{"id":2064,"date":"2019-04-25T01:50:51","date_gmt":"2019-04-25T01:50:51","guid":{"rendered":"https:\/\/quicktransportsolutions.com\/blog\/?p=2064"},"modified":"2019-04-25T01:50:53","modified_gmt":"2019-04-25T01:50:53","slug":"how-e-commerce-is-reshaping-the-warehousing-and-transportation-sector-part-ii","status":"publish","type":"post","link":"https:\/\/quicktransportsolutions.com\/blog\/how-e-commerce-is-reshaping-the-warehousing-and-transportation-sector-part-ii\/","title":{"rendered":"How E-Commerce Is Reshaping The Warehousing And Transportation Sector \u2013 Part II"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">Welcome to Part II of our comprehensive series looking at how e-commerce is changing the nature of the game for both the warehousing and transportation sector. In <a href=\"https:\/\/quicktransportsolutions.com\/blog\/how-e-commerce-is-reshaping-the-warehousing-and-transportation-sector-part-i\/\">Part I<\/a>, we took a hard look at everything from warehouse sizes to changing distribution models. We also examined how consumer buying patterns are changing and what those changes mean for the retail marketplace. With our initial focus on the changing retail and warehousing space complete, today we will turn our eye to the trucking sector. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">                             <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The fact is, the trucking industry provides the vital\nlinkages for omni-channel retailers, from the first to the last mile. As the\nregional fragmentation of supply chains has continued unabated, retailers now\nrely on their transportation partners more than ever. Transportation by truck\nis sill the most flexible and reliable way to get products from one place to\nanother, especially during times of decentralized fulfillment networks and much\ntighter delivery windows. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">There are essentially two different ways that the shift to\nomni-channel retailing has impacted the trucking business model. The first is\nthe emergence of the hub-and-spoke fulfillment model and the second is the\nhigher emphasis on reliable delivery windows. These two changes have had a large\nimpact on the trucking sector. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Changing Truck Trips<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In Part I, we touched on the changing length of the average\nhaul, but today we are going to take a deeper dive. The main reason for the\nshorter average haul lies in the fact that longer inter-regional or national\nruns are being replaced by shorter, intra-regional and local runs. Whether\ntruckload, LTL, or courier, the shorter distances are impacting all operators.\nThe exact figure represents a 37 percent drop in average haul length in mileage\nsince 2000.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Yet, there has been an uptick in urban areas. Average\nvehicle miles traveled (VMT) in urban areas increased by <a href=\"https:\/\/www.fhwa.dot.gov\/policyinformation\/statistics.cfm\">17.7 percent<\/a>\nbetween 2011 and 2016. Shorter truck trips have increased by orders of\nmagnitude since the e-commerce boom. The numbers are directly in line with the\nincreased volume of e-commerce shipments into densely populated urban areas. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Another area where these numbers are born out is in payroll\ntrends. Trucking transportation employment has only recently surpassed its\npre-recession peak. Yet, the numbers have shifted. A lot of the big gains in\nemployment have come at the local pickup and delivery (P&amp;D) level. Between <a href=\"https:\/\/data.bls.gov\/PDQWeb\/en\">2007 and 2017<\/a>, courier and messenger\nservices added over 2,000 new businesses and 85,000 new employees, with the\nbiggest of these gains coming in 2016 and 2017.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A lot of this is a direct result of the pressures associated\nwith shorter and more reliable delivery windows. Certainly, handling delivery\nquickly and reliably is not something new that trucking companies must deal\nwith, but as omni-channel retailing advances, delivery times will continue to\ncompress. This data is supported by informal data from motor carriers, which\nshows that two-day window delivery requests have increased in the past five\nyears. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Most fleets now, by default, operate with faster turnaround\ntimes. Yet, these compressed timelines are creating a host of other problems\nfor fleets. External factors are working against motor carriers more than ever\nbefore. Whether it be traffic congestion, warehouse delays, or inclement\nweather, when a delivery time is compressed into a small window, any small\ndelay can result in a backup in the chain. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">To counteract these changes and make sure their clients stay satisfied, many trucking companies are now changing their offerings. Decades ago, \u201cwhite glove\u201d service was not something associated with the trucking industry. Today, fleets are making big promises to ensure deliveries of large, bulky, and expensive items happen on time, every time. Some trucking companies are even getting into value-add services such as installation, assembly, or repairs. As a result, truck drivers are now receiving more extensive training than ever. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Equipment Evolves<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As  <a href=\"https:\/\/www.quicktransportsolutions.com\/carrier\/ohio\/cleveland.php\">trucking companies<\/a>  respond to the shift, equipment and yard assets have also undergone an evolution. This change is especially true in the last mile segment. Traditional motor carriers are changing their last mile solutions to compete with parcel carriers that have traditionally dominated that space, and truck registration data supports this. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Single-unit truck registrations have increased by 7.8\npercent between 2007 and 2016, with much of the growth happening between 2014\nand 2016. This shift can also be seen in publicly available data from companies\nlike UPS and FedEx, who are rapidly expanding the scale of their operations.\nSince 2007, FedEx has hugely expanded its owner-operated vehicle fleet with\n57,000 new additions. The number of trailers it has in operation has also\ndoubled. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">UPS has also reported a massive increase of 19 percent to the size of its fleet during the same period. UPS has been quickly adding everything from package cars to vans and even motorcycles. UPS has also been experimenting with a range of new technologies to address the challenges related to the increase in urban package deliveries. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">                             <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">UPS has been openly testing vehicles such as drones and\nelectric motorcycles. In a fascinating bit of logistical futurism, the drone\nUPS has been testing emerges from the top of a delivery truck and delivers\npackages at the same time as a truck driver delivers packages, which increases\nthe delivery time window by more than 30%. Other big e-commerce players such as\nAmazon are experimenting with their own advanced delivery methods, as we have\nrecently reported on. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Increased use of electric vehicles also seems to be a\nnatural extension of the changes happening in the transportation sector.\nMunicipalities and transportation companies are now actively looking for ways\nto address air quality and noise pollution and electric vehicles address both\nquite capably. Electric vehicles offer more promise than other alternative fuel\nvehicles. As the market for these vehicles evolve, higher up-front costs\ndecrease and more charging stations and supporting infrastructure come online. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>E-Commerce and Top\nTrucking Issues<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The trucking industry has been grappling with many issues\nsince 2005. Whether it be the ongoing truck driver shortage, hours of service\nissues, <a href=\"https:\/\/quicktransportsolutions.com\/blog\/the-latest-on-the-eld-rule-from-washington-and-beyond\/\">ELD\nimplementation<\/a>, CSA, or infrastructure problems, trucking is not without a\nlaundry list of factors that it is focusing on. As the e-commerce push\ncontinues, it has a direct impact on these issues.&nbsp; <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The truck driver shortage continually ranks as the top\nindustry concern. Year-over-year, it tops the list of factors that fleets deal\nwith on a continual basis. The changing nature of the supply chain is having a\ndirect impact on this problem. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Local last mile operations provide the types of jobs that\ncarry more appeal. Truck drivers operate closer to home, which eliminates the\nmost common complaint of those looking to gain employment in the trucking\nsector: Long hours away from home. There are many benefits to shorter trips,\nand the knock-on benefit decreases on-road time for other trucking segments,\nwhich creates greater appeal throughout the sector. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Intra-regional and local hauls can also be leveraged as a\ntraining opportunity for younger truck drivers. The fact that the truck driver\nindustry is aging at a rapid rate is no great secret. Utilizing a \u201cgraduated\nCDL\u201d concept could help potential truck drivers between 18 and 21 years of age\nacquire training and build experience in intra-state hauls and local pickup and\ndelivery. Once they turn 21, operators learning within this concept can move on\nto interstate deliveries, should they so choose. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This also directly impacts truck driver retention. Attrition\nis primarily a problem in the truckload sector. As such, the growth of\ne-commerce and omni-channel distribution increases the demand for the types of\njobs that many truck drivers prefer. With more opportunities to spend time at\nhome or with friends, it helps ease a big retention problem within the sector. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The new omni-channel paradigm also has a direct impact on\nfederal HOS regulations. Many trucking companies bemoan the lack of flexibility\nin the HOS model, which is a model that hasn\u2019t changed in nearly a century.\nThis directly related to the ELD mandate, which has created a noticeable lack\nof flexibility in how truckers do their jobs. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Fortunately, e-commerce operations provide relief. Truck drivers are not required to log their miles if they operate under a 100 air-mile radius and since the greatest growth in the transportation sector exists under that radius, many new truck drivers would not be subject to HOS regulations. The growth in P&amp;D operations ultimately mitigates one of the biggest concerns truck drivers and trucking companies have when it comes to HOS rules. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">                             <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The fact is this: Trucking industry stakeholders must and will adjust to the changing supply chain landscape. As distribution channels evolve and consumer spending habits change, motor carriers must tighten up their operations and invest in new technologies and methodologies. As retailers have had to adapt, so will <a href=\"https:\/\/www.quicktransportsolutions.com\/carrier\/california\/sacramento.php\">trucking companies<\/a>. Those that are quickest on their feet to accommodate and shift with the times will find great opportunity and emerge ahead of the pack. These are interesting times for the transportation industry, but e-commerce will only provide a greater chance for profit and compatible change. Fleets just need to be ready for it. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Welcome to Part II of our comprehensive series looking at how e-commerce is changing the nature of the game for both the warehousing and transportation sector. In Part I, we took a hard look at everything from warehouse sizes to changing distribution models. We also examined how consumer buying patterns are changing and what those &#8230; <a title=\"How E-Commerce Is Reshaping The Warehousing And Transportation Sector \u2013 Part II\" class=\"read-more\" href=\"https:\/\/quicktransportsolutions.com\/blog\/how-e-commerce-is-reshaping-the-warehousing-and-transportation-sector-part-ii\/\" aria-label=\"Read more about How E-Commerce Is Reshaping The Warehousing And Transportation Sector \u2013 Part II\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2064","post","type-post","status-publish","format-standard","hentry","category-trucking"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How E-Commerce Is Reshaping The Warehousing And Transportation Sector \u2013 Part II - Quick Transport Solutions Trucking Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/quicktransportsolutions.com\/blog\/how-e-commerce-is-reshaping-the-warehousing-and-transportation-sector-part-ii\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How E-Commerce Is Reshaping The Warehousing And Transportation Sector \u2013 Part II - Quick Transport Solutions Trucking Blog\" \/>\n<meta property=\"og:description\" content=\"Welcome to Part II of our comprehensive series looking at how e-commerce is changing the nature of the game for both the warehousing and transportation sector. 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