This commentary appeared in the print edition of the Jan. 6, 2020, Journal of Commerce Annual Review and Outlook.
After a couple of turbulent years in the transportation marketplace, shippers will see relatively calm waters in 2020.
Legislatively speaking, while there are always things happening in our nation’s capital, the good news is that there aren’t a bunch of “BIG” issues threatening a shipper’s transportation budget. Since it’s an election year, it’s unlikely we’ll see a comprehensive transportation infrastructure bill or any legislation helping carrier productivity.
Operationally, there will be sufficient truckload capacity for at least the first six months of 2020. While capacity may tighten in the third and fourth quarters, it won’t be anything like 2018. On the LTL front, look for the LTL carriers to continue exercising uncommon pricing discipline to evaluate who they do business with and how it gets conducted.
If there is a big story in 2020, it will be the continuing evolution of how technology can eliminate waste and improve productivity in corporate supply chains. That is why in 2020, shippers and carriers who are “enlightened” will continue to make significant investments in their technology infrastructure to address the “Amazon/Uber factor.” Specifically, experts are addressing how companies like Amazon and Uber are changing customer expectations.
While your company may not directly compete with Amazon or Uber, your customers may want to know why your company can’t be like them. For example, if Amazon can provide same day/next day capabilities, why can’t you? And if Uber can tell me within minutes when my car will arrive, why can’t you tell me within an hour when I should expect to get my freight that is on your truck?
Smart companies will also continue to focus on technology because they realize that great, accurate data, coupled with effective artificial intelligence (AI) capabilities, can create transformational opportunities that can dramatically improve their operations and profitability.