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It’s almost the end of summer, and pumpkin-spiced everything season is right around the corner, and it’s also the start to peak shipping. Our team of experts is looking at how to succeed during this busy season and how 2021 could shape up differently from years past.
What is peak season shipping?
There are four seasons of freight shipping and the peak season of shipping starts at the end of the summer. This time is considered a peak shipping season because there is a combination of demand from different markets. Businesses start stocking up for the upcoming holiday season, there is back-to-school shopping time, and retailers try to sell out their inventories from the summer season. During this peak time, freight rates are at the highest, and the capacity is tight.
What are the four seasons of freight shipping?
The Quiet Shipping Season (January – March)
The Produce Shipping Season (April – July)
The Peak Shipping Season (August – October)
The Holiday Shipping Season (November – December)
How to be successful throughout the peak shipping season
Knowing the market
The key to navigating peak shipping season is to understand the truckload demand and market specifics across various industries. In 2020, demand was low, and freight rates were higher than usual. In 2021 however, shippers are less cost-sensitive, and freight volumes are extremely hot. If you plan to work with high-quality carriers, start navigating the market during spring and early summer. Create a proper shipping strategy to help you define the market trends and successfully ship goods.
During the peak shipping season, you need every advantage you can get! Here’s an example, you can efficiently utilize a transportation management system (TMS) to optimize route planning and ensure efficient deliveries. You can also use other supply chain technology to automate warehousing processes and inventory control, providing up-to-the-minute data on your entire operation.
Work with reliable a 3PL
Reliable 3PL here, and we will make sure you have fast and reliable shipping services. Our team knows that freight, more often than not, is time-sensitive, and capacity can be tight. So we work with a wide variety of professional, high-quality carriers to ensure your products are delivered timely and with ease.
If you’ve seen higher than expected freight rates, we hear you, we see you. There’s a couple of potential factors for these increases. Since Q2 of 2020, the freight markets have shown robust growth, which has raised rates dramatically. While this is good news for carriers and manufacturers, it has caused CPG shippers to pay the price in rising freight rates. In this week’s blog, our team analyzes the various factors that are driving up freight rates and why they are happening.
Factor 1 | Port Congestion
With pandemic-related consumer shopping habits, many West Coast ports operated at maximum capacity during the summer. In 2021, the uptick in imports has compounded the situation and caused even more congestion. March retail sales increased by 9.8% sequentially and 14.3% year-over-year. A 27.7% jump led to an increase in sales of food services. With more imports on board, shippers should brace for capacity constraints. As the produce season gets underway, rates will also rise.
Factor 2 | Produce Season
The start of the produce season typically occurs in February in the southern US. By spring/summertime, it has reached the majority of the US. During this time, capacity is tightened as refrigerated carriers dedicate a lot of their space to hauling produce. Other products that can ship via dry van or on refrigerated trucks will move to van transport, thus increasing freight rates across the board.
Factor 3 | Reliance on Split Shipments
eCommerce brands have been comprehensively using split shipments for years. Firstly goods need to be picked from inventories across different locations. With not enough room on a single truck or plane for an entire shipment, it may have to be divided into individual boxes and delivered individually. Split shipments happen to occur even more often during cross-country or international shipment of goods. The more the shipments, the costlier the shipping costs; therefore, the trend ends up being a pricey affair and often harmful to the shipping ecosystem.
Counter Rising Rates with these Techniques:
One of the most effective ways to combat these high freight rates is planning shipments far in advance. Cargo cost is increasing every day. To avoid paying surged charges and avail early bird facilities, companies have to plan their shipments well in advance strategically. Working with a team of transportation experts (Like Taylor) that uses digital platforms to leverage data on the freight costs to predict rates and trends affecting the rates will help to plan and lower costs.
Work With A Team Of Experts
Work with a dedicated logistics team to ensure conditions do not endanger profitability. Teaming up with a partner like Taylor can help your organization correctly forecast costs and find more favorable pricing through consolidation or mode optimization services.
Transloading services are an essential part of the supply chain, primarily when shipping with intermodal drayage. When cargo is moved from rail to a truck (or the other way around), the transloading area is where an experienced team uses forklifts, cranes, and other equipment to ensure a seamless transfer of freight. Often, shippers want to combine the economic advantages of rail shipping with the flexibility of over-the-road trucking, using affordable rail shipping for the long haul and trucks for final delivery. Here’s our drayage team tips on how to save:
But First, Products That Can Be Transloaded
Standard Rail Commodities: Lumber, metals, paper, rebar bundles, palletized products
Liquids: Ethanol, biodiesel
Oversized: Transformers, wind blades, and machinery
Bulk: Sand, plastic pellets, food product
Service Sensitive/Critical: Auto parts, parcel, frozen food, and perishables
Everything: Bricks, floor tile, coil, solar panels and nearly everything else
Don’t waste container space! Abiding by container rules and regulations, strive to consolidate as much freight as possible into a larger container. For example, the contents of three 40 ft containers can fit into two 53 footers. Thus, reducing your overall costs significantly..
Check Your Container Cartons
If your container is hauling more cartons than the allocated number, you could incur extra fees. Stay up to date on regulations to avoid paying more.
Try To Palletize Your Products
To save space, putting your product on pallets always helps. When freight arrives at the transloading area, palletize cargo to make distribution handling more efficient.
Partner With A 3PL
Taylor has a full drayage team of transportation professionals that know what to look for to help you cut costs and streamline your supply chain with transloading.