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Reduction in demand leads to opportunities for minimizing transportation costs

Today's global recession is leaving no sector unscathed; consumer spending has decreased, the credit markets are deteriorating, and as a result demand for most goods has declined, which has led to reduced need for transportation services.

Due to the lower demand for goods, LTL and TL carriers are frantically trying to fill empty trucks. Most TL carriers have reduced capacity in response to the declining economy, but the majority of LTL companies have not yet modified their capacities. They have however made many improvements in service in order to attract and retain customers, while either maintaining or cutting rates.

With no bottom in sight, competition between carriers is fierce which leads to the availability of potential deals for customers. If you are renewing your LTL contract this year, you may count on lower rates and accessorial charges. To determine if you have the best deal you should benchmark your rates and accessorial charges for your lanes. Given the recent drastic changes in rates, knowing how your agreement compares can help improve your bottom line.

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Supply Chain Consulting

  Davis Logistics Cost and Service  
Supply Chain Management Specialists
 
Find out about current logistics cost and service trends in North America.

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Not only do we thoroughly understand the supply/demand chain, but we also understand the impact working capital, cost of goods sold and margins have on profitability. If your ultimate focus is on profitability, give us a call.

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Management Consultants Specializing in the Supply Chain

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Find out how Establish helped a multi-billion dollar manufacturer of consumer electronics develop a new supply chain strategy.


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