Ongoing labor negotiations between United Parcel Service (UPS) and the Teamsters union are reaching a key milestone on July 31, with a nationwide labor strike a potential outcome. In addition, Yellow Corporation, the parent company of Yellow Freight, the country’s third largest ‘less than truckload” carrier, is facing a number of significant labor and financial challenges, putting their survival in question. If either of these disruptions occurs this summer, significant impacts across the U.S. supply chain will be felt and could have a rippling effect on event logistics.
UPS has more than 40% share of the domestic small package market. Its competitors, including FedEx and other providers, will not be able to absorb the overflow in volume, likely resulting in mode shifting to LTL and Truckload. In the case of Yellow, with approximately 10% market share, there is some capacity in the LTL sector to consume this freight, but it will be seriously disruptive in the short term. This reduction in capacity will likely impact all transportation providers to some degree. If these disruptions happen simultaneously, the impacts will be even more significant.
In anticipation of either of these events, we want to create awareness of the potential impacts to trade show and event logistics.
Potential Impacts on Trade Show and Event Logistics
Trade show exhibitors who are preparing now to ship materials for events this summer and into the fall should be considering the following:
- Increased transit times for shipments across the country: To prepare, exhibitors should plan to ship items earlier than usual for similar events and locations.
- Increased transportation costs: Exhibitors should prepare for the potential of new surcharges and higher rates resulting from this reduction in market capacity.
- Lower capacity available to ship to show sites: With increased wait times, some carriers will reduce the capacity and coverage they devote to trade shows. Working with a logistics provider that specializes in trade show freight is one way to limit this potential impact.
Overall, we believe that a disruption or shutdown by either of these companies will have a wide-reaching impact on transportation providers, trade show exhibitors, and the entire supply chain, potentially starting as early as August 1st. The time is now to reach out to your transportation partner to understand their strategy to navigate disruptions in the marketplace to minimize the impacts on your upcoming event schedule.
EFW Tradeshow is closely monitoring this situation. If you have any questions, please don’t hesitate to contact our team at 484.637.9333 or email Ernie Magalotti at moc.wonWFE@ittolagaM.einrE.