HOW WILL YOUR FREIGHT PATTERNS CHANGE IN 2017? - I.D. Systems

HOW WILL YOUR FREIGHT PATTERNS CHANGE IN 2017?

By BY ANDY HICKS

Is your fleet ready to meet your customer’s needs as the business landscape changes?

Chances are that you have a pretty good fleet management system in place. You probably routinely work with the same customers on the same routes and have a good handle on how to dedicate your trailers and resources accordingly. But what happens when business demands shift? Do you have the tools you need to have real-time visibility into your fleet so that you can adapt quickly and efficiently without sacrificing your margin of profit?

A shift is, in fact, taking place that will require fleets to change course. According to the National Mover study created by United Van Lines, states such as Oregon, South Dakota, and Vermont can expect to see more freight migrating to their states as their population increases. At the same time, northeast states like New York, Illinois, Connecticut, and New Jersey will likely see their freight diminish.

As more people move from the northeast to the western and southern states, more freight will follow the people. This reflects moves by retirees as they relocate to the western and southern states, says Michael Stoll, a professor and economist at the University of California Los Angeles.

According to John Larkin with Stifel Financial Corp., as this migration occurs it will increase production and consumption within the southwest (excluding California), southeast, and western states. As a result, transportation will be reshaped and distribution patterns altered to keep up with these changes and maintain balance of products.

How Will the Urbanization of Millennials Affect this Trend?

Contrary to this trend, the urbanization of Millennials is also occurring. More Millennials want to live and work in urban areas and make the choice not to have an automobile. Instead, they are moving toward urban areas where they can rely on public transportation, cycling, and walking.  Most of their shopping is done online and delivered to their door, which increases their shipping needs.

Even though Millennials are moving to urban areas, it is being overshadowed by the greater number of retirees moving away.

Are You Ready to Follow This Trend?

Some carriers are not adapting quickly enough to these changes in population and as a result will not be able to handle the adjustments to equipment utilization, lane balancing, and pricing that will result.

“Freight flows are adjusting to the changing industrial migration and population migration patterns,” says Larkin. “[So motor] carriers with a focus on hauling manufactured products out of certain regions (i.e., the northeast, for example) need to be cognizant of these accelerating trends in order to maintain the equipment utilization and lane balance that often drives profitability.”

How Will You Keep Up?

The carriers that rely on traditional supply chains need to be cautious of the speed of these changes. Unless you closely monitor these trends, your fleet, and the customers’ needs, you could get left behind.

Get visibility into your fleet with fleet management software. It provides clarity into business operations through accurate, real-time data like trailer tracking, empowering companies to make the adjustments necessary to adapt to these geographic shifts. This clarity into operations can also drive better proactive business decisions, which have a ripple effect, mitigating maintenance costs, improving customer satisfaction and even reducing turn time. Knowing your fleet’s exact movements and predicting the market changes will give you an advantage over your competition.