The State of Transportation
Our team continues to leverage our relationships with carriers to secure best possible service at very competitive costs. We also continue to see supply chains across industries impacted by high demand, low supply, increasing costs and higher inflation. We are now starting to see general rate increases (GRI) from carriers ranging between 8%-22% depending on carrier or lane.
Although we have mitigated the increase or delayed the implementation of some of these charges, you are going to start seeing your cost of freight increase due to these factors:
1. Driver Shortage: Carriers continue to struggle with an aging workforce as drivers retire or switch careers to stay local. Current projections estimate a shortage of 80,000 truck drivers in the United States.
2. Diesel: Prices continue to increase with projections in 2022 inching toward $6 per gallon nationally. Fuel prices have increased on average by $2 per gallon in the past 12 months per the Department of Energy
3. Accessorial LTL charges: We are seeing carriers increasing their accessorial charges. Two are of particular importance are:
a. Hazmat shipment fees: LTL carriers are starting to charge a nominal fee per shipment of about $15
b. Over Length fees: Many carriers are now charging an over length fee for shipments with articles that have dimensions between 8 and 12 feet. The fee is around $100.
What your Transportation Team is doing about it:
The Johnstone Transportation team is committed to serving our distributors. We continue to have open dialogue with our current carrier partners for improved services and we are pushing back aggressively to mitigate the costs and provide necessary service. We also continue to research new partnerships with potential carriers aligned with the Johnstone DC & Distributor network.
Things You can do to reduce accessorial charges:
1. Consolidate your hazmat product orders into fewer shipments to avoid hazmat fee
2. Consolidate your over length fee products (all products that are in 10-foot lengths) into fewer shipments to avoid over length fee
Shipping Template
You can also obtain quotes from the Transportation team prior to shipping. Use the Shipping Template, now available on JEN, for estimated costs of LTL and truckload (TL) shipments from a DC. All you need to do is complete the rows shaded in Blue and email to the Transportation Team. The Transportation Team will complete the rows shaded in Yellow and send you the freight estimates.
Important Notes:
· LTL Quotes are valid for 3 days from day of quoting
· TL Quotes must be completed by the Transportation Planners and are only valid for up to 2 hours from time of quote
Freight Invoicing Advisory Group
We continue to work towards improving the freight invoicing process and have been listening to store software advisory group feedback. It is important that we listen and learn to better understand your needs, while balancing the needs of the enterprise. You will be hearing more from us once we have validated our improvement recommendations based on the feedback received.
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