New Study Shows Latest Transportation and Logistics Trends
The 26th Annual Study of Logistics and Transportation Trends has recently been released, and it shows that while most companies view transportation as being a strategically important function, a surprising amount of businesses are not taking action to set up their transportation in a way that will help them reach their goals.
The study was conducted by questioning 406 professionals in the fields of domestic and global logistics, supply chain, and transportation across 17 industry sectors. Three fourths of respondents reported using a mixed strategy as their main approach, aiming to “be all things to all people”, while just over half used that approach last year. Increasing customer service and reducing costs are being given nearly equal weight, with 31.3 and 31.9 percent of respondents respectively citing these as a primary objective.
However, for many cost leadership-focused companies, a statistically significant gap has emerged between their strategic focus and their organizational structure. This can be seen, for example, in the fact that businesses do not feel that working together with providers of transportation services is important despite citing transportation as being of strategic importance to them. Customer service-focused companies, on the other hand, appear to be better positioned to reach their objectives.
Transportation Spending Trends
There have also been some shifts in transportation spending by mode. For example, the spending on private fleet/dedicated transportation rose from 20.8 percent in 2016 to 23.8 percent in 2017 in the biggest year-on-year shift in transportation modal spending.
Truckload had a 2.1 percent rise in transportation budget share in spite of pressure to drop prices as capacity outpaces demand, while less-than-truckload showed little change despite the significant increases in rates seen over the past 12 months.
In addition, the less-than-truckload sector has seen a small drop in equipment availability year-on-year, along with a notable increase in turndown ratio.
This blog post was based off of an article from Logistics Management. View the original here.