial officer roles. In those positions they made big decisions about budgets and likely moved millions of dollars around in P&L. While those roles are important, a new contender for future title of CEO is emerging; chief supply chain officer (CSCO).

With trends like rising customer expectations, the capacity crunch, demands for real-time visibility, and the increasing need for optimization, corporate value is increasingly being driven by how well the supply chain can perform its function. Supply chain professionals are learning all the skills needed to effectively manage a large global network, work with new and emerging technologies, communicate effectively both internally and externally, and look for opportunities to eradicate waste. Effective supply chain management impacts billions of dollars in cost of goods sold and can make the difference between a profit and a loss.

Since the time of Amazon’s 2-day free shipping announcement, consumer expectations regarding shipping have been steadily rising. It’s ultimately the chief supply chain officer’s role to ensure products are getting to the end customer quickly and cheaply. CSCOs who can do this successfully will give their companies a competitive advantage and rise above the herd. To do this, they will need to have progressive ideas for change and not be afraid to innovate. Those who leverage technology like a transportation management systems (TMS) early will find that their final cost of goods is strikingly smaller than their rivals and more profit can be made.

Besides contributing to the bottom-line, supply chain professionals have a unique opportunity to cater to their consumers’ moral compasses. Ethical trends like sustainability and green shipping can make a difference between a sale and a lost opportunity. Consumers, particularly millennials, are making their shopping decisions based on more than just price and quality. They want to know that the companies they purchase from have sustainability initiatives and are working to reduce their carbon footprint. As about 80% of a company’s environmental impact can be attributed to the supply chain, the opportunity to implement truly impactful sustainability initiatives is high.

Supply chain executives face operational challenges each day that are unlike any other department within a company. Global supply chain management requires that CSCOs are highly organized and know how to work outside of their silo. Communication between procurement, finance, operations, and other departments needs to flow smoothly for deliveries to be made on time. Issues like product shortages, delays, weather, and uncommunicative external partners have to be addressed daily, making supply chain professionals highly adaptable and nimble in their work.

In the not so distant future, it’s likely that CSCOs will become top contenders for the position of CEO in their companies. A combination of corporate value impact and their expensive network forged from their supply chain work will help them rise to the top.

Technology is Mitigating Risk from Driver Fatigue

Technology is Mitigating Risk from Driver Fatigue and Distraction

Driver fatigue and distraction have long been known to be dangerous, especially for truck drivers who often work long hours. Long before the modern age of handheld technology, drivers were becoming distracted by eating behind the wheel, rummaging around in bags, or even checking their faces in the rear-view mirror for too long. Driver fatigue is especially dangerous as the driver’s full attention is no longer on the road. Distraction and fatigue are issues that some are hoping can be eliminated with the help of technology so that accidents and even deaths can be avoided.

There are two schools of thought on how issues of driver distraction and fatigue can be mitigated. Some technologies measure and act when the truck performs an action that isn’t considered safe and others monitor the driver’s own actions. Both schools of thought have their own merits and drawbacks.

Tech that Monitors the Truck

Similar to how electronic logging devices (ELDs) monitor how long the truck has been in gear and moving, there are new technologies that are measuring other aspects of the trip. Technology like that from Lytx monitors actions like weaving and hard braking. When these types of driving events occur, the system gives the driver an audible alert to let them know that not all is well. After the third such event in quick succession, the system activates a camera and saves footage 8 seconds before and 4 seconds after the event stops. That footage can then be sent off for review and any corrective action needed can be taken.

Tech that Monitors the Driver

Another type of technology that can be used instead of truck monitoring software is driver monitoring software. These new technologies are much more space age and even slightly spooky. Netradyne, a company based in San Diego, is producing a camera system which monitors the driver’s eye positioning, their horizontal and vertical head plane and yawns, and can identify drowsy or distracted driving. If any of the predefined actions indicating distracted/sleepy driving are triggered, an alert (such as a chime or a seat rumble) will occur. These alerts will become more intense with the severity of the event and are designed to be highly annoying to get the driver’s immediate attention.

Besides cameras with sensors monitoring the behavior of drivers, there are also all sort of wearables doing the same thing. Smart watches and even smart headbands are monitoring things like brainwaves, heart rate, etc. This level of tech definitely feels like it’s out of a sci-fi film!

The Future of Driver Fatigue/Distraction

Monitoring the behavior of drivers to help avoid dangerous behavior like falling asleep at the wheel or texting will help to keep our roads safe. There is still a question of which technologies will prove most useful and least invasive to individual driver’s privacy. Depending on the results, it’s likely that all trucks will soon come equipped with advanced monitoring technology like those described above. With the relative success of the ELD Mandate, it’s only a matter of time before similar action is taken to ensure driver fatigue and distraction is reduced on the roads.

holiday e-commerce kuebix

How E-Commerce Companies Cope with the Holiday Shopping Frenzy

Online shoppers, especially American ones, are particularly active during the holiday season. This year’s holiday shopping season has already eclipsed the shopping spree seen in 2017. Buying from e-commerce stores is becoming more and more popular with consumers as they become used to making purchases online on their desktops or mobile devices. Many people find online shopping to be more convenient, faster, and often cheaper when compared with traditional shopping in a store or mall. So far, e-commerce companies are generally meeting or exceeding their customer expectations, but not without a lot of forethought into their supply chains. Here are some stats on the extent of e-commerce sales in the U.S. over the holiday season:

Holiday E-Commerce Sales Facts

  •      •     Total U.S. holiday sales online hit $123.73 billion in 2018, up 16.6% YoY
  •      •     Amazon accounts for 49% of all online shopping in the United States
  •      •     Shoppers spent:
    •           $3.7 billion on Thanksgiving Day, up 27.9% YoY
    •           $6.2 billion on Black Friday up 23.6% YoY
    •           $7.9 billion on Cyber Monday up 19.3% YoY
  •      •     Shopify
  •      •     Mobile device sales overtook desktop sales in 2016 and continue to grow
  •      •     Retailers sent over 7.6 billion emails over Black Friday and Cyber Monday
  •      •     The top category for holiday shopping online was apparel with 1.42M sales

The “Amazon Effect”

Some are blaming the growth of e-commerce for the demise of large retailers like Sears and Toys ‘R Us. Many brick and mortar stores failed to adapt to changing customer expectations and embrace supply chains powered by technology. Others, like Walmart and Target, have jumped on the e-commerce bandwagon and are mirroring successful trends set by e-commerce giant Amazon such as free shipping and fast delivery. The trend of fast delivery for free is often referred to as the “Amazon Effect” and has completely revolutionized customer expectations. However, offering expedited shipping as a standard feature for free is no mean feat for any company. To do so, e-commerce companies can optimize their supply chains with the help of technology to reduce wasted costs and speed up delivery times. This is essential for companies trying to cope with the holiday shopping frenzy.

Optimized Warehouses

Even without a physical storefront, most e-commerce stores still sell a physical product that requires warehousing space. Most companies choose to pool their inbound orders at a single warehouse location before sorting and shipping individual orders out to customers. Traditional warehousing with 100% manual picking and little-to-no automation, however, can be slow and add to order processing times. A two-day order processing time isn’t viable if the entire shipping process is expected to last only two short days. To speed up selection and get orders out the dock door, especially during the seasonal spike in sales, many companies are turning to technology.

Check out this video to see how one modern grocery warehouse uses robots to pick individual orders for customers:

automated warehouse video kuebix

Receiving inbound orders on time and making sure there is a truck to take customer orders to their end destination can be something of a challenge without technology too. Dock Schedulers are helping companies optimize their dock operations and ensure there is always enough labor available to properly handle orders. With Dock Scheduler technology, external partners can easily request and view appointment times at the warehouse in real-time, so holiday orders aren’t delayed because there wasn’t a truck to pick them up.

Faster Shipping

In order for e-commerce companies to provide expedited shipping at little-to-no cost to their customers, they need to find the most efficient, least expensive rate for every shipment. Instead of rating and booking with only one carrier over phone or email, companies can easily leverage a wide network of carriers when they use a cloud-based transportation management system (TMS). With a TMS, companies can compare all their carriers’ rates side-by-side and select the one with the service level and price to fit the need. This ensures they are saving as much money as possible while still meeting customer expectations.

TMSs also provide invaluable visibility to orders down to the SKU level. This not only means that freight spend can be calculated more effectively, it also means that e-commerce companies can give their customers visibility to the status of their orders in real-time. Impatient holiday shoppers who are now accustomed to being able to track and trace their orders are more likely to be repeat customers and to self-serve from the company’s site, rather than tying up customer service phone lines asking where their orders are. With this level of visibility, companies can report on their carrier’s KPIs and leverage these analytics to improve carrier behavior and make strategic changes.

Surviving the Holidays with Technology

The 2018 holiday shopping frenzy is certainly putting the pressure on e-commerce companies trying to keep up with customer expectations. To cope with the increased pressure, companies can use technology to streamline operations in their warehouses and on the road. Staying informed of new technologies and strategically implementing them as needed will speed up companies’ supply chains and reduce waste, resulting in more profitable bottom lines and happier customers!

2019 Supply Chain Predictions Kuebix

10 Transportation & Supply Chain Predictions for 2019

As we head into 2019, the global transportation industry will continue to face complex supply chain challenges. But the new year also provides many opportunities for shippers to turn to technologies and digital transformation to improve their operations, efficiencies and bottom line profits. Here’s what we foresee:

  1. Big changes—and a more holistic, organization-wide approach—to global supply chain strategies. Tariff wars and related uncertainty/repercussions mean top-level executives are relying much more on supply chain professionals and trade compliance personnel to rethink supply chain strategy and operations. Their major strategic focus? Managing global operations risk, understanding and mitigating the role of tariffs on company financials, and dealing with ongoing business uncertainty and higher global supply chain costs.
  2. More intense focus on data analytics in supply chains. Data analytics is key for supply chain professionals looking to examine, analyze and interpret data related to supplier risk, tariff risk, logistics costs or manufacturing costs. Supply chain professionals with well-honed analytical skills and the use of advanced analytics software for mining and reporting data will continue to help organizations make informed and better decisions.
  3. China’s expanding global reach and economic power. China’s One Belt One Road (OBOR) investments in the Middle East and Africa and infrastructure investments in modes including rail lines, roads, ports, bridges and even schools will help the country continue to outpace other countries’ economic expansion as they build long-term economic ties and trading partners. Its development of global trade routes means China’s economic influence is expanding even as U.S. influence begins to contract.
  4. “King Consumer” and ever-faster delivery of e-commerce orders. High consumer expectations about delivery and shipping of packages will continue to challenge retailers, carriers and logistics service providers, forcing fundamental changes to warehouse design and location and driving up wages and competition for all types of supply chain labor.
  5. Intensified technological disruption and innovation. Technological innovations like the “sharing economy,” the Internet of Things (IoT), big data, on-demand logistics and autonomous and automated equipment solutions will have great impact on supply chains around the world. Going into 2019, companies in the logistics and supply chain space will continue to take advantage of innovation in artificial intelligence, robots, freight supply and demand matching and blockchain applications to bring new efficiencies and lower supply chain costs.
  6. Battered U.S. transportation infrastructure. Buffeted and damaged by hurricanes, floods, snowstorms and the like—especially “weather events” that impact ports and major highways—the U.S. transportation infrastructure is a risk for both companies and the U.S. economy.
  7. Continued trucking/transportation regulation impacts. While most larger truck fleets have electronic logging devices (ELDs) that electronically track compliance with driver hours-of-service regulations, smaller fleets without ELDs are reporting reductions in miles traveled per day of up to 15 percent. This significant reduction can impact shippers’ planning and supply chains for 2019 and the longer term.
  8. The ongoing capacity crunch with drivers/trucks. The “capacity crunch” affecting the U.S. trucking industry will continue, due in part to fewer drivers in the “driver pool” thanks to attrition and the tight economy combined with low truck supply and high freight demand.
  9. Soaring truck rates. Rates have continued to rise steeply throughout 2018, are soaring at the end of 2018, and likely will continue to rise into 2019.
  10. Trucking industry technology trends. New technologies and apps will continue to ease the jobs of logistics professionals. On-demand load-matching freight apps are likely to be increasingly embraced by carriers and shippers. In addition, semi-autonomous trucks are finding a place in fleets and the supply chain, providing a 500-mile shipping range.

For 2019, we believe the U.S. transportation industry and supply chain professionals will place more emphasis on digitization within the supply chain to help them address these complex challenges. Kuebix TMS will continue to transform transportation operations, helping companies along their path of growth and sustainability by improving their operations, efficiencies and bottom line profits.

sustainability initiatives supply chain - kuebix

Supply Chains are Saving Money with Sustainability Initiatives

Companies are always looking to improve their bottom lines, but sustainability initiatives have up until this point remained in the “nice to have” category for many companies. The pre-conception that sustainability programs cost too much money is a notion that is being challenged, however. A new study by HSBC of more than 8,500 companies in 34 market sectors shows a trend that businesses who implement sustainability changes in their supply chains are improving their bottom lines.

Supply chains are where the majority of a company’s environmental impact occurs. Transportation of goods eats up a lot of fuel and shipping materials like shrink wrap and pallets often get thrown away. In fact, about 80% of a company’s environmental impact can be attributed to the supply chain. This makes it an obvious place to begin trimming waste.

Fuel Usage

Reducing waste and improving the bottom line go hand in hand, however. A company that wants to cut their fuel usage can consolidate multiple LTL orders into a full truckload or find the optimal route between stops with the help of technology. If truck idling time is a concern, businesses can focus on ways to improve the flow of traffic in their yards and docks. These changes are not only green, but save the company money by improving efficiency and reducing freight spend.

A Digital Paper Trail Instead of a Physical One

Gaining shipping transparency with the help of technology is another method companies can use to reduce their environmental impact. Instead of wasting time, paper, and money chasing down the status of loads and calling and booking appointments, companies can leverage transportation management technology to go paperless and speed up processes or rating, booking and tracking. Digitization trends like automation and machine learning are helping to speed this process up even further. With technology, companies can retain an organized paper trail of their order statuses instead of a disorganized literal one in their offices.

Finding Waste

Tracking and tracing technology can pinpoint areas of waste in a supply chain. A company can analyze where there are delays in their supply chain, measure their carriers’ KPIs, and make strategic optimization changes. Being able to see an order down to the SKU level from the time it leaves the dock to when it’s delivered to the customer gives companies a heightened level of understanding of their freight spend. It also means that nodes which are performing poorly can be addressed. Once issues are found and eliminated, environmental savings follow almost organically.

The Bottom Line

Consumers are becoming more and more environmentally conscious. It’s important for companies to understand what their consumers value and integrate those same principles into their day-to-day operations. Not only will sustainability initiatives help the environment, they will also streamline supply chains and contribute positively to the bottom line. More profits mean more opportunities to streamline processes, and so on. Instead of being wary of investing in sustainability initiatives, companies should consider the positive ROI they will gain and jump on the green supply chain bandwagon!

Transportation management technology like Kuebix TMS can help companies with their green initiatives. In fact, Kuebix recently won Supply & Demand Chain Executive’s Green Award for the second consecutive year. The award recognizes providers of supply chain solutions and services that assist customers in achieving measurable sustainability goals. If you’re interested in improving the efficiency of your transportation operations from both a sustainability and monetary viewpoint, check out Kuebix to find out how intelligent supply chain technology can begin you on your journey!

Uncertain Freight Rates

The Unpredictability of Spot Rates in the Changing Market

Nearly every industry relies on some manner of transportation to keep their sales flowing. Over the past decade, transportation rates have experienced a steady period of growth. A combination of recovery from the Great Recession of 2008 and consumers’ increased dependence on online shopping have kept the supply of trucking capacity at a premium. If we were sitting in an Economics 101 class, there has been plenty of demand for supply. National spot rates, which have remained high in accordance with this supply/demand formula, are becoming more volatile as market uncertainty pervades the industry.

Average daily spot market rates from August to November of 2018 have been nearly twice as erratic as spot rates during the same time-period in 2017. The DAT National Van Freight Rate Index places average daily movement in 2017 as $0.034 per mile. This number has climbed to $0.064 per mile in 2018!

The climb in average daily movement of the national rate per mile is indicative of uncertainty. Key players in the supply chain like shippers and carriers don’t have a solid grasp on market conditions and are quoting and booking rates with less foreknowledge than in the past. Things like fuel prices, driver wages, and the availability of capacity are no longer known facts. Many shippers accept rates without being able to tell what the market price should be.

Spot rates are likely to remain volatile for some time as a result of the capacity crunch and driver shortage. More and more baby-boomers are reaching retirement age, and younger workers are less likely to become truckers than past generations. This is leaving a hole in the industry and too many available positions for truck drivers, which causes wages to go up. Again, supply and demand.

Following a 10 year rise in the transportation market, we’re now in a period of cooling. According to FreightWaves, “The DAT Van Freight Index hit $2.11 per mile on June 27th, the highest rate all year. Since then the market has cooled significantly with the rates falling as low as 1.53 in the middle of October but bounced back up to 1.63 a few days later.” Volatility like this causes uncertainty for people trying to provide rates based on market pricing and for people who are uncertain what a fair price per mile is.

With customer expectations rising, there is a greater need to deliver faster with more visibility. Some companies trying to accommodate these new customer expectations are willing to take a hit to stay in their customers’ “good books.” This means they may take a loss just to meet their on-time delivery standards. This level of unpredictability is adding to uncertainty.

The transportation industry is morphing around emerging technologies and consumer expectations. One thing is for sure though, whether there is an increased or decreased demand for trucking capacity and spot rates, trucking will remain a key feature of the economy’s supply and demand curve. In this unpredictable environment, the goal is to find a comfortable middle where customers are happy and freight costs are kept down as much as possible.

Perfect Storm of Innovation

What Does the “Perfect Storm of Innovation” Mean for Your Supply Chain?

We’re living in a historic era of technology, innovation, and economic growth. Consumers expectations are rising and new technologies are upending the status quo. These two “storm fronts” are clashing together to form a “perfect storm of innovation” which is shaking up the supply chain industry. Between customers’ empowerment to get exactly what they want and a diverse and expanding realm of digitally connected smart technology, companies can be left feeling lost in the storm. However, with a little foresight, companies can navigate these new straights and position themselves for success in this brave new world.

Customer Expectations

In the modern age, if a customer is dissatisfied with a purchase, they don’t just complain to the store manager or forget about it. Instead, they might take to social media to lament their experience. This can be a huge hurdle for any company to overcome. Social media is a double-edged sword. If used correctly, however, social media can be a huge asset to a company.

Taking a personal approach to customer service can help with dissatisfied customers. Whether you are replying to a negative tweet or responding to a direct call to your support team, the customer no longer needs to put up with poor service. It’s a buyer’s market, and consumers can easily move their loyalty to a competitor. Consider leveraging tools like automatic chat on your website and providing them self-help visibility to the status of their orders.

Visibility is a huge buzzword in the supply chain industry right now. Giving your customers visibility means being able to show them where their orders are when their orders are going to be delivered, and being able to explain any delays in transit. To be able to give your customers this level of insight, however, you first need to have visibility to your entire supply chain. Technology like a transportation management system (TMS) with advanced tracking capabilities can give you this.

With a TMS you can view the status of any order at any stage of the supply chain and even have automatic alerts sent to you when something goes wrong, that way you can proactively warn your customers. Customer loyalty can be developed through proactive and personal communication and you can even turn what would likely have been a negative experience for your customer into a positive one.

Technology

Technology and managing customer expectations go hand in hand. If consumer preferences stayed the same, there would be no reason to modernize your supply chain to meet changing expectations. Customers are demanding more and more customization of their purchases. Companies can leverage the Internet of Things (IoT) to connect the moving pieces of their supply chain and compile Big Data about their operations to analyze and make strategic improvements.

Some companies are going as far as to employ 3D printing or additive manufacturing techniques to accommodate this new demand for customization and to help with the cost of R&D. Mass-customization is taking the place of mass-production, and supply chains and manufacturers need to be nimble and react to feedback from customers quickly.

Speed of delivery is another hot-button issue for consumers which can be solved with the help of technology. To keep up with mega-giants like Amazon which dominate the e-commerce market, companies need to offer faster shipping at greatly reduced or free rates. To do this, companies can leverage technology to find and book freight with the most cost-effective carriers at the best service levels. With a transportation management system, you should be able to compare several modes, such as air, LTL, or TL to find the carrier that can meet the customer’s expectations. TMS technology can also help companies improve the flow of their inbound and outbound operations to reduce delays in the yard and speed final mile delivery.

It’s anticipated that drone technology will eventually take over as a main method of delivering orders to individual customers. That isn’t quite a reality at this time, but companies can already leverage drone and robotic technology in their warehousing processes. GPS technology, sensors, and RFID tags can improve operations in the warehouse and streamline the movement of individual orders.

The Eye of the Storm

Many companies are struggling to keep pace with changing consumer expectations and new technological advancements. These companies should take a step back and review how they can leverage technology to meet the needs of their customers. Consider social media as an asset as well as the power of giving customers end-to-end visibility to their orders. Think about ways to speed up the supply chain by finding and capitalizing on different carrier rates and service levels. Can additional technology in the warehouse improve selection times? Companies who get ahead of customer expectations by leveraging technology will find the eye of the innovation storm and be able to benefit from the changes taking place in the industry!

ELD Mandate - Kuebix

10 Months Later – The Impact of the ELD Mandate

The transportation industry, which originally balked at the idea of the ELD mandate, has now had 10 months to come to terms with the new technology requirements. The mandate, which went into effect on April 1st of this year, requires trucks to be equipped with an electronic logging device (ELD) to automatically record a truck’s driving time. This ensures that drivers are strictly obeying hours of service requirements put in place to protect them and other drivers.

10 months in and transportation professionals still seem to have mixed feelings about the ELD mandate. To capture how the industry is reacting, Zipline Logistics’ carrier team surveyed over 150 trucking companies to get their opinions on the ELD mandate and how it’s impacted the industry. FreightWaves compiled these results into this detailed infographic:

ELD Mandate - Kuebix - FreightWaves

According to the research, trucking companies are split on whether ELDs improve safety. About 60% of respondents felt that ELDs increased safety since the mandate went into effect, while the remaining 40% thought the devices decreased safety.

77% of carriers surveyed reported that they are more selective in the shippers/receivers that they are willing to work with after the mandate. 80% of these say there are now some facilities they will absolutely not load out of. Slightly more than half of carrier respondents say they have changed how long they will wait at a shipper/receiver. With hours of service being monitored more closely, there is no longer much wiggle-room for delays or partners who cannot maintain high KPIs.

Whether or not freight costs increased was another main question of Zipline Logistics’ survey. 48% of carriers say that linehaul rates have increased due to the requirement for ELDs, though 33% felt that ELDs weren’t at fault for rate increases. It seems to be a consensus, at 71%, that per mile rates have increased due to ELDs.

What can be done to keep ELDs from disrupting supply chains?

Equipping all trucks with electronic logging devices has been a hurdle for many in the transportation industry. Now that the mandate is in effect, devices are installed, and drivers are successfully using them, it’s time to think about how to leverage them to your best advantage.

Transportation management technology like Kuebix TMS can help companies achieve higher levels of visibility across their entire supply networks. This level of visibility will help them plan ahead to avoid facilities that are too slow to load/unload and choose carriers that have excellent service levels and on-time delivery metrics. The ELD mandate doesn’t have to be a detractor for companies shipping freight, with the right strategies in place, ELDs can actually serve to improve operations and keep drivers safe on the road.

General Motors GM

GM Closes Assembly Plants, Shifts Focus from Cars to Technology

General Motors (GM) announced today that the company will be completely restructuring their global business strategy by closing 8 assembly plants worldwide and shifting focus to futuristic technologies. Five of the plants which will be closing are in North America. Fifteen percent of GM’s salaried workforce is being cut including 25% of top executive positions. These changes are expected to save the company $6 billion by the end of 2020.

In the short term, this announcement is seen as a major blow to workers who will be out of a job by the end of 2019. It will also be a blow to an American-born industry which GM has been a cornerstone of for generations. In the long term, however, GM seems to be positioning itself to react to changing market conditions such as consumer preferences and the need for improved technology.

According to Mary Barra, CEO of GM, General Motors “recognizes the need to stay in front of changing market conditions and customer preferences to position our company for long-term success.” The popularity of sedans is waning with consumers, though anticipation is high for self-driving vehicles and cars with other state-of-the-art technologies.

GM threw its hat in the self-driving car ring with its acquisition of Cruise in March 2016. Cruise is a driverless car company which is headquartered in San Francisco, CA. It’s competing to be the first company in Silicon Valley to successfully make and market a self-driving vehicle to American consumers. Top contenders for the company to make self-driving cars a reality for the public include companies like Google, Apple, and Tesla. GM has announced that it will spend $1 billion on Cruise in the upcoming year to build the car of the future.

Some speculate that rising costs associated with tariffs on imported steel and aluminum have contributed to GM’s decision to close many of its American plants. Commodity costs for GM have risen by $300 million in Q3 of 2018 and are anticipated to raise costs by $1 billion next year. Closing plants and reducing their headcount will work to counter-balance changing consumer tastes and higher commodity prices.

General Motors has a new motto to go along with its change in corporate strategy, “Zero Crashes, Zero Emissions, Zero Congestion.” This new slogan incorporates three of the top concerns drivers have when they weigh the decision to purchase a car. Automation technology and green technology will help to cut down on these negative side effects.

The question remains whether GM’s closure of 8 assembly plants worldwide to put a renewed focus on developing technology will make or break a company steeped in history. If their bid to be one of the first companies to go-to-market with their own self-driving car or a car with zero emissions, the dramatic switch in focus could skyrocket GM’s sales. However, the company walks a fine line between preparing for the future and turning away an American public which has long since regarded GM as a traditional car company.