It looks like e-commerce is set to have another record year. Between the pandemic and fourth-quarter sales, more people and businesses are purchasing items online. The trend has caused an increase in demand for LTL drivers, and in some areas, shippers are fighting for drivers. Yet beyond the trend, e-commerce is transforming LTL motor carriers.
Increased Rates for LTL Haulers
LTL rates have been rising since late spring, giving shipping companies more leverage in pricing negotiations. While it’s been clear that e-commerce is here to stay, trucking companies are outfitting their fleets for more LTL shipments to take advantage of the potential revenue opportunities. Businesses that do not have their own fleets will be relying more on outside shippers to deliver goods purchased online.
A New LTL Sector
“Consumer LTL” is the phrase being tossed around for trucking companies that are expanding their services to meet the demands of e-commerce. This new LTL sector provides the “last mile” service that consumers are looking for, so they can receive shipments at their door. Some fleets are even offering to bring items inside (while wearing masks and PPE) for larger items, such as appliances. Currently, consumer LTL is being performed by larger trucking companies that are working with smaller, local fleets in order to reach areas that previously weren’t covered by drivers. This crossover could very well transform into a freight sector of it its very own, dedicated to e-commerce deliveries.
A New Age of Transparency
Many of the new LTL offshoots are taking their cues from big shippers like Amazon, UPS, and FedEx. Customers need to be able to track their items down to the street level if possible. This means LTL carriers will have to invest in technology to provide the transparency that customers demand, and to stay competitive with other shipping companies.
The Need for Capital
Right now, the LTL rush is attracting existing carriers that want to tap into a new market, as well as owner-operators who want to launch their own carrier companies. At Single Point Capital, we help fleet owners build up capital with our factoring services, which turn unpaid invoices to cash within a single day. We also help our clients with the forms, permits, and paperwork necessary to launch their own trucking companies. If you want to explore the opportunities offered by the new surge of LTL trucking, and improve your cash flow to ensure long-term success, contact the team at Single Point Capital today.