David Maggied, Eco-Energy President of Transportation, Discusses the Impact of Supply Chain Transportation on RFD-TV


Wednesday, May 10th 2023, David Maggied joined Susanne Alexander of RFD-TV to discuss the tolls supply chain faced during the pandemic and the outlook for future transportation hurdles. Watch the full interview here

Due to many of these challenges, companies are taking a more active role in their supply chain management decisions. Historically, many larger buyers depended on their suppliers to get their products to them. As a result, more companies are stepping into the supply chain and transferring their purchases to origin. Many of these companies need internal resources, contributing to the increased use of third-party logistics services to make this transition smoother.

The number one issue for the transportation industry is figuring out how to attract and retain qualified workers. While you can earn a decent wage, younger generations of employees are less interested in working 14-hour days, being on call for off-hour shifts, or being away from home for long periods of time. As the older workforce ages, transportation companies must find ways to restructure their work assignments into a more favorable work/life balance for their employees. 

The good news is that transportation executives see these challenges and are taking steps to address the deficiencies. However, it will undoubtedly take time to restructure all these roles.

Factors like automation, routing optimization, and blockchain technologies are on the other side of the labor issue. These could reduce the number of employees required in supply chains, but there will be an inflection point. However, we have some real challenges in the short to medium term as we balance addressing the current labor dynamics with integrating these new technologies.

The energy sector has built a highly efficient, just-in-time supply chain network. Unfortunately, part of being efficient means that only a little excess product is available to handle supply chain shocks. Any delay in transit or other disruption to the supply chain can result in localized outages. The industry can typically mitigate this through spot purchases or the re-directing of shipments, but these do come at a cost. Unfortunately, whether the supply chain disruption results in an outage or additional expense, consumers ultimately shouldered these impacts.

"More companies are focused on scope three emissions. Not to get all in the weeds, but that involves your supply chain emissions. As this becomes more of a focus for companies, carbon emissions is going to become a point of differentiation in transportation as people are selecting their service providers. As a large buyer, as well as provider of freight services, we are having to make the same assessments and focus on it ourselves as well. Long term, you have new biofuels like renewable diesel, but it is going to be a long time before those are widely available. So our current focus is route optimization, as well as leveraging carbon offsets", David Maggied, Eco-Energy President of Transportation. 

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