The three states that border the Pacific Ocean are home to 48 million people, with the states just slightly inland adding millions more to the population of the “Western U.S.” With such a sizable chunk of the U.S. population residing in these Western states, West region distribution is a vital part of the supply chains of companies whose products originate in the Central and Eastern U.S.
In recent years, however, multiple factors – the truck driver shortage chief among them – have made long-haul truck runs to the West Coast increasingly unreliable and inefficient. The response of many companies has been to focus less on shipping West and, instead, store products in a West Coast distribution center operated by a third-party logistics provider (3PL).
The impact of the driver shortage on westward distribution
Here in 2019, the driver shortage remains a very large concern for shippers and logisticians alike. 2018 ended with a deficit of around 60,000 drivers (maybe more, depending on who you ask). Unfortunately, it is a number that is only expected to increase, as some estimates put the deficit close to 200,000 by 2026.
With the driver shortage, it becomes harder for carriers to secure drivers to haul loads, and therefore harder for shippers to have products transported. This problem exists for short, regional runs as well as longer, cross-country treks. So, while just about all companies east of the West Coast need to ship their goods to the Western market, many are facing challenges in doing so reliably. Furthermore, truck capacity is more expensive than it used to be.
West Coast distribution center partnerships lessen or eliminate the capacity “pinch”
Many Eastern and Midwestern companies have adapted to their capacity challenges by partnering with 3PLs on the West Coast for warehousing and distribution. With this model, inventory is stored and managed at the 3PL warehouse from the get-go, and orders are distributed by the 3PL for final delivery (and/or ecommerce fulfillment) throughout the West. With product stored within reach of Western customers, regular long-haul trips across the country are no longer necessary.
Additional benefits of West Coast 3PL distribution centers include the following.
- The cost is not much greater. Companies doing regular long-haul runs to the West at (sometimes substantially) increased rates will find that the cost of partnering with a 3PL and positioning inventory on the West Coast is commensurate with current costs once all factors are considered.
- Improved service to retail customers. Locally-staged goods can hit tight delivery windows. Schedules are driven by retailer RAD dates.
- Competitors are already using West Coast 3PLs. No matter what industry you’re in, your competitors are likely taking advantage of West Coast 3PL partnerships. And, if they are and you’re not, you may find yourself at a competitive disadvantage as they regularly serve Western customers faster than you can.
- Fewer weather-related shipping delays. Delivery disruptions are rare in the West’s more moderate climate versus the more storm-challenged regions back East.
- Variable rate structure. If your demand is unpredictable or seasonal, most 3PLs can offer a cost structure where your space and labor costs parallel your revenue stream (e.g, as with public warehousing).
Turn to Weber for West Coast 3PL services
Getting your products to customers quickly is of paramount importance to your business’s success. For steady and reliable distribution speed, you need to eliminate uncertainty in your supply chain. This means limiting your exposure to the driver shortage by scaling back your reliance on long-haul runs.
A 3PL can help you put your goods closer to your customers and eliminate the need for long-haul transportation before final distribution. Perhaps best of all, partnering with a 3PL allows you to tap into its already-existent infrastructure, equipment, and resources. There’s nothing you need to build, and no one you need to hire.
When it comes to West Coast distribution centers, you can rely on Weber Logistics to act as the Western arm of your supply chain. We have 11 strategically-located DCs in California, asset-based drayage and transportation operations, standing appointments with most large retailers, and robust ecommerce capabilities. Contact Weber today to learn how we can optimize your operation for West Coast success.