Opinion: Don’t Say You Weren’t Warned

LI> The problem is getting worse over time.

LI> Fixing the problem would cost a lot now, but the benefits are in the future.

LI> Much of the benefit of addressing the problem at the present time lies in avoiding an uncertain future cost.

On that last point, even if it appears reasonable that such a future cost could very well be tremendous, many people are hesitant to budget a lesser, but still substantial amount of money today to achieve a future benefit that is not completely certain.

How does this relate to freight transportation? Check the Wall Street Journal or leading industry publications and you will read about concerns with capacity, port congestion and security. The infrastructure supporting the supply chain is overburdened — and in a way that fits the four points described above.

Barring an economic depression, the problems with lack of capacity in the motor carrier and rail sectors aren’t going to get better anytime soon — and certainly will not solve themselves. Congestion at ports will remain problematic, based on import-export activity that will continue to overwhelm them, at least on a seasonal basis. Security requirements related to commerce and trade will only continue to get more stringent.

This is all predictable.

The fact that thousands of shippers and carriers choose to sit on the sidelines and let only 10% of their colleagues — those belonging to major transportation trade associations — carry the water for them on these critical issues is absolutely shameful.

The situation is further compounded when you have thousands of high-ranking executives completely unaware of the potential impact these issues will have on their companies. The situation can get much worse — and probably will.

What are the practical implications of shipper and carrier apathy?

Consider the multiyear highway funding bill languishing before Congress.

urrent versions include billions of dollars of pork-barrel spending that have nothing to do with highway infrastructure. For now, Congress and the White House continue their debate about the size of the bill, further postponing the benefits of legislation that would be experienced by carriers, shippers and the public in years to come.

On the security front, the Transportation Security Administration has prescribed regulations dealing with the number of packages inspected — measures having a profound impact on shippers once they are implemented. You can also count on the government doing something about the fact that fewer than 5% of the containers coming into this country’s ports are inspected. That will have an impact on transit times and inventory levels for companies importing products from around the world.

There are still more examples of the impact of shipper and carrier apathy. Look at railroad infrastructure. Either the railroads will have to build a lot of new mainline capacity, or shippers must figure out how to move significantly more volume over the existing network. So when railroads impose quotas — as they did this summer and fall — it should not be a surprise. It’s entirely predictable.

And for those shippers that don’t care about rail because they don’t have rail shipments, where do you think the excess volume not moving by rail is going? It will move on trucks, exacerbating the motor carrier industry’s capacity situation.

For shippers and carriers sitting on the sidelines, there are two choices.

irst, step up to the plate and give your industry trade associations financial support and even personal and corporate involvement. These associations are great investments for you and your company. You get information and access to a network that keeps you in the know about the critical issues related to your industry.

The second option is for you to continue to sit on the sidelines while the game is being played. This may appear to be a safe strategy that will save some time and money, but it also has risks.

When your company gets hit with “predictable surprises,” you will be looking for solutions and strategies to avoid them in the future.

When your company experiences delays at ports, finds that your transportation costs have risen by 10% or more or learns that the critical shipment you needed has been hung up due to security issues, your customers and employees will come to you looking for answers. What will you do then?

Here is a word of caution: Don’t think it can’t happen to you. I’ve lost track of the number of people who have told me, “I never saw it coming.”

onsider this your wake-up call and remind yourself: “I can be part of the solution, or a casualty of the problem.”

You can still be surprised, but you can’t say you weren’t warned.

TranzAct, of Elmhurst, Ill., designs Internet-based transportation management software for shippers.

This story appeared in the Jan. 17 print edition of Transport Topics. Subscribe today.