The COVID-19 (coronavirus) pandemic has impacted everyone and this includes LTL demand. With many businesses closing their doors and a large part of the country having experienced shelter in place orders, inventory, purchases, and orders grounded to a standstill, severely impacting the demand for LTL shipping. Now, it looks like demand could be picking up.
Recently, analysts reported that the 10-day stretch prior to the Memorial Day holiday weekend saw an increase in LTL. While it is good news that the demand is going up, it is important to note that the demand for LTL freight took a major hit in April. Experts reported that revenue declined around 20 percent. Therefore, an improvement in May might not be enough to revive the industry. On the other hand, any improvement is good news for an industry that desperately needs it.
Comments from Industry Leaders
Recently, Deutsche Bank held an informative meeting with one of the industry leaders, Airfreight and Surface Transportation and Maritime Shipping along with the analytics provider Recon Logistics. Together, the experts indicated that there was an uptick in the demand for LTL carriers prior to April. As a result of the weakness in oil and gas prices, revenue increases were lower in the Southwest than in other parts of the country.
LTL demand in the Midwest, however, appeared to grow more than other markets due to a recent increase in demand for industrial and chemical markets that call that region home. In addition, experts expect to see an increase in LTL freight related to the auto industry in June now that many of the companies have resumed their operations.
Overall, the experts indicated that they were optimistic about the recovery of the market, as they see signs that the industry starting to rebound. This is good news for companies that sorely need the business.
The Pricing of LTL
The experts also offered their opinions on pricing in the LTL industry. Technological improvements in freight scanning in addition to weight dimensions have allowed national and regional companies to become more strategic when it comes to bidding on freight they would like to haul. In addition, this ability to use a powerful pricing algorithm also means that they can better capture the overall cost of moving freight. While shippers are looking for more competitive rates, carriers need to make sure they price accordingly. They need to protect their operating line, capacity, accessorials, and other pricing factors. All of these need to come into play, as the cheapest route is not always the best. Getting the job done right comes at a cost.
The Future of LTL Shipping Is Looking Up
Overall, this report is good news for LTL shipping as businesses start returning. Pricing should still remain competitive despite the pent up supply of LTL shipping. As more employees return from being furloughed, opportunities exist for LTL shipping to improve their bottom lines by capitalizing on the growing demand for shipping services across the country.
LTL Optimization Can Save You Money
Road Scholar Transport understands the changing needs and fast paced nature of your distribution and shipping program. Our innovative LTL shipping program is designed to offer you the best of both worlds, the shipping service you need, combined with cost effective pricing solutions. By combining your shipment with other pieces but maintaining the integrity and safety of your product with our tough internal security gates, our LTL program allows you to take advantage of the lowered shipping cost without sacrificing quality or security.
Learning more about LTL optimization can help you make the optimal choice for your shipping needs. If you are constantly faced with holding shipments until you have a full truckload, or shipping incomplete trailers (and paying for space you are not using), then LTL services might be right for you.
LTL Optimization Benefits
Lower shipping prices: You don’t have to pay for the entire truck if you are only using a portion of it. LTL shipping allows you to pay for only the portion of the trailer you use. By combining your shipment with other freight, you can reduce the amount of money you spend getting your product where it needs to go, without sacrificing security and the integrity of your shipment.
Secure, protected shipping: Our innovative internal shipping gates allow us to secure your freight and keep it separate from other items. You can see our gates in action on our video channel; using a security gate allows us to restrict access and protect the integrity of your product in real time.
True shipment optimization: We can evaluate your needs and design an LTL program that not only saves you money, but meets your scheduling and delivery goals, too. LTL shipping combines the best value for your shipping dollar if you have less than a full truckload to convey.
Full reporting: With LTL shipping, you get the same great service, security and attention to detail that you are accustomed to from our regular service. You will still be able to track your shipment and see what’s going on in real time, every step of the way.
Contact us to learn more about the benefits of LTL shipping and what it can do for your product and business. Our goal is to help you get the best possible value on the most secure shipping and logistics service in the marketplace today.