How Supply Chain Issues Are Affecting Drayage
Most consumers don’t think much about drayage, the short-range movement of freight from a dock to somewhere else in the city. Yet, it’s a crucial step in the freight movement process. After all, just two U.S. ports moved over 10 million import containers in 2021 alone.
Of course, even average shoppers know that the supply chain has faced some serious hurdles in the last few years, mostly courtesy of the Covid pandemic. They see empty spots on store shelves if nothing else.
Those supply chain problems also create real challenges for drayage companies, whether those companies do New York drayage or L.A. drayage. Keep reading for some of the ways that supply chain issues affect drayage services.
The exact relationship between supply chain issues and inflation can prove murky. Yet, once prices for things like fuel increase, it has a very real impact on transportation services in general and drayage in particular.
Most drayage happens on trucks, and trucks burn fuel. While better efficiency can offset that a little, rising fuel costs inevitably drive up the costs of drayage. Those higher costs compound throughout the supply chain and drive up the costs of consumer goods.
While the e-commerce boom that happened at the height of the pandemic has cooled off a little, it fundamentally changed consumer expectations about the speed of delivery. On top of that, there is still a higher total volume of e-commerce goods coming into ports.
Those goods once got moved around primarily via rail. With consumers expecting shipment arrival within days or a week, that isn’t possible for a lot of those goods. Now, a drayage company must coordinate with long-haul shippers that run hubs or depots in port cities.
A task made even more challenging because those hubs and depots now receive and send much higher volumes of goods.
Of course, one ongoing issue with the supply chain problems is that drayage companies face the same kinds of shortages that everyday consumers face. There is a finite amount of available equipment, such as the marine containers that hold much of the imported goods that enter the U.S.
A shortage of computer chips has hampered automotive manufacturers, which means replacing fleet trucks is problematic and expensive. Shortages of basic materials also hamper the production of things like tires, which are essential for most domestic freight transportation.
On top of that, a driver shortage makes staffing problematic for drayage and other freight transportation companies.
Drayage and Supply Chain Problems
Drayage is in an odd position in terms of supply chain problems. In one respect, it’s part of the supply chain problem because inefficient, understaffed, or underequipped drayage companies struggle to move freight off of docks as swiftly as necessary.
On the other hand, drayage companies are victims of supply chain problems. These problems create or reinforce issues like equipment shortages and inflation. Plus, consumer expectations about delivery times change almost overnight.
Looking for more insight into global business concerns? Check out some of the other articles in our Business section.