Why Do Customers Change Port Drayage Partners GlobeCon Freight Services

2023 Trends to Follow for Freight and Shipping

COVID-19 had major impacts on global supply chains and shipping management trends in recent years. Demand increased while simultaneously the ability to meet the demand decreased due to delays and supply chain issues.

Companies have taken notice and reorganized fulfillment processes to meet customer expectations. This has impacted the way the supply chain operates, from loading and unloading container ships to the placement of warehousing facilities to last-mile infrastructure and reverse logistics.

There’s no small amount of uncertainty in the world of international trade, even as COVID fears subside in many places. Major weather events, labor unrest, energy costs, and rising tensions can lead to unexpected outcomes. What can businesses and shipping companies do to anticipate headwinds in the year to come?

Why does it matter?

Shipping is an increasingly important customer service metric for eCommerce and brick-and-mortar retailers. Only a few years ago, the web UX and turnaround time on a web purchase didn’t impact the average customer’s experience very much. Now, it’s a keystone piece of the sales puzzle.

When customers experience delays — and many of them have, according to a recent Gallup poll — it strongly or somewhat negatively affects their decision to order from the retailer again. Repeat customers are the bread and butter of a successful business, so this puts a lot of pressure on eCommerce firms and shipping companies to get it right the first time.

With a slowdown in demand on the horizon, now is a good time to review your strategy and ensure you’re optimizing and improving your processes to be able to deal with any volatility. Here are some shipping trends we expect to see moving into 2023.

Freight shipping trends to watch in 2023

Don’t be caught off guard by changes in the shipping and logistics marketplace. Stay ahead of the competition by keeping an eye on these trends:

The supply chain is still a big challenge

Shortages and delays will likely still affect international shipping for the foreseeable future.

Many of the same factors that have created headaches for logistics companies in recent years — localized outbreaks of COVID-19, international conflict and trade restrictions, and infrastructural shortfalls at key points continue to cause delays — are still causing trouble today.

Strategic planning around shifting trends, in concert with investment in technology and partnerships, gives businesses an advantage even in uncertain times.

Decrease in congestion and shipping costs

We’re seeing some positive changes as well. The congestion is finally clearing at key hubs like the LA Port now that the initial surge of demand subsided, reducing pressure on container availability and overall prices.

Globally, container shipping freight rate trends suggest that congestion is still an issue but experts are hoping to see it ease up throughout 2023.

New solutions are being developed for shipping strategies

With so much changing in the last few years, it’s hard to stick to the “tried and true” methods as they just can’t keep up with the demand or flexibility required of the present.

Improvements in customs processing, drayage, intermodal transfers, and more have become key to ratcheting up capacity to meet steep demand.

In addition, flexibility has become key to a lot of companies hoping to avoid stock shortages at key times. Partnerships with third-party warehouses have allowed many eCommerce firms to scale capacity up or down to meet demand without investing significant resources into a tight commercial warehouse real estate space.

Sustainability is coming more to the forefront

Sustainability and carbon reduction are increasingly important to consumers around the world, and many companies need to meet sustainability standards being set by governments, too. Businesses need to invest in clean transportation technologies in order to stay competitive.

When last-mile deliveries are estimated to continue to increase globally by 2030, that correlates to a direct increase in emissions. To compensate, many firms are switching to electric fleets, decentralizing their warehousing, utilizing parcel lockers, and working with 3PLs to optimize routes and transportation options.

Higher visibility and transparency around delivery times

Today’s customers expect updates on the progress of their order throughout the entire shipping process. However, some supply chains are more transparent than others — and having a lack of visibility around shipping can lead to lost sales.

Companies will be looking for shipping partners that can provide accurate information around shipping and quick turnaround times. Supply chains connected with IoT can provide real-time updates to customers to pull back the curtain on shipping expectations.

Decentralized, load balancing warehousing, and inventory

Increasing weather events and changes to international trade have led many companies to rethink their logistics infrastructure. The large, centralized regional warehouse hub is increasingly too slow and isolated to meet fast eCommerce turnaround times, and it can become a liability when a storm closes down local highways and rail lines.

Many companies have looked to decentralize inventory to lessen the impact of trade disruptions. Smaller hub warehouses that are closer to urban centers allow companies to manage fast turnaround times by staying nimble and balancing stock to meet real-time consumer demand. A lot of traditional brick-and-mortar stores are using their physical footprint like a distribution center to manage same-day deliveries for eCommerce orders.

This has proven easier for companies like Amazon that benefit from the connections and resources needed to scale their infrastructure in response to shifting trends. Fortunately, companies of all sizes can connect with 3PL providers with the experience and infrastructure needed to compete.

Conclusion

The trends of today have been largely informed by the response to the pandemic. Even as the big impact wanes, other conflicts and natural disasters mean that agility and flexibility are still imperative. Partnering with a 3PL can help you keep up with trends and improve transparency, expedite shipments through customs and drayage, and prevent backstock challenges.

Partner with a 3PL to ensure shipments get to where they need to go. Contact GlobeCon today!