The Scarbrough Journal:
Transportation Edition
Adam Hill
Chief Executive Officer
The Scarbrough Group
Welcome to the latest edition of the Scarbrough Journal. As we close out Q3 in a matter of days and head into Q4, we wanted to turn our focus to the domestic transportation industry and the role it plays not only in our country, but within Scarbrough as well. We will take a deep dive into our hometown (and Scarbrough's HQ), Kansas City, and its continued growth as a major transportation hub. Next, we explore the benefits of a brokerage relationship to manage cost, complexity, and the ever present need to find faster, more efficient shipping solutions (and frankly how we can fit into this mix). In closing, you will meet three of our leaders along with some of their insights into the coming quarter.
Thanks for reading and enjoy the issue!
DOMESTIC TRANSPORTATION TODAY
The pandemic taught us many lessons, but none more apparent than the critical role the domestic transportation industry plays in this country. It serves as the backbone of economic activity, plays a significant role in determining the nation's profitability, competitiveness, and support of sustainable everyday life. Domestic transportation is essential. It connects regions, cities, and communities across the country to ensure the seamless movement of goods from shippers to consumers. But managing this sector is becoming increasingly more complex. Beyond determining the right mix of roadways, railways, waterways, and air travel, shippers must control costs, meet increasingly tighter delivery timelines, compete for capacity, and embrace technology advancements. All while delivering the most cost-effective and efficient solutions for their businesses.
Shippers have multiple modes of transportation to choose from depending on the size of your inventory, the speed of delivery, and your cost threshold.
Full Truckload (FTL) is tailored for larger shipments that require an entire truck, ensuring exclusive use of the vehicle and faster delivery.
Less-Than-Truckload (LTL) is ideal for smaller shipments, where multiple shipments from various customers are consolidated into a single truck, optimizing capacity and cost efficiency.
Intermodal leverages the strengths of multiple modes, transitioning from trucks to trains or ships, and vice versa, to maximize efficiency and reduce environmental impact.
Parcel is best for shipping lighter, smaller boxed items, typically 100 pounds or less that can be moved without assistance.
As cost control is a primary concern for shippers, price is another crucial element to consider when determining your freight shipping method. Multiple factors impact pricing:
Class vs. Dimensional Pricing:
Though most freight pricing still utilizes classes (based on their characteristics, including density, stowability, handling ease, and liability), carriers are increasingly reweighing freight or using dimensionalizer technology (considers the volume or size of a shipment in addition to its weight) to get a more accurate read. This can lead to additional charges for the shipper if the class does not accurately represent the actual freight.
Capacity & Timing:
The tighter the pick-up window, the more capacity constraints shippers face. Pre-planning even a few days out can save significant costs. Disruptions in the market, such the potential for a UPS strike and Yellow’s closure, caused considerable capacity constraints and pricing impacts.
Loading & Unloading windows:
Carriers count on efficiency from shippers when they arrive at their docks. Prolonged time waiting to load or unload the assigned freight impacts each subsequent customer for the day. Repeated delays at a shipper can lead to rejected freight and a need to find another solution.
In addition to mode, price and capacity, the increasing adoption of e-commerce is transforming the supply chains of many businesses to accommodate for the surge in small parcel and last-mile delivery services. Shippers are adapting by optimizing their supply chains for faster and more convenient deliveries to meet the heightened expectations of online consumers. Moreover, there's a growing emphasis on sustainability and environmental responsibility, pushing shippers to explore greener transportation options, such as electric vehicles and more efficient routing.
Technology is also playing a substantial role in keeping up with modern consumer demand. Shippers are harnessing data analytics and artificial intelligence to gain real-time visibility into their shipments, enhance route optimization, and improve overall supply chain efficiency. Automation, including robotics and autonomous vehicles, is being increasingly integrated into warehousing and distribution centers, reducing labor costs and streamlining production processes. This has led to a reassessment of sourcing and production locations which has many considering the options of nearshoring or reshoring. The shift towards nearshoring and the relocation of companies from China is significantly impacting domestic transportation. These changes have led to shortened supply chains, increased regional transportation demand, and the need for more pliable, and structured logistics networks.
As we see all these ongoing advancements in technology, shifts in supply chain strategies, and evolving consumer expectations, the industry will need to continue to adapt and innovate. Moving forward, it's essential for stakeholders, including shippers, carriers, policymakers, and consumers, to collaborate and embrace sustainable, efficient, and resilient transportation solutions to meet the ever-changing demands of our interconnected world.
KANSAS CITY
A MIDWEST TRANSPORTATION HUB
Strategically positioned in the heart of America, Kansas City, Missouri, serves as a vital hub for the transportation industry. This growing metropolitan area owes much of its prominence in the world of transportation to its geographic location and historical legacy. Positioned at the confluence of the Missouri and Kansas Rivers, Kansas City has long been a crossroads for commerce and travel in the United States. Over time, it has evolved into a multifaceted transportation hub with a remarkable combination of road, rail, river, and air infrastructure that fuels the movement of a variety of goods across the nation.
KC SmartPort, the region’s industrial business attraction organization, promotes Kansas City as a leading North American manufacturing and logistics hub. Key components that make Kansas City an ideal location include:
KC Smartport
Kansas City’s geographic advantage is bolstered by a well-developed transportation infrastructure.
RAIL
Home to the largest rail center in the United States by tonnage with four Class 1 Rail Lines – BNSF, Canadian Pacific Kansas City Railway, Norfolk Southern, Union Pacific.
Interstate
Located at the intersection of four of the nation’s major interstate highways (I-35, I-70, I-29, I-49) with 30% more interstate miles per capita than any other city in the nation.
Air
The new Kansas City International Airport opened in February 2023 and moves more air cargo each year than any air center in a six-state region.
Intermodal
Extensive rail and highway infrastructure makes Kansas City an ideal location for intermodal activity and the city is home to four intermodal parks.
KC Smartport
The eCommerce community is taking notice of Kansas City’s transportation advantages as well. With 85% of the US population accessible within 1-2 business days, it is an ideal location for eCommerce distribution and fulfillment centers. Current companies with an existing presence in Kansas City include major retailers like Amazon, Chewy, Lowe’s, Home Depot, and Walmart. And in the last five years, eCommerce and distribution companies have pledged to invest $1.9 billion, create more than 10,650 jobs, and occupy 17.8 million square feet here. And with the available real estate, skilled workforce, low operating costs, abundant utility capacity, and fiber infrastructure, Kansas City growth should continue in the future.
Geographic advantages, the transportation infrastructure, and the continually expanding business community make Kansas City a natural fit for The Scarbrough Group’s headquarters, asset-based trucking operation, and 416,000 square foot warehousing facility. Kansas City remains a major transportation hub and is primed and ready for continued growth.
GET TO KNOW
SCARBROUGH TRANSPORTATION
As a shipper, deciding to use a brokerage vs. managing all logistics in house can be a daunting task. Beyond the change in mindset, we’ve all heard the horror stories of fly-by-night brokers burning shippers during the pandemic. A brokerage relationship can be beneficial as the pressure to reduce costs increases, complexities escalate, and finding faster, more efficient solutions is more important than ever.
Advantages can include:
Bid management – they handle it all, can save shippers money, and secure better contracts.
Capacity management – with a broker, shippers are not limited to their carrier’s capacity. They have an entire network of carriers to work with that equals more solutions, better pricing, and the ability to fulfill last-minute hot shots because we all know retail windows don’t move.
Staffing – shippers don’t have to flex their staff with volume needs or build a team to manage logistics internally. A quality brokerage is staffed with experts in the industry to manage it all.
Range of solutions – from FTL, LTL, and 3PL solutions.
Advanced technology – a TMS system to streamline daily tasks, provide visibility into freight, automate load tendering, and analytics to effectively reduce costs and accurately track transportation charges.
Beyond the benefits, the most important consideration is choosing a reputable, established brokerage to work with. At Scarbrough Transportation, we can be that partner. We offer nearly forty years of expertise to simplify the complexities of domestic transportation. Our freight brokerage process involves meticulous planning, leverages advanced technologies, and utilizes a vast network of carriers to ensure smooth and cost-effective transportation solutions. Our experienced team provides personalized attention to each client's unique needs, managing carrier selection, rate negotiation, bid process, and the overall optimization of transportation routes.
Our services include:
Full Truckload (FTL)
Less-than-Truckload (LTL)
Dedicated Drayage Management (DDM)
"By entrusting Scarbrough Transportation with your logistics needs, you gain a strategic partner that is well-equipped to navigate the complexities of domestic trade, optimize your transportation routes, and ultimately drive the success of your business."
Matt Wilcox
Director, Scarbrough Transportation
Scarbrough Transportation can work with shippers as a transactional broker or as a 3PL where we handle everything from origin to delivery. Our team is led by Matt Wilcox, Director, Scarbrough Transportation. Matt brings a holistic perspective to transportation having led teams on both the shipping and brokerage sides of the industry. When asked his advice for shippers now that he’s on this side of the desk, he laid out three main pieces to consider. “First, soak up the knowledge when it comes to the operational side of the equation. Second, keep an open mind when it comes to using a broker. And finally, come to your broker with all the information upfront. It will make for a cleaner process for everybody.”
Scarbrough Transportation will ensure that your supply chain operations are not just efficient but also responsive to the ever-evolving demands of the market. By entrusting us with your logistics needs, you gain a strategic partner that is well-equipped to navigate the complexities of domestic trade, optimize your transportation routes, and ultimately drive the success of your business. “We offer the expertise so you can sleep at night,” Matt Wilcox concludes.
AN INTERVIEW WITH
SCARBROUGH LEADERSHIP
UPCOMING EVENTS
& LATEST NEWS
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