Contributing Editor Toby Gooley is a writer and editor specializing in supply chain, logistics, and material handling, and a lecturer at MIT's Center for Transportation & Logistics. She previously was Senior Editor at DC VELOCITY and Editor of DCV's sister publication, CSCMP's Supply Chain Quarterly. Prior to joining AGiLE Business Media in 2007, she spent 20 years at Logistics Management magazine as Managing Editor and Senior Editor covering international trade and transportation. Prior to that she was an export traffic manager for 10 years. She holds a B.A. in Asian Studies from Cornell University.
sponsored the seventh annual National Forklift Safety Day on June 9. The event provides an opportunity for the industry to educate customers, government officials, and other stakeholders about the safe use of forklifts, including the importance of training for operators and for pedestrians who work around forklifts. ITA members manufacture over 90 percent of the forklifts and similar powered industrial trucks sold in North America. The organization promotes standards development, advances safe forklift design and use, disseminates statistical information, and holds industry forums.
This year’s National Forklift Safety Day program was presented virtually, with videos and webinar-style presentations by experts on a range of safety-related topics. The following are some of the highlights:
ITA President Brian Feehan and Jay Gusler, ITA Chairman and Executive Vice President of Operations, Mitsubishi Caterpillar Forklift America (MCFA), welcomed viewers. Their remarks focused on the ongoing commitment to forklift safety by the organization, its members, and the industry as a whole. “Safety has been and will continue to be paramount to our industry,” said Gusler. “Collectively we dedicate a tremendous amount of time and effort to ensure the safety of our products. ... Safety requires dedication, time, and perseverance. We must take the time to ensure proper safety training is adhered to and make it a priority.”
Loren Sweatt, Principal Deputy Assistant Secretary of Labor, Occupational Safety and Health Administration (OSHA), noted that 2020 marks 50 years since OSHA was formed and federal workplace safety and health protections were signed into law. Despite long-term progress in reducing the number of forklift-related accidents, in FY 2018, the number of serious forklift-related injuries increased by 4% over the previous year, and there were 85 fatalities, she said. Emphasizing the importance of proper training, she pointed out that in FY 2019, four of the five most frequently cited violations of the powered industrial truck rules in CFR 1910.178 involved inadequate or improper operator training, evaluation, and certification.
Sweatt urged forklift users to take advantage of OSHA’s educational resources, including a free on-site health and safety consultation for small businesses. Businesses may also apply to participate in the Voluntary Protection Program (VPP), under which management, labor, and OSHA collaborate to prevent fatalities, injuries, and illnesses by focusing on hazard prevention and control, worksite analysis, training, management commitment, and worker involvement.
Sweatt added that OSHA is examining an update to its powered industrial truck (PIT) standards, and that two regulatory actions are currently in process. The first would update employer requirements for operations, maintenance, and worker training, she said. The agency is now analyzing comments submitted in response to a request for information (RFI) issued last year. The second—something the forklift industry has long advocated—would update references to PIT consensus standards in OSHA rules. If the proposal moves forward, Sweatt explained, OSHA rules will incorporate by reference current industry practice, forklift design, and technology, rather than older, sometimes outdated information. OSHA expects to publish a notice of proposed rulemaking by the end of this year, she said.
Finally, Sweatt outlined the many resources OSHA has made available to assist workplaces in coping with the COVID-19 pandemic. OSHA is closely coordinating with the Centers for Disease Control and other federal agencies to monitor the pandemic, she said. She recommended that facility managers take advantage of OSHA’s guidance about workplace risk assessment, controls, cleaning, and more at www.osha.gov/coronavirus.
Pedestrian safety was the focus of a presentation by Chuck Leon, Technical Specialist, Workplace Safety and Prevention Services (WSPS). Leon offered many suggestions for reducing risk to pedestrians where forklifts are in use. Examples include:
To identify potential trouble spots, create a map of your facility that shows storage aisles, forklift travel lanes, and pedestrian walkways.
Manage traffic flows. For example, if a forklift is working in an area with a blocked view, have another person present to control and direct pedestrians.
Mitigate or eliminate blind spots; if an operator has to work around an obstacle, such as stacked pallets stored on the floor, then remove it.
Train pedestrians how to safely walk and work around mobile equipment. Let them sit on a parked forklift with loaded forks to show them what operators see.
Establish rights of way in all directions for both pedestrians and operators.
Make sure barriers, gates, and floor and wall markings are high-visibility and clearly marked. Refresh the paint and markings at regular intervals.
Use high-visibility PPE. Some companies use different colors for staff, visitors, and contractors, which signals to operators that some pedestrians may not know the facility’s policies and procedures.
J. Scott Bicksler, Lead Safety Manager for the staffing agency Aerotek, spoke about the safety of forklift operators who are temporary employees. Bicksler, whose company employs about 9,000 lift truck operators, explained how the host employer and the staffing agency can best work together in three important areas:
1. Evaluating and contracting—Before signing a contract with a temporary labor agency, the host employer and the agency should conduct a joint risk assessment, including a site visit and evaluation of the OSHA 300 log (a form for recording information about reportable injuries and illnesses). The contract should specify each party’s responsibilities for activities such as operator training, OSHA reporting, and provision of protective gear, among others. Job descriptions for each position should be clearly defined.
2. Training for temporary workers and supervisors—Typically the staffing agency is responsible for general safety awareness training, and the host must give temporary workers training that is equivalent to what regular employees in the same jobs receive, Bicksler said. Supervisors must know the limitations and requirements for training temporary forklift operators; if a temp is moved to a new position or the job description changes, the employer must notify the staffing agency right away, as any change can impact workers’ compensation claims—for example, if an accident occurs in a job the worker has not been trained for.
3. Injury and illness reporting, response, and recordkeeping—Temporary employees need to know to whom they should report an injury or incident. When an incident or injury occurs, supervisors should immediately inform the agency and also record the incident in the OSHA 300 log. Research has found that waiting to report and record injuries contributes to higher workers compensation costs, Bicksler said.
(For more about working with temporary forklift operators, read the 2018 DCV Q&A with Bicksler.)
The COVID-19 pandemic has helped business and the public understand how vital forklifts are to the functioning of the global supply chain, said Chuck Moratz, NFSD Task Force Chair and Senior Vice President, Global Engineering, Clark Material Handling Co. Lift trucks are critical tools that allow grocery stores, pharmacies, and other essential businesses to ensure that the public gets needed personal hygiene products, food, medicines, and safety supplies, he said.
In a discussion of forklift accident trends, Moratz noted that after declining steadily for years after OSHA began requiring operator training and certification in the early 1990s, the number of forklift accidents rose slightly after 2011, and the number of fatal accidents saw an uptick in 2018. He attributed the rise in large part to a significant increase since 2011 in the number of rider forklifts and pallet trucks being used in the United States. Moratz emphasized that safety is everyone’s responsibility, because the data “are not really numbers we’re talking about. Each number represents people: your co-workers, family, and friends whose lives have been disrupted by accidents.”
The Industrial Truck Association’s National Forklift Safety Day webcast is still available at no charge online. Registrants will receive access to the slides from the presentations by Sweatt, Leon, and Bicksler. Click here to register. And click here to read all of DC Velocity’s special NFSD 2020 coverage and forklift safety articles.
The way that shippers and carriers classify loads of less than truckload (LTL) freight to determine delivery rates is set to change in 2025 for the first time in decades, introducing a new approach that is designed to support more standardized practices.
But the transition may take some time. Businesses throughout the logistics sector will be affected by the transition, since the NMFC is a critical tool for setting prices that is used daily by transportation providers, trucking fleets, third party logistics providers (3PLs), and freight brokers.
For example, the current system creates 18 classes of freight that are identified by numbers from 50 to 500, according to a blog post by Nolan Transportation Group (NTG). Lower classed freight costs less to ship, ranging from basic goods that fit on a standard shrink-wrapped 4X4 pallet (class 50) up to highly valuable or delicate items such as bags of gold dust or boxes of ping pong balls (class 500).
In the future, that system will be streamlined by four new features, NMFTA said:
standardized density scale for LTL freight with no handling, stowability, and liability issues,
unique identifiers for freight with special handling, stowability, or liability needs,
condensed and modernized commodity listings, and
improved usability of the ClassIT classification tool.
The new changes look to simplify the classification by grouping similar articles together and assigning most classes based solely on density – the most measurable of the four characteristics, he said. Exceptions will be handled separately, adding one or more of the three remaining characteristics in cases where density alone is not adequate to determine an accurate class.
When the updates roll out in 2025, many shippers will see shifts in the LTL prices they pay to move loads, because the way their freight is classified – and subsequently billed – might change. To cope with those changes, he said it’s important for shippers to review their pricing agreements and be prepared for these adjustments, while carriers should prepare to manage customer relationships through the transition.
“This shift is a big deal for the LTL industry, and it’s going to require a lot of work upfront,” Davis said. “But ultimately, simplifying the classification system should help reduce friction between shippers and carriers. We want to make the process as straightforward as possible, eliminate unnecessary disputes, and make the system more intuitive for everyone. It’s a change that’s long overdue, and while there might be challenges in the short term, I believe it will benefit the industry in the long run.
Business leaders in the manufacturing and transportation sectors will increasingly turn to technology in 2025 to adapt to developments in a tricky economic environment, according to a report from Forrester.
That approach is needed because companies in asset-intensive industries like manufacturing and transportation quickly feel the pain when energy prices rise, raw materials are harder to access, or borrowing money for capital projects becomes more expensive, according to researcher Paul Miller, vice president and principal analyst at Forrester.
And all of those conditions arose in 2024, forcing leaders to focus even more than usual on managing costs and improving efficiency. Forrester’s latest forecast doesn’t anticipate any dramatic improvement in the global macroeconomic situation in 2025, but it does anticipate several ways that companies will adapt.
For 2025, Forrester predicts that:
over 25% of big last-mile service and delivery fleets in Europe will be electric. Across the continent, parcel delivery firms, utility companies, and local governments operating large fleets of small vans over relatively short distances see electrification as an opportunity to manage costs while lowering carbon emissions.
less than 5% of the robots entering factories and warehouses will walk. While industry coverage often focuses on two-legged robots, Forrester says the compelling use cases for those legs are less common — or obvious — than supporters suggest. The report says that those robots have a wow factor, but they may not have the best form factor for addressing industry’s dull, dirty, and dangerous tasks.
carmakers will make significant cuts to their digital divisions, admitting defeat after the industry invested billions of dollars in recent years to build the capability to design the connected and digital features installed in modern vehicles. Instead, the future of mobility will be underpinned by ecosystems of various technology providers, not necessarily reliant on the same large automaker that made the car itself.
This story first appeared in the September/October issue of Supply Chain Xchange, a journal of thought leadership for the supply chain management profession and a sister publication to AGiLE Business Media & Events’' DC Velocity.
For the trucking industry, operational costs have become the most urgent issue of 2024, even more so than issues around driver shortages and driver retention. That’s because while demand has dropped and rates have plummeted, costs have risen significantly since 2022.
As reported by the American Transportation Research Institute (ATRI), every cost element has increased over the past two years, including diesel prices, insurance premiums, driver rates, and trailer and truck payments. Operating costs increased beyond $2.00 per mile for the first time ever in 2022. This trend continued in 2023, with the total marginal cost of operating a truck rising to $2.27 per mile, marking a new record-high cost. At the same time, the average spot rate for a dry van was $2.02 per mile, meaning that trucking companies would lose $0.25 per mile to haul a dry van load at spot rates.
These high costs have placed a significant burden on the operations of trucking companies, challenging their financial sustainability over the last two years. As a result, 2023 saw approximately 8,000 brokers and 88,000 trucking companies cease operations, including some marquee names, such as Yellow Corp. and Convoy, and decades-long businesses, such as Matheson Trucking and Arnold Transportation Services.
More so than ever before, trucking companies need to get better at efficiently using their assets and reducing operational costs. So, what is a trucking company to do? Technology is the answer! Given the nature of the problem, technology-led innovation will be critical to ensure companies can balance rising costs through efficient operations.
One technology that could be the answer to many of the trucking industry’s issues is the concept of digital twins. A digital twin is a virtual model of a real system and simulates the physical state and behavior of the real system. As the physical system changes state, the digital twin keeps up with the real-world changes and provides predictive and decision-making capabilities built on top of the digital model.
DHL, in a 2023 white paper, suggests that—due to the maturation of technologies such as the internet of things (IoT), cloud computing, artificial intelligence (AI), advanced software engineering paradigms, and virtual reality—digital twins have “come of age” and are now viable across multiple sectors, including transportation. We agree with this assessment and believe that digital twins are essential to radically improving the processes of fleet planning and dispatch.
THE NEED TO AUTOMATE
Outside of attaining procurement efficiencies, trucking companies can achieve lower costs by focusing on critical operational levers such as minimizing deadheads, reducing driver dwell time, and maximizing driver and asset utilization.
However, manual methods of planning and dispatch cannot optimally balance these levers to achieve efficiency and cost control. Even when planners work very hard and owners strive to improve processes, optimizing fleet planning is not a problem humans can solve routinely. Planning is a computationally intensive activity. To achieve fleet-level efficiencies, the planner has to consider all possible truck-to-load combinations in real time and solve for many operational constraints such as drivers’ hours of service, customer windows, and driver home time, to name just a few. These computations become even more complex when you add in the dynamic nature of real-world conditions such as trucks getting stuck in traffic or breaking down or orders getting delayed. This is not a task humans do best! For these sorts of tasks, technology has the upper hand.
When a company creates a digital twin of its trucking network, it has a real-time model that factors in truck locations, drivers’ hours of service, and loads being executed and planned. Planners can then use this digital model to assess possible decisions and select ones that increase asset utilization, improve customer and driver satisfaction, and lower costs.
For example, a digital twin of the network can offer significant insights and analysis on the state of the network, including exceptions such as delayed pickups and deliveries, unassigned loads, and trucks needing assignments. Backed by AI that takes business rules into account, digital twins can allow companies to optimize their fleet performance by finding the most efficient load assignments and dynamically adjusting in real time to changes in traffic patterns and weather, customer delays, truck issues, and so on.
With a digital twin, carriers can optimize the matching of assets, drivers, and freight. Typically, an investment in this innovative technology results in a 20%+ increase in productive miles per truck, while also improving driver pay and significantly decreasing driver churn. Drivers get paid by the miles they run, so when they run more, they are able to make more money, resulting in less need to chase the next job in search of better pay.
ADDITIONAL BENEFITS
Digital twins also combat deadheading, another source of driver dissatisfaction and cost inefficiencies. On average, over-the-road drivers spend 17%–20% of road miles driving empty. Using a digital twin, a company can search across several freight sources to find a load that perfectly matches the deadhead leg without impacting downstream commitments. These additional revenue miles will help drivers to maximize their earnings on the road and carriers to maximize their asset utilization and profitability.
The traditional manual dispatch planning model is becoming increasingly outdated—each planner and fleet manager tasked with overseeing 30 to 40 vehicles. Carriers try to manage this problem by dividing the fleet into manageable chunks, which results in cross-fleet inefficiencies. Such a system isn’t scalable. A digital twin acts as an equalizer for small and mid-sized fleets. It enables carriers to expand by venturing beyond the fixed routes and network they were forced to run out of fear of additional logistical complexity.
A digital twin can also give an organization the transparency and visibility it needs to find and fix inefficiencies. A successful carrier will leverage the technology to learn from the hitches in its operations. While this visibility is beneficial in its own right, it also provides the first step toward a seamless, digitized operation. “Digital revolution” is a buzzword frequently heard at transportation conferences. Yet not too many organizations are dedicated to digitizing their operations past the visibility stage. The end goal should be using decision-support systems to automate key elements of the system, thus freeing up planners from their daily rote tasks to focus on problems that only humans can solve.
Finally incorporating a digital twin can also help trucking companies work toward the broader trend of creating greener supply chains. Because they have lower deadhead and dwell times, trucking companies that have adopted a digital twin can be more attractive to shippers that are looking for more efficient operations that meet their environmental, social, and governance (ESG) goals.
THE FUTURE IS HERE
It is important to note that the benefits described here are not dreams for the future; digital twin technology is already here. In fact, choosing a digital twin can seem daunting because there are already a spectrum of options out there. First and foremost, an organization must ensure that the digital twin it selects aligns with both the goals and the scope of its operation.
Additionally, the ideal digital twin should:
Operate in near real time. A digital twin should be able to refresh as often as the network changes.
Be able to factor in specific customer delivery requirements as well as asset- and operator-specific constraints.
Be computationally efficient and comprehensive as it considers thousands of permutations in milliseconds. The digital twin should be able to reoptimize an entire fleet’s schedule of multi-day routes on the fly.
Before implementing a digital twin, carriers need to make sure that they have robust data management processes in place. Electronic logging devices (ELDs), customers’ tenders, billing, shipments, and so on are already inundating carriers with a glut of data. However, the manual nature of operations in many carriers leads to poor data quality. Carriers will need to invest in data management approaches to improve data quality to support the generation and use of high-fidelity digital twins. Otherwise, the digital twin will not be representative of reality and companies will run into an issue of “garbage in, garbage out.”
REINVENTION AND TRANSFORMATION
While data management is critical, change management through the ranks of dispatch operations is often a harder task. In fact, the largest roadblock carriers face when undergoing a digital transformation is the lack of willingness to change, not the technology itself. Many carriers cling to outmoded planning methods. Planners, used to operating based on well-worn business rules and tribal knowledge, could be wary of the technology and resistant to change. They may need to be assured that, while it is true that every trucking network is uniquely complex, digital twins can be set up to model the intricacies of their specific dispatch operations and drive value to the network. A significant amount of time and resources will need to be expended on change management. Otherwise even though trucking companies may invest in cutting-edge technology, they won't be able to fully capitalize on the added value it can provide.
As the truckload industry works through the current freight cycle, it is important to realize that change is inevitable. Carriers will need to reinvent their operations and invest in technologies to ride through the busts and booms of future freight cycles. Recent global events point to the many ways that wrenches can be thrown into global transportation networks, and the fact that such volatility is here to stay. Digital twins can provide companies with the visibility to navigate such changes. But above all, an operation that uses the digital twin to drive decisions can make customers and drivers happy, and help the carriers keep their heads above water during times such as now.
Regular online readers of DC Velocity and Supply Chain Xchange have probably noticed something new during the past few weeks. Our team has been working for months to produce shiny new websites that allow you to find the supply chain news and stories you need more easily.
It is always good for a media brand to undergo a refresh every once in a while. We certainly are not alone in retooling our websites; most of you likely go through that rather complex process every few years. But this was more than just your average refresh. We did it to take advantage of the most recent developments in artificial intelligence (AI).
Most of the AI work will take place behind the scenes. We will not, for instance, use AI to generate our stories. Those will still be written by our award-winning editorial team (I realize I’m biased, but I believe them to be the best in the business). Instead, we will be applying AI to things like graphics, search functions, and prioritizing relevant stories to make it easier for you to find the information you need along with related content.
We have also redesigned the websites’ layouts to make it quick and easy to find articles on specific topics. For example, content on DC Velocity’s new site is divided into five categories: material handling, robotics, transportation, technology, and supply chain services. We also offer a robust video section, including case histories, webcasts, and executive interviews, plus our weekly podcasts.
Over on the Supply Chain Xchange site, we have organized articles into categories that align with the traditional five phases of supply chain management: plan, procure, produce, move, and store. Plus, we added a “tech” category just to round it off. You can also find links to our videos, newsletters, podcasts, webcasts, blogs, and much more on the site.
Our mobile-app users will also notice some enhancements. An increasing number of you are receiving your daily supply chain news on your phones and tablets, so we have revamped our sites for optimal performance on those devices. For instance, you’ll find that related stories will appear right after the article you’re reading in case you want to delve further into the topic.
However you view us, you will find snappier headlines, more graphics and illustrations, and sites that are easier to navigate.
I would personally like to thank our management, IT department, and editors for their work in making this transition a reality. In our more than 20 years as a media company, this is our largest expansion into digital yet.
We hope you enjoy the experience.
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In this chart, the red and green bars represent Trucking Conditions Index for 2024. The blue line represents the Trucking Conditions Index for 2023. The index shows that while business conditions for trucking companies improved in August of 2024 versus July of 2024, they are still overall negative.
FTR’s Trucking Conditions Index improved in August to -1.39 from the reading of -5.59 in July. The Bloomington, Indiana-based firm forecasts that its TCI readings will remain mostly negative-to-neutral through the beginning of 2025.
“Trucking is en route to more favorable conditions next year, but the road remains bumpy as both freight volume and capacity utilization are still soft, keeping rates weak. Our forecasts continue to show the truck freight market starting to favor carriers modestly before the second quarter of next year,” Avery Vise, FTR’s vice president of trucking, said in a release.
The TCI tracks the changes representing five major conditions in the U.S. truck market: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. Combined into a single index, a positive score represents good, optimistic conditions, and a negative score shows the opposite.