Trucking Companies Choosier About Customers Copyright Getty Images

Trucking Companies Choosier About Customers

Improving volumes make profitability a priority and less stress on their systems a major drive.

Considering 2014 started with a polar vortex, the freight industry is showing signs of life. Strong freight levels in Q2 have challenged many trucking companies to develop new plans to cope with increased demand for their services. Meanwhile, the pool of qualified drivers has fallen short of demand and the effects from last year’s FMCSA changes have created new hurdles to overcome, observes a domestic freight market report covering the trends of 2014, released by CarrierDirect, a strategic advisory firm in the transport and logistics industry. 

“Despite the challenges, we’re really seeing the pendulum swing back into favor of the carrier,” said Joel Clum, president of CarrierDirect. “Carriers are now in a place where they are choosing the shippers and 3PLs they want to do business with based on factors that go outside just the amount of freight they offer, looking more towards profitability and how little stress the customer puts on their operations, people and drivers.”

The report also expects trucking companies to seize the opportunity to invest in new technology and pricing changes.

“We’re standing on the edge of a sweeping reform in technology that will allow carriers to operate more efficiently – particularly in LTL – and price their services according to those they provide,” Clum added. “The shippers and 3PLs that aren’t equipped to do business in that environment or aren’t ‘carrier-friendly’ will face a challenging road ahead.”

Some of the trends this report identifies include:

  • Web services-enabled dynamic pricing in the less-than-truckload sector will allow transport companies like Con-way Freight, UPS Freight, FedEx Freight and others to charge more appropriately for their services based on space taken up by shipments and the needs of their networks;
  • Privately held logistics companies like Coyote, FreightQuote and Worldwide Express will continue to set the tone for best practices in the freight brokerage industry;
  • Asset-based trucking companies such as Swift Transportation, Werner and Estes-Express Lines will become leading third-party logistics providers alongside their asset-based divisions
  • Carriers will better utilize third-party logistics companies who resell less-than-truckload services, such as an Echo Global Logistics, as a complement to their salesforce rather than a competitor.

 

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