Make.Ship.Happen.® Part 1: 2023 Logistics Trends

At TA Services, we Make.Ship.Happen.® — that’s our promise to shippers and carriers. But what does it actually mean to Make Ship Happen? It’s more than just keeping up with the current logistics trends. For us, it’s a daily promise to go above and beyond for our carrier network and the shippers who partner with us. We go the extra mile, every mile for them because we know their success is our success.

We seek out opportunities, utilize our resources, and find ways to make the improbable possible. As we kick off the new year, we want to share how we will continue to Make Ship Happen in 2023 and beyond. To start, we’re sharing the trends we anticipate will shape the logistics industry this year — with a glimpse at our strategy for navigating those trends.

Top 3 Logistics Trends in 2023

1. Increased Operating Costs & Weakened Demand

Inflation continues to be a hot topic across all industries. One of the most notable impacts inflation has on the logistics industry is an increase in trucking companies’ operating costs. At the same time, consumers are starting to spend in ways they did pre-pandemic: more on services and less on goods.

This has caused the demand for trucking services to decrease. Increased operating costs combined with weakened demand mean lower profitability for many carriers. This will likely lead to some carriers closing shop or reducing their fleet size.

The recessive economy has also caused imports to decline, directly affecting the international shipping market. This is likely to continue due to the shift in consumer spending and today’s already high inventory levels.

When it comes to LTL, the softened market will likely put LTL carriers in a comfortable position, as opposed to running their networks in overdrive. We expect this year to be more balanced, with the shipper and LTL carrier having equal power in negotiations.

The weakened demand has led to lower rates, but as the supply decreases because of the economy’s impact on carriers, we anticipate a strong trucking market in 2024 and 2025. There is also the potential for demand to increase by the second half of 2023 — but it all depends on the severity and duration of a recession.

2. Loosening Warehousing Capacity

Many retailers wanted their goods housed closer to consumers during the 2022 holiday season, effectively increasing warehousing utilization during Q4. In the next 12 months, we anticipate that inflationary pressures to reduce inventory holding, the introduction of new warehouse space, and reduced demand will all lead to an increase in warehousing capacity.

The manufacturing sector is still trying to catch up with demand. Global supply chain issues have led to the unavailability of critical parts, causing assembly line challenges across the industry. In Q4 2022, this caused a surge in inventory holding of non-critical parts, reducing the availability of warehouse capacity.

We expect this tightness to remain during the first half of 2023 since supply chain issues will likely take time to resolve. The delay in resolution is driven by longer lead times for manufacturing parts therefore taking months for any inventory reduction to be realized. 

3. Increased Importance in Technology

With a softer market, technology will continue to play a critical role in supply chains as the industry looks for ways to create efficiencies, lower costs, and maintain earnings. Visibility is crucial, so more and more shippers require real-time tracking and integration. The industry has already made great strides toward the digitalization of logistics processes, and it’s not done yet. We expect to see many more innovations across all levels of the business, from data entry to pricing to routing.

Conquering the Logistics Trends of 2023

From inflation’s impact on shipping demand to shifts in warehousing capacity, it will be challenging for shippers and carriers alike to navigate 2023. At TA Services, we Make Ship Happen. We’re looking forward and planning ahead to overcome any challenges this year may bring.

With changes in the market, shippers should search for creative solutions to better serve their needs. At TA Services, we’re answering the call by being a full-service logistics partner.

In 2022, we expanded on multiple services — including cold chain, international shipping, third-party drop trailer solutions, and on-site management — to better serve the needs of the shippers who partner with us. In 2023, we will continue to deliver creative, value-adding solutions.

When we say we’ll make ship happen, that’s our promise to you. Ready to conquer the logistics trends of 2023 with TA Services? Contact us today!