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Time to Hug your Best Carriers

November 9, 2008 The odds, that your Percent of Logistics to Sales will soon be on the rise because of an Administration change, are more than likely....they're for sure!

The Employee Free Choice Act endorsed by Presidential Elect Obama will likely be enacted by congress early in his administration; and regardless of who becomes the Secretary of Transportation it is clear to me that all aspects of trucking and the transportation industry will soon be increased regulatory constraints which will quickly flow down to shippers and 3PLs in terms of prices, service and reduced capacity.

I expect HOS to be revised and perhaps even codified and I would not be surprised to see driving hours reduced to 10 based on a 12 hour work day. You should expect to see a mandatory fuel surcharge program and stronger enforcement of the EPA Model Anti-idling law; and many (not just LTL) trucking companies could become unionized. Lastly, all efforts to improve productivity through Size and Weight, will quietly be put to sleep.

So what can you do? Better start by educating your senior management quickly to the issue and cost consequences and potential logistical alternatives;  Solicit the help of your political laison; Contact one or more of the transportation trade organizations like TIA - NITL - NASSTRAC and learn with others are doing; and lastly don't delay in looking at your optimization models that will evaluate the inventory, distribution, and service tradeoffs.

If you haven't hugged your best carriers yet, perhaps now is a good time to do so!  You need to support each other now more than ever before and begin acting and planning together!

Posted by John A. Gentle on November 9, 2008 | Comments (3)