When the effects of the Great Recession began to subside, the US economy took off at a fast clip. Companies were again spending cash and ramping up manufacturing while consumers began buying goods of all kinds again in droves.
Manufacturing increased and more goods were available and needed shipment. But while an uptick in sales and revenues is a good thing, 3PL companies have a number of supply chain challenges that affect both.
3PL’s Good And Bad
On the one hand, a booming economy means more freight, more shipments, and more revenue for 3PL and transportation companies. Spending increases in both the B2B and B2C markets. The threat of an upcoming recession is always a prediction during periods of high growth. But e-commerce has helped the high growth not only advance but continue.
But companies who ramp up manufacturing may find themselves with an excess of inventory through their supply chains that will impact truck volumes, especially if there is a stall or downturn in the economy.
Having a partnership with a Connecticut 3PL company helps companies to not only manage their supply chain logistics better but includes transparency through advanced logistics software. Customers can see where their shipments are headed in real-time and know where they are anywhere in the process. But according to the
Low unemployment has made it more difficult to find and hire both truck drivers and warehouse workers, leading to wage increases for both. Many companies simply pass along these costs to customers.
Additionally, the nationwide driver shortage can limit the amount of freight that can travel at any point. The new regulations on hours of service and ELD (electronic logging devices) have led to smaller transportation companies consolidating, being acquired by larger companies, or simply cease operations.
Effects Of The Pandemic
The US as well as other economies have all but stopped by the advent of COVID-19. Many people simply began working from home, while others have become unemployed. But instead of a shutdown, the US economy began to shift. Parts of the economy are still booming, and even more than before.
For 3PL companies, and indeed, the entire transportation industry, it’s even more than a booming economy. As consumers began buying increased amounts of basic household supplies, store shelves quickly emptied with no replenishment in sight. Normal manufacturing and distribution have been replaced by consumers snapping up everything as soon as they hit store shelves. Many stores have imposed limits on what each customer can purchase to help everyone get what they need, but many have still sold out quickly.
3PLs who deal in grocery products are particularly susceptible since many of their products are perishable and have a time limit on delivery. With many restaurants closed, grocery stores and fast food have become the focus of just-in-time delivery to keep foodstuffs moving into areas where they are needed.
Let 3PL Worldwide Be Your Supply Chain Partner
While companies ramp up to meet the demand, a strong supply chain is more important than ever. Having a Connecticut 3PL company to help manage the distribution of your company’s essential supplies means even more bustling activity along with increased revenues.
If your company has an increased need for help with your supply chain, call us. We can help with shipping, warehousing, delivery, and so much more. We also offer additional help such as call center services and bicoastal warehouse space in Connecticut. Based in Southern California, we serve supply chain customers nationwide. Contact us today to learn more at (877) 444-0002 or use our online contact form.