The businesses that rely on shippers and carriers face no shortage of challenges on their journeys to sustained success in the ever-changing global marketplace. These entities must not only adapt to emerging yearly trends but also navigate the fluctuating demands of the seasonality of freight.
Before these organizations can accomplish this, they must first understand the ebbs and flows that come with freight seasonality. While truckload shipping seasons primarily impact domestic carriers, they can also affect every other link of the supply chain.
By preparing for these unavoidable seasonal freight trends, companies can minimize supply chain disruptions, stabilize cash flow, and protect business continuity.
What Is The Seasonality of Freight?
The term “freight seasonality” refers to four truckload shipping seasons that begin and end at approximately the same time each year. During each of the four freight seasons, carriers and shippers typically experience shifts in supply and demand.
Understanding these seasonal freight trends helps shippers determine when to ramp up operations and when to scale things back. Shippers should take advantage of the predictability of these trends. Specifically, they should explore ways to maximize revenue during peak seasons and deploy cost-savings measures during lean times.
Navigating the Four Freight Seasons
In some circles, more than four freight seasons are recognized. Also, the seasonality of freight is liable to change depending on who you are talking to. These additional seasons are actually short-term spikes that occur in the middle of the four primary freight seasonality periods.
After your organization has incorporated seasonal freight trends into its strategy and begun to capitalize on them using established principles, it may be beneficial to explore these auxiliary shifts in supply and demand. However, we will focus on the four core truckload shipping seasons, which include:
The Quiet Season
Seasonality of freight kicks off with what we call “The Quiet Season.” The quiet season begins in January and lasts until the end of March. End consumers have just wrapped up a slew of holiday gatherings and the shopping sprees that go along with them.
During the quiet season, freight volume typically drops to its lowest annual point. This is because demand from both consumers and retailers is drastically lower than it is during the later seasons.
The quiet season provides shippers and carriers with the perfect opportunity to reevaluate their current processes. They can examine how their supply chain performed during the end of the prior year and explore opportunities for improvement.
Organizations can also implement changes, such as modernized reverse logistics procedures or a new transportation management system. This is especially the case during the quiet season, as many consumers are returning items they received during the holiday season. Package returns are at an all-time high in the first few weeks of the calendar year, logistics companies should seize the opportunity to consider any lessons learned as they develop and optimize this important aspect of their supply chain.
Since the business is not as busy as usual, it is more capable of withstanding these changes without experiencing significant disruptions. If a business is successful during the peak season, it should also have the resources to invest in technologies, training, or other improvement initiatives.
The Produce Season
At or near the first of April, the produce season begins. This uptick in freight volume typically lasts until mid to late July.
As the name suggests, this spike in freight volume and demand for shipping services is primarily due to the influx of fresh produce during spring and early summer. However, several other factors also influence supply and demand during the produce season.
For instance, restaurants tend to be busier during the warmer months. Food service establishments will begin ordering more products to keep up with customer demand. Consumers may also start ordering items for summer vacations, such as BBQ supplies, towels, portable swimming pools, and other goods commonly associated with warm-weather activities.
Cumulatively, these factors significantly raise demand for shipping services. Carriers with the flexibility to do so may begin hauling more loads because they pay a better rate. This creates a cascade effect that reduces capacity and raises rates for shippers that deal in other goods.
Shippers that were ill-prepared for this fluctuation might struggle to arrange the pickup of their goods. As a result, they might far exceed their freight budget for the quarter, cutting into profitability.
The Peak Season
By early August, the peak season is in full swing. This season lasts until the end of October. The peak season is fueled by back-to-school shopping and retailers gearing up for the end-of-year surge.
Both freight rates and volume peak during this season, hence its name. Companies are constantly shipping products to their distributors and ensuring that frontline retailers can get the inventory they need to serve consumers.
Any changes or technologies that were implemented prior to the peak season will be subjected to a trial by fire. Therefore, it is critical that businesses take full advantage of the lulls they experience from January through March.
The Holiday Season
The holiday season rounds out the four primary freight seasonality periods. This season runs the entirety of November and December.
Consumers are flocking to brick-and-mortar stores or launching their favorite apps to purchase gifts for friends and family.
Shippers are scrambling to fulfill all orders and get them in the hands of customers on time. Carriers and third-party logistics partners are pulling out all of the stops to maintain high operational efficiency while simultaneously wrapping up any last-minute shipping requests.
How a Logistics Partner Can Help Businesses Overcome Freight Seasons
No matter what role your organization holds in the supply chain, mastering the four freight seasons is critical to the success of your organization. However, navigating the fluctuations in supply and demand inherent in freight seasonality can be incredibly challenging.
Fortunately, you can improve your ability to do so by partnering with an experienced logistics services provider and consulting firm like R2 Logistics. We combine our award-winning TMS technology with timely guidance and proven practices in order to help you thrive during every freight season.
Connect with R2 Logistics to receive a custom quote on our suite of logistics solutions.