Supply Chain and LTL

LTL means “less than load”. For those not in the know, a “load” means a full truck. Full trucks in the USA can be those huge 53 footers, or something smaller.

In industrial distribution for most products, we utilize LTL for the majority of our inventory. It’s a serious disaster right now.

I have been carping for the better part of a couple years about the issue. As with most things, there are several factors at play.

1) No new entries in the truck driving industry – we simply have a driver shortage, and have for a very long time. From what I am reading we are around eighty thousand short and the problem is only getting worse. All trades have this same issue. Kids growing up simply don’t want to do actual work, and would rather spend time making their money in front of screens or doing “soft labor” as I call it. Not that “soft labor” such as cutting hair or being an accountant are necessarily bad in and of themselves, mind you.

2) Nobody gives a f – this is harsh, but there it is. The work that is getting done, when it gets done in LTL is slow and sloppy. We have record amounts of damage and missing freight. It is absolutely maddening when you wait with these extended lead times for a specialized piece of equipment, and it finally arrives with a fork passed through the center.

3) I firmly believe that the cops, Teamsters and insurance companies have teamed up into a strange cabal to “slow roll” driverless vehicles. This is a bit of tinfoil had stuff I will admit but it is a theory I have had for a while. If we had driverless trucks a lot of these problems would be solved almost overnight, however there would be no speeding tickets to write, labor contracts to negotiate or premiums to collect. Well, virtually none anyways. This wouldn’t solve the issue of a lack of mechanics to service the vehicles, but that is grist for another post.

4) Lack of sense of urgency in government. As I have pounded the table on before, we need a “port team” or “transportation team” to get industry experts together, and start solving problems. Flying into LA and waving a magic wand over the ports, like has been done so far, is getting less than nothing done.

So the result is that we have this insane mess across the whole country. I have been trying to figure out ways to pick up freight that is within a reasonable range and trying other ideas such as even partnering with competitors or people outside of my industry to come up with a full truck to get a non stop delivery to the area.

A few anecdotal stories to end this rant.

I have a manufacturer that is 45 minutes from one of my stores. They sent out five pallets of stuff to me last Friday and it still isn’t here. The reason is that the trucking company has it parked at some sort of re-sorting facility as they lack drivers and need to consolidate their shipments. Meanwhile, people are getting cold.

This is an interesting article I spied the other day about a local chocolatier waiting forever for a skid of chocolate. I would bet a large amount of their extended lead time is transportation. It affects everything.

22 thoughts on “Supply Chain and LTL”

  1. Dan: “Nobody gives a f – this is harsh, but there it is.”

    It seems that is the more significant problem. As someone once noted — The battle can be lost in the general’s tent, but it can be won only on the front line. No number of additional trucks can compensate for casual handling of freight or careless dispatching.

    How to solve that problem? Maybe the answer is to take away the safety nets — government jobs as well as government handouts. We can’t afford them anyway.

    As a side comment, the number of big trucks thundering along the freeways today is staggering; I avoid freeways where possible simply because of that traffic. If we had more drivers and more trucks, the inadequacy of the freeway system would become even more apparent. We have enjoyed the benefits of global markets with their long-distance transportation for decades now; perhaps the costs of that system are now becoming more apparent.

  2. “we simply have a driver shortage, and have for a very long time. From what I am reading we are around eighty thousand short and the problem is only getting worse.”…if ‘Biden’ had been awake and interested in solving the problem, then back in July or August the government could have launched a program to promote people going into truck driving, and pressed states and federal bureaucrats to reduce bureaucratic obstacles to getting CDLs and establishing schools for the teaching of the required skills.

    I bet there are quite a few people who would give truck driving a try, in preference to their current fast-food or retail jobs, if given some inspiration and some pointers as to how to go about it. I met one kid a couple of years ago who had switched from fast-food to long-haul trucking; he was thrilled with his new career and was trying to persuade his friend to do likewise. Surely there are at least a few tens of thousand potential new drivers?

  3. I would agree with your assessment David and I love the way you use Biden in quote marks. I’m going to start doing that in the future.

    Truck driving could be the solution for a lot of inner city kids problems and get them the hell out of there as well.

  4. The biggest problem is this: They’ve sucked all the incentive out of it all. Why work your fingers off to the bone hauling containers out of Long Beach, when the companies running the operation are all out to chisel you out of every single dime they can, keeping you in what amounts to a modern-day sharecropping situation. It’s damn near indentured servitude, and then what do you have at the end of it all…?

    Government isn’t any better–The idiots running things have no more idea about the actual effect of their diktat than a flea grasps that it’s transmitting the bubonic plague when it bites you.

    No, not a damn thing is going to change until people look at jobs in trucking and say “Yeah, I could make a good living doing that…”. Right now, they’re doing the cost-benefit analysis, and the simple fact is, there’s no real incentive to make someone want to drive a truck or swing a hammer, rather than cut hair or draw welfare.

    As well, the idiots cut “child labor” out of the market, such that we’ve trained entire generations that “manual labor” is, and I quote: “Mexican’s work”. Guess what, vato? Your kids are ‘effing useless on the job site, most of them. It’s really astonishing how few can actually work, and the ones who can stand out like freakin’ sore thumbs because they’re the exception to the rule.

    It’s weird to be “that guy”, but I’m here to tell you, most of the things I’m noting about the “next generations” are sadly true. I think a lot of it has to do with the way parents have raised their kids by remote control, and never exposed them to any reality about the working world. I was running gas-powered chainsaws, lawn mowers, snowblowers, and all the rest when I was around 15. I’ve encountered manlets who’re 25, and who’ve never, ever had to operate any of that stuff, ‘cos Mommy and Daddy hired them some cheap labor down at Home Depot to do all that stuff whilst little Johnny and Sally played video games…

    Chickens come home to roost, darlin’s… You’ll pay the price. Literally.

  5. No one in the media knows anything about logistics. No elected officials know anything about it. We have Mayor Pete put into a position he is completely unqualified for (which admittedly, would be pretty much anything), and taking a multi-month vacation.

    I don’t believe for a second that there’s any conspiracy to stop driverless cars. All the hype from five or six years ago was total SV BS. The concept is straightforward, and getting it ~90% “right” is easy, but you have to have a 100% solution before you can deploy, and that (as I said at the time) is basically impossible.

  6. Driverless anything is not going to happen for a good, long time–Not out in the wild, on open roads. The liability lawsuits will see to that. The other problem is this–Who will be the responsible party, when there’s an accident? The programmer? The manufacturer? The people who service the cars and trucks? The owners?

    Yeah, until and unless that shakes out with an economic solution, it won’t happen. All it will take is a major accident and someone like Hertz or Tesla being sued into penury for that lesson to be learned, and then people are going to go back to the status quo.

    Right now, the situation is that if you’re a bad driver? The car company, the maintenance guys, and all the rest are essentially immune from all but the most egregious misconduct. Add in software and systems to drive with? LOL… It’ll be epic. For the lawyers.

  7. Obviously the answer is that Pfizer needs to build an electric car, and call it a vaccine against automobile accidents, and boom, they’ll have complete liability protection…

  8. I was an automation engineer in a previous career. Self-driving is incredibly difficult. We can’t even fully automate trains, and they run on tracks. Removing pilots from commercial aviation would be easier. When self-driving vehicles are fully implemented in a captive environment, like a large retirement village or spotting trailers at a large factory, we will be getting closer.

    Economics holds the solution to a truck driver shortage. Pay them more or treat them better. Does anyone object to a truck driver making $600 per day? Yes, the college educated mid-level bureaucrat who makes $80 K per year can’t believe some lunkhead with a CDL can make more.

    We should expect a federal Department of Transportation that is actually effective. Unfortunately, the California ports are in crazy town. I hate to say it, but perhaps the state of California can’t have full authority over a national security asset like the Ports of Los Angeles and Long Beach.

  9. First: Driving a truck, just like any job, isn’t for everyone. Depending on the particular job, it can be very physically demanding. How many here could get a couple of hundred pounds of tarp to the top of a flatbed load and spread it out 13′ off the ground in bad weather? Do you really like spending 12-14 hours a day driving with just the radio for company? Etc.

    Second: Do you have a clean MVR. No more than two moving violations in the last three years, no serious (DUI,DWI, Reckless) in the last 5 years?

    Third: do you have a clean criminal record? No felonies or only long past. Even misdemeanors are a problem. Especially drugs and booze. You will be drug tested often.

    Fourth: Are you willing to spend a few years doing the crap hauls? The good deals are already taken by drivers that have spent ten or twenty years learning the ropes. They get their choice, you won’t.

    Driving a truck is one of those very weird jobs where a lot of the drivers would pay to do it and believe me, a lot do, one way or another. Flying an airplane and cowboying are the same way.

    Twenty years ago, I had just enough experience driving, waiting for the truck to find a new way to break down and avoiding all the suicidal idiots to make me sure that I’m not one to do it.

    A lot of the big trucking companies will hire to train, they have their own schools and training drivers (another job I had a taste of, no thanks).

    How many inner city youths can cut it, I have no idea. Lack of self motivation and impulse control is likely to be a problem.

  10. “I have a manufacturer that is 45 minutes from one of my stores.”

    Knowing the problems with LTL shipping, why did you not go with a truck and take delivery at the factory?

  11. I had dinner with my stepson last night. He is a contractor building custom houses in Oregon. He said he is building four houses now with, basically, two crews. He can’t get workers. One of the common problems I have heard of is getting the new hire to show up the second day. I agree that kids don’t want to work hard. I have a feeling that medical students have changed, speaking of my own career, and do not want to put in the hours required for some specialties. It seems a societal problem.

  12. Thirty years ago I worked at a unionized store, stocking groceries. In my time there the top rate for that job went from $12.xx and to $8.xx an hour. I literally could eat anything I wanted and not gain any weight. In fact I lost about 20 pounds while I was there. Turnover was high. Then, jobs started opening up with higher paying employers and many people left. I presume the company was able to replace them.

    I further presume the subset of people willing to do hard physical labor for low and dropping wages was relatively small then and is smaller now. Plus, that was pre-NAFTA.

    If you want people to work, you have to pay them. If you aren’t getting people to come back on day two, you aren’t paying them enough.

    I suspect a key component of the societal problem is that wages are now too low to attract willing workers.

    If the regime can’t import enough willing foreigners to fill these jobs, they stay unfilled.

  13. It’s a self-reinforcing circle of crap, and when you go to look at the “why”, much of it stems from well-meaning government intervention that doesn’t really actually do much to help people–But, it does serve to cycle a lot of money through the clawing hands of the useless mouths in government.

    Friend of mine in contracting pointed out that the OSHA BS that you have to have compliance with actually winds up costing enough money that some companies can’t afford to comply and still make a profit; they then go to subcontractors who don’t follow the rules and who hire illegals. Those subcontractors often bribe the inspectors, which… You get the idea.

    Some interventions are net positives, and even necessary. The problem is that once you’ve plucked all the low-hanging fruit, as an agency, you have nothing to do to justify your existence–Except, to go after more and more esoteric and expensive crap to enforce. Which drives up costs, but you don’t care, ‘cos you ain’t suffering from the lost jobs and opportunities.

    The whole thing is an interlocking descent into a hell-world of obfuscated cause-and-effect that creates massive economic destruction, when compared to companies that can do business where such internecine self-destructiveness isn’t common. Big reason everyone gravitated to China, industrially? There. Were. No. Rules. Not that anyone enforced, anyway…

    You have to have a balance; some regulation and control is required, given human nature. However, also given human nature…? You have to have controls on the controls, or you’re going to wind up unable to function inside the straightjacket you’ve woven for yourself.

  14. Which drives up costs, but you don’t care, ‘cos you ain’t suffering from the lost jobs and opportunities.

    Which is why I no longer can regard the endless meddling by bureaucrats as “well-meaning.”

    There’s a documentary that used to be on Youtube-and maybe still is- about the end-Permian mass extinction. At some point some scientists found a good sequence of sedimentary rock which covered the event from beginning to end. They interviewed one of the scientists involved, and he says something like, “first this group of animals disappeared, followed a few thousand years later by that group, and then the whole food chain collapsed.”

    I keep thinking of that quote in the context of the US economy- first, manufacturing disappeared, followed up by the expansion of service jobs and welfare. Then the wages for the service jobs dropped too low to attract workers, and the 80k/year bureaucrats hated and resented the people who made more money than they did, so they deliberately created a hell-world of regulations just to fsck with them. And then the whole thing collapsed, because it turns out truck drivers are important.

    Who knew? Not OSHA inspectors, is my guess.

    …or you’re going to wind up unable to function inside the straightjacket you’ve woven for yourself.

    Considering that the US has apparently lost the ability to put food on grocery store shelves or deliver spare parts, I’d say we’re just about there.

  15. Xennady, it’s a choice we made. One that can be unmade.

    You wonder how it was that the Mafia took over in Southern Italy, and reigned supreme for generations; this crap is why. When the open market cannot or will not provide because of onerous government intervention, then the alternatives will spring up.

    The irony here is that organized crime really got going in North America due to another ill-thought “market intervention”, that of Prohibition. What will likely happen in the case that the current government doesn’t unfsck itself is that you’re going to start see organized crime going “Hmm. Opportunity knocks…”, and you’ll be sitting there in Cleveland waiting for your containers of industrial parts to come off a ship in Long Beach, when a helpful man calls you up and say “Hey, your supply chain is fscked, ‘cos Customs and all the BS California bureaucrats put into effect… How’s about we do a deal, here?”.

    Then, if you take them up on it, threats will be made, rules broken, and your containers show up. And, we’re on our way to Clown World, where everybody but the actual productive people are making profit off of the ridiculousness involved.

    It’s a stage on the way to civilizational irrelevance, but it’s one we’re making the choice to go in to. Frankly, I think it would be better to fire all these officious bureaucrats and then cut down the forests of red tape they’ve been cultivating, but that’s me.

    It is the result of choices made, however, and we could very well turn back from the precipice, were we willing. That’s another choice.

  16. Kirk…”you’ll be sitting there in Cleveland waiting for your containers of industrial parts to come off a ship in Long Beach, when a helpful man calls you up and say “Hey, your supply chain is fscked, ‘cos Customs and all the BS California bureaucrats put into effect… How’s about we do a deal, here?”.

    People who tried to run enterprises in the Soviet Union were very familiar, by necessity, with this way of doing business. Gennady Andreev-Khomiakov was deputy manager of a Stalin-era factory, a sawmill, which was being strangled by inability to procure raw lumber. Gennady, whose father had been in the lumber trade before the revolution, was contemptuous of the chaos into which the industry had been reduced by the Soviets:

    “The free and “unplanned” and therefore ostensibly chaotic character of lumber production before the revolution in reality possessed a definite order. As the season approached, hundreds of thousands of forest workers gathered in small artels of loggers, rafters, and floaters, hired themselves out to entrepreneurs through their foremen, and got all the work done. The Bolsheviks, concerned with “putting order” into life and organizing it according to their single scheme, destroyed that order and introduced their own–and arrived at complete chaos in lumbering.”

    As Gennady says:

    “Such in the immutable law. The forceful subordination of life’s variety into a single mold will be avenged by that variety’s becoming nothing but chaos and disorder.”

  17. “it’s a choice we made. One that can be unmade”

    Given that the law of unintended consequences and the capture theory of regulation are operable, unmaking it is no small feat. Given the bureaucratic state’s power and vested interest and the general public’s disinterest in and ignorance of the diffused costs of such regulation and government guarantees of market power to powerful supporters, I wonder what it takes.

    The current structural issues in the supply side of the economy didn’t happen over night and shows the mark of systemic inefficiencies first slowly then greatly accelerating. Thinking that such a crisis as we have now would cause a sober look at bureaucratic and monopoly market distortions looks to me to be wishful thinking. It seems to me that every macro crisis we endure is answered by popular support for experts and elites to “do something”. Which means more regulatory control, buckets of ill-spent money and deeper distortions. If the system utterly fails, government control will be the expedient solution to the call of “do something”.

    I didn’t choose this current or past path to fracturing our economy and most of those that did support the actions that have caused it did not want this outcome, Ignorance has karma. We are so far down this path that I wonder how we can actually unmake it. Donald didn’t and even a earthquake in 2022 elections will still have the pay-to-play in firm control.

    Death6

  18. One that can be unmade.

    This is very easy to write, harder to accomplish.

    Then, if you take them up on it, threats will be made, rules broken, and your containers show up.

    Or they just steal your stuff and make you pay twice for it. Or sell it to someone else. Or start their own business with it.

    It is the result of choices made, however, and we could very well turn back from the precipice, were we willing. That’s another choice.

    You keep writing things like this, as if people suddenly decided to choose empty grocery shelves and no spare parts.

    I think not. I thoroughly believe the 2020 election was stolen, thus demonstrating that people didn’t choose the present regime in the first place. And since 2020 I’ve come to strongly suspect prior elections were equally “fortified,” to borrow from the infamous regime media puff piece boasting about the fraud.

    In any case, despite any fraud, the left has been thrown out office multiple times only to have the Gee Ohhh Peeee ensure the country was kept on the wrong track. When this process finally failed and Trump became president, the party worked hard to fight him at every turn and then conspired with the left to get him removed from office.

    Bluntly, merely saying all this is a choice a that can be unmade is like saying the Cambodians could have chosen to remove Pol Pot, or the Russians could have just decided to remove Stalin.

    Again, easy to write, harder to do.

  19. Xennady: “easy to write, harder to do.”

    Sadly, we do not have to do anything to end the foolishness. That which cannot continue … won’t! We know the current path is unsustainable. What we don’t know is the mechanism which will lead to the collapse of the present dysfunctional system. However, we do know with total certainty that the end of the current system will cause a whole lot of pain & grief.

    There are many “White Swans” headed our way. Maybe hyper-inflation. Maybe collapse of the dollar exchange rate. Maybe collapse of the electric grid one cold winter night when the bird-whackers are not turning and the solar panels are sitting there useless. Maybe contagion from European problems. Maybe embargoes by exporters. Maybe even an actual genuine pandemic. But one way or another, the current system will come to an end. Maybe sooner, maybe later, but it will end. And we do not have to do a thing to bring it to an end.

    The tragedy is that even if we did all get together and try to avoid collapse, the cure would still be very painful for many people.

  20. …the cure would still be very painful for many people.

    All true- but I’d like to make mention of how much pain there already has been and how much damage has already taken place.

    I suspect that the reason why things are failing now in the way they are is because that damage already done has finally reached the point where it simply can’t be routed around anymore.

    I admit this is not a new insight, certainly not here. But just ponder how awfully the working people of the US have been treated by the regime.

    Note how the recent illegal “vaccine” mandate was applied to something like 80 million employed people- but not illegal aliens or welfare recipients. Note also that the regime was distributing infected illegals in Florida and Texas and probably elsewhere.

    The departure of productive industries from the country has often been discussed here. Note that this has now been happening for generations, with the casual indifference of the US government, which is essentially the only agency capable of interceding properly against foreign mercantilism. The people who lost their jobs or businesses get nasty contempt from the regime, as an added bonus.

    Note that medications that are cheap in foreign countries and often over-the-counter are here ruinously expensive- but we paid to develop them.

    Note the casual contempt displayed for the people who lost their businesses to leftist rioters last year- rioters who were usually let off without punishment- compared to the treatment of the people who were at the capitol on 1/6- most still in prison, without charges. Note the treatment of Kyle Rittenhouse, compared to the treatment of the guy who admitted on the stand of threatening him with an illegal gun.

    I think I could go on for a few hundred thousand more words, but I hope this enough to make my point.

    So if there is yet more pain to be bestowed, I know exactly who should get it and how hard.

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