COVID-19 UPDATE

Load Volume

ATA Launches Efforts to Help Texans Battered by Storm

Freight Waves, Connor Wolf, Monday, February 22, 2021

American Trucking Associations has launched a relief effort aimed at helping those in Texas and Louisiana impacted by the recent deadly snowstorm.

In Texas, residents were left without power and water after a historic snowstorm hit the state earlier this month. With efforts underway to restore utilities and provide relief to those in need, ATA launched an effort to get clean water to residents.

“We are asking our trucking family to not only keep all those affected in your thoughts and prayers, but to help ATA coordinate relief efforts,” ATA President Chris Spear said in a Feb. 19 letter to members. “Our friends in Texas need your help.”

At around the same time, the federation had plans underway to get two truckloads delivered to Shreveport, La., which also felt severe effects from the unusual weather for the region.

For both states, each truckload carried 20 pallets with an estimated 960 cases of water. And more shipments were in the pipeline, ATA said, once trucks and drivers were lined up.

In Texas, the earliest shipments were delivered to recipients with the greatest need, including Houston Memorial Hermann Hospital and Catholic Charities of Central Texas. The Texas Trucking Association and the Southwest Movers Association are helping to coordinate those relief efforts on the ground.

“We have a pipeline of support that we can tap when these things come up,” Texas Trucking Association President John Esparza told Transport Topics on Feb. 22. “We start plugging in what we know and where we know [help is needed], whether it’s moving generators or locating potable water or just resourcing water to be used in boilers. You name it. We’re looking to connect to people within the trucking universe to be able to help and they very much responded.”

Esparza noted that the state has a good level of preparedness to coordinate relief efforts due to experience with past natural disasters like hurricanes. While the snowstorm presents different challenges, knowing whom to contact for emergency management or to move supplies is the same, he said. Esparza noted that uncertainty created by the fast-changing situation with the current relief effort is a challenge, but said drivers who have volunteered are providing constant updates about road conditions and availability of fuel.

“A lot of that stuff has to be triaged by the hour,” Esparza said. “Just anything we can do with boots on the ground to evaluate the situation hour by hour as we are going through this.”

In Louisiana, over-the-road carriers Preferred Materials has been helping coordinate efforts between local trucking companies, the state trucking association and ATA.

“We have been working diligently in aiding both state and local governments in relief efforts, as well as working with our area hospitals to provide them with much-needed water 24 hours a day,” company president David Todd Ruple said in a statement to TT. Ruple said he expected to be providing water to area hospitals at least through the week of Feb. 22, and noted that while southern states simply weren’t prepared for such a severe snowstorm, he was glad to see the industry leading the relief effort.

“I am proud of our trucking community,” Ruple said. “We did and are doing what we always do — pulling together and getting much-needed supplies and goods delivered to those in need. That is the heart of the truck driver — to serve others and their communities regardless of the obstacles and hardships they may face.”

ATA is asking members, affiliates and others to consider donations of cash, supplies or transportation to assist with storm relief efforts.

Hurricane Relief Pressure-Tests the ‘New Normal’ Supply Chain

Freight Waves, Corrie White, Tuesday, September 29, 2020

Historically, hurricane season presents abundant and often lucrative freight-hauling opportunities. For weeks or months after a storm passes, affected cities need rebuilding materials, temporary housing units, nonperishable foods, water and generators. Trucking companies and owner-operators can bid on Federal Emergency Management Agency (FEMA) contracts as early as a week or two before a hurricane makes landfall. 

But COVID-19’s supply chain disruptions, like restaurant and meat plant closures, led to a reduction of the fleets, some of which couldn’t pivot quickly enough. With a reduction of capacity and general disruptions caused by COVID-19, Senior Vice President of Global Marketing at PowerFleet Craig Montgomery is concerned about the exacerbated strain on our supply chain during events like hurricane recovery. The SONAR chart below shows the climbing Outbound Tender Reject Index (OTRI), which correlates with tightening capacity in the United States. 

“It’s hard enough when communications and cellular networks are knocked down, when roads are blocked and warehouses are destroyed,” Montgomery said. “And when you’re trying to bring loads into a COVID-19-affected world, it’s like a Rubik’s cube with 14 sides. It’s just that much harder on our fleets to deal with COVID issues and a natural disaster.”

Over the past six months, the industry has proved its resilience, arriving at a new normal. The beef and poultry plants have come back online. Most stores’ shelves are stocked with toilet paper. But while the industry has achieved a kind of stability, Montgomery wonders about the impact on a still fragile system in the face of hurricanes.

For instance, last week, Tropical Storm Beta delivered an onslaught of rain to the Gulf Coast, making it the 23rd named storm of 2020. While meteorologists from Colorado State University’s Tropical Meteorology Project predicted 2020 to be an active year for hurricanes, they initially predicted only 16 named storms back in April. Hurricane seasons typically run from June to the end of November, but August and September tend to see the highest concentration of storms. 

“No Atlantic season on record has had this many named storms through late September, and they’ve definitely caused transportation troubles,” said Nick Austin, director of weather analytics and senior meteorologist at FreightWaves. “Hurricane Laura, a major Category 4 storm with winds of 150 mph at landfall, forced a shutdown of Interstate 10 from eastern Texas into Louisiana in late August. Hurricane Sally, just a couple of weeks later, shut down I-10 from Alabama into western Florida. The Pensacola Bay Bridge remains closed due to damage from Sally. Worse yet, the hurricane season doesn’t officially end until Nov. 30, so more storms are possible. The Gulf of Mexico and tropical Atlantic waters are still quite warm.”

When Hurricane Laura  hit the Gulf Coast, the trucking market’s tight capacity coupled with this region’s lack of logistics activity meant relief efforts had to be sourced from Dallas, Shreveport, Louisiana, and other cities with established logistics networks. The tight market also means that many truckers may choose to serve their contracted or spot market loads as opposed to bidding on FEMA contracts. 


“It will take a long time to clean up from this,” said Kathy Fulton, executive director of the American Logistics Aid Network (ALAN), the country’s most notable humanitarian logistics organization. 

Scalable Growth Starts with the Back Office

Freight Waves, Jack Glenn, September 23, 2020

ARTICLE BROUGHT TO YOU BY HUBTRAN!!

The transportation and logistics landscape of today looks a lot different than it did just a few short years ago. An industry once overflowing with paperwork, manual data-logging and pencil-pushing has come to embrace new technologies to track and move freight as well as streamline manual processes.

A top priority for brokers, carriers and logistics providers alike has become automating back-office processes to simplify invoicing and other freight management tasks. Early adopters have gained a competitive advantage over those still clinging to the old ways of doing business. 

Back-office automation is an attainable goal for companies of all sizes thanks to innovative platforms such as HubTran. Through the utilization of artificial intelligence and machine learning, the cloud-based Software-as-a-Service-based (SaaS) platform has eliminated numerous tedious manual processes for transportation companies, enabling users to instead dedicate more time and resources toward enabling users to instead dedicate more time and resources toward activities that will grow their business such as carrier onboarding.

Every transportation company will experience growing pains at some point; however, the feeling is multiplied when a company’s outdated technological infrastructure inhibits it from expanding to meet demand. This was the case for HubTran customer Integrity Express Logistics (IEL), as it realized it was growing beyond what its systems were capable of handling.

The Cincinnati-based third-party logistics (3PL) service provider contracted with around 35,000 unique carriers in 2019, handling roughly 4,000 loads per week. As it neared the 500-employee mark, IEL was unsure if its cradle-to-grave business model could keep up with the fast-growing pace of the company.

IEL Director of Operations Eric Arling detailed the specifics that led the full-truckload brokerage to consider an automation solution, “Reviewing our back office, we concluded that too many of our manual-touch processes were inefficient and holding us back from scaling effectively to reach our $1 billion annual sales goal. It came down to a business decision: Are our systems scalable for us to continue to grow?”

IEL leaders understood that greater success would be achieved if the workforce operated as service-oriented problem-solvers rather than data crunchers. Arling credited the company for immediately beginning its search for an automation solution — a search that led IEL to HubTran.

“With the current capacity crunch in addition to overall market uncertainty, we see tremendous value in HubTran for the opportunity to repurpose some of our internal roles to strengthen our carrier and customer relationships,” Arling said. “Using HubTran for every load, we knew that we’d immediately gain greater efficiency and reap the benefits regarding the elimination of human error as well as improving our ability to bill customers and carriers accurately and without payment gaps.”

HubTran’s cloud-based platform automatically processes invoices, bills customers, manages documents and factors funds. The platform gains an increased understanding of your system with each unique document it processes using optical character recognition (OCR), machine learning and artificial intelligence (AI).

With HubTran, brokers, 3PLs, forwarders, and factors, can reduce back-office work by up to 80% and process paperwork four times faster than what manual processes can achieve at an error-free rate of over 99%, according to the company. 

What also makes HubTran an attractive back-office automation solution is that it’s pre-integrated with major transportation management systems (TMS) and factoring applications. Additionally, HubTran also integrates with the customer’s proprietary systems. For example, IEL integrated HubTran with its proprietary TMS in August and has already realized the benefits of faster billing, among other efficiencies. Arling said, “Anytime you integrate with a third party, there’s a lot of risks involved, but HubTran has been a wonderful partner. The integration was a collaborative effort.”

Confidence is key to attracting bigger customers. As HubTran Vice President Joshua Asbury explained, “3PLs never walk away from big deals. Large shippers will thoroughly make sure the 3PLs they work withs have the operational capabilities to handle the increase in loads. It’s crucial for 3PLs to know both the capabilities and limits of their current operations and be able to prove they have the ability to absorb the additional workload required to support them. As IEL has proven, an automated back office is a competitive advantage for 3PLs and brokers.“

In today’s fast-paced freight environment, shippers have very little patience for brokerages with back-office glitches; they expect your processes to be seamless. Arling suggested that it’s quite easy for a profitable customer to become unprofitable if you handle volumes inefficiently.

“Shippers expect more from their brokers now than they ever have. They want to see brokers articulate efficiencies that they can provide them as well,” Arling said. “With HubTran, our customers can see that we’re capable of scaling a greater amount of volume for their business without needing both parties to add headcount; that’s a value that we weren’t able to provide shippers with before.”

Asbury understands that some in the industry consider it a risk to even think about disrupting their back-office practices — especially those workforces that have achieved moderate success by operating the same way for decades. However, he encourages the entire freight and logistics sector to consider the potential for even greater success by embracing the disruption that accompanies freight-tech innovations.

“Our forward-thinking customers like IEL understand the value in automating the back office,” Asbury said. “They realize that it can add to their bottom line, strengthen customer relationships, and overall enable them to grow the business.”

DOD Re-Awards $7.2 Billion Household Goods Moving Contract

Transport Topics, Eric Miller, July 22, 2020, 11:30 AM

The Department of Defense has re-awarded a $7.2 billion household goods moving contract just two weeks after it had pledged to take corrective action on the contested award by two competitors.

In a statement, the military said the re-award for the potential $20 billion contract came after a protest had alleged that the award winner, American Roll-on Roll-off Carrier Group (ARC) of Parsippany, N.J., had failed to disclose that its parent corporation pleaded guilty to fraud and anti-trust violations, and that three of its owner’s executives were convicted of price fixing.

“The Department of Justice confirmed ARC and its parent company, Wallenius Wilhelmsen ASA, were not part of the 2016 conviction for Sherman Anti-Trust violations,” Transcom said in a statement. “A separate company with a similar name, Wallenius Wilhelmsen Logistics AS, was convicted.”

Transcom oversees moves for members of all military services and DOD civilians.

The sweeping contract is intended to address military families’ long-standing problems with delays and damaged goods during the estimated 400,000 annual moves to assignments around the globe, Transcom officials said.

ARC originally was awarded the contract April 30.

Transcom said that after extensive independent review, it determined that the corporate misconduct was not affiliated with ARC nor its parent company.

In 2016, Wallenius Wilhelmsen Logistics AS pleaded guilty to Sherman Anti-Trust violations and paid more than $98 million in fines after three company executives were indicted. Wallenius Wilhelmsen Logistics AS has no ownership or control over ARC and is a separate corporate entity, the military said.

“During its proposal submission, ARC erroneously listed WWLAS, instead of WWASA, as corporate owner in the pull-down menus of the Government’s System of Award Management,” Transcom said. “It appeared to the protester that ARC failed to meet Federal Acquisition Regulation disclosure requirements when, in actuality, the true parent company was misidentified.”

Minor errors are not grounds for disqualification, Transcom said. “Since neither ARC, nor its parent company WWASA, have a record of misconduct, Transcom substantiated its original award to ARC because its proposal provided the best service for the best value for service members, Department of Defense civilians and their families.”

“Team ARC remains committed to our proposal to provide exceptional customer service to Transcom and the service members,” Eric Ebeling, CEO of ARC, said in a statement. “We look forward to getting started on GHC.”

However, the contract will be held up for up to 100 days as the U.S. Government Accountability Office investigates protests of the re-award by HomeSafe Alliance and Connected Global Solutions.

“U.S. Transcom’s decision to re-award the Global Household Goods Contract in light of the serious issues raised is extremely disappointing,” HomeSafe Alliance CEO Al Thompson said. “We are confident GAO will agree that errors have been made on a major contract that touches every member of the armed forces and their families.”

He added, “HomeSafe Alliance filed an initial protest to the GAO following Transcom’s original decision on April 30. The protest included nine points challenging numerous issues with the winning bid, including a flawed technical evaluation process and extremely misleading contract discussions between bidders and Transcom.”

A message seeking comment from Connected Global Solutions was not returned at press time.

Transcom’s global household goods contract is a major aspect of a broader DOD reform plan to improve the relocation process for DOD families, and integrates functions currently performed by hundreds of commercial entities.

“It will improve access to, and management of, quality capacity to meet peak demand and enable the department to affix the accountability and responsibility lacking in today’s program,” DOD said.

West Coast Ports Show Early Signs of Slowdown Due to Tariffs

www.ttnews.com, Dan Ronan, October 17, 2019, 4:15 PM

West Coast Ports Show Early Signs of Slowdown Due to Tariffs

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While the holiday shipping season is keeping import volume steady for some of the nation’s busiest ports, executives are raising concerns about the long-term effects an extended trade battle with China could have on exports, and business overall.

At the Port of Los Angeles — the nation’s busiest facility — the volume of 20-foot-equivalent unit containers (TEUs) dropped 2.7% year-over-year to 779,902, compared with 801,264 in 2018. However, year-to-date the port is still 3.7% ahead of 2018’s record pace, having processed 7,091,776 TEUs through the first nine months of 2019, compared with 6,779,605 in 2018.

While the Trump administration has announced a partial agreement with China that could eventually scale back some of the tariffs the U.S. has placed on Chinese goods, the head of the L.A. facility has a stern warning to Washington.

Seroka

“The ill-advised U.S.-China trade war continues to wreak havoc on American exporters and manufacturers,” said Port of Los Angeles Executive Director Gene Seroka. “We’ve seen declining exports for 11 consecutive months while our fastest growing market segment is exporting empty containers back to Asia. It’s likely we’ll see softer volumes in the fourth quarter. We must have a negotiated settlement of the trade war as it is beginning to impact the more than 3 million jobs in the U.S. that are tied to this port complex.”

The Port of Long Beach, the nation’s second-busiest facility, in preliminary September figures released on Oct. 16 showed a 0.8% increase from 2018. The port processed 706,956 TEUs, compared with 701,204 in 2018.

However, fiscal year-to-date the port’s TEU numbers are down 3.2% at 7,747,252 compared with 8,000,929. The port’s fiscal year wrapped up Sept. 30.

The port’s chief cited the tariffs as the main reason why the facility is seeing numbers dip.

“We continue to advocate for an end to the cycle of tariffs to give American businesses the certainty they need to thrive,” said Port of Long Beach Executive Director Mario Cordero.

The Port of Oakland saw its September TEU numbers decline 6.1% to 206,540 from 220,068 in 2018. However, year-to-date the port said its total volume numbers are up 3.1% compared to 2018.

Port of Oakland@PortofOakland

Port of Oakland loaded container volume up 3.1 percent YTD; loaded imports up 3.5 percent; loaded exports up 2.7 percent

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Officials said there are several reasons for the increase, including a continued increase in imports to meet the demand of the Northern California economy, and export volumes also continue to grow as U.S. shippers find new markets outside of China.

A leading economist said the mixed signals coming from some of the West Coast ports are not yet a clear signal of an economic slowdown.

“One month does not make a trend. There is nothing you can draw from a one-month drop. You have to have a couple of months to have a trend, or some reason,” said Rhajeev Dhawan, director of the Economic Forecasting Center at Georgia State University in Atlanta. “If it happens another month, then you have to worry about the health of the economy. You’d have a problem.”

Port Houston’s September TEU numbers were up 9.2% to 251,524, compared with 230,331 a year ago.

Record Gate Moves at Port Houston Container Terminals

Port Houston’s Bayport and Barbours Cut container terminals combined handled more than 11,000 gate moves in one day for the first time ever recently Aug. 28. Service levels included sub-60-minute…

Year-to-date the Houston facility is running 10.9% ahead of last year’s record pace, having already processed 2,231,699 TEUs through the end of September, compared with 2,011,187 last year.

Last month the port also announced a multimillion-dollar expansion plan and additional dredging to deepen the Houston Shipping Channel.

On the East Coast, the Port of Virginia also saw an increase in TEU numbers last month to 241,416, a 9% jump from September 2018’s 221,355 TEUs.

“As a result of peak-season volumes and the ongoing trade tariffs, we are seeing a lot of imports and repositioning of empty containers,” said Virginia Port Authority CEO John Reinhart. “In September, China granted an exemption from additional tariffs on some American soybean imports, pork and other agricultural products, and this works in our favor as we have seen some rebound in those cargoes.”

The overall strong numbers for the port industry are not only reflected in the larger facilities but smaller ones as well. In Palmetto, Fla, Port Manatee broke its all-time cargo record during its 50 years of operation as it ended its fiscal year Sept. 30. The port saw TEU volumes up 49% to 57,255, much of which was pineapples and bananas from Latin America for Del Monte Fresh Produce. The port also set a record for cargo tonnage of nearly 10.1 millions pounds, up 6.2% from FY 2018.

The port also imported 474 million gallons of petroleum products, up 12.5% from 2018. Florida does not have any oil refineries or interstate petroleum pipelines and relies on petroleum products delivered by tanker and barge to several marine terminals.

Making Life Easier on the Road

Transport Topics (https://cdn.advanced-pub.com), Week of October 15

It’s no secret that finding and retaining good
truck drivers is a challenge for fleets, but recent
reporting has taught us that there are simple
options for improving drivers’ quality of life on
the road.

For one thing, listen to them. In discussing the 96%
turnover rate among for-hire drivers reported earlier this
month by American Trucking Associations, experts said
the key to retaining drivers is efforts designed to make
them feel appreciated — not just sign-on bonuses to lure
them through the door, but rather things that will compel
them to stay once they’ve arrived. That includes generous
benefits packages, easy and ready access to freight,
and an open arena to always speak their minds, and be
heard.

While they’re on the road, increased flexibility
with hours-of-service regulations would also be welcomed,
according to comments during a listening
session to discuss possible changes to those regulations.
The latest in a series of these events, hosted
Oct. 10 by the Federal Motor Carrier Safety Administration,
revealed that drivers want the ability to
determine when and for how long they take breaks,
and also want regulators to understand that different
sectors of the industry have different needs. A
break for a driver hauling a load of livestock is very
different from a break for someone hauling a load
of dry goods. And short breaks offer precious little
time to either check on animals or check the condition
of a truck’s tires.

Let’s hope that the members of Congress already
angling to be in charge of top transportation committees
after the midterm elections are listening, and will
emerge post-election ready to help the trucking industry.
Not all of them will earn leadership posts, but all
of them can play a role in helping to shape a future for
the trucking industry that is built around creating an
environment where drivers can succeed.

Let’s hope the same for the leaders of the companies
that employ them. Truck drivers keep food on the table
and clothes on our backs, and we as a country must
show appreciation for them year-round. Day to day, it’s
up to the carriers who employ them — and the government
leaders who set the rules they follow — to listen
to the guidance they’re offering. After all, they’re the
ones living life on the road.

The Rules of The Road: Avoiding Ambiguity in Documenting Your Load, 3PL Perspectives

3PL Perspectives (www.3plperspectives-digital), James W. Kelly,II and Eric Arling, October 2018

EVERYBODY KNOWS THE drill. You finally get a shot at a load by a prospect you have been calling for months. You agree on a rate, find a qualified carrier, and you are off! If only it were that simple. When time is of the essence and a customer relationship is on the line, too often the very actions that can show a customer your ability to provide them exceptional service are the ones being overlooked.

The fast-moving pace of our industry can create ambiguities in real-time expectations. As a 3PL, how you manage potential grey areas can make or break your customer relationships, and with them, your entire business.

Anyone can get a load tender, book a truck, hope for the best, and blame the carrier if something goes wrong. That is precisely the perception brokers have been trying to overcome for years: book first, disclaim responsibility later. Transportation intermediaries should be looking to provide service and expertise that goes beyond what a customer expects from a carrier directly. While carriers have their own specialized knowledge, a 3PL must use its services to create efficiencies a carrier is not capable of achieving on its own. That service starts with making sure that as freight makes its way from the shipper to the customer, every hand that it touches knows what the other ones expect.

Identifying the Key Documents

Always verify, never assume. There is no better opportunity to add value as a freight broker than connecting the dots between the key documents relating to a load: the broker-carrier agreement, the customer load tender, the carrier rate confirmation, and the bill of lading. If those documents are not double checked and do not align, the broker will often be the one stuck sorting through the wreckage – literally and figuratively. If you can spot potential misunderstandings before they happen, you will not only provide a higher level of service but also save you and your company time and money.

It is often said that 80 percent of your time on a load should be spent before a truck is booked. Each load has different elements and multiple people involved. Many times, those people are experts and are excellent at what they do. However, if the broker is not focused on ensuring that all the pieces are in place for a load to run smoothly, things can and will go wrong.

Even if you think the arrangements that have been made comply with the expectations of shipper and the carrier, the relevant documents may reflect something different. And if the customer is not happy with the product it gets, it is going to look at those documents to see what went wrong – and why. As the intermediary, it is the 3PL’s job to ensure that those documents do not contain different or conflicting instructions. If they do, you need to know what you have agreed to. If you do not confirm this before the load is picked up, you may have unwittingly breached your agreement with the shipper before the product has even shipped.

Legal Considerations

Generally, under the common law governing contracts for services, a written contract can only be formed if parties agree to the same terms. Referred to as the mirror rule, if an offer is made under particular terms, the acceptance must mirror the terms of the offer. If it does not, no acceptance has occurred. Rather, a counteroffer has been made that will only become a contract if accepted by the original offeror.

However, the law imposes certain rules regarding how acceptance can occur. These rules allow parties to be able to act quickly in response to fast-moving economic demands, while ensuring parties can predictably rely on the behavior of others. But it is only predictable if you know those rules. (Note: under contracts for goods, such as the shipper’s contract with the ultimate recipient of the goods, different sets of assumptions than those below may apply under the Uniform Commercial Code.)

For instance, acceptance does not always have to occur through a signature or a piece of paper. A load tender can be accepted through any conduct that an offeror in the particular circumstances would reasonably believe indicates acceptance. If such conduct is undertaken in response to the terms offered, that conduct often will be presumed to be an acceptance of all these terms. As a practical example, if a 3PL books a carrier and maintains a running carrier-broker agreement that lays out standards of conduct for the carrier to follow, the carrier’s unconditional acceptance (perhaps through a confirmation email, an acceptance in a TMS system, or simply by picking up and carrying the load) likely will be understood to accept the load tender along with all the terms of the brokercarrier agreement. The law will presume that the parties are acting according to the mutual understanding they maintain.

But what happens when one party seeks to change that understanding? If a party says they accept an offer, but that acceptance adds additional terms or conflicting terms, they have not accepted your offer; they have made a counteroffer. Thus, if a request is made to a carrier, and an enthusiastic acceptance attaches a rate confirmation sheet, the carrier has offered you a new contract. That new contract contains the new and additional terms from the carrier. It may also be implied to contain the original terms you offered that do not conflict with the carrier’s offer. Known as the last-shot rule, if you accept the carrier’s “acceptance” through your words or conduct, the latest-offered terms control and become the contract – or at least are added to the uncontested contractual terms you originally offered.

It is critical to closely review these new terms. They may contain assumptions of liability for the broker, limitations of liability for the carrier, or requirements that do not conform to or agree with the instructions given to you by the shipper. Likewise, if you are contracting out a shipment to another broker, the second broker could include carrier requirements that do not conform to what you agreed to with the shipper. If you ignore the terms of the new offer and continue to coordinate shipment – including simply letting the carrier or broker proceed with their obligations – those actions likely constitute acceptance of the terms in the counteroffer. In addition to making the customer unhappy, you may have just breached your contract with the shipper to ensure that a carrier kept a product at the specified temperature.

Vigilance is required throughout the performance of the contract. It is important to ensure that inconsistencies do not crop up again down the line. Even if prior contract terms have been set – either explicitly between you and the carrier or constructively by the rules of common law a subsequent document, such as a bill of lading, can act as an amendment to the agreed terms or the formation of a completely new contract. Again, permitting performance after receipt of the bill of lading can be conduct indicating acceptance of those new terms.

Practical Applications

Confirm that the customer’s load tender to you is the same thing the shipper and receiver have in their systems. Just because a customer orders 1,800 cases of Roma tomatoes does not mean the shipper received the same order, or has all the product available to ship on the date your customer instructed. In addition to quantity and availability, temperature also needs to be closely monitored.

Over the years 3PLs have fallen victim to assuming everyone is on the same page. 3PLs can be encumbered with expensive claims due to a customer ordering fresh product, and the shipper having it down as frozen. The driver inevitably is going to set the temperature to the reefer incorrectly, and the 3PL is the one who will have to explain why the order was not fulfilled as promised (not to mention get a bill for several thousand dollars). All of that could have been avoided with a simple phone call.

The same process applies to the receiver. If they don’t expect an order or get the correct product, the truck is not going to deliver on time. Your driver is then in a precarious position and will likely need to be compensated on top of the customer service issue and risk of a cargo claim. Laying a driver over an entire weekend is very costly, and if you are dealing with perishable product, these delays slash the shelf life and value of the product.

What if your customer gives you orders verbally or via text message? Very simple, either utilize your TMS system to generate a customer confirmation with consistent terms, or outline the details of the load via email and have your customer confirm what you have down is accurate.

To protect your customer and protect yourself, the time you take at the start of the shipment will go a long way to ensuring success. That proves the important role of 3PLs in making sure a product safely reaches its final destination.

James W. Kelly, II is an attorney in the Cincinnati office of Vorys, Sater, Seymour and Pease, LLP. He can be reached at and 513-723-4089.

Eric Arling is Director of Operations at Integrity Express Logistics, LLC. He can be reached at  and 937-684-8202

    DAT Freight Broker Benchmark: 41% More Load Volume Yields 78% Higher Revenue

    DAT (https://www.dat.com), Steve Blair – July 10, 2018

    Monthly revenue rose 78% for freight brokers in May on a 41% increase in load volume, to set new records for those two metrics. Brokers achieved 23% net operating profit, a solid outcome that beat May 2017 results but fell short of April’s record levels.

    Gross margins averaged 12.7% in May, down from 13.6% in April and 13.2% in May 2017. High demand and tight capacity continue push truckload rates higher, so margin compression could be an ongoing factor in the coming months.

    Sign up for the monthly Broker Benchmark report to see how your business compares to the competition. 

    Brokers moved 41% more loads in May, compared to the same month last year, to set a new record. Load volume rose 10% month over month.

     

    This benchmark report draws data from an aggregate of more than 100 freight brokerage companies, whose 2017 average annual revenue of $19.5 million grew 26% compared to 2016. Average revenues for the group were 69% higher in the first five months of 2018, compared to the same period last year. To receive monthly updates in your inbox, subscribe to the DAT Broker Benchmark Report.

     

    DAT Keypoint, the TMS created exclusively for freight brokers, keeps track of all your business-critical data