While 2023’s soft market has made it easier to secure capacity, it’s still crucial for shippers to remain proactive heading into the holiday season. Shippers anticipate a mild peak season due to ample capacity, inflation, and inventory carry-over from 2022. However, with carriers like UPS, FedEx, and Amazon implementing higher-than-ever surcharges—and Yellow operations closing down—it’s important to remain strategic moving into Q4. Plus, more than 40% of consumers have already started their holiday shopping, which could result in a flatter but longer peak season.
To go the distance this holiday season, shippers will need to implement proactive strategies that prioritize supply chain optimization and cost savings.
With ample capacity, shippers might not have a lot of motivation to plan well in advance. Real-time procurement tools can enable shippers to source capacity up to the last minute, but that doesn’t mean you shouldn’t remain proactive
If anything, lack of consumer demand, tightening LTL capacity, and increasing peak-season surcharges means that cost savings should be top of mind. Secure capacity early to lock in the best rates and avoid these surcharges. Technology built with route optimization tools can adjust for price, capacity, and mode to help determine the most efficient lane fits and offer end-to-end shipment tracking throughout—saving shippers even more money.
A soft market gives shippers more choice flexibility thanks to over-capacity, but the market is still adjusting to Yellow’s bankruptcy filing earlier this quarter.
Carriers are able to fill Yellow’s absence, but the market is still experiencing slimmed capacity. On the LTL side, carriers were able to absorb Yellow’s volume because of a nearly 10% drop in volume from prior years. But because Yellow represented 9% of LTL market share, this eliminated nearly all excess capacity. Even slight fluctuations in peak season are likely to have a greater impact. As the market adjusts over the next few months, shippers will need to be extra communicative with carriers to ensure access to capacity.
During this time, before the market stabilizes, shippers should continue to build relationships with their existing carrier partners and even explore relationships with new carriers. While over-capacity remains, shippers have additional flexibility in who they work with—allowing them to secure the best possible rate on a timeframe that aligns with their schedule and needs.
While saving on rates thanks to over-capacity, shippers can use funds to invest in technology platforms that help streamline their business operations. A comprehensive one-stop-shop solution can offer additional transparency and flexibility for shippers when booking and managing loads.
Especially during peak seasons, when volume increases, a self-service management platform allows shippers to gain more high-level visibility across their supply chain and ensure nothing falls through the cracks. Advanced technology such as instant quotes and bookings, real-time tracking, route optimization, and automated workflows can help shippers visualize shipment journeys, strategically plan by mode, and manage and upload documentation all in one place.
Uber Freight’s Shipper Platform helps shippers quickly and easily secure freight capacity and optimize shipments across their network, all while offering full visibility into the entire process. Learn more about our Shipper Platform today.
Just because the peak of holiday season will be flatter this year doesn’t mean shippers should let their guard down. Planning ahead, thinking strategically, and investing in technology will help shippers not only handle the unexpected turns of holiday season, but also prepare for the freight market rebound. When the market recovers, shippers who implemented proactive strategies will reap the benefits.