Most of us over the age of 25 can remember when the World Wide Web made its debut. We remember the “beep-boop” sound of dial-up and the big chunky computers that were as wide as a television set in the 1990’s. It’s been almost 30 years since the dawn of the Internet. It’s mystifying to look at the impact it still has on our everyday lives. Because of the Internet, e-commerce was born, and the need for flatbed shipping has increased. 

The Beginning of ECommerce

Over time, ecommerce has taken the baton from traditional brick-and-mortar stores, leaving many big-box store retailers high and dry. Since Amazon Prime’s arrival in 2005, online shopping has exploded in the marketplace. The ease and convenience of it have forced many retailers to develop a strong online presence or risk closing their doors for good.

COVID-19 Creates Rapid Growth

Due to health concerns and social distancing practices, COVID-19 rapidly escalated the use of ecommerce. Total online spending in May 2020 was up 77 percent year-over-year (YOY), according to a report on online spending released in June by Adobe. In that report, Vivek Pandya, Adobe’s Digital Insights Manager, states that it would have typically taken 4-6 years to see the level of growth in online shopping that was seen then. Contactless online ordering helped individuals attempt to limit their exposure to the virus by shopping from home, so it’s easy to see why those reported numbers were so high. 

Since the pandemic, the changes in the ways consumers shop have remained. While in-person shopping has increased compared to then, it still lacks in the amount of foot traffic that was received previously. Consumers continue to like the ease of online shopping, and with fewer in-person shoppers, companies are investing less in their brick-and-mortar locations, which has only made people less likely to want to shop in person. In fact, it’s estimated that 40,000 to 50,000 retail stores will close in the next five years, according to the UBS investment bank.

Ecommerce continues to experience growth, with 22 percent of retail sales being online in 2023, the largest U.S. ecommerce sales percentage to date, according to the U.S. Department of Commerce. As e-commerce growth carries on, it’s created a growing need for companies to expand their inventory and improve their ability to distribute their products. What used to be a problem of “too much” storage space for companies before the pandemic has quickly turned into a necessity in today’s time. 

The Need for Storage Space

As online distributors continue to see growth, their need for storage space has grown as well. Prior to Covid-19, one or two warehouses could keep a medium-sized company running efficiently. Now, more space is needed to keep up with the increasing demand of companies. Having more than one distribution center can be a huge benefit to a company’s ability to stay successful these days.

This all trickles down to the construction industry. As demand grows for new or renovated warehousing, the need for building materials to meet that demand has also increased.

How ECommerce Growth Affects Flatbed Shipping

Flatbed shipping has always been a leading mode of transportation for industrial freight. Lumber, stone, racking, and other building materials travel best on an open trailer due to their odd dimensions and additional weight requirements.

Looking for an extensive guide to keep on hand for your over-dimensional shipping?

Usually, flatbed shipping sees an increase in volume in the summer months. Construction companies take advantage of the warmer weather, which is most suitable for outdoor construction work. During this peak shipping flatbed season, it’s not unusual to see tightened capacity and higher freight rates, but any added demand for warehousing can add to that, making securing a flatbed carrier more difficult.

Strong Relationships Help

Having a relationship with a third-party logistics company (3PL can be a benefit to those who coordinate freight to be delivered to a job site. Typically, job site freight is very hands-on and has a perpetual knack for being time-sensitive. Installation crews are on-site to receive and install the material scheduled to be delivered. Even the slightest delay can cause significant ramifications to the completion of the construction project. Having a strong relationship with a 3PL can help companies mitigate risk, reduce costs, and provide peace of mind to those who are coordinating the freight.

Be Ready for Anything

It appears online shopping is here for the long-haul and whether it’s causing you to expand your warehousing or not a 3PL like Trinity Logistics can help you be prepared for any changes that may come your way. With Trinity, you’ll gain a Team of experts that can help you optimize your supply chain and arrange shipping for various of transportation modes, including flatbed, while offering end-to-end visibility of your shipments. No matter what changes the future brings, you can stay one step ahead when you choose to have Trinity Logistics by your side.

Many of today’s manufacturing trends are in line with the industry’s goals to improve processes, create more efficiency, and meet consumer demand.

The manufacturing industry has seen challenges, from changes in the way people work to the rapid growth in demand, with many of these challenges accelerated by the recent covid-19 pandemic.

So, what evolutions and challenges are the manufacturing industry currently facing? Let’s dive into the latest manufacturing trends.

WHAT ARE THE LATEST TRENDS IN MANUFACTURING?

• DIFFICULTY FINDING LABOR
• DIVERSIFYING WORKFORCE
• TECHNOLOGY IS TAKING OVER
• INCREASING CYBERSECURITY
• CARBON NEUTRALITY
• BUILDING RESILIENT SUPPLY CHAINS

DIFFICULTY FINDING LABOR

Manufacturers are still struggling to find labor, with a recent Deloitte survey estimating that the manufacturing sector will be short 2.1 million skilled workers by 2030. It’s difficult for manufacturers to fill open positions, with respondents claiming it is 36 percent more difficult to recruit than in 2018.

To combat the shortage, manufacturers are looking for ways to recruit and retain skilled talent, by raising wages and reskilling current talent to meet company needs. According to the Manufacturing Institute, young employees are attracted to companies that look to train and invest in them. 70 percent of manufacturing workers under 25 said they will stick with an employer because of these opportunities to grow.

Additionally, technology is advancing and should help manufacturers combat their labor challenges. With tools like artificial intelligence (AI) and the Internet of Things (IoT) becoming more accessible, companies should be able to become more efficient and able to produce more with fewer people.

DIVERSIFYING WORKFORCE

Diversifying the workforce is one of the growing manufacturing trends because the industry has held a reputation for being a male-dominated industry. According to a study by the Manufacturing Institute, less than 30 percent of manufacturing workers are women. So, in 2021, the Building Economic Strength Through Manufacturing Act was passed. This bill seeks to double the number of women-owned and minority-owned manufacturers.

According to Glassdoor, when applying for jobs, 76 percent of applicants look for company diversity. Diversifying the workforce is a trend that goes in hand with employee recruiting. It creates opportunities for new talent and can help make operations more resilient.

TECHNOLOGY IS CHANGING THE INDUSTRY

Technology changing the industry has been and will be a manufacturing trend for some time. Technology is improving, becoming more accessible, and showing its benefits, so many manufacturers are investing in it more. Manufacturers need technology to keep up with the challenges of increased demand while facing a labor shortage.

Some technology tools companies are using include AI, automation, sensors, IoT, robotics, predictive maintenance, and remote monitoring. These tools help manufacturers with the manual and repetitive tasks that they struggle to find the labor for. In addition, companies are evaluating their operations to make the best use of technology and people.

Frontline workers will likely expand their roles to take on new responsibilities. As technology automates processes, workers will need to use more communication, collaboration, and analytical skills. Technology will also offer more flexibility and safety for frontline workers, further helping with employee recruiting and retention.

Some manufacturers are even pushing the limit and testing our “dark factories”. These are fully automated factories without any human workers on site.

Industry 4.0 is what many refer to as this trend of technology. It’s a shortened term for what is being called the fourth industrial revolution. Industry 4.0 technologies, such as the above examples, can raise productivity by 40 percent.

INCREASING CYBERSECURITY

As technology use increases and manufacturing processes get more connected and complex, a growing challenge is cybersecurity. In 2021, manufacturing was the industry that suffered the most cyberattacks, according to IBM’s X-Force Threat Intelligence Index. In fact, according to a survey by Omdia, the increasing risk of cyber attacks are one of the main challenges slowing down the implementation of more analytics, automation, and AI in manufacturing.

Because of its increased risk for cyber attacks compared to any other industry, manufacturing companies are investing more in the cybersecurity strategies and monitoring, implementing the use of multi-factor authentication, issuing employee training on cybersecurity, and building recovery plans to be prepared should any attacks take place.

CARBON NEUTRALITY

Combatting climate change is a priority on everyone’s mind and the manufacturing industry is no exception. The manufacturing industry produces almost a quarter of global greenhouse emissions. However, with the government pushing industries towards sustainability, manufacturing companies are rethinking their operations.

One manufacturing trend is carbon neutrality. Carbon neutral is when a company removes the same amount of carbon dioxide it emits into the atmosphere.

Manufacturing companies can become carbon neutral by purchasing carbon offsets. An example of this would be a company sponsoring a solar energy farm or a project for reforestation.

BUILDING SUPPLY CHAIN RESILIENCE

Since the start of the covid-19 pandemic and the supply chain bottlenecks we continue to face, supply chain resilience remains a top manufacturing trend.

Supply chain bottlenecks like the covid-19 pandemic, high container costs and delays, severe weather, protests, and new regulations are a few of the disruptions that have shed light on manufacturers’ fragile supply chains.

Manufacturers continue to look for more resilience to keep up with consumer demand despite these challenges.

Improving communications with supply chain partners, onshoring or reshoring, and investing in supply chain technology are some of the ways manufacturers are making their supply chains more stable.

STAY AHEAD OF MANUFACTURING TRENDS

Whether you know the latest manufacturing trends are or not, having an expert on your side is one easy way to stay ahead. And that’s just what Trinity Logistics aims to be.

Yes, our primary focus is as your logistics partner, but our People-Centric culture means we’re more than that. As a business relationship, we’re invested in your company’s success. We stay knowledgeable on what’s going on in your industry to help keep you updated. And we stand at the ready to offer your business any logistics support and expertise that you need.

Don’t miss your opportunity to gain a business relationship that stays on top of your industry’s trends and is people focused. Let’s get connected.

Stay up to date on the latest information on conditions impacting the freight market, curated by Trinity Logistics through our Freightwaves Sonar subscription.

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2023 Crystal Ball

It’s usually this time of year when predictions for the upcoming year start to make headlines. It’s safe to say that most folks could make some predictions based on what has transpired recently, so I wanted to highlight a few of those as we kick off the new year.

The gap between spot and contract rates will stabilize.  

Now, this does not mean that they will be equal – that rarely happens. Just about a month ago, the spread was quickly approaching $1.00 per mile between contract and spot rates (with contract being higher). That gap is slowly starting to shrink (Figure 1.1). Some of that is due to spot rates seeing a holiday bump, and part of that is related to new contract rates taking hold. With many carriers taking an extended break from the road since mid-December, less capacity has pushed spot rates higher. This upward trend will be short-lived and expect rates below $2.00 per mile to become the norm as we chug through winter and into early spring. Contract rates will also trend downward, finding a floor most likely in the middle part of the year.

Few sectors will see bright spots in 2023.  

I don’t think anyone thought the economy could continue to chug along at its rapid pace seen in the latter half of 2020 and through most of 2021.  Even though 2022’s growth was not as robust as the prior year, the U.S. Gross Domestic Product (GDP) should seek out a modest two percent growth rate. However, where that growth occurred sets the stage for this year.  

2022 saw a return of spending on services versus goods. So, while things like healthcare are important to the overall economy, from a freight standpoint, service spending has much less impact on transportation. Expect auto sales, both new and used, to continue their strong run. As parts and inventory issues continue to be resolved, vehicles with temporary tags will be more commonplace as Americans continue to purchase cars and trucks.  

On the opposite end, most notably, the housing market will have a rough 2023. With Americans seeing inflation compete for more of their take-home dollars, and the cost of borrowing increasing, many will choose to remain in their current situation. And it’s not just the building materials that will see less of a demand. With fewer new homes comes less demand for things that go in those homes – like appliances, carpets, and furniture.

Following the building industry, manufacturing will be the next downstream effect, and banking will also see less demand for consumer and business loans. Overall, expect 2023 to see, at best, no year-over-year (YoY) growth in GDP, with 2024 being a rebound year (Figure 2.1)

Import activity will continue to slow. 

As we saw in last month’s update, Figure 3.1 shows the impact of the ship backlog being resolved and container movement starting to slow. That will be a common theme this year. While 2022 saw year-over-year import activity down almost 20 percent, that downward YoY story will continue in 2023. This will have an immediate impact on intermodal activity, but also over-the-road and less-than-truckload volumes will feel the impact.

One thing to keep in mind as we see recent actual and forecasted numbers showing negative, that is against a backdrop of a very successful 2021 and modest growth year in 2022. So while 2023 will not continue that positive trend, by comparison to a recent down year like 2019, 2023 will be up from an overall volume standpoint versus just a few years ago.

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Stay up to date on the latest information on conditions impacting the freight market, curated by Trinity Logistics through our Freightwaves Sonar subscription.

As we near the end of 2022 and the start of 2023, let’s look at three things in relation to the freight market: freight volumes, the rates, and what’s happening in the maritime segment. 

SLOWING FREIGHT VOLUMES

In Figure 1.1, you can see the contracted outbound tender volume index over the past four years. The yellow line on the top represents 2021, the blue line represents 2022. 

Since about the end of the first quarter of this year, we started seeing those volumes pacing around the same way as last year, but then all of the sudden they started to take a nosedive. Contract volumes are down around 15 percent below 2021 levels. What that means is we’re seeing less volume trickling to the spot market and this trend will certainly continue as we go into 2023.

FALLING RATES

Speaking of rates, in figure 2.1, you’ll see the top green line represents the average van rate for contracted freight. The blue line is vans for the spot market. 

As you can see, just like with freight volumes, they were running neck and neck until about March, and then there was a discrepancy. We’re seeing this on the rates side as well. Typically, the difference between contracted and spot rates is maybe 10 or 15 cents per mile. The fact that right now it’s about 70 to 80 cents a mile, we’ve never seen it at that high of a discrepancy.  We do feel that as we get into the bidding season, new contracted rates will start to kick in, so we do anticipate that the green line will trend down.  I’m not sure how much the blue line, the spot line, can continue to go, as it’s currently sitting at just below $2.00/mile. We may soon reach a point where carriers are not profitable on spot rates. 

FINDING MARITIME BALANCE

On the maritime side of things, in figure 3.1, the green line shows the number of actual containers that are clearing customs. They are coming off the ships, being unloaded, and clearing customs to be distributed via warehouses, intermodal, truckload, and what have you. The blue line shows the number of actual import bookings that have happened. 

You may say to yourself, that doesn’t make sense. If somebody is booking freight and that number is going down, how come we are still clearing these containers? Remember, throughout much of 2021 and even 2020, there was a backlog of ships, particularly on the West Coast, waiting to get unloaded. So, while the flow of ships is not coming into the ports as greatly as it was, it just kind of shows you how big of a backlog there was, that it’s taken six months and we’re still not through this backlog of ships, both on the West and East Coast.

Overall import volume is down 20 percent year over year. Yet, East Coast and Gulf ports are up as shippers moved their freight to the East Coast when the West Coast was originally facing backlog delays. 

KEY TAKEAWAYS

Low, single-digit rejection rates on contracted freight mean less is hitting the spot market, by some accounts 30 percent less than last year. 

Carriers need, and we need carriers, to remain solvent. Be diligent in negotiations with carriers but understand that we are very close to the floor for when a carrier becomes unprofitable.

Less freight is coming through the ports. Short-term will trigger an over-supply situation, particularly on ports with declining YoY volumes like Los Angeles and Long Beach. Other ports like Savannah, Houston, New York, and New Jersey will see more capacity balance.

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Flatbed shipping is an essential part of the logistics industry.

Flatbed trailers are incredibly versatile and offer many benefits to shippers. Not to mention, flatbed shipping has been on the rise in recent years. In this blog, we’ll divulge to you our comprehensive knowledge of flatbed shipping so you can master this transportation mode. 

Want your flatbed shipping to seem effortless? Join our inner circle of customers that make their flatbed shipments easy by getting a quote with Trinity Logistics.

WHAT IS A FLATBED TRAILER? FLATBED SHIPPING?

Flatbed Shipping

Flatbed shipping is often the transportation choice for cargo that doesn’t need the enclosure of a dry van. It’s ideal for cargo that cannot be loaded or unloaded from a dock as the shipper or receiver can load or unload from a variety of ways. The design of a flatbed trailer allows for cranes and forklifts to unload and load goods from a loading dock, from the side with a forklift or crane, or from above with an overhead, gantry, or crawler crane. This makes a flatbed trailer versatile and critical for numerous loading and unloading scenarios including at job sites, warehouses, and distribution centers. 

Flatbed Trailer

A flatbed trailer is the most common type of open-deck trailer used in commercial, over-the-road, long-haul, and specialized trucking such as oversized or over-dimensional shipments. A flatbed trailer is a 48ft or 53ft trailer, that can accommodate loads up to 48,000lbs. They typically have two axles, air-ride suspension, and kingpin for a standard 5th wheel hook up. 

Flatbed Freight

Flatbed freight tends to be more industrial than truckload dry van freight. There is a wide variety of flatbed freight in the marketplace. Some higher volume products like lumber or building supplies will generally pay less than more industrial items that support our country’s energy and core infrastructure needs, like construction equipment, generators, fabricated steel, and other project or job site-related freight.

WHAT CAN BE HAULED ON A FLATBED TRAILER?

The most common freight shipping uses for flatbed trailers are:

o Formed concrete items

o Lumber

o Construction materials

o Steel beams

o Scaffolding

o Trusses

o Electrical transformers

o Oil, gas, and petrochemical equipment

o Solar panels or wind turbines

o Commercial heating and air conditioning units

o Landscaping materials

o Large quantities of wrapped and stackable products

WHAT INDUSTRIES USE FLATBED TRAILERS?

Because flatbed trailers have no enclosure, the freight they carry can be versatile and their use extends across several industries, such as;

o Housing

o Construction

o Renewable energy

o Agricultural

o Warehousing

o Manufacturing

o Mining and drilling

o Military

o Automotive

o Landscaping

WHAT ARE THE BENEFITS OF A FLATBED TRAILER?

There are several benefits to using a flatbed trailer for your freight. With a flatbed trailer, there is dimensional flexibility for loading or unloading freight since there are no physical walls or a ceiling to restrict its use. Any cargo that is oddly sized or irregular-shaped can be easily moved with a flatbed trailer. 

WHAT ARE THE DISADVANTAGES OF USING A FLATBED TRAILER?

When selecting the type of trailer your freight needs, you should know the disadvantages of each. Compared to traditional hauls, all flatbeds take considerable skill, effort, and time.

Since there are no physical walls to restrain freight, cargo securement and balance are two significant concerns with flatbeds. The FMCSA has a lengthy section in rules specifically for securement, as insecure cargo is a serious safety hazard.

Proper securement is needed for your freight too because if not done correctly, your freight can get damaged from the securement itself. Also, shipments often shift some during transportation, so even weight distribution and securement are necessary.

Another disadvantage to flatbed trailers is that there are no physical walls. It’s a positive for loading and unloading. Still, it can also be a negative as no enclosure means dealing with the elements (wind, rain, snow, sun, animal or human interference, truck smoke/smog, dust, and road debris). To combat this, there is the option of tarping your freight or using a Conestoga trailer.

There are even more significant risks and responsibilities with any oversized freight as these shipments have even more strict regulations to follow.

FLATBED SHIPPING TIPS

Know your cargo

Be sure to know all the details of your shipment. This includes commodities, value, dimensions, and weight. This information will help logistics providers know how to properly secure your cargo ahead of time. 

Understand what trailer you’ll need

Familiarize yourself with the different types of flatbed trailers before booking a shipment so you can make the most cost-effective and safe choice. Each type of flatbed trailer has certain limitations. For example, a specific flatbed trailer like extended trailers and Conestogas can be harder to find so your provider may need advanced notice when they are required.

Be aware of accessorial charges

Flatbed shipping may involve moving specialized loads which can need special equipment or extra services. Make sure you have the proper equipment and services needed for your freight to avoid extra charges, freight damage, or delays.

Choose to work with an expert

Arranging flatbed shipments on your own can be time-consuming and expensive, making sure all regulations are met and your cargo travels safely. Consider working with an expert in flatbed shipping to help secure capacity and locate the right equipment for your freight.

FLATBED RATES AND SEASONALITY

Freight shipping demand, which includes flatbed demand, is something that is often based seasonally. No matter the market, shipping rates fluctuate throughout the year and rise as the demand for freight rises.

Flatbed shipping is very closely connected to construction and industrial production, which can be highly dependent on the weather. These industries often slow down in the winter months, so normally, the demand for flatbed shipping will soften at the end of the year.

Smaller to medium-sized companies often slow down during winter and resume activity when warmer weather returns. However, larger companies are affected less by the seasonality and continue to move their commodities regardless of the time of the year.

Because of the seasonal rise and fall, you’ll find volume and rates lowest in the late fall/early winter, with the peak flatbed season being from April to October. This is when the volume of flatbed loads is highest, as are the rates.

FLATBED SHIPPING WITH TRINITY LOGISTICS

Did you know Trinity Logistics is an industry leader in brokering flatbed freight to small and midsize carriers throughout North America?

Our vast network of Independent Freight Agents, combined with our Regional Service Centers deliver the best-in-class flatbed shipping through our expert carrier relationships. We accomplish this by supporting core energy and infrastructure clients with their project-based, unique, and often specialized freight.