FTR Associates recently released its Shippers Conditions Index (SCI) reading for the month of December. Conditions were ranked at -4.9, indicating a "tightening capacity" in the industry. The number came in above November's reading of -5.3. According to the FTR's scale, any number below zero signals a tough climate for transportation service providers.
Some experts predict the environment may worsen before it gets better, as transportation costs have grown and new federal regulations are expected to limit truck capacity in the coming months. Despite this, the SCI did increase slightly from November to December, indicating some commercial carriers may have had a better month than anticipated.
"Despite recent problems emanating from issues at the federal level, most indicators point to continued modest growth in both the economy and freight materials," said Jonathan Starks, FTR's director of transportation analysis. "The biggest transport issue that arose at the end of 2012 was the reduction in inventories. Shipping managers will be quickly turning their attention to the looming hours-of-service changes that are scheduled for July 1. Those rules will have a varied impact on shippers depending on how their operations are currently set up. Many will take a substantial hit to the productivity of their trucking operations, some as great as a 10 percent hit."
With experts advising fleets to take caution and watch out for factors that could hurt productivity and raise costs, transportation enterprises may benefit from implementing the use of technology such as route optimization software. This can help ensure drivers are taking the most timely and fuel-efficient paths to their destinations and prevent fleets from inadvertently wasting time and funds driving on poorly planned routes. Managers looking to maximize productivity and limit waste may find routing software helps them achieve company targets.