Episode Transcript
[00:00:04] Speaker A: You're listening to the Zipline Logistics Truck. Yeah. Podcast, where we explore all kinds of hot topics in the logistics industry.
Get ready to learn, laugh, and get your brain on.
Ladies and gentlemen, welcome back to another edition of the Zipline Logistics Podcast. My name is Jesse Jewett, coming to you live from the training room. Join with me as always, our director of Training development, Teddy Lee Knox. Teddy, how we doing today?
[00:00:41] Speaker B: Very good, thank you. How are you?
[00:00:43] Speaker A: Wonderful. We are talking about something near and dear to our hearts. Produce season.
[00:00:49] Speaker B: Produce.
[00:00:50] Speaker A: Let's get excited.
Produce season.
We did a little survey.
[00:00:58] Speaker B: Do you remember your first produce season?
[00:00:59] Speaker A: Oh, do I.
[00:01:02] Speaker B: I was terrified.
[00:01:04] Speaker A: It was great. I used to move. My last job or one of my jobs before I joined the sip line was moving produce.
[00:01:11] Speaker B: Really?
[00:01:11] Speaker A: Yeah.
[00:01:12] Speaker B: No, that's cool.
[00:01:14] Speaker A: 45,000 pounds of peppers out of Nogales, Arizona, sitting on a driveway in the heat. Got to get it picked up quickly or it's going to go to waste.
But that's a different podcast.
We're talking about produce season, how it can impact our friends in the CPG space, how it impacts the market.
Most recent updates over the last couple years.
Let's dive into it. We did some surveys here in our office, didn't we, Teddy?
[00:01:44] Speaker B: Yes, we did.
[00:01:45] Speaker A: All right, what did our. Give me some what our CPG experts
[00:01:48] Speaker B: within the office said, not what it used to be. So produce is not what we remember from when I first started.
It's just a blip. So you'll see more volume and slightly higher rates, but then it'll plateau. It's not going to be a continue, you know, hike up a hill like it used to be.
Volume can tighten capacity, drive up rates, and make for some challenging conditions if you don't prepare accordingly. I think that's super important.
[00:02:12] Speaker A: Yeah, that's fairly accurate. Right.
[00:02:15] Speaker B: Other people, you know, thought of just certain things like reefer capacity, trailer washes, hard to get trucks, hard to get trucks out of the south and paying higher rates for fewer available trucks left.
And I think that definitely dictates on a certain type of equipment as well.
So those are what some of our experts said. CPG experts in the office.
[00:02:36] Speaker A: Yeah.
Some other folks mentioned just like the time period, obviously, spring.
[00:02:41] Speaker B: Yeah. Potatoes in general, which I think is important because when you talk to someone who's not in logistics, just like we've talked about with Life below, it's sounds simple, seems easy. When you think of produce, you think of going to the store and picking up lettuce.
[00:02:55] Speaker A: Sure, sure, possibly.
[00:02:56] Speaker B: So other ones that I really liked is. I've heard it's a pain. I thought that was an interesting one to hear because they're not wrong.
Apples, broccoli and all that good stuff was another one that I enjoyed.
[00:03:10] Speaker A: All the good stuff that's good for you. The real food, if you will.
[00:03:15] Speaker B: Yeah.
[00:03:17] Speaker A: I always thought. I think we talked about it in a previous episode, but like Christmas tree season.
[00:03:22] Speaker B: Yeah.
[00:03:23] Speaker A: Technically, I wouldn't call it produce. Maybe not. But it definitely affects the marketplace.
Right.
[00:03:28] Speaker B: Yeah.
[00:03:28] Speaker A: Something that I'd like to expand on of just a blip. Not what it used to be. I think since April of 2020, when we saw, or I guess March of 2020, when we had our first shutdown for the COVID pandemic. Right. That kind of flipped everything up on its head and has disrupted the marketplace for the past two years and counting. We are starting to see a more stabilized freight market.
So we'll see what 2023 has to bring. I would imagine it's going to.
We're going to talk about an injection of some additional freight in certain marketplaces.
[00:04:09] Speaker B: Yeah.
[00:04:11] Speaker A: But it may not be as disruptive as previous years. Right. It used to disrupt the entire country.
[00:04:17] Speaker B: Yeah.
[00:04:18] Speaker A: I think now it might.
I'm predicting. Let's go back to more like seasonal. Right.
That April through July time period is going to disrupt the Southeast and maybe not everywhere else. That's my prediction.
[00:04:33] Speaker B: Which is great when you think about it because you can actually kind of plan for that correctly.
[00:04:38] Speaker A: Something that we've talked about before.
[00:04:39] Speaker B: Right. Manage expectations that we did have a previous podcast. Controlling the controllables.
[00:04:45] Speaker A: Yeah.
[00:04:46] Speaker B: And I think that's really important.
And one way to do that is just have regular check ins with your partners.
That can help prevent big surprises.
I remember when I first started, everyone that I worked with, with customer was always so surprised when produce came up. And after a while I was like, why every year.
[00:05:04] Speaker A: Right.
[00:05:04] Speaker B: You know what's coming. But it could have been on me not making it clear enough. So that's something that we can do to help them deal with chargebacks, issues, delays, layovers, and hopefully eliminate that added stress on top of the marketplace already.
[00:05:18] Speaker A: So let's talk about some things that we do or that we can do to minimize the impact of produce season. Right. There's going to be an impact.
Let's control what we can control.
I think one of the first things we talk about is like expanding our trailer types. Right. If we have a customer that ships regularly, regularly from the Southeast and if they're dry, freight refinished, Goods going into a Costco or a Walmart. Our core delivery locations.
Previously we could ship fan or reefer or maybe we focused in on dry van freight. But now we're going to expand it into multiple trailer types. Right. Obviously with produce is really focusing on refrigerated.
So if we can expand it into dry van, that's going to help with capacity big time.
[00:06:12] Speaker B: And I think also the fact that we know our modes so well, we know these equipment so well, we can advise if anything actually has to happen in advance. For example, Costco is pretty notorious for maxing out that pallet.
[00:06:24] Speaker A: Yeah.
[00:06:24] Speaker B: Putting a lot of weight on that pallet which can cause over axle issues.
So if we know we're opening it up to reefer, we can talk to them in advance of being like certain loads can go on reefers and broadening that out a little bit. Which I think is really important because you don't want to get yourself in a situation where you're opening it to reefers when you can't actually.
[00:06:44] Speaker A: Absolutely.
[00:06:46] Speaker B: I think some other things going into trailer types and modes are when you're looking at ltl. So produce still affects all modes. I think so we still see impacts with ltl. So just getting more lead time. A lot of times we get somewhere between 10 to 14 days for LTL.
[00:07:05] Speaker A: Yeah.
[00:07:05] Speaker B: So making sure that we get that information over right away so we can give the lead time to LTL or get that lead time so we can look into consolidating and doing a multi drop and making it worthwhile for someone to get to the hot areas for produce and really benefit both sides of our customers, carriers and the vendors that we're working with. Which I think is really nice.
[00:07:28] Speaker A: Double ended partnership. I like that.
[00:07:30] Speaker B: Exactly. And that helps everybody. If both of them are happy, both of them are actually working really well.
That's our job.
We've succeeded.
[00:07:39] Speaker A: Here's a good one. For some of our bigger customers.
They've got multiple warehouses from different locations of the country. Maybe have the same product that we can switch source from there.
Right. Shipping from Jacksonville may not be desirable from April through July.
[00:07:55] Speaker B: Yeah.
[00:07:55] Speaker A: So maybe we start pulling that freight from New Jersey or from North Carolina or Dallas or whatever. Whatever location is more beneficial.
[00:08:07] Speaker B: Right.
[00:08:08] Speaker A: And not as impacted by the produce season. Yeah, that's a really good suggestion. And again something that we can play with in our canopy system or you know, just through some network analysis.
[00:08:19] Speaker B: Yeah.
[00:08:20] Speaker A: So that's really exciting there.
[00:08:22] Speaker B: I think that's key too because a lot of times people are just Thinking about the actual rates for those individual loads. But you have to remember, if capacity is tight, if we have a breakdown, if we have an over axle issue and it causes a delay, now we're looking at chargebacks and possible MAVD issues which can cost the customer more.
[00:08:40] Speaker A: Right.
[00:08:40] Speaker B: So sometimes it makes more sense to look at it through a different lens of chipping it from here and then replenishing and showing those sales numbers going up and also, you know, possibly rates staying the same or even going down.
[00:08:54] Speaker A: Really good idea.
I like you mentioned another potential mode. Right. Checking out the rail. Yeah, Rail always is a good alternative, especially for longer hauls.
That's, that's another group internally that we can throw some rates off of, see what comes back again. The last couple years, the rail and the truckloads pricing has been relatively similar, I guess for lack of a better term, just because of the influx of inventory. But we're starting to see that stabilize and rail is going to be going to be more and more of an alternative, positive alternative, especially during those spikes like produce season.
[00:09:38] Speaker B: And rail is really unique too because you can do some sort of projects with them. So normally if you want to get like confirmed rates with rail, you have to have I think a couple months. But if you have confirmed lanes for a month or two, you can still get really effective pricing. And that's just a really good thing to remember because that is going to come in handy. And having someone to tell you that rather than just doing spot rates can save you even more money on top of the money that rail wouldn't actually save you.
And then go ahead and say, lastly, managing expectations in the spot market I think is huge. Some customers don't use the spot market, they just reach out to individual carriers. So I don't think that's the same. Yeah, but going into the spot market, which I think you have a lot more experience in, so you'd be able to talk about it a little bit more intelligently.
[00:10:28] Speaker A: Sure.
[00:10:28] Speaker B: But managing those expectations I think is really important because we've seen customers put things on the spot market and ship them for more than what they could have if they just kind of kept with one carrier.
[00:10:40] Speaker A: Plan ahead. Yeah, yeah. It's a matter of chasing those rates. Right. When you're seeing an aggressive amount of like an injection of freight from certain areas. We talked about it a few weeks ago, the Utah market spiked up here with the weather and we had 1100 loads with only 23 carriers. Well, you know, that's where when you're playing in the Spot market, trying to find that dirt cheap rate and then it flips quickly.
Then you can end up kind of being left with the freight on the dock, which is not the most important thing. Right.
Which is not a great result when you're chasing that rate. You don't. You want your freight to get to the shelves, hit the mavd, get it there for your customers to be able to purchase. So understanding that those, those rates are going to be impacted for that small period of time and then identifying some, I guess parameters around what's acceptable. Right. Hey. Is you know, we're going to see a little bit of a variance. We're going to do our best to hit this rate that we've committed to for X amount of period of time. But this little window, we could see a blip. What can we do to prevent, you know, massive problems. Right.
[00:12:00] Speaker B: Yeah.
[00:12:01] Speaker A: Goes back to managing those expectations, getting the freight and bookable status, getting it on the board quickly, giving us lead time, understanding the true mmbd, all that stuff.
[00:12:10] Speaker B: Yeah.
[00:12:10] Speaker A: That we've talked about previously.
[00:12:12] Speaker B: So I agree.
Beautifully said. Yeah.
[00:12:18] Speaker A: Traditionally we're talking kind of like the main produce season is April through July.
I think we used to call it like tax day to the July 4th.
[00:12:28] Speaker B: Yeah.
[00:12:29] Speaker A: That is the Southeast roughly.
So Florida, Georgia, Mississippi, Arkansas.
You've got soybeans in Arkansas and some other.
The oranges, peanuts, etc.
[00:12:44] Speaker B: Yeah.
[00:12:46] Speaker A: What are some other locations that have produce seasons that you, you're aware of, Teddy?
[00:12:50] Speaker B: Well, I'm going to start alphabetically and go through all of them.
[00:12:53] Speaker A: Oh gosh.
[00:12:54] Speaker B: Do we have time?
[00:12:55] Speaker A: Yeah.
[00:12:56] Speaker B: No, I won't, I promise.
So you mentioned Arkansas soy soybeans. Most popular is June to August. Idaho potatoes as we noted. People think about here December to October, New Mexico's pecans. They have two seasons actually. June and then September through November. South Dakota, sunflowers. So that's kind of an interesting one. I think that's usually really popular flower and make, you know, that's always really first thing to go when you see a Kroger. When flowers come up. September, November and then Wyoming is hay a little bit more consistent but you see it more in the fall.
And this is something that I remember very well. Having complaints of trailer smells stinky and then figuring out that it was hay, which is technically a food. Not for us, but it is food.
So it will be in food grade trailers.
[00:13:46] Speaker A: It's organic item. Yep.
[00:13:47] Speaker B: Yeah. So I think that that's also understanding that these are a lot of these are foods. So they will be in food grade Trailers, but they may leave residue or smell. And that's a problem when we go to somewhere like Costco or Walmart or even just a distributor or a shipper, normal warehouse. So we have to understand those things and again manage those expectations.
[00:14:08] Speaker A: What's your quick solution for a trailer
[00:14:10] Speaker B: that's smelling like, hey, coffee grounds. Yeah. So you can actually buy them or get them for free at Starbucks, which is nice. So have you ever seen those grounds for your garden?
[00:14:21] Speaker A: No.
[00:14:21] Speaker B: You can just take it for your trailer now too. So in produce season you just kind of run, rub some coffee grounds on your truck and then you give it a normal wash and it takes out a lot of smell. Have you ever smelled cologne or anything at like a,
[00:14:39] Speaker A: you know me, of course.
[00:14:41] Speaker B: So they have coffee in between all the scents and it clears out smell. So it's the same, same idea there idea. And this is something that we learned from one of our carrier partners is we were actually just struggling with an issue and talking, you know, he said, well, this is what I do. And it was a really great thing. Again, that partnership is really important.
[00:15:01] Speaker A: Do a quick washout, throw some coffee grounds, rub some coffee grounds in the bottom and you got fresh smelling trailer with some coffee grounds on it and
[00:15:09] Speaker B: you're probably a little bit more awake in the process.
[00:15:11] Speaker A: There's something about the PH balance there.
[00:15:14] Speaker B: But that's again, that's another podcast getting scientific.
[00:15:19] Speaker A: We talked about it. Most pronounced produce hits between tax day and July 4th.
Obviously different pockets of the country has different produce seasons. We mentioned Christmas trees in the Pacific Northwest, October, November.
It's really important that you obviously work with a transportation provider like Zipline who keeps you informed. In fact, why we're talking about this, we have a blog out. It is about our interactive produce season map goes through the different states across the 48 contiguous United States and what time period and what product is affecting their produce season. So check that out. Www.ziplinelogistics.com sure. There's like a backslash blog in there, but we'll get that to you.
We obviously have a strong network of carriers across the country.
We've gone through multiple produce seasons. We're excited to dive into 2023.
We're not only partnering with customers to deliver the freight, get it on the shelves, but carriers who understand the ins and outs. So we'd love to chat with you.
That does it for us, Teddy.
[00:16:33] Speaker B: Yes, it does.
[00:16:33] Speaker A: Thank you everybody for joining us on another edition of the Zipline Logistics podcast.
[00:16:41] Speaker B: See you next time, Sam.
