Posts Tagged “Keeping It Fresh”
By Makenna Christensen ALC Logistics
California’s requirements for zero-energy fleets may be on hold, but the push to electrify the transportation industry is far from over. In March, the U.S. Environmental Protection Agency released new emission standards, outlining limits on carbon dioxide emissions that become increasingly stringent each year from 2027 to 2032. While these regulations are well-intentioned, forcing carriers to comply with unreasonable standards will have impacts far beyond the transportation industry.
As of April 2023, there were over 750,000 active motor carriers in the U.S., 95.8% of whom operate 10 or fewer trucks. These small businesses are the backbone of our economy. Without them, store shelves would be empty and we would struggle to find food to put on our tables. Look no further than the 2021 global supply chain crisis to see what happens when shipping demand outpaces truck supply. Like every other business, trucking companies must minimize costs to maximize profitability. When the annual cost of operating battery-electric big rigs is about twice as expensive as diesel trucks, the transition to zero-emission fleets becomes fiscally impossible for some companies. Add-on government mandates, like those in California, and you have a recipe for disaster.
Battery-electric is not the only zero-emission fuel source. Some long-haul drivers have turned to hydrogen fuel as an alternative since it allows them to travel lighter, farther, and faster. However, a lack of fueling infrastructure and large costs associated with ownership are serious barriers to adoption.
Beyond the immediate impacts, the shift to zero-emission trucks will have financial repercussions on millions of consumers. According to a March 2024 study, “The charging infrastructure for a nationwide fleet of 100% electric trucks – from delivery trucks to big rigs – will cost $622 billion.” Further analysis suggests the additional cost will be passed along to consumers, adding approximately 0.5% to 1% to overall inflation. For a nation already waist deep in debt, I’m not sure we can handle that burden.
The goal to cut carbon emissions is desirable, but forcing small businesses into bankruptcy gets us nowhere. If legislators want to enable lasting change, they need to slow down and focus on smaller, more economically sound solutions to our climate crisis. Compressed natural gas (CNG) has been found to reduce tailpipe greenhouse gas emissions by about 20% and could be a welcome alternative to diesel since it is widely available and affordable. Further, the adoption of diesel-electric and gasoline-electric hybrid trucks could help the transition to zero-emissions fleets without bringing our supply chain and economy to a halt. We may not currently know all the answers, but when we empower small businesses to take action we can do just about anything.
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Makenna Christensen graduated from Marquette University in 2022 with a Bachelor of Science in Marketing and Human Resources. In July 2022, she began working as a Software Sales Coordinator for ALC Logistics, the software division of the Allen Lund Company. She joined the Fresh Produce & Floral Council’s Apprentice program in April 2024.
makenna.christensen@alclogistics.com
By Iyer Amruthur ALC San Antonio
Cargo theft in the transportation industry is a long-standing, but rapidly growing issue. One of the most frequent occurrences of cargo theft is during the trade between the U.S. and Mexico. Statistics show up to 49 truckers are assaulted in some fashion in Mexico each day. Other harrowing data shows that at least 50 drivers were killed in 2023 alone.
Starting on February 5, 2024, thousands of drivers from 15 of the largest carrier organizations set out on strike. The goal of the organizers was to seek more patrols from Mexico’s National Guard on roads with a high incidence of theft, more stringent penalties against cargo thieves, and increased support for the families of truckers affected. They ultimately sought to secure common roads and travel for all law-abiding parties, while cracking down on illegal activity.
Another strike penned for August by truck drivers belonging to the Mexican Alliance of Carrier Organizations (Asociación Mexicana de Organizaciones de Transportistas A.C. – AMOTAC) and others was postponed through promises the federal authorities made to increase roadway security measures. This included agreements reached by AMOTAC and authorities, including Mexico’s National Guard, to hold monthly meetings with trucking officials to create enhanced safety measures to combat cargo theft.
However, despite the effort, crime continues to rise. Cargo theft cases increased 4% year over year in 2023 to 9,181 incidents, including 7,862 cases that involved violence. Members of AMOTAC and other trucking organizations held demonstrations on the Mexico-Queretaro federal highway (one of the largest U.S.-Mexico highways for commercial transport) to protest road insecurities.
With tech developments and the continued pressure from multiple parties to secure transit between the U.S. and Mexico, we all hope to see progress and attempts to reduce crime, keep our drivers safe, and get product from point A to point B.
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Iyer Amruthur is a national sales manager in the ALC San Antonio office and has been with the company for three years. He attended The University of Georgia where he obtained a Bachelor’s Degree in Marketing, with a minor in Communications.
iyer.amruthur@allenlund.com
By Josh Rivera, ALC St. Louis
Everyday, we hear more and more about how AI is being implemented in all sorts of industries across the globe. There is a need to automate certain processes in all aspects of business to increase efficiency, especially in the logistics industry. Though we are in the early stages of adopting AI and learning where it can provide the most benefit, we are already seeing some of this technology in warehouse automation and robotics and the early stages of driverless vehicles. AI can assist in data collection and analytics to provide real-time information.
In Bart De Muynck’ Forbes article The True Role of AI in Logistics, he states, “AI is being used to improve data quality, generate data through Generative AI when real data is not available and provide valuable insights through predictions (like an ETA or dwell times) or forecasts (available capacity of assets or at ports). By implementing real-time visibility, companies can share information, updates, and forecasts with suppliers, customers, and partners.” We know AI can offer much but, just like everything else, it’s not perfect. Transportation is and will remain a human central function, but paired with AI technology can propel the industry forward. The key is for companies to stop looking in the past, and use this information to help predict and adjust for the future.
Even in the early stages, AI is demonstrating its value in the logistics industry. As time progresses, its capabilities will only improve. It’s only a matter of time before we witness its widespread adoption. AI’s limitless potential is a compelling prospect for every industry, including logistics, in managing and optimizing their supply chains.
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Josh Rivera studied at Western Illinois University where he received a BA in Marketing. Josh has been working in the ALC St. Louis office for six years as a transportation broker. Out of the office, he is a musician who enjoys playing the drums and ukulele. He has two dogs, Bella and Louie, who love to play and keep him busy.
josh.rivera@allenlund.com
By Matt Barnes ALC Human Resources
The impact of the 2020 pandemic on the job market reverberates to this day. In 2024, global conflicts, supply chain disruptions, the double-edged sword of technological advances, and remote/hybrid opportunities amplify the sensation that recruiting and retention are more challenging than ever in this ever-changing, roller-coaster landscape. How do companies cope?
In 2021, as resignations surged and companies faced critical labor shortages, impacted employers responded with raises, signing bonuses, and perks to boost employee wellness. This created short-term peaks in starting salary ranges that trickled beyond the most affected industries. As a result, Americans quit 6.1 million fewer jobs in 2023 compared to the previous year, a 12% decrease, and 353,000 jobs were added in January 2024. The unemployment rate stayed at 3.7%, just above a half-century low. These numbers point to a strengthening economy, but just when the data indicates stabilization, the media is reporting mass layoffs at major companies, with predictions of more to come, plus smaller pay increases and hiring slowdowns in certain sectors as large organizations struggle to scale up with the “new normal.” The annual turnover rate for the transportation industry consistently hovers around 50%. This speaks to the volatility of the job market, meaning the “job-hopping” trend doesn’t look to end soon as employees frightened by potential layoffs look for opportunities to secure a more reliable future.
Hiring and retaining good employees has never been an easy task. This is all the more so during turbulent social, political, or economic times. Lucky for ALC, all of those factors are in play in 2024.
Wait, did I say “lucky”?
That’s right. And I’ll double down on it.
In his book, “The Obstacle is The Way,” NY Times bestselling author, Ryan Holiday writes, “You never want a serious crisis to go to waste. Things that we had postponed for too long, that were long-term, are now immediate and must be dealt with. Crisis provides the opportunity for us to do things that you could not do before… In fact, half of the companies in the Fortune 500 were started during a bear market or recession.”
To quote former Intel CEO, Andy Grove, on what happens to businesses in tumultuous times: “Bad companies are destroyed by crisis. Good companies survive them. Great companies are improved by them.”
The companies with the biggest advantage in such a climate have great benefits, culture, and proven stability resulting from sound financial practices, expansion, and opportunities for internal career growth. A quick check of ALC’s recent internal communications (celebrating 20 and 25 year anniversaries, advertising new positions and growth opportunities) and a look at the Managers’ Meeting agenda tells the story of a company perfectly positioned to seize the advantage of a job market in flux and provide opportunities to job seekers on the hunt for long term security.
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Matt Barnes has worked in HR, Recruiting, and Personnel Development for 27 years across multiple industries including Manufacturing, Engineering, Healthcare, and Transportation. Matt was hired by ALC in 2022, and promoted to Sr. Director of Human Resources the following year. A graduate of the University of Wyoming, and a native of Tennessee, Matt has used his diverse background and experiences to develop expertise in domestic and international talent acquisition, team building, labor law, employee relations, conflict resolution, and organizational design.
matt.barnes@allenlund.com
By Isabella Silva, ALC Marketing Coordinator
Recent storms in California have significantly impacted agricultural operations. However, the U.S. Department of Agriculture (USDA) is ready with technical and financial assistance to aid farmers and livestock producers in recovering from these adverse weather events. California’s agricultural sector has demonstrated remarkable resilience, supported by infrastructure enhancements, crop diversification, government assistance programs, and ongoing research and innovation efforts. It’s fascinating to note that California was in a severe drought just three years ago, highlighting the striking contrast in weather patterns. Nevertheless, both extremes resulted in similar agricultural shifts, noting the industry’s adaptability. This article explores the sector’s recovery from floods and projects California’s demand for refrigerated trucks.
According to the UC Agriculture and Natural Resources, investments in infrastructure, such as levees and irrigation systems, have played a crucial role in mitigating flood damage and protecting agricultural lands. Farmers in California have implemented crop diversification strategies by planting flood-tolerant varieties to minimize losses. Partnering with Full Belly Farm in Yolo County, California, the USDA California Climate Hub conducted an extensive case study emphasizing adaptation planning practices as opportunities to alleviate the impacts of extreme weather conditions. Their focus on building soil organic matter not only improves crop fertility, but also increases soil water retention and holding capacity. Ongoing research endeavors aim to develop flood-resistant crop varieties and innovative farming techniques, further enhancing the industry’s resilience against future flood events. As government-sponsored insurance and assistance programs offer crucial financial support to farmers, it’s important to see how this reflects the transportation industry.
DAT reported citrus, almonds, avocado, and strawberry crops are expected to be impacted and have already contributed to 84% fewer truckloads of produce compared to this time last year. However, there’s still ample time for the 2024 produce season to regain its momentum, even with the national produce volumes down 17% from last year. With more resources, solutions, and research each year, California is continually improving its ability to address flooding challenges. This suggests a potential increase in the demand for refrigerated trucks in California’s agricultural supply chain, a positive sign for the industry’s recovery.
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Isabella Silva graduated from St. Edward’s University in 2022 with a BA in Communication, complemented by minors in Psychology and Health Communication. In July of the same year, she began her career at the Allen Lund Company in the Marketing department. Isabella is set to start her MS in Public Relations Innovation, Strategy, and Management at the University of Southern California in May.
isabella.silva@allenlund.com
By Fernando Dominguez ALC San Francisco
The Transportation industry is more than just getting products from point A to point B. There are myriad factors to consider, from the product itself and the agricultural regulations it abides by to the equipment utilized and the laws that govern it. Most importantly, but arguably the most overlooked factor in this industry, are the laws, rules, and regulations that create the foundation under which many products are cultivated. Being part of a national transportation brokerage and working in the San Francisco office, whose main niche is in produce, we are consistently watchful for changes in regulations and shifts in the market. They have the potential to affect both the customers we conduct business with and the carrier companies that relentlessly move product from coast to coast. I am part of a team that must shift and pivot in an industry full of change, but with change comes bountiful opportunities.
There have been numerous occasions where changes in agriculture and consumer spending have led customers and carriers to adjust their daily procedures to keep up with demand. Most recently, the USDA Announced Temporary Suspension of the Continuance Referendum Requirement for California Raisins. This has the potential to change how much grapes are moved throughout the country. Subsequently, other produce products grown in California will be impacted, as this action amends a marketing order affecting growers and handlers of grapes (of whom presently, there are approximately 18 handlers of raisins subject to regulation under the Order and approximately 2,000 raisin producers in the regulated area). Keeping track of regulatory changes is extremely important because they enable multiple entities to regulate the cultivation and distribution processes. Additionally, it’s crucial to understand the financial effects of these changes. Any time there is a change of this magnitude in the transportation industry, it has the potential to change customer buying projections, bids on specific lanes, and carrier shifts in certain geographical regions. It even changes the compliance that drivers must adhere to when loading at specific shippers.
I take pride in contributing to an industry that ensures Americans have access to high-quality goods and efficient resource distribution. Our direct involvement in this dynamic system allows us to continuously sharpen our skills and thrive amidst challenges. These challenges foster team cohesion and offer unparalleled opportunities for career growth. The next time I go to the grocery store and see a display of grapes or raisins, I will know that many people and businesses made a tremendous effort to cultivate, supply, and distribute them even through changing regulations. At ALC, we’re committed to upholding our core values of integrity, dependability, service, honesty, and family while meeting the evolving needs of our industry.
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Fernando Dominguez graduated from California State University Chico in 2020. He served as an embarkation logistics specialist in the United States Marine Corps Reserve as a sergeant, while beginning his career at the Allen Lund Company as a transportation broker in training. He was promoted to transportation broker after eight months and subsequently to carrier manager after a year and a half at the ALC San Francisco office.
fernando.dominguez@allenlund.com
By Scott Fontes ALC Orlando
International logistics plays a crucial role in facilitating global trade and commerce by connecting businesses across continents. The Red Sea, a key maritime route, is currently experiencing significant disruptions that have led to impacts on international logistics. The ongoing geopolitical tensions in the region, coupled with environmental challenges, are reshaping the landscape of maritime transportation. Shipping times and costs have increased, adding significant delays and costs. Oil and gas prices have jumped following news of attacks, and shipping insurance premiums have nearly doubled for some carriers. Even if attacks stopped today, the effects will take a significant time to resolve.
The Red Sea has become a focal point for tensions and conflicts, influencing the safety and efficiency of shipping lanes. By January 2024, only 200,000 standard containers were passing through the waterway per day, compared with around 450,000 in December 2022. Strategic chokepoints, such as the Bab-el-Mandeb and the Suez Canal, are vital passages for vessels navigating between the Mediterranean and the Indian Ocean. Political instability in the surrounding areas can lead to heightened security concerns, affecting the smooth flow of goods. According to the AP, “The governments of Australia, Bahrain, Canada, Denmark, Germany, Netherlands, New Zealand, and South Korea joined the U.S. and U.K. in issuing a statement saying that while the aim is to de-escalate tensions and restore stability in the Red Sea, the allies won’t hesitate to defend lives and protect commerce in the critical waterway.” Instead of sailing through the Red Sea, ships traveling between Asia and Europe are now being re-routed around Africa and the Cape of Good Hope. Stakeholders in international logistics are closely monitoring these developments to assess potential disruptions to supply chains.
Furthermore, environmental factors like extreme temperatures, strong currents, occasional coral reefs, and weather events pose challenges to maritime operations in the Red Sea. Rising sea levels and changing weather patterns can impact navigation, port infrastructure, and overall logistics efficiency. Companies engaged in international trade must adapt to these environmental shifts, incorporating resilience measures into their logistical strategies.
As the Red Sea continues to play a pivotal role in global trade routes, a comprehensive understanding of both geopolitical and environmental dynamics is essential for the sustainable functioning of international logistics networks. By embracing innovation and responsible practices, we can ensure that the Red Sea remains a vital and sustainable lifeline for international trade in the years to come.
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Scott Fontes began working for the Allen Lund Company in 2023 as an international logistics specialist in the Orlando office. Scott joined the company with years of experience in transportation, most recently as a logistics manager for an OTR transportation company.
scott.fontes@allenlund.com
By Charlie Fabricant, ALC Corporate
With the growth in awareness around climate change, the supply chain industry is taking significant strides to reduce greenhouse gas emissions while maintaining the crucial service of keeping our economy flowing. Many companies across all sectors, driven by altruism or differentiation, are incorporating ESG-focused improvements. In 2021, 73% of S&P 500 companies tied their executives’ compensation to ESG metrics. Governments are investigating additional ways to push organizations to decarbonize. One avenue that many regulators are exploring is requiring companies to publicly share their annual carbon emission data. Both California and the EU have already passed emission disclosure bills, and the SEC is expected to release U.S. wide regulations this Spring. With the transportation sector currently leading all business sectors in carbon emissions, ALC is developing low-carbon shipping programs to help our customers with their reduction and reporting goals.
To provide a very brief explanation of GHG (greenhouse gas) accounting, there are three “scopes” of emissions. Scope 1 and 2 cover direct (owned assets) and indirect (purchased utilities) emissions, which are largely controllable by reporting companies. Scope 3 includes more complex calculations from production to disposal, including all emissions associated with a manufacturer’s or retailer’s supply chain, a significant aspect of which is transportation. For example, if you were a car manufacturer, your scope 3 would include the emissions associated with the first metal being mined through the post consumer disposal and everything in between (excluding emissions captured in scope 1 and 2). The SEC regulation was originally proposed in 2022, but has been pushed back multiple times due to the difficulties associated with reporting scope 3 emissions. Due to the truckload market’s fractured nature, many shippers work with multiple transportation partners, further increasing the difficulty of consolidating this data.
So, now that I have made ESG seem scary, here’s the soothing part…In order to address environmental concerns, our company uses an EPA and CDP (Carbon Disclosure Project) based calculator which provides truckload emission data. In addition, we’re developing a ‘Green Carrier Base’, recruiting low-emission carriers for sustainable shipping needs who will have a reportable emission reduction when compared to traditional fleets. Investigations into alternative fuels, such as renewable diesel, compressed natural gas, and eventually electric charging, are also underway with the goal of setting up a fuel delivery program for interested carriers and shippers through our partner, one of the U.S.’s largest energy providers. We’re also partnering with a unique carbon offset company which prioritizes additionality and building local coalitions of small-businesses and community leaders to ensure long-term environmental and economic benefits. We all live together on the same planet, and reducing our carbon footprint should be important to us all. Reach out to me if you’d like to have a conversation.
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Charlie Fabricant graduated from Vanderbilt University in 2021 with a double major in Economics and Human & Organizational Development with a minor in Environmental Sustainability. He joined the Nashville office as an undergraduate intern in 2021 and became a transportation broker along with the company’s Environmental, Social, and Governance (ESG) coordinator. In 2024, he was promoted to ESG programs manager.
charlie.fabricant@allenlund.com
By Jon Manning, ALC Cincinnati
Creighton Abrams once said, “When eating an elephant, take one bite at a time.” AI is that elephant in the logistics space that everyone seems to be talking about. Let’s not kid ourselves here, we humans love the opportunity to have something within our grasp, that ultimately will make our lives less laborious, and can provide boundless information whenever and wherever we need it. Within the past week, I would have loved to have had something tell me how to make a beef Wellington from scratch or provide me with college football picks. That time will come, I’m sure, but even before the time comes the conversation about policy and ethics of AI will certainly be debated in many forums.
Ultimately, the idea is that AI can and will eventually surpass a team of people in breadth and scope of work, in mere seconds, it will become the new standard. I opened ChatGPT recently and typed in, “How will AI help supply chains?” The answer was shocking. In a matter of seconds, it gave me a plethora of ways that AI could be beneficial, such as demand forecasting, inventory management, predictive maintenance, blockchain for transparency, and risk management. For those thought-provoking scholars, that means AI can carve vast efficiencies in any supply chain. In a recent article from Nasdaq, “AI is being used worldwide to improve production times and boost safety in manufacturing plants in what is referred to as the ‘Industry 4.0’ era.” Will the human element still be applicable? The short answer is yes. While AI is revolutionizing the supply chain by optimizing processes, predicting demand, and enhancing efficiency, it will never replace the invaluable human connection, compassion and sensible foresight that supports the industry.
So, where would I guess the logistics industry to be in 5 to 10 years from now? Perhaps we’ll see a litany of providers offering up to customers a comprehensive “AI” program to help manage their supply chain stem to stern, or, most likely, staying the course and navigating the nuances of logistics using the best and brightest talent in the industry, which is none other than human capital. This remains essential for fostering collaboration, resolving complex issues, and navigating the unpredictable challenges inherent in the dynamic world of supply chain management. AI may streamline operations, but the industry’s success will always count on the symbiotic relationship between technological innovation and the irreplaceable human element that is required to cultivate and grow businesses.
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Jon Manning is the general manager of the ALC Cincinnati office. He started in the logistics industry working in transportation sales role in 2002. Manning graduated from Bowling Green State University with a B.A.C. degree in Communications.
jon.manning@allenlund.com
By Isabella Silva, ALC Marcom
A harsh reality of climate and economic twists is unfolding in the heartland of Mexico, where a colorful abundance of strawberries and avocados usually flourish. The country is painted with the struggles of a severe drought, hurricane surprises, and a resilient agricultural community striving to adapt to the shifting circumstances. I had the opportunity to interview Mark Santos, Manager of Santos International and TransKool Solutions, to hear firsthand how the economic climate in Mexico is affecting the year-round supply of produce coming into the United States.
“Mexico as a whole has been struggling with severe drought. Water shortages affected many commodities greatly across the board. The state of Michoacán, where the majority of strawberries and avocados come from, has felt the brunt of this,” stated Santos. “Then comes the irony of Hurricane Otis that went from a Category 1 to a Category 4 hurricane in less than 48 hours.” While the Zamora area, a significant agricultural region, escaped direct impact, other vital areas suffered, leaving a trail of damaged crops and economic uncertainty.
During these climatic challenges, Mexico faces an intriguing economic landscape. Despite the hardships, Santos shares that the peso stands strong against the dollar, maintaining a formidable exchange rate of 17-18 MXN, compared to previous fluctuations of 25 -27 MXN. “A stronger dollar encourages Mexican exports to the United States as Mexican growers strive to recover their investment in dollars. A weaker dollar has had growers questioning whether they should take on additional expenses such as freight and transmit times to get their product to the U.S.” With its predictable payment upon delivery terms, the Mexican market presents a tempting alternative. Adding to the complexities, Santos said, “Mexico is also struggling with labor shortages, forcing the industry to import labor from southern regions to fill the gaps.”
The Pharr International Bridge, a port of entry for the U.S.-Mexico border, reported the lowest crossing number of agricultural loads in the last quarter in comparison to the same time frame in the past five years. Santos gives an example, “we have a customer that would traditionally move about 180 loads of berries in October, and this year moved 110 loads.” However, in the grand scheme of things, every climate has its season, and while challenges persist, there are brighter days ahead. “Mexico continues to see an increase in planted acreage, especially in high-end commodities such as berries and avocados. Geographically, it is still in the best position than any other country to export to the U.S.”
Mark Santos has been a longtime friend with Allen Lund Company and the Lund family. Given the alignment in company culture and shared values with Santos International, the decision to collaborate six years ago was a natural progression. ALC takes pride in the partnership with the Santos family and draws upon their great insight, expertise, and local knowledge in McAllen, Texas, which is essential with Mexico being the United States largest trading partner.
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Isabella Silva graduated from St. Edward’s University in 2022 with a BA in Communication and minors in Psychology and Health Communication. She started working at the Allen Lund Company in July 2022 in the Marketing department.
isabella.silva@allenlund.com
Interviewee: Mark Santos, TransKool Solutions
In 2017, Allen Lund Company and Santos International came together and announced a new company, TransKool Solutions. This joint venture delivers top-tier warehousing solutions, specializing in LTL and FTL services, load consolidations, and Customs brokerage.