We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • ::COVID-19 COVERAGE::
  • INDUSTRY PRESS ROOM
  • ABOUT
  • CONTACT
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Dispatches
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Dispatches
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
Home » Don't underestimate the challenges of recovery
big picture

Don't underestimate the challenges of recovery

July 7, 2010
Peter Bradley
No Comments

While the economic recovery has been slower and more modest than hoped, it apparently is real. That's good.

But as we arrive at the peak shipping season, shippers may still have to contend with the recession's aftereffects. During the worst economic downturn in our lifetimes, carriers in all modes made sharp cutbacks in order to survive. As a result, shippers could be looking at a serious shortage of freight capacity just when they need it the most.

Some signs indicate that the nation's freight transportation capacity is already under pressure. In June, trucking officials speaking at a conference in Atlanta warned that the industry could face the most severe driver shortage in its history as a result of increased demand and an aging workforce. That same month, intermodal volume on the nation's railroads reached its highest level since late 2008, while rail carloads posted solid gains.

The picture is much the same on the ocean side. In May and June, import container volumes at the country's top retail container ports showed double-digit gains over year-ago levels, according to the National Retail Federation—a trend the group expects will continue into the fall. At the same time, reports out of Asia suggest that ocean carriers are facing a shortage of containers to move goods to the United States. And when the goods get here, shippers may have a hard time getting them out of port. In a June story, the Journal of Commerce reported that terminal operators at ports around the country expected difficulty in handling the surge in imports.

All this means that shippers have a lot of decisions to make regarding what carriers they use, what they're willing to pay, where to source, whether they should consider redesigning their networks, and more. But one of the toughest quandaries of all may be the inventory/transportation tradeoff: Do you build stocks in what some still consider a wobbly recovery in order to take advantage of transportation economies of scale? Or do you keep inventory lean even though it will mean making smaller, more frequent—and thus more costly—shipments?

The choices are not easy. But while the current experience may be extreme, the dilemmas should not be a surprise to shippers who have paid attention. A post-recession capacity crunch and concomitant rate pressure was almost a certainty.

A recovery of course is a good thing. But it has its challenges. The analogy that springs to mind comes from meteorology: A high-pressure system that brings balmy weather is often preceded by a squall line of dangerous storms. The key is to be ready.

Transportation
  • Related Articles

    The unsung heroes of end-of-the-line logistics

    in recovery

    don't weight up

Peterbradley
Peter Bradley is an award-winning career journalist with more than three decades of experience in both newspapers and national business magazines. His credentials include seven years as the transportation and supply chain editor at Purchasing Magazine and six years as the chief editor of Logistics Management.

Recent Articles by Peter Bradley

From temp to management: interview with Diane Garforth

Watching over intermodal's interests: interview with Joni Casey

Building resilience into the supply chain: interview with Yossi Sheffi

You must login or register in order to post a comment.

Report Abusive Comment

Most Popular Articles

  • Cold chain giant Lineage Logistics buys its own rail operator

  • Biden names dozens of senior leaders to DOT, including FMCSA and FRA

  • Cushman & Wakefield Brokers Sale of 170 Acres plus Lease for 1MSF Build-to-Suit for Home Improvement Retailer in Commerce City, CO.

  • Thriving in the long haul: interview with Colin Yankee

  • Capacity challenges will continue in 2021

Now Playing on DCV-TV

Sick agv demo thumbnail

Optimize Load Handling Tasks with Industrial Mobile Robots

DCV-TV 4: Viewer Contributed
Intelligent sensors detect the presence of goods, check for empty shelves, or the correct alignment on the mobile platform towards the freight. The solutions range from simple detection sensors, thorough measuring devices, and 2D LiDAR sensors.

FEATURED WHITE PAPERS

  • Proven Benefits: A Compendium of Slotting Optimization Success Snapshots

  • Bridging Information Gaps in Dock and Yard Operations

  • How Intelligent Sensor Solutions Turn Data Into Action

  • Order picking Solutions: Understanding Your Options

View More

Subscribe to DC Velocity Magazine

GET YOUR FREE SUBSCRIPTION
  • SUBSCRIBE
  • NEWSLETTERS
  • ADVERTISING
  • CUSTOMER CARE
  • CONTACT
  • ABOUT
  • STAFF
  • PRIVACY POLICY

Copyright ©2021. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing