The 2024 Managed Transportation Outlook: Building Resilience

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A guest blog by Jeff Kanterman, SVP of Transportation Management, NFI

Managed transportation visibility

Heading into 2024, the North American transportation environment will be shaped by cautious optimism amidst economic uncertainty. While demand is expected to begin improving midyear from current softness, shippers must maintain a disciplined approach focused on optimizing costs and supply chain networks. Providers who can deliver flexibility, data-driven insights, and operational excellence will be indispensable partners. 

One notable trend is the expansion of nearshoring within North America as shippers and suppliers seek greater stability close to home. However, the trucking recession likely persists into early 2024 based on rising interest rates curbing freight volumes in the near-term. Shippers should brace for general rate increases in parcel and LTL as inventory reductions cannot fully offset steady replenishment cycles. Ongoing economic strains may also force another round of exits for tech-focused brokers, asset transportation companies, and small to mid-sized 3PLs.

With higher carrying costs, we should see a shift to just-in-time inventory strategies becoming favored once again, except in growth sectors like energy, industrial manufacturing, and defense. The shift towards replenishment volume will support parcel and LTL demand but prolong truckload weakness. 

As unemployment falls, tighter labor markets will reintroduce wage pressures across the transportation sector. There will be a heavier focus on hiring for data science and engineering roles that support network design and drive efficiency gains. This strategic concentration of talent is aimed at helping organizations optimize and align their supply chains to be more adaptable and resilient in the face of future volatility and disruption. Investing in human capital and advanced analytics will provide the capabilities needed to navigate complex supply chain ecosystems.

Network optimization will be an urgent priority for supply chains to build resilience. We expect more shippers to rapidly adopt technologies like artificial intelligence, predictive analytics, and control tower solutions for sharpened planning and calculated decision-making. Process automation in warehousing, fulfillment, and first-mile operations will also accelerate. Strong e-commerce growth will continue boosting final mile services, requiring sophisticated route optimization and visibility tools. 

To prepare for ongoing volatility, shippers should actively collaborate with logistics partners on anticipated market dynamics and service plans. Instituting frequent tender-acceptance measurements can help avoid route guide rejections when volumes rebound. Carrier diversification will also be vital, given economic uncertainty. 

On the provider side, recruitment, retention, and technology investments remain top focuses for strategic, financially stable organizations. New capabilities in AI, automation, visibility, and continuous improvement enable 3PLs like NFI to deliver more value-added services. With customer requirements changing rapidly, providers aim to offer flexible, data-driven solutions tailored to shippers’ unique needs. 

Adaptability will be critical in 2024 as supply chain recovery progresses at varying speeds across sectors. Shippers need partners able to calibrate network services and capacity in step with demand. Providers who showcase resilience, innovation, and transparency will emerge as trusted advisors. Through ongoing uncertainty, the managed transportation space will continue to expand throughout 2024, offering a safe haven for shippers to navigate change and future economic disruptions.

Jeff Kanterman, SVP of Transportation Management

Joining NFI in 2014, Jeff Kanterman oversees NFI’s transportation management division. Jeff and his team combine people, processes, and technology to help businesses enhance their supply chain networks.