Success in a turbulent economic environment requires precision, agility, and quality partners. For shippers, it also means finding carriers with ample vehicle capacity and the logistics capabilities to handle every shipment as efficiently as possible. But carrier capacity has been limited lately, and many carriers face difficulties in scaling their capabilities to match high consumer demand for fast, e-commerce-enabled shipping. According to Food Shippers of America, carriers with more than 100 trucks—those with the capacity shippers need to fulfill deliveries at scale—have just 2.7% more drivers than they did in March 2020, when consumer demand began to soar.
By understanding the key causes of the capacity constraints miring carriers, shippers can take steps to preempt them and amplify their business, such as by integrating a proprietary transportation management system (TMS) into their workflows.
Uncover the factors stifling carrier capacity
From labor constraints to seasonal demand peaks, a wide range of factors can hamper a shipper’s ability to locate carriers with ample vehicle capacity for their cargo:
- Driver shortages. High consumer product demand has left some carriers struggling to source drivers. These drivers are the backbone of domestic and cross-border logistics, so when availability is low, overall carrier capacity follows suit—and rates go sky high.
- Economic and environmental factors. Sudden shifts in national or regional economies and even weather events can have a huge impact on organizations’ manufacturing and distribution operations. For instance, when a region is anticipating a storm, businesses may need to deliver nearby goods as quickly as possible. These unforeseen circumstances can increase carrier demand, forcing businesses to adjust their shipping volumes and transportation needs to survive the fluctuations.
- Changing regulations. Legal compliance is constantly top of mind for carriers, as new and shifting laws and regulations can significantly alter their ability to maximize capacity. For example, if a region passes a law dictating that carriers pay a fee for putting drivers on the road overnight to curb late-night traffic accidents, carriers operating in that area could be forced to reduce or eliminate late-night transportation services. In turn, this could reduce a shipper’s ability to offer the next- and two-day shipping that today’s consumers expect.
- Seasonality. The time of year can directly affect carrier capacity. For example, carriers routinely see demand surges in the peak season between late summer and the year’s end. As shippers’ order volumes reach far greater highs than usual, carriers won’t hesitate to raise prices to accommodate increased demand and lower driver and vehicle availability.
Take action to secure logistics operations against capacity shifts
While many of the moving parts that hurt carrier capacity are beyond a shipper’s control, logistics leaders can still take proactive steps to mitigate any damaging impacts. For instance, by identifying carriers with the most vehicle space well ahead of peak season, shippers may be able to receive priority courier service, maximizing space usage to transport larger loads at the highest frequency possible. Meanwhile, paying close attention to their local, state, and federal regulatory landscapes can enable shippers to quickly pivot their processes when changes occur and remain compliant.
Platforms like CTSI-Global’s Honeybee TMS are another essential solution that can help shippers overcome a litany of carrier capacity challenges. From their TMS dashboard, shippers can get near-instant transparency into carrier costs and the capacity of available carriers. The most robust TMS solutions automatically consolidate orders by size or weight, with flexibility for multi-stop routing, pooling, and intelligent process automation. And once an order is tendered and executed, shippers can use their TMS to track the shipment pre-, in-, and post-transit, and receive automated alerts on any delivery exceptions.
Overcome carrier capacity dilemmas with CTSI-Global’s Honeybee TMS
With the right approaches and technology for anticipating and mitigating challenging carrier capacity circumstances, shippers have everything they need to flourish in the face of towering competition. CTSI-Global’s Honeybee TMS delivers up-to-the-minute insights on relevant vehicle capacity across an international network of carriers, each vetted on everything from security to performance. Backed by this comprehensive information, shippers can make efficient and cost-effective carrier decisions for every shipment and pivot in the face of changing circumstances, from peak season hikes to regulatory shifts to economic headwinds.
Maximize vehicle space usage and minimize carrier costs with the right technology. Contact us to see how Honeybee TMS can help you overcome carrier capacity challenges before they impact your business.
