CHAPTERS

7TH ANNUAL

GLOBAL TRANSPORTATION MANAGEMENT

BENCHMARK SURVEY

Discover the transportation management strategies, tactics and technology that top performers are leveraging to capitalize on market opportunities and adapt to challenges of a constantly evolving supply chain landscape.

About the Survey

Since 2017, Descartes has conducted an annual benchmark survey of global transportation professionals to identify the strategies, tactics and technology-thinking of top-performing organizations.

Survey participants represent a wide range of industry leaders including Descartes customers and followers, trade association members and industry publication readers to provide a balanced view of transportation management (TM). Only the last five years of results are used to keep the study relevant.

Each year our benchmark survey:

• Explores how companies view the role of TM
• Identifies key industry trends driving the market
• Examines how transportation value is measured
• Uncovers which capabilities, technologies, and competitive strategies/tactics are making the greatest impact
• Provides the outlook for future IT investment

The 2023 Survey: Transportation Management in Transition

Late 2022 set the stage for 2023 for many economies and transportation. Consumers pulled back from the buying spree of the previous two years. Higher costs, especially energy and commodities, and inflation have been big reasons for slower economic growth and, in some countries, recession. The cost of ocean and air transportation receded as capacity opened up; however, driver shortages continue to impact over-the-road capacity and reliability. Transportation leaders are focused on addressing the capability shortfalls that were exposed during the pandemic such as shipment visibility. Top performers continue to take more aggressive actions to turn these transportation management challenges into opportunities to become more competitive and grow.

Who We Surveyed

This year’s 345 survey participants represent the logistics community and shippers from a wide variety of industries. Again, there was a significant emphasis and success on garnering more respondents beyond North America. Here’s a snapshot of respondents’ business type and global footprint, plus the transportation modes they use.

Growing participation by logistics community:

• Freight Brokers are the top business type represented (24%)
• Almost two-thirds of respondents (66%) work in the logistics community

What is your primary business type? (select one)

• Truckload continues to dominate
  • As expected, truckload usage leads other modes in percentage of survey respondents (89%), as well as in volume (56%)
  • Truckload usage was up 9% and 4% in volume in 2023 versus 2022

About the Survey

Respondent Perspectives

To get a better sense of how companies think and act, we asked respondents to rate their companies on senior management’s strategic view of transportation management. We also wanted to see how those perspectives related to overall financial performance. Based on their ratings, respondents were consolidated into groups for further analysis. The first grouping concerns the strategic importance of transportation and whether management believes it is a Competitive Weapon or Not Important. The second grouping looks at the difference in financial performance where industry leaders are defined as Top Performers, and average financial performers and below are defined as Poorer Performers. The results of the study were then compared by these groups to see if management importance and financial performance had an impact on strategic, tactical and technology decisions.

TM Strategy, Financial Performance & Growth: A Strong Correlation

As in previous surveys, the 2023 results once again indicate a correlation between how well a company performs financially and the strategic importance senior management places on transportation.

Survey findings

• Industry leading financial performance declined in 2023 (2023: 18% vs 2022: 23%) for Competitive Weapon respondents but was still 2X higher than Not Important respondents
• 60% of Not Important respondents had poorer financial performance—up 20% from 2022
• Poorer Performers (38%) were more than 2X more likely to view transportation management as Not Important than Top Performers (16%)

Key Trends & Practices

We asked respondents several questions related to transportation management regarding the future significance of current market and business drivers, value measurement, where information is used and concerns about competitive strategies.

Industry or regulatory changes with the greatest market impact over the next 5 years

• Driver shortage (42%) and carrier capacity (40%) remain the overall market drivers, but are down ~8%
• Fuel costs continued their rapid rise in importance, moving from #4 in 2022 (25%) to #3 overall in 2023 (40%)
• Fuel costs was the top response for Not Important respondents (56%)—almost 1.8X more important than for Competitive Weapon respondents (32%)

Strategies & Tactics

Survey respondents were asked how they are planning to address the key trends and improve transportation value—both strategically and tactically. In addition, they ranked the capabilities required to effectively manage transportation, and then took a deeper dive into the highest ranked capabilities.

Organizational approach to transportation strategies

• Overall, create or adopt leading-edge strategies was again the top response in 2023 (42%) but down 7% versus 2022
• Competitive Weapon (53%) and Top Performer (68%) were both more likely to be leading-edge strategy adopters than Not Important (24%) and Poorer Performer (31%) respondents

Key Survey Findings

There is a direct relationship between management’s perception of the strategic value of transportation and performance—higher strategic value results in better financial performance and growth. Driver shortage, carrier capacity and now fuel costs are the top overall concerns. Competitive Weapon and Top Performer respondents are much more likely to have operations, technology adoption strategies and investment plans that are the most aggressive.