Welcome to Check Call, our corner of the web for all things 3PL, freight broker and provide chain. Check Call the podcast comes out every Tuesday at 12:30 p.m. EDT. Compensate for previous episodes here. If this was forwarded to you, join for Check Call the newsletter here.
On this edition: It’s not your mama’s bid season this yr; Shippers are on the hook for carbon emissions; and UPS tries to get customers back on their side.
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It’s not going to be fun and games for the fourth quarter, the unofficial bid season in less-than-truckload freight. As we predicted with the demise of Yellow, bid season might be a bit bit different this yr, now that that freight has been absorbed and dispersed into the network.
Shippers which are trying to take freight out to bid at the tip of the yr should consider sending out their RFPs sooner moderately than later. The dust has settled and shippers are searching for a more everlasting solution to the post-Yellow problems. Sure the freight got moved for now but when the brand new carrier isn’t the suitable fit, everyone might be bidding out freight again, driving rates up.
Morgan Stanley recently released a report finding that 35% of shippers and brokers are going to search out a brand new carrier for his or her network. Half are expected to do it this yr and the opposite half at first of next yr. “Sixty-nine percent of brokers said a change could be made this yr while 60% of shippers said they’d wait until the primary half of next yr.”
Bid season this yr won’t be for the faint of heart. Get those bids out now and save everyone the trouble of attempting to return bid responses over Thanksgiving. Trust me: Nobody enjoys that.
This week on Check Call the show, we discuss with Rob Cook, CTO at Sheer Logistics. We break down the brand new regulation in California about disclosing Scope 3 carbon emissions. The full episode is here.
It’s actually a timely topic as there was discuss ROI because it pertains to sustainability. Apart from the massive one, equivalent to the Earth still being habitable. There are some that may actually affect the underside line.
Working more proactively on developing and hitting sustainability goals will help immensely in the long run. Fewer natural disasters that interrupt supply chain operations and fewer likelihood of decreased water levels that make it difficult to move goods via the ocean — type of like what is going on with the Panama Canal — come to mind.
A 2022 Dartmouth University study estimates business costs worldwide from rising temperatures over the period from 1992-2013 at $16 trillion — a lack of 1.5% of GDP per capita in developed economies and 6.7% in emerging markets. The U.S. National Oceanic and Atmospheric Administration estimates damage from $1 billion-plus climate events of every kind since 2000 — storms, fires, freezes, floods, droughts — at greater than $2 trillion.
While some shippers could also be hesitant, a start, irrespective of how small, must occur. There can’t be an improvement in carbon emissions without first knowing where you stand. It’s not unlikely that additional states could adopt laws much like California’s; it has happened countless times in regard to produce chains.
Also as an increasing number of of a lot of these regulations come down, imagine the worth add a 3PL or 4PL would have with shippers if there have been already an answer developed that just happened to suit right right into a shipper’s current setup? That may be a fairly easy sale — to have the answer to an issue a shipper didn’t comprehend it had.
TRAC Tuesday. This week’s TRAC lane goes from Allentown, Pennsylvania, to Charleston, West Virginia. This 439-mile trip has had some spot rate volatility up to now month as rates began at over $2 per mile, dropped to $1.85 and shot back as much as just below $2 a mile. The National Truckload Index is at $2.27 so rates on this lane are a bit lower than the national average despite the tightening capability in Allentown putting upward pressure on spot rates.
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Who’s with whom? Baby come back. UPS is asking customers to return back. People who left the Atlanta-based parcel company because of this of the threatened strike over the summer were presented with rebates to return back. These rebates are being offered to offset early-termination penalties for purchasers to interrupt current contracts. No price tag has been added to those rebates but for those who’re curious, UPS would love to speak about it.
FreightWaves’ Mark Solomon wrote, “UPS lost about 1.2 million every day parcels as shippers concerned about service disruptions shifted traffic to other carriers. Rival FedEx Corp. received about 400,000 of the diverted parcels. The remainder were split among the many U.S. Postal Service and an array of regional delivery carriers.
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