Hosted by the Carolina Traffic and Transportation Club Team, the Logistics Insights Conference (LIFTCON) promotes the interests of transportation industry and provides opportunities for logistic professionals to network. This year’s conference contained compelling information regarding the expanding role Southeastern transportation facilities and companies are now playing in the national supply chain.
Dennis Brannon, Founder and CEO of Artisan Logistics and President of Carolina Traffic and Transportation Club, raised awareness of a provocative and looming issue for trucking companies. According to CrunchBase, retail companies invested $1.8 billion in “on-demand” delivery models in 2014 alone, a model in which a retail company’s only direct interaction with a customer occurs via a “middle man” — the trucker who delivers the product. Given that prospect, should freight companies be reviewing the role they will play in that relationship? If so, how will this method of business affect trucking companies? Freight companies might want to engage with their retail customers to discuss expectations, as well as review their own internal business models.
Port Initiatives in South Carolina
Jack Ellenberg, Senior Vice President of Economic Development & Projects for SC Ports Authority, provided an amazing overview of the increasing role the South Carolina Ports Authority is playing as international shipping center. The statistics are stunning:
- 30% TEU (Twenty-Foot Equivalent Unit) Volume Growth from 2011-2014
- Intermodal volume at the port is up 106%
- $1.4 billion already invested in 2015
- Approximately 140,000 TEUs of new business is made up of just 7 firms: Mercedes, Volvo, Rite Aid, Dollar Tree, TTI, Nobelco and Gerber Children’s Wear
- Port of Charleston freezer space increased 10x in one year
- By 2019 Charleston is expected to become the deepest water port on the East Coast, which means the largest ships in the world will be able to dock
- The Southeast region is on track to see 46% in population growth by 2030
Ellenberg cited multiple opportunities for growth, including export of trans-loads, reliability and high-velocity performance in the retail market, taking full advantage of the SC Inland Port and investment. He also noted that with such explosive growth comes crime. The current security measures at the port include assistance from Customs and Border Protection, Homeland Security, the U.S. Coast Guard and chain link fencing.
Current State of Truckload Transportation
Clifton Parker, President and General Manager of G&P Trucking Company since 1986, gave an overview of Truckload Transportation. Like many transportation professionals, his primary concern is the driver shortage. He cited that G&P is now taking measures of their own, including:
- Creating more hourly driver positions, so drivers can be at home more often
- Developing multiple pay ranges
- Investing in television commercials — the first will air within the next few months
- Employing a company to administer a 2-month survey
G&P has also invested heavily in active safety features, as they can assist younger drivers, including collision avoidance, audible distance warnings, active braking, adaptive cruise, lane departure warnings and blind spot detection.
Future of Transportation
Scott Moscrip, Founder of Truckstop.com, took questions about the future of transportation technology. Truckstop.com is the largest freight matching marketplace in the industry. Their offerings include: Real Time Freight, uDrove, D&S Factors, ITS Financial Services, Roady’s Truck Stops and ITS.
Questions included interface changes to accommodate mobile, social media and hubs. But the most revealing statement came when an audience member asked about the future of transportation.
Moscrip answered, “The phrase they are using at economic conferences is ‘unprecedented growth period — we are due a contraction.’ We are not seeing anything that is changing slowly. We are hearing that everything is already on ships or already here for the holidays. We heard recently that major retailers have gone to 90-day pay on transportation. A healthy company may do this, but how many in this room can go 90 days without pay? These are the challenges. We have seen an increase of interstate trucks, but the average fleet size is 9 trucks and shrinking. People coming into transportation are small micro-carriers — they can’t last 90 days. If you push these people out of business, you have to turn to who is left: large fleets. Large fleets aren’t growing. You get so large, economy of scale stops —10% of capacity will be gone, while SC PORT OF AUTHORTY says we are doubling in size. How do we handle all this? As an industry how do we do this? We have to be better and more efficient at what we do.”
All told, there was good reason to be excited for the Southeast’s expanding role in the national supply chain. There also seemed good reason to prepare by attending conferences like LIFTCON. It offered an opportunity for everyone in the supply chain in the Southeast to pose provocative questions and engage in industry-wide inquiry for answers. We’ll keep you posted.