The trucking industry is facing some major innovations this year due to the effects of the coronavirus pandemic on e-commerce and new technology implementation, as discussed by industry experts during the 2021 GlobalTranz Agent Conference.
The conference’s participants discussed subjects like changes in consumer behavior, market volatility, volume shifts within e-commerce, and the overall impacts of the pandemic on the industry.
“It’s very exciting, said Roadrunner Transportation Systems vice president of corporate sales, Dave Black. “We’re back to talking about technology. We’re talking about advancement. We know some of the enormous challenges that all of us on this panel are fighting right now in terms of capacity and in terms of driver resources.”
Still, Black notes that consumer demand is the most pressing issue that has risen in the midst of this pandemic.
“I think we all know that as we move forward, we’re going to have to do something different to make sure that we keep pace and accommodate the demand.”
Contract negotiations with carriers have also seen many changes–in fact, customers are often asking for shorter deals due to the pandemic’s economic turbulence.
“We tend to have one-year agreements in place with most of our accounts base,” said Black. “Now, when you take a look at just the unprecedented changes within the industry, what a variety of the different vertical markets are going through right now, we’re finding that there’s just too much uncertainty.”
The kinds of trends in consumer demand that shippers and carriers alike have had to accommodate throughout the last year has been a main area of focus, as made clear by the conference’s speakers. A major topic that many have had to acclimate to, specifically, is that of market volatility.
“We saw freight all over the board,” explained Ward Transport and Logistics’ corporate account executive, Steve Clagg, at the event. “Pre-COVID, I would say, [freight] was [falling] flat compared to 2019 and 2020. Then, you get into the first COVID month, which was in the latter part of March, [when] we saw the immediate drop-off of business, and then April continued suit.”
Early on in the pandemic, many carriers and shippers had to quickly learn to identify the differences between essential and non-essential work, while also adapting to new shifts in regulations for the industry as a whole, Clagg said.
Ward’s business numbers declined by nearly 30 percent within that time frame, although that challenge dissipated nearly as quickly as it had arrived.
“I think the thing that caught us by surprise–I think it probably did [for] all of us on the panel–was the fact that the industry recovered very quickly,” Clagg explained. “We got into May and June, and that drop-off really began to lessen dramatically. Then, we got into the second half of 2021, [and] our numbers started increasing precipitously.”
E-commerce may be to thank for these rapid boosts of shipment numbers for carriers across the globe. A survey conducted by XPO Logistics Inc. found that 94% of consumers throughout the United States, United Kingdom, Spain, and France are more likely to shop online than in person, and 51% of those consumers prefer to shop online overall. Additionally, according to the survey, 91% of retailers consider themselves fully prepared to properly handle the spike in online orders that arose during 2020.
“So, our thought on e-commerce is that it’s here to stay,” said XPO’s vice president of national 3PL sales, Marissa Christenesen. “Overall, consumers want speed and they want availability, and retailers are turning to experts for more support to get it done.”
E-commerce also led to the surge in orders for ABF Freight System, a subsidiary of ArcBest.
“Since [the second quarter of 2020] and through the third quarter, we’ve experienced sequential increases in monthly revenue and tonnage almost every month, which is certainly encouraging,” said ABF’s director of enterprise sales, Phil Atwell. “Through the third quarter, we saw our average weight per shipment increase over that same period versus 2019. We’re starting to see some positives there.”
This also led to companies like ABF needing to learn–rapidly–how best to navigate the new need of employees working remotely.
“Fortunately, we adapted rather quickly to our virtual interactions and social selling,” Atwell said. “Earlier [in 2020], we successfully transitioned nearly 90% of our employees to work from home. The productivity levels of our employees have remained high through this transition, which is certainly encouraging.”