In a globalized world, countries have become reliant on international supply chains to bring people food, commodities, and other consumer goods. Over 80% of global shipping arrives via containers, which makes drayage service one of the most important modes of transportation in logistics.
Container drayage tracking and service management have also grown in importance for shippers. Understanding the state of the drayage market is essential to ongoing recovery and growth among drayage service providers and shipping companies. First-mile experience remains an essential piece of the customer journey and on-time, in-full delivery is vital for the optimal logistical process. Shippers must focus on the intermediate steps of the transportation process to thrive. Drayage transport is often the most vital yet overlooked piece of the shipping and logistics puzzle. As shippers continue to battle higher freight transportation costs and greater difficulty with basic services and operations, the need for reliable drayage transportation is more critical than ever.
Supply Chain Brain recently reported that inefficiencies within drayage operations are contributing to port congestion, longer loading times, and an increase in demurrage and detention fees. Streamlining services, optimizing routine procedures, and automating drayage processes all help to ensure the best possible services for companies. Understanding drayage service’s impact and influence will make the entire process of streamlining dray freight easier from start to finish and improve end-to-end visibility.
What is Drayage Service?
Drayage service is the movement of cargo over short distances from one place to another, usually from a port or rail terminal and to a warehouse or trans-loading facility. Usually, trucks hauling containerized freight that can be dry, refrigerated, or hazardous material. Rates for containerized freight have increased substantially since the global pandemic, which has impacted the demand for trucks and chassis throughout the drayage industry.
One feature that makes the drayage transportation process different from regular shipping and trucking is how it is designed and structured to be a step within the longer shipping process. For instance, a container might need to get moved from the docks to a warehouse farther inland to be loaded on a train or another truck. Drayage services allow containers to be moved short distances without tying up vehicles and drivers that are already busy with long hauls and final delivery routes. In most cases, drayage happens in a single shift. This differs from other transportation providers who move FTL or LTL loads that might have multiple pickups and drop-offs. Best-in-class container drayage services handle the full transport, usually in a day or much less, by implementing KPI groups to track and monitor shipments.
The Importance of Knowing about Drayage’s Impact in Logistics
Drayage services are essential to maintaining global supply chains, and with so many companies to choose from, what should shippers be looking for in a service provider?
Shippers need reliable drayage services, container tracking, and real-time notifications The best drayage companies are the ones that provide reliable service, good rates, and are trustworthy to take regular volume. By focusing on drayage services and solutions, shipping companies can ensure they are meeting the needs of their customers while also reducing execution costs and improving bottom lines.
All of this intensifies the ongoing issues the drayage market has faced over the past few years:
- Chassis shortage compounding port bottlenecks- Containers take longer to load, unload, and move around the port and dock areas without fast and easy access to chassis. Delays with chassis location and usage create a domino effect of delays that intensifies existing bottlenecks, making them even more difficult to manage.
- Port truckers' frustration over conditions intensifies- Drivers move the supply chain and often take the brunt of the stress and aggravation that comes from long wait times, slow loading/unloading, and port navigation issues. As work conditions worsen, so too does morale and availability of drivers, which only further worsens drayage conditions overall.
- The surge in owner-operator numbers complicates drayage- As a response to surges in demand for import and export services and drayage options, the number of OOs in the market has exploded in recent years. While initially, this helped deal with demand surges, in the long-term, it further complicates the overall logistics of drayage service logistics.
- Imports increased dramatically and threw off drayage balances- As the pandemic hit its peak, the level of imports hit a peak as well, thanks to the rise in e-commerce shipping. The rise in imports added even more volatility to the market as consumers moved from brick-and-mortar shopping to shipping intensive online ordering and remote shopping.
- Shifting consumer demands add to market volatility- The final drayage issue that supply chain logistics has to contend with is a simple fact that the market today is still incredibly volatile. Shifting consumer demands, market trends, and global factors continue to influence the drayage process and make drayage shipping more challenging.
Because we offer comprehensive port drayage, transportation, and distribution solutions, Port City Logistics is uniquely positioned to minimize the risk of late, damaged, or mis-shipped goods with specialized and customized drayage shipping and container tracking services. Read on to learn more about container drayage services' impact on supply chain logistics.
What Does Best in Class Container Drayage Service Look Like?
Data shows that US imports grew by 14.4% year-over-year in October 2021 - and a full 53% growth from the last year’s levels, and the demand has only continued to grow throughout 2022, only further increasing the demand for best-in-class drayage services. Ensuring best-in-class drayage every time a load is shipped comes down to knowing what factors impact drayage service. Best in class drayage comes down to understanding these five key concepts: Service Options, Cost Management, Operational Planning, Customer Trust, and Delivery Consistency.
1. Drayage Depends on Real-Time Service Options
customers demand reliable on-time delivery services and up-to-the-minute tracking. Shippers expect that their drayage providers offer real-time tracking and technologies to help them meet customer expectations.
2. Drayage Services Rely on Proper Cost Management
Best-in-class drayage container tracking and transportation focuses on reducing shippers' dwell time and related expenses. Failure to complete on-time in-full delivery can set off a domino effect that leads to rising logistics costs and impacts overall customer satisfaction and retention. Careful cost management significantly improves drayage tracking and transportation overall.
3. Drayage Requires Advanced Operational Planning
Successful drayage service provision requires service providers to understand individual customers’ setup and unique needs. These include ensuring any weight, size, and specialized handling requirements are properly planned for and carried out effectively. Operational planning and services improve end-to-end logistics and boost drayage success dramatically.
4. Drayage Providers Instill Trust in the Face of Change
In a digital day and age, achieving optimal drayage operations and maintaining best-in-class level services relies on innovative technology and automation. Manual processes and outdated ones increase the chances of errors and mistakes. Best-in-class drayage services embrace change and make the most of innovative technology to scale and adapt to fluctuating markets.
5. Strong Drayage Relationships Thrive on Consistency
The ultimate goal for any company is profitability and to expand its book of business beyond the existing customer base. Increasing profits with drayage shipping and logistics are all about networking and finding mutually beneficial drayage/shipper partnerships to reduce expenses and increase profits consistently.
When freight sits idle at the port for days, it can’t get to market, consumers can’t buy it, businesses can’t earn a profit and the whole supply chain. At Port City Logistics, the focus on streamlining and improving logistics helps reduce drayage difficulties and overcome shipping headaches. Optimizing approaches to defining drayage services and maintaining a high level of customer satisfaction is at the heart of best-in-class drayage transportation services.
What are the Benefits of Optimized Shipping and Drayage?
Demand for reliable OTIF delivery services will not diminish anytime soon, even as new challenges emerge as recovery efforts remain ongoing. LogisticsManagement highlighted these new challenges in an April 2022 article highlighting the “decades of underinvestment in our infrastructure, unprecedented consumer demand amid our strong economic recovery, and continued pressure from the pandemic have put immense strain on our supply chains.” These challenges present a unique conundrum for shippers offering best-in-class drayage services as it impacts the visibility, control, and insight they have into the supply chain.
A quality industry partner can leverage relationships, assets, and networks to deliver on commitments consistently, so shippers can improve drayage efficiency across the board. Companies can say goodbye to speed and accuracy problems, bottlenecks at the distribution center, financial loss or missed profits, and unhappy customers with reliable drayage services designed from the ground up to assist growing companies and meet their unique needs and goals. Optimized drayage options offer widespread improvements from visibility to management to scalability.
Visibility Improvements With Drayage Service Insights
Shippers can enjoy enhanced visibility across the board with improved logistics and best-in-class drayage planning and services, including:
- Vessel visibility — the ability to see where the ships are at all stages of the voyage.
- Port visibility — insights into the port's queue lineups and berth schedules.
- Drayage trip visibility — real-time monitoring of drayage loading and transport.
- PCL Yard/Dock visibility — insights into port drayage freight yard movement.
- Inventory visibility — improved tracking of cargo movement and warehouse inventory.
- Order status visibility — ability to track order progress and delivery status in real-time.
- Shipment status visibility — faster notification and updates regarding shipment deliveries.
- OTR trip visibility — tracking of cargo once it leaves the ship or docks for transport.
- Document visibility — digital tracking and recording of shipment documentation.
Improved Management for Exception-Based Alerts
Shippers can better negotiate management protocols for exception-based tracking, monitoring, and notifications with a clear idea of drayage services and what that looks like in a real-world setting. Improved drayage management makes it easier to track the following:
- Changes in estimated arrival time for vessels
- Notifications of port congestion and long queue lines
- OS&D reporting of overages, shortages, damages
- Equipment maintenance delays or breakdowns
- Labor availability and possible capacity shortages
- Port and equipment-related issues and truck turn services
- Carrier failures and issues with third-party providers
- Final delivery issues related to customer unavailability
- Issues with documentation, customs, and legal requirements
- Predictive alerts for weather, traffic, and logistical concerns
- Many other exceptions that can be addressed sooner
Top Benefits of Drayage Container Services for a Better Business
Improving container drayage services helps shipping companies better manage resources and personnel to ensure daily optimal performance. Many of the benefits stemming from drayage services focus on improving business operations and bottom line profits. As noted in a 2020-2021 review by Zippia, the global supply chain industry is worth an estimated $15.85 billion with an estimated CAGR growth of 11.2% from 2020 to 2027, despite the COVID-19 pandemic. This CAGR would put its value at $37.41 billion in 2027, more than double 2020 values.
In addition, the transportation industry is worth $120.7 billion and is expected to see similar growth with a predicted value of nearly $261.89 billion by 2028. With so much attention falling on supply chain management and logistics, it is vital that drayage services remain a key factor in planning and optimizing the transportation market and following through on promised drayage fulfillment services.
The biggest benefits to come from this optimization include the following:
- Security — Enhanced protection every step of the way, including improved tracking and monitoring to reduce theft and lost cargo and added protection against cyber threats and risks associated with ocean freight management and transportation.
- Efficiency — A more streamlined process saves time and money and allows team members to focus on more vital and meaningful drayage services by automating mundane processes and increasing efficiency and throughput from end to end.
- Cost — Improved logistics and supply chain management allows for more efficient route planning and implementation, reducing freight spending, surcharges, expenses, and accessorial fees related to drayage shipping services.
- Accuracy — Automated processes, real-time tracking, push notifications, and dynamic service opportunities improve accuracy and keep on-time delivery rates high, protecting shippers’ reputation and standing within the industry.
- Reliability — Working with trusted carriers and drivers and providing all third parties and team members access to data and logistical insights help improve visibility, scalability, and adaptability, even during uncertain market conditions.
Define Drayage Shipping Services and Perfect Logistical Performace by Partnering With Port City Logistics Today
The strongest supply chain is only as strong as its weakest link, and when transportation and drayage-related problems go unchecked, problems can quickly spiral out of control. Shippers lose control of their shipment and cant track current location data, bottom line profits and revenues fall to fees and surcharges, and brand image and reputation suffer as a result of poor services. Simply put, everything is at stake when dealing with container drayage transportation logistics and the need to balance challenges and solutions within ocean shipping.
Shipping service providers must find expert drayage providers and partners that offer comprehensive port drayage, transportation, and distribution solutions, to help ensure optimal performance, regardless of market trends, consumer demands, and industry standards. Port City Logistics is uniquely positioned to minimize the risk of late, damaged, or mis-shipped goods, which helps shippers remain confident and in control of their drayage shipments. Contact Port City Logistics today to learn more about why understanding best-in-class container drayage services are essential to ongoing growth and success in 2022 and beyond.