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Freight Shipping Tips

Is Intermodal on the Rise with ELD, Driver Shortage and Tightening Capacity?

A recent Cowen & Co survey discovered that 65 percent of shippers didn’t move their freight from road to rail during the second quarter. This result was also backed by a survey from Morgan Stanley, which had 59 percent of respondents indicating the same. However, while few shippers decide to make the switch, that could be changing this December. Why would shippers decided to hop the rails instead of utilizing trucks? Because of the Electronic Logging Device mandate which will be going into effect at the end of the year.

65 percent of shippers didn’t move their freight from road to rail during the second quarter.

The Reluctance to Shift

While rails are touted as a way to save money, more than a few shippers are reluctant to shift away from using trucks to haul their freight. Ideally, railroads as an intermodal service can offer a lower price at the expense of some speed. When it comes to inbound costs, it can be a way for some shippers to cut down on expenses in order to remain competitive. Or at least, that is the reasoning being sold to them.

Railroads as an intermodal service can offer a lower price at the expense of some speed

According to the Cowen survey, nearly half of the shippers surveyed stated that intermodal options only saved them upwards of five percent. A quarter of the respondents said that truck prices were lower than intermodal options. It’s that tight gap that might be responsible for making the reluctance to shift from road to rail. As there isn’t a huge cost advantage for sacrificing speed, most shippers prefer to stick with trucks as they don’t believe that rail can keep up with the speed of inventory turnover.

They don’t believe that rail can keep up with the speed of inventory turnover

Rails Starting to See Growth

Whatever reservations shippers might hold for rail and intermodal options will soon be falling to the wayside. For shippers that already made the switch, they noted not only better intermodal service but also the tightening of truckload capacity as their main reasons why.

Tightening of truckload capacity is a BIG concern

“Morgan Stanley asked shippers to rank truckload capacity in six months based on a scale where one equals abundant, five is balanced, and 10 is very tight. Shippers put the current market at 6.3 and projected 6.8 in six months. One year ago, the number was 4.9,” according to Transport Topics.

Executives believe that many truckers will leave the industry rather than deal with the ELD mandate

Another factor to consider is the potential spike in truck rates as truckload executives believe that many truckers will leave the industry rather than deal with the ELD mandate. Which, in turn, could cause a modest 3 percent increase in intermodal rates over the next six months due to a rise in demand.

“Overall, we view the results of this survey as positive for the railroads,” says Jason Seidl, a Cowen & Co analyst. “The 3.0% price increase expectation leaves additional breathing room from the all-important 2% rate, which is important because rail-cost inflation typically hovers in that area, and pricing will need to remain above that level in order for the railroads to improve their operating ratios.”

We view the results of this survey as positive for the railroads

The ELD mandate, the tightening of capacity, and the driver shortage could all be contributing factors to shippers taking a more favorable look at intermodal and rail options. In any case, 72 percent of respondents for the Morgan Stanley survey indicated that they would be increasing their rail spending in the next six months. However, in order to close the gap between either mode of pricing to err on the side of rails, there would have to be a serious shift in the trucking industry.

 

 

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Supply Chain: Nervous Over NAFTA

The White House has released President Trump’s plans to “renegotiate” the North American Free Trade Agreement. While it comes as a welcome sight for investors, it’s only sent the logistics industry into a mild state of panic as they try to determine just what effects these changes will have on the supply chain.

While on the campaign trail, Trump cited the deal as “the worst trade deal signed maybe anywhere” making a bold proclamation that maybe it was time to leave it altogether. However, in a recent press release, the administration suggested a slight restructuring, rather than a total withdrawal.

Sudden Changes Can Hurt the Industry

Trump’s business demeanor has a lot to do with the reason that the logistics industry is nervous, according to the president of the Arkansas Trucking Association, Shannon Newton. She said that a sudden change to the free trade agreement between the U.S. and its neighbors could cause some serious issues in the supply chain, especially when there isn’t time to adapt to these changes.

The industry has anxiety over change.

“The industry has anxiety over change, and it’s not necessarily that the way we are doing it is the best way,” Newton said. “It’s that the way freight currently flows dependent upon the methodologies that are currently in play.”

A sudden change in any trade agreement, could upset the way shippers do business.

A sudden change in any trade agreement, let alone NAFTA, could potentially upset the way shippers do business. Combine that with innovations in technology and rapid changes in consumer demand and renegotiations could have some serious adverse effects on shipping.

The Ripple Effect: Automotives

Just how bad could this ripple effect hit U.S. industries? Quartz explains that renegotiating NAFTA would more likely kill jobs in the U.S. auto industry rather than improve them.

Renegotiating NAFTA would more likely kill jobs

“Take the proposed (and widely criticized) border-adjustment tax proposal, which would result in higher taxes for imports. If it was applied at a 15% rate, it would raise the cost of making a car by $1,000, according to the BCG analysis. That’s too small of a difference to warrant moving production from Mexico to the US but large enough to force manufacturers to adjust—at the expense of US suppliers,” Quartz says.

So the manufacturers pass the buck, and the consumer pays a little more for the end product, right? Not exactly. What would likely happen is that automakers would simply offer vehicles with fewer features. Those features, such as automatic braking systems, would shut down other jobs somewhere down the supply chain.

Automakers would simply offer vehicles with fewer features

The Boston Consulting Group projects that 20,000 to 45,000 US jobs could be lost this way if the US adopts a 15% border adjustment tax. Which not only goes against the grain of the “America First” initiative proposed by the Trump administration but also make the United States significantly less competitive in the global market. And that’s just for the automotive industry, saying nothing of other manufacturers that rely on goods from Mexico.

Not All Doom and Gloom

Most of what is causing the anxiety in the trucking industry is simply the uncertainty of what’s to come. However, there are some positives to the new proposals. For instance, the new proposals heavily support the automation and streamlining of the customs procedures at the border which could help to be boost efficiency of cross border logistics.

The new proposals heavily support the automation and streamlining of the customs procedures

“For its part, the U.S. has already indicated an interest in automating and streamlining customs and border procedures. Those were among negotiation objectives released on July 17 by the Office of the United States Trade Representative (USTR). That 18-page document asks for ‘automation of import, export, and transit processes’ as well as ‘reduced import, export, and transit forms, documents, and formalities [and] enhanced harmonization of customs data requirements’ for goods crossing the border,” according to an article from Today’s Trucking.

If President Trump’s negotiations could help to address the imbalance, specifically in wage and labor gaps between the U.S. and Mexico, while streamlining trade between customs process, then it could end up as a win for the logistics industry. As it stands, however, only time will tell.

 

 

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BlueGrace Awarded Top 100 3PL By Inbound Logistics

Over the last nine years, BlueGrace Logistics has been awarded Inc. 500, Best Places to Work, Top Minority Owned Business, Happiest Company Award, Inc. Hire Power Award, and many more. As one of the fastest growing leaders of transportation management services in North America, BlueGrace is now being awarded the Top 100 3PL prize from industry publication, Inbound Logistics.

Inbound Logistics editors selected this year’s class of Top 100 3PLs from a pool of more than 300 companies.

“Today’s leading companies are struggling to balance the need for advance planning against the demands for supply chain agility, low-inventory schemes, and complex omni-channel and e-commerce distribution regimes.  BlueGrace Logistics continues to provide solutions to help companies meet those challenges, and that’s why Inbound Logistics editors have recognized BlueGrace Logistics as one of 2017’s Top 100 3PL Providers.” said Felecia Stratton, Editor at Inbound Logistics.

Top 100 Selection Methodology

Inbound Logistics’ Top 100 3PL Provider’s list serves as a qualitative assessment of service providers they feel are best equipped to meet and surpass readers’ evolving outsourcing needs. Distilling the Top 100 is never an easy task, and the process becomes increasingly difficult as more 3PLs enter the market and service providers from other functional areas develop value-added logistics capabilities.

Distilling the Top 100 is never an easy task

Each year, Inbound Logistics editors select the best logistics solutions providers by carefully evaluating submitted information, conducting personal interviews and online research, and comparing that data to our readers’ burgeoning global supply chain and logistics challenges.

“The service providers we selected are companies that, in the opinion of Inbound Logistics editors, offer the diverse operational capabilities and experience to meet readers’ unique supply chain and logistics needs.” said Stratton.

A Look Ahead

BlueGrace Logistics will continue its quest to be the best 3PL, by offering its freight customers the ability to ‘Simplify their Freight’ by providing customized transportation management through their proprietary technology, BlueShip™. By developing tighter integrations with BlueShip™ and major ERPs such as SAP and NetSuite, the transportation management team can offer more tools to help consolidate, streamline and predict future freight issues and opportunities. The BlueGrace team of transportation management experts have already helped many companies reduce their over freight spend through a tight combination of data engineering, carrier relationships and excellent customer support.

The transportation management team can offer more tools to help consolidate, streamline and predict future freight issues and opportunities

About Inbound Logistics

Inbound Logistics is the leading trade publication targeted toward business logistics and supply chain managers. Inbound Logistics’ mission is to help companies of all sizes better manage corporate resources by speeding and reducing inventory and supporting infrastructure, and better matching demand signals to supply lines. More information is available at www.inboundlogistics.com.

 

 

 

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Understanding and Managing Your Hazardous Materials Supply Chain (hazmat)

Shipping Hazardous Materials

Any company that ships hazmat knows that every piece of the puzzle needs to be perfect before the freight gets moving. Between surcharges, accessorial fees, packing groups and hazmat classes, every aspect of each shipment needs to be in its place or else someone gets fined.

With the government mandates and regulations so heavily involved in every aspect of the transportation industry, it is imperative for a logistics coordinator or a third-party logistics (3PL) provider to be knowledgeable and current with industry and carrier regulations. Here is where it can get sticky for some providers who may not have excellent carrier relationships.

Our relationship with our carriers is different.

Our relationship with our carriers is different. They are as important to us as our customers, so it is to our benefit to work with them to stay up to date on industry and carrier regulations. We are constantly training our transportation and freight representatives as well as communicating weekly with our ‘Carrier Update’ that goes out to our entire company, not just sales!

How BlueGrace is Different

BlueGrace is different than other 3PLs for several reasons, but one that sticks out above the rest; Business Intelligence and Transparency.

Business Intelligence and Transparency

A massive agriculture chemicals manufacturer in the United States was with another large 3PL when an opportunity came across for BlueGrace to do a consultative review. Upon conducting the review and data engineering screening, this company felt that BlueGrace offered greater transparency and pricing structure than their current provider and ultimately made the switch.

See How BlueGrace Helped an Agriculture Chemicals Manufacturer Realize a Cost Savings of 14% YOY

Download Case Study

Use a Proven 3PL for Your Hazmat

 

 

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Shedding Some Light on Dimensional Pricing

As more carriers are beginning to make a move to dimensional (DIM) pricing, it’s important that we take a moment to understand what this means exactly. Just like any change that happens in the shipping industry, being aware of it before it becomes the norm is the best way to stay ahead of the curve and to mitigate any unwelcome surprises in the form of higher shipping rates.

So what is dimensional pricing?

So what is dimensional pricing? Simply put, DIM pricing is a way for carriers more accurately price packages that take up more space rather than simply basing it on weight. A blog released earlier this year from EasyPost sums it up like this.

“Dimensional pricing (or dimensional weight) is a pricing technique for carriers to better reflect the cost of carrying bigger packages, regardless of their weight. Traditionally, carriers have used weight as the major determinant in rates. But by charging only by weight, carriers lose money when carrying bulky and lightweight packages that take up valuable space. Space can be just as important to a carrier as weight since bulky packages limit the amount of total packages the carrier’s vehicle can carry,” says EasyPost.

While the calculations might vary from carrier to carrier, there is a basic formula used by most.

Some carriers, like USPS, offer a DIM weight calculator so you can plug in your dimensions and see what your dimensional factor would be before you take your package to be shipped.

Understanding What this Means For Your Business

Once a carrier has their DIM factor, they can determine the rate to ship the package. However, here’s the catch. A carrier will also determine the weight rate as well and likely charge you the higher of the two. Understanding how your carrier will use dimensional pricing, as well as what the rates are will give you some insight as to how to move forward.

Understanding how your carrier will use dimensional pricing, as well as what the rates are will give you some insight as to how to move forward.

If their dimensional pricing is higher than their weight pricing, it might be time to rethink your packaging process, breaking items down into smaller packages or changing your packing material and box sizes for example.

LTL Shippers Might Get Hit Harder Than Most

The thought behind DIM weight pricing was born from both necessity and technology. Given the boom in e-commerce, many carriers realize that they’re maxed out on space, rather than weight, making their trips less than efficient. Given that we have the technology to accurately measure the dimensions of packages, this move is the next logical step for the LTL sector.

The thought behind DIM weight pricing was born from both necessity and technology.

‘The (LTL) industry in the last three or four years has rapidly embraced dimensioning (measuring) machines,” said Satish Jindel, principal of SJ Consulting, which closely tracks trends in the LTL sector. “It works, and it’s cost effective—the payback comes in just a few months,’ according to an article from Logistics Management.

How BlueGrace Can Help

While LTL carriers have been slow to react in comparison to parcel carriers, Dimensional Pricing is a reality in the future of our business. The DIM weight trend is beginning to grow, quickly. With the increased usage of dimensioners, carriers can more accurately capture cost data and ensure that price is compensatory with the cost to move it. The ultimate laggards here will be big shippers migrating off of the conventional class based system. Dimensional pricing is prevalent throughout the world, now the U.S. based shippers will have to play catch up. Not only will it apply to boxed parcels, but to palletized freight as well. Shippers will feel the sting of excessive packaging quickly if they don’t start making changes now.

Shippers will feel the sting of excessive packaging quickly if they don’t start making changes now.

Dimensional shipping might seem like a quick grab for a few extra bucks on shipping rates, but it’s actually a more accurate and fair way of doing business for all parties involved. Still, it can be a bit confusing at first, especially when dealing with other changes at the same time. At BlueGrace, we make it our mission to not only keep pace with these changes but to help you do the same. Whether it’s getting a better handle on dim weight, or finding carriers at the best rates to help you keep your supply chain moving, we’re here to help.

 

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CSA Report Card: Room for Improvement

Compliance, Safety & Accountability

While the Compliance, Safety, Accountability (CSA) scoring mandate is meant to improve carrier performance and safety for trucks on the road by providing a scoring metric, it wasn’t without its blind spots. A recently released report from the National Academies of Science, Engineering, and Medicine (NAS) shows that the CSA scoring method has some pretty glaring flaws when it comes to the Safety Measurement System (SMS) which can lead to an unfair scoring for a company.

CSA scoring method has some pretty glaring flaws

The main issues brought up by the NAS report include “some BASICs lack correlation with crash risk, data insufficiency, use of relative rankings, use of non-fault or non-preventable crashes, state variations in inspections and violations, lack of consistency in violation coding, a lack of transparency of the SMS algorithm and the public availability of SMS rankings,” according to GloStone.

The DOT will need to make the SMS metrics more fair and accurate

A point to note from the NAS report is that they believe the premise behind the SMS is fairly solid; it’s the FMCSA’s execution of the program that leaves something to be desired. The DOT will need to make the SMS metrics more fair and accurate when it comes to assessing actual safety risk.

Recommendations for the SMS

Again, the idea of the SMS is sound, the main problem is when it comes to the execution of the SMS. “The Safety Measurement System is used to identify commercial motor vehicle carriers at high risk for future crashes. It’s the heart of the Federal Motor Carrier Safety Administration’s Compliance, Safety, Accountability enforcement regime, known as CSA. After numerous criticisms of the methodology from the industry, Congress called for the review of SMS as part of the Fixing America’s Surface Transportation (FAST) Act of 2015,” according to TruckingInfo.

Congress called for the review of SMS as part of the Fixing America’s Surface Transportation (FAST) Act of 2015

The current SMS metric fails to take into account some variables that play a bigger role in safety practices. Some of these faulty measurements include:

  • Using highly variable assessments
  • Not accounting for crashes where the motor carrier is not at fault
  • Including carriers that have very different tasks in the same peer groups
  • Using measures that are sensitive to effects from one or more individual states
  • Using measures that are not predictive of a carrier’s future crash frequency
  • Using measures that are not reflective of a carrier’s efforts to improve its safety performance over time.

Statistically Principled Approach

It’s easy to see that these oversights can lead to some bigger issues down the road. For that reason, the NAS study suggests that the current system takes a “more statistically principled approach” when it comes to collecting data. The NAS report recommends using latent trait theory or an “item response theory” (IRT) model. The IRT is the same approach used by hospitals for safety and performance rankings and helps to shape policy decisions.

“We have found, for the most part, that the current SMS implementation is defensible as being fair and not overtly biased against various types of carriers, to the extent that data on MCMIS can be used for this purpose,” said the National Academies panel.

SMS implementation is defensible as being fair and not overtly biased against various types of carriers

“However, we believe some features of SMS implementation can be improved upon, and some of the details of the implementation are ad hoc and not fully supported by empirical studies. Many of these details of implementation would be easily addressed if the algorithm currently used were replaced by a statistical model that is natural to this sort of discrimination problem,” they added.

Quality of Data

Another issue mentioned by the report is the poor quality of data. It’s recommended that the FMCSA continues to work with state departments and other agencies to improve the collection of data when it comes to miles traveled and crashes. Unfortunately, as it stands, this data is either missing or is of poor quality. Should the FMCSA be able to improve the quality of their data, the SMS will be able to take other factors such as environmental factors of travel which will give a better understanding of the crash conditions.

Unfortunately, as it stands, this data is either missing or is of poor quality

There are other, more obscured, data points that the report says should be included when collecting data on carriers, including driver turnover, cargo type, as well as method and level of driver pay. The panel suggests that driver pay is an important factor to consider especially when taking into account that better-paid drivers (those who aren’t paid based on miles traveled) tend to have fewer crashes.

What Does this Mean for the Industry

As you can imagine, the trucking industry has been waiting for NAS findings as it highlights all the issues they’ve had with the program for the beginning.

“This report has confirmed much of what we have said about the program for some time,” said American Trucking Associations President and CEO Chris Spear. “The program, while a valuable enforcement tool, has significant shortcomings that must be addressed, and we look forward to working with FMCSA to strengthen the program.”

we look forward to working with FMCSA to strengthen the program

If the FMCSA does decide to implement the suggested changes, then we can expect a more or less total overhaul of the CSA rating system. Now carriers with a mediocre level of safety performance can’t rely on poorer carriers to make them look good. Simply put, everyone is going to have to step up their game and start pulling their weight, safely.

Carriers with a mediocre level of safety performance can’t rely on poorer carriers to make them look good

In addition to providing more accurate and reliable data, carriers will also be able to get a better understanding of their score as well as how to improve it.

 

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What Happens If Freight Economy Rises?

 

A market that is already beleaguered by a significant shortage in workforce is seeing a disturbing trend in the form of an uptick in turnover rates.

“The slight uptick in turnover, despite weak freight volumes in the first quarter, may be indicative of a tightening in the driver market,” said ATA Chief Economist Bob Costello. “The situation bears watching because if the freight economy picks up significantly, turnover will surely accelerate – as will concerns about the driver shortage.”

Turnover will surely accelerate – as will concerns about the driver shortage

Within the first few months of 2017, the annualized rate of turnover for large TL (truckload) fleets, rose three percent, up to 74 percent. While it’s somewhat heartening to know that this is still down 15 points from what it was last year, a 74 percent turnover rate is nothing to be ignored. For small TL fleets, the increase was a bit smaller, two points, bringing the turnover rate to 66 percent.

Fixing a Growing Problem

When you consider the importance of trucking to the United States, the shortage in drivers is becoming a serious issue. Add in the fact that a large portion of the active drivers on the road are just about at retirement age and you have a full-blown crisis for the industry.

The shortage in drivers is becoming a serious issue.

So what is being done to fix or, at the very least, soften the blow of the driver shortage? Well, for starters, many trucking companies are taking steps to recruit more women into what is typically considered a predominately male industry. Anything from offering better maternity leaves to other incentives. At this point, anything that can draw in more personnel and drivers is considered a win.

Many trucking companies are taking steps to recruit more women

‘The American Trucking Associations, declared in a recent report that the industry needs to add almost 1 million new drivers by 2024 to replace retired drivers and keep up with demand. Some companies have added 401(k) and tuition reimbursement programs. Others have hired “female driver liaisons” and started support groups called “Highway Diamonds,” said Ellen Voie, president of the Women in Trucking Association,’ in a quote taken from the Washington Post.

The industry needs to add almost 1 million new drivers by 2024 to replace retired drivers and keep up with demand.

“In 2015, her organization created a Girl Scout badge to teach girls that trucking isn’t just for men,”  WP added.

Women in Trucking

Carriers are really pushing for more female drivers, according to Voie. “They’re facing the retirement issue, yes, but they also know that women tend to be more risk averse, which is extremely important.”

The drive for more women drivers is starting to pay off, however, there was a slight increase in female drivers over the course of the past year, rising from 6 to 7 percent.

There was a slight increase in female drivers over the course of the past year

Even as we see some slight improvements, it’s almost impossible to believe that one of the most predominate fields of employment in the United States might be on the verge of extinction, or at the very least is in danger of heading that way.

Is the Trucker the Only One at Risk?

A recent post from Bloomberg has a rather interesting interactive chart that shows whether or not your job might disappear in the future. For the trucking industry, it’s not just the drivers who might be dusting off their resume, but even shipping clerks and freight agents might soon be out of a job as the industry continues to change and evolve through new technology.

Even shipping clerks and freight agents might soon be out of a job

Most of what the chart predicts is that low skill, low paying jobs, will eventually be phased out by computerization and automation. For example, Shipping, Receiving and Traffic clerks have a 98% probability of having their position becoming computerized in the future. However, as we’ve learned from history, the evolutionary path of technology isn’t always the easiest to predict. While it’s true some jobs might become obsolete, there are a number of jobs that will simply become augmented with technology, still maintaining the need for the human element.

 

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Do you have the right TMS for your business?

 

Transportation Management Systems on the Rise

Whether you’re shipping domestically or internationally, keeping everything running smoothly can be a big job to say the least. It requires a careful orchestration of a potentially vast number of moving parts. The smoother these parts operate in conjunction with one another, the better your operation will be. For that reason, transportation management is essential for domestic and global shippers.

Transportation management is essential for domestic and global shippers.

If we consider the way things have been done in the past in comparison to the new technological advancements that are being developed at an ever-increasing pace, the old school, manual system just isn’t going to cut it any more. Phone calls, faxes, emails, and spreadsheets might have been enough to keep a trucking company running a few decades ago, but now companies who can’t keep pace with the time and technology, will run the risk of being outmoded and left behind.

Companies who can’t keep pace with the time and technology, will run the risk of being outmoded and left behind.

Advancements in Technology

Transportation management technology has come quite some way from what it once was. The myriad of options available for both shippers and 3PLs to choose from for planning and executing systems is massive compared to that of the past. Not only are there more options to choose from, but the speed, cost, and modes that these management systems can be obtained, implemented, and used have also improved.

American Shipper TMS Benchmark

Transportation management systems (TMS) will vary from company to company, depending on what the shippers needs are. A recent benchmark report from American shipper highlights some of the key developments in TMS, including how shippers see the market, the technology they currently use, how they connect with other carriers, and how new transportation technology interacts with the inventory variance created by omnichannel marketing. In short, the nature of shipping and transportation is changing, and shippers will need a different approach to adapt to this market evolution.

When you consider that omnichannel retailing is on the rise, this will make things more difficult for trucking companies as it will require increased flexibility in their supply chain. In fact, only 20 percent of shippers and 30 percent of 3PLs feel that their TMS system can support an omnichannel strategy.

Only 20 percent of shippers and 30 percent of 3PLs feel that their TMS system can support an omnichannel strategy.

The report also highlighted some of the challenges involved with TMS. One of the biggest challenges, according to the respondents revolves around connectivity to outside partners and compatibility with other systems. While having a good TMS is useful, it doesn’t make too much of a difference if it’s only capable of working “in house.”

A Growing Need for TMS

Another startling discovery made by the report is that 40 percent of the respondents aren’t using a TMS or a 3PL to manage their logistics. However, given the coming shift in the market, there is a considerable uptick, 55 percent, in the amount of trucking companies who are beginning to utilize management systems when compared to last year. This is becoming increasingly important as trucking companies begin to shift gears for omnichannel demands which require higher data volumes and increased workload for transportation departments.

40 percent of the study’s respondents, aren’t using a TMS or a 3PL to manage their logistics.

An Industry Leading TMS Is Available For Free

While it’s encouraging to see that the number of companies who are open to using a TMS is on the rise, it’s still worrisome that there are many who don’t. TMS systems are not only improving in ease and speed of implementation, but the cost is also dropping. In fact, there’s even a free transportation management system that’s available to shippers. That’s right, free.

Whether you’re a one-time shipper or ship 7-days a week, the cost is zero to you!

Our proprietary transportation management system, BlueShip, is free! Whether you’re a one-time shipper or ship 7-days a week, the cost is zero to you! Whereas other 3PLs charge anywhere from $3-10K for the use of their TMS. Our system is cloud based, which offers ease of implementation and utilization from system to system and partner to partner. We’re always fine-tuning our system to offer you the best in both reporting and live tracking.

BlueShip Is Free For All BlueGrace Customers

 

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Do You Have The Right Technology To Dissect Big Data?

 

For what was once a stagnant industry for best practices, the freight industry is now being bombarded with new disruptive technology on a near constant basis. Dealing with one issue means that another takes its place. Begin to understand and utilize new technology, and it becomes quickly outmoded, or there’s another system to learn. Even the roster of companies is constantly changing, old players, leaving and new ones rushing in to fill the void.

Dealing with one issue means that another takes its place.

With such a constant back and forth, it would be all too easy to simply stick to what you know and call it a day, especially from a technological perspective. However, those old ways, comfortable though they may be, are a road to ruin. Companies who embrace innovation and new technology will part ways with companies that rely on “traditional” methods.

Additionally, these “pioneering spirits” for the industry are providing new options for customers that simply can’t be matched by the old school. The industry is evolving, which means shippers and carriers need to be on board or be left behind.

The Keys to the Data Stream

Big data is a term that gets thrown around a lot, especially now with the changes in industry technology. Now more than ever, the supply chain can provide more data and insight into the process than ever before. More ways of tracking data can show where weak points are within the supply chain. Whether it be driver, loading or unloading, traffic issues, road conditions or damaged shipments, everything is being monitored for efficiency. Whenever a change in address comes in from head office, it can be pushed to the driver or captain in real-time. The system automatically calculates and optimizes the ideal and cheapest new routing to the new destination.

More ways of tracking data can show where weak points are within the process

Part of adapting to the changes that are happening within the transportation industry is to know which data is useful and which data isn’t. While collecting data is all well and good, there is such a thing as too much data (TMD), which can be overwhelming when trying to decipher it all.

Which data is useful and which data isn’t.

“Collecting too much data is a problem, because it forces a company to spend valuable resources gathering and understanding data, much of which is likely to not be impactful from a bottom line or service level perspective. It also creates a secondary problem that’s just as harmful—the valuable data can be lost in the avalanche of meaningless information,” according to American Shipper.

Having the Right System in Place

So what can you do to protect yourself from data overload? Well, it’s all about having the right system in place to make sure you’re collecting only the data that you’ll need and weeding out all the rest. Having access to the right data at the right time can prevent problems before they start and, more often than not, many of the issues for transportation come from poor planning.

It’s all about having the right system in place

One of the most instrumental uses for new technology is a transportation management system (TMS) which can give companies an edge when planning their logistics. Not only does this allow for a better insight into customer experiences and needs, but it also provides the necessary information to correct an issue before it becomes a more serious problem. Additionally, a good TMS can also help bridge the gap between shippers and carriers, saving both time and money when it comes to transportation.

American Shipper recently released a report about combating the volatility of transportation and part of their suggestion is the use of TMS.

“Shippers are realizing daily that transportation management systems (TMSs) are both more necessary and more affordable than ever before. Even the simplest of transportation networks could benefit from optimization and automation of data entry functions. But these TMSs are also becoming more hyper-reliant on outside sources of data to reach their peak usefulness. So a shipper can’t just simply plug a TMS in and let the magic happen. It has to actively feed that TMS with useful, forward-looking, and reliable data.”

All of this to say that armed with the right data and a strong TMS, a shipper can take their business much further.

BlueGrace Proprietary TMS – BlueShip®

The easiest way to get started utilizing your valuable shipping data is with a full featured TMS, such as BlueShip. BlueGrace’s proprietary technology is designed to put the power of easy supply chain management and optimization back in your hands. BlueShip® offers cutting-edge tools for strong reliability and quick performance. Our customers are especially impressed with the user experience, which is completely customizable and has real-time updates, giving them a single source tool for tracking, addressing, and product listing.

BlueShip Is Free For All BlueGrace Customers

 

 

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Automated Trucking is Poised to Play Huge Roll in Transportation Industry

Navigating the Transition to Driverless Trucking

Automated trucking is poised to play a huge roll in the transportation industry. Overall, the implications of driverless trucks have near limitless potential. Without the margin of human error, autonomous trucks are safer and more efficient. Working in tandem for one another, driverless trucks can capitalize on fuel efficiency while working around the clock bringing in more deliveries at a fraction of the labor cost.

Driverless trucks can capitalize on fuel efficiency while working around the clock

However, while the end goal of automated trucking in the freight industry has some incredible possibilities, it’s the transition to this point that has more than a few people worried. Given that driverless vehicles is something of a precedent, there’s a lot of obstacles to overcome before the idea becomes a reality.

The Un(der)employed 

Job loss is a very large possibility with automated trucking. As truck drivers make up 1% of the total U.S. labor force, the volume of displaced workers will be severe. Mitigating the job loss and the potential impact of unemployment rates will be a key element to the transition to automated trucking.

Truck drivers make up 1% of the total U.S. labor force

More often than not, whenever there is a potential for massive job displacement, the words to follow are “There are other jobs to be had.”  While this is true for some industries, it might not necessarily hold true for truck drivers. These, according to the International Transportation Forum’s report on the matter, are the possible obstacles to this “conventional wisdom.”

“The conventional argument is that displaced workers in any given industry will find alternative employment through the expansion of activity in new and existing industries. However, there are several reasons described below as to why this argument may not provide comfort for truck drivers and others in the high-automation scenarios.” 

  • The high costs associated with losing a job
  • The risk that this time is different, i.e. that a low employment future is possible, at least temporarily, because automation may occur in many sectors of the economy
  • The emerging economic context means that job losses may result in higher social costs than previously.

The cost of losing a job alone represents one of the biggest issues, both on a financial and physical scale. Displaced workers, on average, take a 20% drop in annual wages. Additionally, being displaced from a job is often a trigger for both anxiety and depression according to the ITF report.

The cost of losing a job alone represents one of the biggest issues

“The mental and physical impacts of job loss are estimated to have a greater combined impact on well-being than the financial costs from lost income. Helliwell and Huang (2014) estimate that such non-financial factors decrease the average person’s well-being two to seven times more than the does their lost income from losing their job.”

Infrastructure Challenges

In addition to the unemployment costs of automated trucking, there is some considerable concern about the infrastructure that will be required to support automated freight transportation.

“The infrastructure requirements for full automation of driving functions are not yet clear-cut (section “Towards driverless road freight”). The need for 5G mobile internet connectivity between vehicles along the full corridor is not yet certain. Further, specific applications such as platooning and remote control centre operations are also likely to have additional infrastructure requirements. For instance, platooning may require longer motorway entry and exit ramps than are currently in place (Janssen et al., 2015).”

A possible solution to this obstacle would be to roll out test corridors to slowly integrate autonomous trucks, which would significantly lower the upfront costs. However, as the technology grows in both sophistication and popularity, the overall costs will be both substantial and unmitigatable.

The Foreseeable Future

As it stands, the technology, policies, and regulations are not in place to fully support automated freight hauling. However, in the not-so-distant future, these questions and obstacles will need to be addressed in order for these driverless trucks to take the road. As with most disruptive technologies, it will be the transitional period that will be the hardest to accommodate.

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What Can We Expect for the IoT for 2017 and Beyond?

The IoT of 2017

The Internet of Things, an interconnected program that is supposed to provide unparalleled data for shippers and carriers, has certainly been a hot topic for the logistics industry. With 2016 well and truly in the past, it’s time to start looking forward to what 2017 will hold for this burgeoning system. What new changes can we expect? How do these expectations compare to what we thought the system could do for us in the past? With a new partnership between Intel’s logistics platform and Honeywell’s hardware and cloud services, the IoT is beginning to really take shape.

What new changes can we expect?

The Partnership

The newly formed partnership, announced last Thursday, will marry Intel’s connected Logistics platform to Honeywell’s Connected Freight Solution. Data gathered by this new system will allow shippers to track products from start to finish. However, this system ranges far beyond the simple tracking capabilities of a truck or pallet. Users will be able to track a number of different variables including: temperature, shock, vibration, tilt, humidity, pressure, and exposure to light. If freight gets damaged during transit, a shipper will be able to know when, where, and how it happened. That alone can prove invaluable when it comes to preparing damage audits and projecting yearly PNLs.

Data gathered by this new system will allow shippers to track products from start to finish.

With data being tracked by a number of low cost sensors, part of the Intel/Honeywell package, users will have access not only to data on demand, but data that is pre-drilled down to useful data points that a company can act on.

Past Predictions for the IoT

While there have always been high hopes for the IoT, the expectations for it’s potential have changed throughout the past few years.

“Several years ago the market for connected products and services was promising eye popping growth numbers of up to 100 billion units. Today, a majority of forecasts show a more tampered 20 billion or 30 billion units (while a few others say we are saying we are still severely underestimating size of impact),” according to an article from Postscapes regarding IoT market forecasts.

Cyber security is also expected to become a boom market

What’s interesting to note from this article is that while the IoT is expected to grow by leaps and bounds, it’s not a standalone technology. Included in these forecasts is also expectations for sensor technology, cloud computing, and cellular capabilities will also continue to grow and expand. Cyber security is also expected to become a boom market as the sensitivity of data continues to rise.

On the Rise for 2017

So what can we expect for the IoT for 2017 and points beyond? Forbes has quite a few predictions that are worth considering. For starters, this year is going to see a lot of shake ups as new companies trying to get in on the game either make the cut, or get swallowed up by larger, more stable companies. As the IoT is now past proof-of-concept, there will soon be regulations and standardization to contend with as well. These regulations won’t be static either, as the technology continues to grow and evolve so will the standards being applied to them. As the IoT continues to grow and take shape, companies will need to embrace the new technology swiftly or fall behind the competition as supply chains and logistics fully enter into the digital realm.

Companies will need to embrace the new technology swiftly or fall behind the competition

 

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Tampa Manufacturing and Logistics – A Perfect Marriage.

Manufacturing in Florida, is the backbone of the state’s economy.

Florida has nearly 18,000 manufacturers in all types of industries ranging from traditional such as plastics and printing to breakthrough technologies like aerospace and medical devices.

Tampa Bay knows a thing or two about manufacturing and economic development, as it is home to 19 corporate headquarters with over $1 billion in annual revenue, eight of which are Fortune 1000 companies.

The depth and diversity the city provides for its economy makes for the perfect marriage of logistics and businesses, especially manufacturers.

Manufacturing Growth Perfect for 3PLs

While the manufacturing businesses in the region are continuing to see a huge amount of growth, the infrastructure that Tampa Bay provides, is allowing modern logistics and Third Party Logistics (3PL) providers to grow and adapt alongside the companies they ship for.

Florida is second in the nation for transportation infrastructure with our ports, airports, rail and roadways.

Logistics and 3PLs providers are always looking for ways to improve these modes to help businesses move raw materials, components and finished products. With these options, logistics and 3PL providers have the ability to provide customized transportation programs that help grow local manufacturing.

E-Commerce Puts Pressure on Logistics

Both regionally and nationally based manufacturers are seeing a demand to keep up with e-commerce giants like Amazon, which means that their logistics provider needs to stay one step ahead to provide efficient and cost effective transportation management. Much like consumers, big box retailers and mom and pop shops now demand the product to be on their shelves at a quicker pace. This “just-in-time” mentality is what puts a strain on manufacturers who rely on an in-house transportation department. Business intelligence and carrier advocacy are critical to these companies in order to keep up with the changing market.

The Value of Business Intelligence

Of all the resources that a logistics or 3PL providers delivers to its customers, the most underrated yet most valuable is business intelligence. A 3PL has the ability to take a company’s current freight data and see where opportunities are being missed, find ways to shave costs and offer an efficient transportation program that ultimately mirrors their business model and will push for more growth.

This valuable data, when run through the right engineering platforms, can help decide the best modes, which carriers to use and even help pinpoint where the best location for a new distribution center would be, based solely on past data and performance.

By partnering with logistics or 3PL providers that have access to multiple modes of transportation, large carrier networks and the ability to review current freight data, solutions can be provided that better fit the company’s business model. Manufacturers can adjust rapidly to the increased supply chain demands, without expensive increases to the head count of their transportation department.

Job Opportunities for the Future Generations

While the logistics and 3PL providers continue the push to deliver customized and adaptable transportation programs for manufacturers, the state of Florida is also striving to increase job opportunities to fulfill logistics and distribution demands. Currently the logistics and transportation industry employs more than half a million Floridians. 85,500 of these employees are working at companies that specifically provide logistics and distribution services. The future is also bright as Florida has ten public high school career academies offering training in Global Logistics and Supply Chain Technology.

Optimization and Forward Thinking Manufacturers

Today’s technology and service that a logistics or 3PL providers utilizes, paired with a forward thinking manufacturer looking to optimize their supply chain, will prove to be a successful marriage for growth. This growth is what will help bring even more success and jobs to Florida for both the manufacturing and logistics sectors.

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How Can Expedited Shipping Be A Game Changer For Your Business?

 

Quick, Fast and In a Hurry

You can bet that manufacturers pay close attention to the Must Arrive By Date (MABD), set by big box retailers like WalMart and Target. While big box retailers mandate Must Arrive By Dates to ensure their shelves are always stocked with products consumers want, many companies who sell products directly are often are losing potential customers and revenue by not offering expedited shipping options to customers who have their own Must Arrive By Dates in mind for freight sized purchases.

What Is Expedited Freight?

For smaller parcel sized items, a business will often utilize the overnight or next day air options available from USPS, FedEx or UPS. But for larger sized items requiring freight shipping, many businesses and consumers aren’t aware that expedited shipping options are available, or find that they aren’t able to receive reliable or economical shipping rates from their current transportation partners.

Let’s explain more about how Expedited Freight works in comparison to standard LTL Options.

The transit of a standard LTL shipment is typically estimated as the shipment being picked up from the shipper that has to be taken to a terminal where it will be cross-docked. During this process the shipment will be loaded and unloaded from freight trucks multiple times, depending on the distance, before it arrives at the final destination. While many LTL carriers offer guaranteed shipping services, some shipments need to arrive sooner than LTL shipping can provide.

New Expedited Options For Your Business

Depending on the size of a shipment there are multiple expedited shipping options available for freight sized orders. By cutting out the cross-docking necessary in LTL shipments, expedited services are able to cover quite a bit more ground, or air, in a much shorter time than a standard LTL carrier could.

Cargo vans, straight trucks with lift gates, and air freight can be utilized for shipments that would ordinarily take up a few pallet spaces on a LTL truck. For orders that require a full truckload, a team of drivers can be booked so that your freight can theoretically move non-stop without breaking regulations imposed by the United States Department of Transportation. 

Expedited Freight = Time Sensitive Freight

It doesn’t matter if it’s June or if its a few weeks before Black Friday, as a shipper, you have the ability to expedite your freight. Whether you need to get your pallet of a custom equipment repair parts to the factory that is currently down or you need to get your trade show displays to a convention center by Friday, expedited shipping may be the best route for you. Some of our current customers are from industries like: Auto Parts, Promotional Displays, Industrial EquipmentTrade Show Management,  Airplane Parts, Computer Servers & Equipment, Maintenance Repair, AV Equipment, Restaurant Equipment and Medical Suppliers.

What Qualifies for Expedited Shipping

  1. Shipments that need to be picked up after 5 p.m. and delivered before 8 a.m.
  2. Shipments that need to move 1000 miles in 24 hours.
  3. Shipments that are loose and fragile, can’t be cross-docked with LTL carriers.
  4. Shipments that require faster transit than what LTL can offer. (Express LTL is one step away from Expedited)

How Does BlueGrace Put Expedited Shipping to Work for YOU?

BlueGrace can easily handle any expedited freight shipment request. We offer 30-minute quotes on price and capacity directly, from over 300 pre-screened, local expedite carriers nationwide. With over 10,000 pieces of equipment from Sprinter vans and semis, to domestic air, we can handle any type of freight. Each shipment it tracked by Macropoint, so you always know where your freight is located.

Expedited Freight Only Works With An Expedited Quote

BlueGrace is also one of the few providers that is able to offer guaranteed pricing and availability within 30 minutes of your request.

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For any questions, please contact your BlueGrace Logistics Rep today! If you call after 5PM EST or weekends, please email expedite@mybluegrace.com or you can download our Expedited PDF by Clicking Here.

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Drones – Why You Want Them In Your Supply Chain.

 

Drones are all over the media these days. Civilian drones have taken selfies to a whole new height, while Amazon has been working to get their drone delivery service off the ground. However, many companies are looking at the other ideas of using drones, especially when it comes to mapping out your supply chain.

An article recently released on Forbes website is showing the advancements being made to drone technology and why they could become an invaluable resource moving forward.

New Technology Makes Drones more Effective

One of the most pressing concerns about drone use is the limited range of operation. Even with the new battery technology, a drone typically has a flight time of about 25 minutes.

While this is great for taking a few aerial shots at a picnic, it’s not too helpful when it comes to large scale operations like mapping a supply chain.

Matternet, a company that specializes in drone logistics systems, partnered with Mercedes-Benz to co-develop a docking system that would allow a drone to take off from and reconnect to the roof of a vehicle. This would not only solve the matter of charging, it would also accommodate for packing and delivery all while increasing the range and payload utilization in the field.

This alone already ramps up the possibility for drone usage for last mile deliveries and improved logistics.

What Drones Could Mean for Your Supply Chain

First and foremost, drones are incredibly flexible as far as their uses go, even if you’re not looking to make quick deliveries.

“It’s increasingly clear that drones deserve consideration as part of your digital roadmap. Plus, ground and even ocean-going drones are developing fast, with problem-solving applications such as driver hour limitations, inaccessible or hazardous locations and massive materials handling chores, similar to what BASF is doing with autonomous vehicles in its mega-plant in Ludwigshafen, Germany,” says Forbes writer, Kevin O’Marah.

Companies Look into Fielding Drones

More and more companies are looking into fielding drones, and nearly a third of all supply chain professionals have said that drones have become very important to their supply chain roadmapping and strategy.

This is almost triple what the response was only two years ago, back in 2014.

More businesses are seeing the tremendous benefit and are lobbying to get regulatory approval for wider use. This is something which the FAA has been slow to agree to at first, but is starting to become more receptive to the idea as time goes on.

Proactive vs. Reactive

Much like the new digital platforms that are allowing businesses to be proactive about their supply chain issues, rather than merely reactive, it would be a mistake to ignore the benefits of drones and the advantages they can bring to your supply chain.

 

 

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How Do Construction Suppliers Overcome Logistics Challenges?

The MABD and Your Construction Supply Company

Construction suppliers who provide hardware and tools are under tighter compliance regulations to get the right products to the right stores or distribution centers by a certain time, or they pay a fee. Walmart suppliers now face paying a fee of 3% of the cost of goods of all deliveries after the Must Arrive By Date (MABD).

These regulations for Walmart were implemented back in early 2016, but other retailers such as Target and Home Depot have been charging these fees for some time.

Walmart suppliers now face paying a fee of 3% of the cost of goods of all non-compliant deliveries.

Your construction supply company succeeds or fails based on the constant delivery of your products. Even more so now with the MABD mandate. The timely and effective delivery of your products, is a major priority for you, your retailers and your market. How do the logistics aspects of hardware and building materials differ from other industries?

How do the logistics aspects of hardware and building materials differ from other industries?

The truth is they don’t, with the exception of specific project dates and deadlines that could be missed.

Manufacturers and suppliers that work with large retailers like Walmart, Target and Home Depot are more successful in getting their merchandise on the shelves with the proper lead time due to partnering with a third party logistics provider (3PL).

Out with the Old

Doing things the old way, is not always the best way. Once employees get comfortable in their schedule and day to day routine it  becomes difficult to change those habits and behaviors. BlueGrace Logistics has seen and learned how to explain and implement these changes. In the case study you will learn about a Hardware distributor that was drowning in manual processes and letting inefficiencies become the norm.  

Once employees get comfortable in their schedule and day to day routine, it becomes difficult to change those habits and behaviors.

How We Reduced Costs & Removed Manual Processes for Hardware Supplier

A large big box hardware supplier, based in the Midwest, was utilizing a single national carrier model. There was no GRI mitigation, or freight bill auditing. The manual task of booking shipments was taking up much of the customer support team’s day. The accounting team had no way to tell if the invoiced amount of the shipment was the same as the quoted amount of the shipment. The ways of the past were starting to catch up as volume increased and this supplier had to make a change.

This Hardware Supplier saved 13% of their yearly freight spend which added up to $260,000 annually.

Hardware Suppliers In The Construction Industry Case Study

What About Other Construction Freight?

As a successful third-party logistics (3PL), BlueGrace handles the freight for all types of construction supply businesses. This freight can be heavy, oversized loads, such as cranes and dump trucks to replacement parts and pallets of construction materials. Our first step in any relationship is what sets us apart and brings the most value to your freight and logistics team. Your current freight data is analyzed and then processed with our proprietary engineering software.

Your current freight data is analyzed and then processed with our proprietary engineering software.

This process gives your logistics team a brand new overview of your freight. From there, your team has access to the entire BlueGrace toolbox of solutions, including ERP integrations to our flagship quoting and product, BlueShip. All of these tools come with a team of logistics experts at your disposal and a constant goal to make your freight program more successful.

Would you like to talk with BlueGrace today? Feel free to call our Enterprise Group at 800.MY.SHIPPING or come see us at the CONEXPO in Las Vegas March 7-11 Booth #B9500.

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Laying the First Bricks: Amazon is Getting Physical but Wal-Mart Fights Back

 

There aren’t a whole lot of companies that can match up to the innovative prowess of the e-Commerce giant, Amazon. It seems as though every couple of months we’re catching some snippet that Amazon is trying out a new trick for the convenience of its loyal customers and, true to it’s nature, Amazon is about to pull their next trick out of the bag. An actual grocery store.

Amazon Go

Unlike AmazonFresh, the online grocery shopping option that promises quick deliveries of produce and other perishables, Amazon Go will be an actual brick and mortar store, one of the few ventures Amazon hasn’t really gotten into yet. So why the sudden change? For starters, how about throwing the competition a curve ball?

Some of Amazon’s biggest competitors are Wal-Mart and Target, who focuses on a combined service of both groceries as well as higher ticket items such as apparel and home goods.

Some of Amazon’s biggest competitors are Wal-Mart and Target, who focus on a combined service of both groceries as well as higher ticket items such as apparel and home goods. While the groceries and produce account for a relatively small amount of the sales, it does bring in business which helps these chains hit their real goal of selling more expensive items.

Working out of a brick and mortar store will have its advantages.

Logistically speaking, trying to deliver produce and temperature sensitive goods in an appropriate time frame isn’t out of the scope of Amazon’s fairly comprehensive delivery machine, but it’s not necessarily practical either. This is why the grocery delivery service is only offered in select locations and still isn’t quite as popular as the tried and true alternative, as many customers still prefer to do their grocery shopping in stores, being able to touch, smell, and generally select their produce before purchase.

Many customers still prefer to do their grocery shopping in stores, being able to touch, smell, and generally select their produce before purchase.

According to an article from the Wall Street Journal, Amazon is experimenting with a few different styles of store, a convenience style or quick pick up store, as well as a drive through style, which lets customers skip having to walk into the store to begin with. The key is this, if Amazon has a physical location to work out of, they can capture more of the grocery market shares. As it stands, online grocery shopping is only a small portion of the business, about one percent currently, but is expected to continue to grow.

Wal-Mart Fights Back

If Amazon is going physical then Wal-Mart is retorting with the digital, according to an article from The Motley Fool. Many of the Wal-Mart supercenters are getting a technological upgrade in the attempt to keep Amazon in check in two ways. First is the curbside order pickup. Rather than having to walk into the store, select your items, then wade your way through the checkout line, you can simply place your order online and have it brought out to the car, allowing customers to skip the check out.

Additionally is the Gas and Go Style of Shopping, Similar to a Convenience Store.

Additionally is the Gas and Go style of shopping. This involves a secondary shop, similar to a convenience store, that has some last minute grocery items, coffee, snacks, and other concessions, as well as being a full service Gas Station. The twist is that, customers can place an online order, which is fulfilled by a nearby Supercenter, and arrive at a set time to have their groceries delivered while they gas up their vehicle. This level of convenience, combined with the grocery infrastructure that Wal-Mart already has in place might be enough to keep Amazon Go at bay.

This level of convenience, combined with the grocery infrastructure that Wal-Mart already has in place might be enough to keep Amazon Go at bay.

The Master of Logistics

It’s fairly safe to say that this point that Amazon’s actions are rarely without some sort of ulterior motive. Think back to the Amazon cloud services, which was originally designed to be an in-house service and was then converted into a highly successful business model.

If Amazon can get down the necessary logistics infrastructure to handle groceries and perishable produce, who’s to say they can’t then turn that service towards their competitors?

If Amazon can get down the necessary logistics infrastructure to handle groceries and perishable produce, who’s to say they can’t then turn that service towards their competitors? While it’s unlikely that many grocery stores are eager to hand over any form of control over to Amazon, it might be something we hear about in the future, especially given how skilled Amazon is at offering a high caliber service at a lower rate than the competition. Again, this is a bit too far off to tell presently, but it will be something to keep an eye on, especially as Amazon Go stores start to open around the country.

 

 

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2017 Is The Year Of The 3PL. Will Your Freight Be On Board?

While the shipping industry is still suffering through a glut of overcapacity, things are finally starting to look up. The 3PL Value Creation Summit of 2016 yielded some pretty interesting results. Namely that the value added by 3PLs is only expected to keep going up through 2017 and beyond, a welcome boon for the weary shipper. This growth is expected to continue well through the following year and only continue beyond that.

“The global third party logistics (3PL) market is expected to be worth $925.31 billion by 2020 and will be partially driven by the outsourcing of secondary business activities,” according to a study released by Orbis.

A Combined Front of Transportation

While just about all modes of transportation are experiencing an issue, oceanic freight is dealing with a gross overcapacity and weak demand, truckers are faced with growing legislation and on the road concerns, to name a few issues, it will be the combined effort of all these various modes of transportation that will create the greatest value for shippers. A service, of course, that is rendered by eager 3PLs.

“Although carrier overcapacity on the still continues, Evan Armstrong, the president of Armstrong & Associates, predicts that integrated solutions such as air-ground, air-sea, and other combinations will create more value for shippers and increase 3PL margins,” said Patrick Burnson, executive editor for Logistics Management and Supply Chain Management Review .

The big winner in the transportation race is going to be the domestic transportation sector

However, the big winner in the transportation race is going to be the domestic transportation sector, responsible for facilitating the last mile deliveries for the majority of eCommerce companies.

Calmer Waters for M&A to Mark Stability for the End of 2016

One of the most promising signs of 2016 is seeing the feeding frenzy of mergers and acquisitions finally dying down. Now that all of the smaller companies have either been absorbed or faded away, the transportation industry is able to turn its attention on the importance of building the right team, focusing on training and talent acquisition. This is important to note given the confusion and frustration of the M&A period that many companies have experienced caused by negative acquisition experiences and overpriced companies. With the dust finally settling, 3PLs and logistics companies can focus on adding value for their customers, which will come as no small undertaking.

With the dust finally settling, 3PLs and logistics companies can focus on adding value for their customers, which will come as no small undertaking.

The challenges of managing geographically dispersed supply chain operations as a result of increased globalization, has led to several companies to outsource their logistics function.

And difficulties with addressing logistical challenges has also led to increased outsourcing by wholesalers and retailers, thereby boosting the 3PL industry.

It found that emerging trends such as Big Data and availability of bespoke 3PL services are expected to drive the market over the forecast period,” says Andrew Allen, a CIPS contributor.

Improving Technology will Continue to Add Value

Another driving factor is the continuous improvement of technology which will only add value for all parties involved. Cloud based IT solutions help to control overhead costs while providing invaluable data in real time, which is necessary for the continued success of 3PLs and shippers alike.

All told, 2017 looks to be a more promising year for both Shippers and 3PL providers.

 

 

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Debate This: Vehicle-to-Vehicle Communications Systems

bluegrace_autonomous_driving

We saw the success of the automated fleet as it made its debut journey through Eastern Europe. The idea that something the size of a tractor trailer can link up and draft off another tractor trailer in near perfect unison seems like something out of science fiction. However, the technology is not only here, but is undergoing approval for use in not only the logistics sector, but also for non-commercial use as well. The V2V or vehicle to vehicle communications systems is currently being debated on with a final decision to be issued from the White House this coming January.

“The National Highway Traffic Safety Administration (NHTSA) submitted a draft proposal to require V2V technology in all cars and light trucks to the White House at the beginning of this year,” said Transportation Secretary Anthony Foxx, who is optimistic that the rule would be released before the next administration takes over in January.

A Frequency Issue

One of the biggest opponents for the V2V systems is the band spectrum which the system will be using according to a recent article from Bloomberg. There is a growing concern as telecommunication companies are attempting to skirt around the Department of Transportation’s issuance of the V2V rule which would allow automotive manufacturers to start making plans to use the spectrum.

The DOT and the Federal Communications Commission are working together to test spectrum-sharing tools. However, the 5.9 gigahertz spectrum band at the center of the industry fight should remain dedicated for use by connected cars until there is a proven and safe method of sharing it,” Foxx said.

About More than Just Communication

While the vehicle-to-vehicle communication system is all well and good, there’s a bigger prize at the end of the line, the driverless car. This has some pretty big implications not just for the consumer sector, but would prove to be a massive boon for the logistics industry as a whole. Imagine if the roads were free of traffic jams and snarls caused by inattentive or unskilled drivers. Not only would this cut down on the amount of accidents, but also traffic flow as a whole would be greatly improved. This improvement would come as an increase in fuel efficiency and productivity overall for trucks on the road, allowing for better forecasting and productivity for logistics decisions makers.

That is, of course, if the NHTSA, the DoT, and the White House can all come to a consensus this Janurary.

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A Change of Plans: Reevaluating A Company Supply Chain

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Sales and Operations Planning (S&OP)

Both are critical to running a successful business, however trying to favor one over the other can prove to be disastrous. More often than not, companies are losing out on considerable profits, or paying out tremendous expenses such as last minute shipping charges due to a lack of cohesion between sales and operations planning.

A number of manufacturing companies are operating off a general set of rules for supply and demand, leaving both sales and production teams frustrated when they aren’t reaching their target goals.

While these generalizations might have cut it in the past, companies are going to have to change their operations if they want to succeed and thrive in the future.

The Creation of Internal Conflict

Supply Chain Management Review, an online industry news source recently reviewed this issue as it’s occurring in a number of companies, not only manufacturing, but service firms as well. With decision makers from both sides of the companies calling shots without conferring with the other side, there are a number of mistakes being made.

“A different type of demand–supply mismatch plagued a computer hardware maker. It relied on ocean shipping for units made in China because that was $15–$20 per unit cheaper than air freight. But while the units sailed across the ocean, the commercial team frequently changed their forecast for the mix of units that would sell over the next few weeks. The company routinely had to scramble at the last minute to ship via air (at great expense) in order to match the right supply to changes in demand forecasts.”

The article goes on to list a number of different causes for these problems, the core of which, comes down to poor information. Often times different cells within the operation are operating with different sets of data, both of which are skewed, leading to complications down the line.

Learning the Best Practice

Perhaps the biggest facilitator for change is the growing expectations from clients. With higher demand for more products with shorter delivery times, manufacturers will need to get their act together. Failure to do so could mean losing out on profits or even losing clients altogether.

“Running merely good S&OP may no longer be acceptable, because customers have higher expectations for product availability and fast delivery. The spread of new digital channels, on top of existing physical channels, has made it more complicated to know where inventory sits and what it will cost to deliver to customers. Also, the supply chain has grown more complex as suppliers operate a more far-flung network of suppliers, third-party logistics providers and inventory partners. Coordinating all that activity can be a stiff challenge.”

Changing the Game

In addition to finding better ways to communicate within the business, other business are branching out in different ways and are successful in doing so.

Apple is a perfect example of this. Originally, all Apple products were made and manufactured in the U.S. which was all well and good when they started. However, it didn’t take long for Apple to realize that manufacturing could be done cheaper out of house.

Not only could parts be procured at a lower cost but everything from assembling to warehousing could be done at a better rate. Some would simply cite lower labor costs as the main reasoning for this strategy, and to that end, gives Apple some flak for not bringing jobs back stateside. However, there’s more than one side to that issue.

“It’s also about, you don’t have as many mid-level manufacturing engineers available in the U.S. anymore, just because as an economy we don’t have as many of those types of jobs. That’s not the type of education that we focus on anymore, and there’s a ton of that over there,” said Evan Niu in an interview with the Motley Fool.

“Including the lower-cost labor, they have more people that are within the specific skill sets that they need to ramp up the manufacturing. I think a long time ago they said you could fit every single manufacturing engineer within, they would need a baseball stadium; in the country, that’s just how many there are now. Over in China, Foxconn can get hundreds of thousands of engineers within a couple hours if they need them to make some change, or tweak some processor. There’s a lot of sides to the story why they do it like that,” he added.

The manufacturing industry is accelerating and evolving rapidly, creating a challenge as businesses will need to be able to adapt and overcome, altering their business structure to meet the ever changing demand. — The real question is, will companies be able to adapt to quickly enough to meet these new expectations?

 

 

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Empathy in the Workplace – Why BlueGrace is Successful!

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Empathy: The ability to understand and share the feelings of another.

Take a moment and think back to some of the jobs you’ve held in your life.

If you identify as a millennial, you’ve probably held several jobs since college. You maybe reach a point where you hit a ceiling, or you don’t enjoy the culture, disagree with management, etc. You may have worked for a company that doesn’t empathize with it’s people.

Typically the older generations have more tenure at companies and see long-term growth within. They ignore the issues with management or the mundane work culture, and “put in their time”.

So who is right and wrong in this scenario? Are the millennials wrong for wanting to be happy and pursue something different? Are the Gen X and older right for “embracing the suck”?

The feeling of being unimportant and undervalued is actually more common than you might think.

The End of an Era

The days of ‘hiring the resume’ are soon coming to an end. Highly successful start-ups are focusing on the person and not necessarily the resume, in the recruiting process.

A large issue is that companies are placing too much value on “hard skills” or the abilities of prospective employees that directly complement the nature of the position.

On paper, that sounds like what a company should do right?

There is no arguing that hard skills are important, as the company does depend on employees with strong knowledge that allows the organization to run smoothly. Putting a strong emphasis on the process has allowed companies to evolve and develop to the point they have today.

When Process Comes Before People

However, when process comes before people, when empathy and the true valuing of employees comes after the bottom line, it creates a large problem for retention.

No one wants to work a job where they don’t feel appreciated.

Prospective employees don’t want to sign up with a company where all their coworkers seem unhappy. It creates stagnation and lack of innovation, which can be the death of a business, or at least have a crushing effect on morale and productivity.

Building a Team

Much the same with playing sports, your team is only as good as your weakest player. Here’s where ideas like empathy and inclusion come into play.

Your smartest and most tenured manager may be loaded with hard skills but lack in the subtleties necessary to be an effective team player. This person could be ruthless when it comes to efficiency, which may lead to a singular mode of thinking, “My Way or the Highway” scenario.

While you might get a good jump in numbers for a time, that sort of thinking can be fragile, as it’s too rigid.

The logistics industry is constantly changing, and because of this, a good manager needs to be able to adapt and change tactics as necessary. They need the help of the team in order to stay ahead of the changes and make the process work consistently.

This is why empathy is so very important.

BlueGrace Logistics and Empathy

We’ve mentioned our Core Values before and we have highlighted our second as ‘Be Caring of Others’. This is probably one of the characteristics we focus on the most during the recruiting process.

Our team not only cares about each other, we care for our carriers, vendors, clients and partners. We work best with those who have compassion for others and truly show it.

The takeaway from this is simple. If you want a better business, you have to put your people first. Give them an environment where they cannot just survive, but thrive, and you’ll find your company will also reap the benefits.

To see all available positions at BlueGrace Logistics locations all over the US, visit careers.mybluegrace.com today.

 

 

 

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