The manufacturing industry plays a key role in how busy transportation companies across the country are on a daily basis. When production levels are strong and consumer goods are in demand, drivers must make more pickups and deliveries to ensure products are available on store shelves for shoppers and to guarantee manufacturing facilities have the raw materials they need to continue meeting production numbers.
American manufacturing performs well in September
The Institute for Supply Management's (ISM) factory index jumped in September, indicating economic improvements are still occurring, and it will be necessary for carriers to use route optimization software to ensure they can make scheduled stops in a timely manner. The index leaped to 56.2 in September, compared to 55.7 in August. This is the highest level it has reached since April 2011, showing strong growth in the manufacturing industry and increasing potential for transportation companies. Any number over 50 indicates the sector is expanding.
The jump was unexpected. According to Reuters, analysts polled by the news source anticipated the reading would drop slightly in September.
American factories weren't the only ones that experienced growth. Bloomberg Businessweek reported European factory output jumped for the third consecutive month and Japanese confidence in domestic manufacturers skyrocketed to the highest numbers seen since 2007.
While American carriers will benefit from the increase in transporting raw materials to producers and finished products to consumers and retail outlets, they may also notice an uptick in orders thanks to the production growth overseas. Drivers may need to deliver raw materials to ports, where they will be shipped to foreign manufacturers, or find themselves carrying more finished products made in other countries to American stores.
Adapting to increasing demands
While more orders may be good news for fleet owners, it could be difficult for tightly resourced companies to ensure they can make an increased number of pickups and deliveries on schedule. Because some companies have cut back on staff in recent years, they may lack the manpower necessary to take on many additional runs, especially longer routes that may seem out of the way. However, employing logistics software can help these fleets ensure they're benefiting from the additional business being offered while still ensuring they meet obligations.