October 26 2023 | 8 Min Read

The LTL market is evolving – how to open the door to efficiencies

Posted By
Wendy Mackenzie
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The LTL market is evolving – how to open the door to efficiencies
Supply chains across the US have been in disarray since Yellow Corp announced its bankruptcy in 2023. Unlike the truckload market, which has many, many more available carriers compared to LTL, LTL shipping changed overnight. Simple shipping tasks suddenly became treacherous and unpredictable. And what the market was expected to do at the sunset of 2023 quickly changed.

Of course, there isn’t some neat situational bookend between Yellow’s exit from the market and now. It’s still happening. Whenever an unforeseen big supply chain event happens, there’s the first shockwave of disruption, and then there’s the aftereffects. Response rebounds off response, sending discordant vibrations through the vast mesh of interdependencies that form our global supply chain, affecting transportation services from the first to last mile delivery needs. 

It’s a complex time for LTL. Let’s drill down into that complexity and look at a few ways you can better manage a way forward.

The inevitable churn only…churnier

Right now, about 35% of US companies are looking for a better LTL fit, according to a late 2023 report by investment firm, Morgan Stanley, shared by FreightWaves. The market trends do not favor stability, and the market size isn’t large enough, so far as LTL is concerned, to fully absorb and redirect LTL shipments so easily. 

That churn makes sense, given how many shippers had little choice but to rush into temporary relationships with new carriers In the weeks following Yellow’s departure from the market.

Despite that churn, other Morgan Stanley statistics paint an optimistic picture of LTL reliability. 

When shippers were asked to quantify their level of satisfaction with their current LTL service, the great majority gave a favorable account. Around 39% of respondents reported being very happy, and the majority – 60% – indicated they were at least somewhat happy. This is a remarkably solid state of affairs given the marketwide shake-up. And it bodes well for what comes next.

pallet within the LTL market that looks unsteadyNevertheless, right now, many shippers are dealing with a temporary square-peg, round-hole situation. An already pretty bouncy market is in a state of flux, and that’ll take time to settle.

If you’re one such company, you’re likely dealing with a battery of unfamiliar (or differently familiar!) problems — new classification requirements, unexpected pickup delays, and hidden costs, to name just a few.

You might also be dealing with a general overall efficiency drain that’s hard to put a finger on: a general overall lack of supply chain efficiency that drains away your time and freight budget in gradual, frustrating increments.

Navigating the LTL market churn with IL2000

Here’s the bottom line. With the current market churn, the work of optimizing your supply chain will be more competitive, more confusing, more shrouded in shifting contingencies.

And this brings us to the first big reason for why now is a perfect time to bring IL2000 to your table. We have established relationships with LTL carriers all across the US. We have firm, reliable, and ever-evolving data on which of these carriers do best with what lanes. We can pick up the phone and talk to real people about real things, effectively shortcutting your way through the shipment process. On top of that, we can negotiate carrier rates you won't get on your own.

IL2000 can guide you through the churn to efficient and cost-effective carrier relationships.

A changing of the guard

Enough about churn. Let’s talk about what lies beyond that.

It’s worth hanging a bell off the kinds of companies that gobbled up the market share in the wake of Yellow exiting the market. Transit times have led some players to purchase Yellow terminals and equipment. Others are waiting to see exactly how the closure affects LTL lines across North America. It’s a unique situation with an ongoing change in demand. 

While a ton of shipping business went out to the big-player carriers, many shippers took a different route — opting instead to entrust their shipments to local players. This surprised more than a few people.

Home-town advantage prevailed. So what?

This turn of events goes quite a bit deeper than that. What we’re experiencing now represents a changing of the guard.

The Big 5 ubiquitous shipping companies losing ground to regionally specific shipping infrastructure is a potent reflection of where supply chain management is headed. Now more than ever, we’re seeing that supply chains matter. An inefficient shipping operation can scuttle a company’s profitability and open the door wide for the competition. To stay on top of their inbound and outbound, companies are looking to get more granular, more focused, and more bang for their supply chain buck.

The problem, of course, is that all that organizational precision is a two-edged sword. Out on the open road, a Porsche goes faster than a Prius. It also requires a lot more skill to drive.

IL2000 and the open road

LTL Truck on open road_small

Post Yellow, as LTL transportation settles into a new groove, the companies seeking the greatest levels of supply chain efficiency will be working with many shifting variables.

They’ll need to maintain a carefully selected pool of carriers that changes dynamically over time. They’ll place a high premium on data and insight. They’ll have powerful and customized BI tools to keep watch over what is moving where and measures in place to react swiftly when the situation demands. 

If all that efficiency sounds like a lot of extra work, that’s because it is! We specialize in doing that work for clients across a broad cross-section of industries. Our team and approach are built on 25 years of industry experience, BI, and our TMS tools that we customize to the use case of each and every client.

We’re able to help you choose the right carrier and offer around-the-clock support to make sure your shipments move quickly and smoothly to their destination.

Make the future a road to successful shipping

LTL has always been volatile, and that volatility looks set to compound as shippers and carriers adjust to life in the new carrier market. IL2000 can help your supply chain stay agile and responsive with industry-leading tools and decades of shipping expertise.

Contact IL2000 to schedule your no-obligation consultation.

Topics: Supply Chain Management, Freight Costs, Business Intelligence, LTL

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