Logistics Software Gurus Share Their Top Five 3PL Trends for 2023
Logistics software system provider CartonCloud have shared their predictions for the top 5 trends that will share how Third-Party Logistics providers will operate in 2023, and it’s all about working smarter, not harder.
Logistics software system provider CartonCloud have shared their predictions for the top 5 trends that will share how Third-Party Logistics providers will operate in 2023, and it’s all about working smarter, not harder.
Their team of experts have experience in the industry and work closely with customers and industry partners — giving them a front-row seat to what 3PLs and their customers are seeking into the new year. They’ve shared their predictions here, for the top five 3PL trends to shape 2023— from revenue boosters to better customer service, here they are.
Diversifying services to boost revenue
This year, 3PL providers will be looking to introduce new revenue streams and services to customers, providing a single touch point to outsource their logistics needs, made possible with integrated systems and software.
“We’re seeing a shift in the services 3PLs are offering, as more and more businesses look to outsource logistics altogether. 3PLs are acting more like 4PLs, providing storage, freight and handling services as well as reporting and advice, and even acting as a single point of contact for customers, as they manage a range of logistics providers on the customer’s behalf.
“Our software is an integrated WMS/TMS, which means our customers can play it smart, listen to what their customers need and find new and innovative ways to provide that, under one umbrella,” said CartonCloud COO Shaun Hagen.
In 2022, 3PLs were beginning to move further into diversification; building new revenue streams and thinking of new ways to offer additional services to either win new business or provide more to their existing customers.
The importance of Direct Software Integrations
Data accuracy, speed, and security remains front of mind for 3PLs looking to grow in the coming 12 months. In 2023, the ability to connect systems and securely share data seamlessly across systems and platforms as a part of day-to-day operations will be a key focus for 3PLs looking to optimize operations and expand.
“In 2022, we built over 1,000 integrations for CartonCloud customers, allowing them to streamline data flow between systems — from linking to their customer’s online stores like Shopify and WooCommerce, to direct connections with specialty ERP systems like Crafted ERP, accounting platforms like Xero and Quickbooks, or DIY integrations through our public Zapier or self-service API,” said CartonCloud founder and CEO Vincent Fletcher.
Saving time with hands-off reporting
The new year will see 3PLs focus on building efficiency in more than just their operations. Logistics businesses will be looking at how they can save time in all areas of their business, especially through automating manual tasks like rate calculations, invoicing and ordering.
“Back in the paper days, reporting would take hours or days — trawling through spreadsheets or trying to find paper PODs and receipts, and then answering the phone to every customer seeking an update on their inventory or shipment.
“Not anymore, 3PLs can’t afford to lose so many hours on manual data entry and they can’t afford to have data that isn’t accurate. Automated reporting and customer access to reporting portals needs to be a priority for 3PLs who are serious about customer service, and growing their business,” said CartonCloud Implementation Manager Shaun Johnson.
From sign on glass at warehouse dispatch, to barcode scanning for cross-docking — data capture in 2023 will be important, thorough, and simplified. With manual tasks automated, they have more time to fulfill more orders, or focus on other areas of their business.
Track-ability
Whether it’s the ability to see a shipment in transit, view stock levels in the warehouse, or receive an electronic POD (ePOD) at the point of delivery, track-ability provides important usable data to all members of the supply chain.
With this data collection comes the importance of sharing information with partners and customers to use in their own planning and reporting needs.
“The ability to pull up any consignment and instantly see who it has been allocated to, if it’s in transit, and exactly when it is delivered is paramount to having a scalable transport operation.
Likewise, being able to easily capture inventory data as your warehouse personnel work directly through the mobile app is a game changer. It keeps reports up to date and allows you to show order dispatch date and time across multiple platforms through integrations,” said CartonCloud Customer Operations Manager Scott Murray.
Deep understanding of tech features and a drive to get the most
This year, 3PL providers will begin taking a bigger part in learning about the technology they have on hand, exploring how new features can allow them to do more for their customers or bring on new customer entirely.
3PL providers will take time to ensure thy have the right software for their system, and they will want it to be usable and easy to roll out across their team and operations. They want to do more for their customers, and they want to know all the ways their software can help them save time and money, and increase their output.
“When we started with CartonCloud, we were probably only using about 5% of the software’s capability. Now, each client we bring on has a new requirement, and we start to use a new level of the software, or access features we hadn’t needed before,” said TNS Logistics Commercial Manager Matt Norton.
“We used to see warehouses and transport companies have to bring in project managers and, tech experts or have an entire team dedicated to switching their software system or bringing on a new system, but the way CartonCloud is designed makes it so easy-to-use, that the team they have on hand can simply pick it up and start using it,” said CartonCloud Implementation Consultant Mitch Whitnack.
Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.
The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.
Total hours of congestion fell slightly compared to 2021 due to softening freight market conditions, but the cost of operating a truck increased at a much higher rate, according to the research. As a result, the overall cost of congestion increased by 15% year-over-year—a level equivalent to more than 430,000 commercial truck drivers sitting idle for one work year and an average cost of $7,588 for every registered combination truck.
The analysis also identified metropolitan delays and related impacts, showing that the top 10 most-congested states each experienced added costs of more than $8 billion. That list was led by Texas, at $9.17 billion in added costs; California, at $8.77 billion; and Florida, $8.44 billion. Rounding out the top 10 list were New York, Georgia, New Jersey, Illinois, Pennsylvania, Louisiana, and Tennessee. Combined, the top 10 states account for more than half of the trucking industry’s congestion costs nationwide—52%, according to the research.
The metro areas with the highest congestion costs include New York City, $6.68 billion; Miami, $3.2 billion; and Chicago, $3.14 billion.
ATRI’s analysis also found that the trucking industry wasted more than 6.4 billion gallons of diesel fuel in 2022 due to congestion, resulting in additional fuel costs of $32.1 billion.
ATRI used a combination of data sources, including its truck GPS database and Operational Costs study benchmarks, to calculate the impacts of trucking delays on major U.S. roadways.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
Global trade will see a moderate rebound in 2025, likely growing by 3.6% in volume terms, helped by companies restocking and households renewing purchases of durable goods while reducing spending on services, according to a forecast from trade credit insurer Allianz Trade.
The end of the year for 2024 will also likely be supported by companies rushing to ship goods in anticipation of the higher tariffs likely to be imposed by the coming Trump administration, and other potential disruptions in the coming quarters, the report said.
However, that tailwind for global trade will likely shift to a headwind once the effects of a renewed but contained trade war are felt from the second half of 2025 and in full in 2026. As a result, Allianz Trade has throttled back its predictions, saying that global trade in volume will grow by 2.8% in 2025 (reduced by 0.2 percentage points vs. its previous forecast) and 2.3% in 2026 (reduced by 0.5 percentage points).
The same logic applies to Allianz Trade’s forecast for export prices in U.S. dollars, which the firm has now revised downward to predict growth reaching 2.3% in 2025 (reduced by 1.7 percentage points) and 4.1% in 2026 (reduced by 0.8 percentage points).
In the meantime, the rush to frontload imports into the U.S. is giving freight carriers an early Christmas present. According to Allianz Trade, data released last week showed Chinese exports rising by a robust 6.7% y/y in November. And imports of some consumer goods that have been threatened with a likely 25% tariff under the new Trump administration have outperformed even more, growing by nearly 20% y/y on average between July and September.