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Shippers & 3PLs: Driver Shortage Top Concern

Third-party logistics providers and the shippers they serve face numerous challenges in the years ahead, not the least of which is the ability to secure capacity from their transport providers, which is affecting how the supply chain moves loads.

So concludes the 2016 Third-Party Logistics (3PL) Study, sponsored by Penske Logistics and released in San Diego this week at  a conference of the Council of Supply Chain Management Professionals. The study is based on responses from more than 260 shippers and logistics-service providers based in North America, Europe, the Asia-Pacific region and Latin America as well as a survey of the CEOs of 30 of the world’s largest 3PLs.

According to Heavy Duty Trucking, the study found that over 80 percent of the firms surveyed were profitable in 2014, but the companies are bracing for challenges such as the driver shortage and tightening capacity, the impact of mergers and acquisitions, increasing regulations and “industry innovations” that are “altering competition, 3PL service offerings and shipper-3PL relationships.”

“Within the U.S., 70% of freight tonnage is moved on a truck, and without drivers, that freight is likely to stand still,” states the report.

Meanwhile, tightened capacity is seen as “altering shippers’ ability to move loads as well as how these shippers interact with their third-party logistics providers. The authors contend that “the need for shippers to find alternate methods and providers is apparent.”

The report points out that “almost 37% of the demand for drivers is to substitute the aging drivers, and the average age of a truck driver today is 55 years old or more. Even those now entering the industry are older than those entering in the past.”

As for solutions to the overall logistics labour shortage, the authors suggest a number of strategies that could be deployed.

“To meet the growing labour needs, companies will likely develop built-in succession or talent pipeline programs, identifying opportunities for high-potential workers and creating structured paths for advancement. Training programs will help employers develop their existing talent pool, and there may be an increased number of partnerships between providers and driver schools or other industry groups.:

In addition, 3PLs are using technology and data to aid shippers in selecting the right shipment modes to maximize efficiency and reduce costs. Per the report, 60 percent of the respondents are using technology to increase visibility within orders, shipments and inventory; 40 percent are using technology for planning within transportation management; and 48 percent are using it for scheduling within transportation management.

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