Skip to main content

Content is loading...

Loading...

Close

Posted January 7, 2020

by

As last year drew to a close, Amazon announced that it will be banning third-party sellers from using FedEx for any of their two-day shipments to Prime members. According to the Wall Street Journal, the ban is meant to continue until the delivery method improves. And while the FedEx ban is said to be temporary, the growth in Amazon’s own delivery methods shows that the split could be permanent, suggesting tension in the continuing battle for freight shipping dominance. However, for the trucking industry, the shipping war is not necessarily a bad thing, and the industry is learning a lot from the business model in shipping as well as fleet payment.

Bezos has clearly disrupted the way we do business, and in turn, we have embraced the technology behind it. With such an expansive reach in product and innovation, it is no surprise that the impact has reached the trucking industry. Amazon’s impact on the trucking industry has been enormous, not only fueling the competition to meet the speed of delivery but also forcing Amazon to run like a tech company by providing tools for fleet payment that help to enable even more efficiencies. 

The US Department of Transportation projects that by 2040, US annual freight volume will increase by 45% to 29 billion tons, with most of that volume hauled by truck. More than 51,000 drivers will be needed to meet that level of demand and the industry is struggling to meet the challenge. With shipping costs rising and transportation costs following suit, prices are rising for any and all products that are carried on the trailer of a truck. Unfortunately, the driver shortage continues to be the number one challenge for the industry.

Joyce Brenny, chief executive of Brenny Transportation in Minnesota, gave her truckdrivers a 15 percent raise this year, but she still can’t find enough workers for a job that now pays $80,000 a year.

To address the “Amazon effect” and critical need for drivers, Joyce Brenny and other fleet owners and contractors are offering drivers as much as they can afford to get inventory delivered. These companies have realized that drivers are expecting more than sizable salaries. The benefits of time off and being home for the holidays along with tools such as fleet cards are making the job easier and life more balanced. The fleet and fuel card advantages provide benefits not only to the fleet managers but also to the drivers. The access and efficiencies that the right EFS/WEX fleet card delivers are significant:

  • Automatic accounting, reports, and powerful tools for savings
  • Rebates and cashflow flexibility to fuel your business
  • Mixed fleet and fueling solutions
  • Fuel anywhere; get savings per gallon from 7-Eleven, Conoco, and Phillips 66 pumps

The Amazon effect is forcing the transportation industry to adapt to Amazon practices, which is why fleets are continuing to bolster technology to maximize efficiencies. The Amazon effect will also continue to increase downward pressure on delivery costs, which means fleet payments could be compromised if fleet managers are not smart. Now more than ever, efficiency matters in trucking. The increased use of technology will improve efficiencies through better route planning, truck progress monitoring, and vehicle and driver performance tracking. Additionally, trucking companies will continue adapting to their customers’ needs by tracking individual products through the supply chain from factory to final destination. With thousands more data points to monitor, trucking companies will have to become more comfortable with onboard and cloud technology and the insights they offer. 

Payment industry leader EFS/WEX has recognized these same needs for the trucking industry and has developed the technology to help. By leveraging payment data and technology, they are able to enhance fleet payment systems and streamline the process. Powerful fleet solutions provide the speed, accuracy, and transparency needed in all fleet payment transactions including vendor payment and payroll. In addition to the convenience, EFS/WEX fuel and fleet cards offer the ability to rein in one of a fleet’s biggest business expenses.

EFS/WEX fuel cards and fleet management solutions provide powerful tools to reduce spending for any business of any size:

  • Fleet fuel cards with automatic expense tracking, enhanced security, and detailed reporting. Choose the best fleet card for your business.
  • Powerful mobile apps to access your account, help drivers find the cheapest nearby fuel, pay at the pump, and more.
  • Premium GPS telematics for tracking vehicle location, speed, fuel use, and more—to capture the data you need to keep improving your bottom line.
  • Advanced analytics software to keep you informed, help you find new ways to save, and streamline your overall fleet operations.

Tools like these are just a few of the innovations that companies like EFS/WEX are developing to address industry requirements for efficiency and speed. So while Amazon has helped to push the industry forward, companies like EFS/WEX enable that progress by supplying the technology to not only keep up, but also to grow.

 

 

 

 

RESOURCES:

https://www.omnitracs.com/blog/amazon-effect-trucking

https://www.truckinginfo.com/142145/the-amazon-effect-on-freight-transportation-discussed-at-ftr-conference

https://www.shorr.com/packaging-news/2015-06/amazon-effect-impacts-shipping-and-retail

https://www.washingtonpost.com/news/wonk/wp/2018/05/21/america-doesnt-have-enough-truckers-and-its-starting-to-cause-prices-of-about-everything-to-rise/?utm_term=.b773214aa0e8

Share:

EFS

EFS


Topics