STATE OF THE INDUSTRY
“The logistics industry is chin deep in a bear market that is affecting companies of all sizes with some running out of air to breathe. The closures of giants like Yellow and Convoy are a glimpse into the overall picture of what is happening in logistics. The downward pressure in the market post Covid accelerated at a pace many did not forecast. Some in the industry are forecasting for an inevitable turn around on the horizon. The severity of current conditions and the timeline could suggest this, but there are many variables in play. Volumes, capacity, consumer debt, worldwide issues, inflation, student loan, interest rates, etc.” Says COO Michael Crosby.
THE EFFECTS OF THE HOLIDAY SEASON ON THE FREIGHT MARKET & FREIGHT BROKERS
Approaching the holiday season brings about shifts in the freight market influenced by several factors. A major driver is the increased appetite for consumer goods and e-commerce items. The surge in gift shopping and other consumption of other holiday items lead to a notable uptick in freight volumes for shippers and carriers. This heightened demand, in turn, creates a scenario where capacity becomes more constrained, as carriers may be hesitant to take on additional loads amid the intensified seasonal demand.
The convergence of heightened demand, capacity limitations, and weather factors this holiday season is certain to trigger fluctuations in rates, resulting in elevated shipping costs for shippers.
Brokers need to consider not only the rising demand but also the potential disruptions caused by holiday-related closures and reduced operating hours at warehouses and distribution centers. Such changes can impact delivery schedules, resulting in frustrations for both shippers and receivers. To mitigate these challenges, brokers should maintain open lines of communication with their carriers and shippers. This proactive approach helps ensure that schedules are adhered to as closely as possible and enables the timely resolution of any arising issues.
Additionally, brokers must be cognizant of their carriers’ capabilities and limitations, especially during the holiday season. Carriers may need to make adjustments to their routes and schedules to accommodate the surge in demand. Brokers should show understanding and collaborate closely with carriers to guarantee the safe and efficient transportation of freight during these periods.
ELI’S PERSPECTIVE GOING INTO THE HOLIDAY SEASON
“We can do our best to continue to grow and service our customer base by providing valuable relationships and services at pricing that is competitive and sustainable. ELI will never be the cheapest provider of supply chain management. We do not strive to provide “Big Box” pricing. It is our goal to provide a lasting relationship, clear communication, and partnerships to our customers where we can grow alongside them.
The industry is full of companies that have a “super-secret sauce” whether it be technology, procedures, or some other hot new item. These are all great tools, but in the end, we still believe business is about relationships first and foremost.
ELI is poised to continue to supply our customers with honest communication and exceptional service no matter if we stay in this current market or if we start to experience a rebound.” Michael Crosby, COO