About the Industry
Firms in the truck transportation and warehousing industry provide a link between manufacturers and consumers. Businesses, and occasionally individuals, contract with trucking and warehousing companies to pick up, transport, store, and deliver a variety of goods. The industry includes general freight trucking, specialized freight trucking, and warehousing and storage.
General freight trucking uses motor vehicles, such as trucks and tractor-trailers, to provide over-the-road transportation of general commodities. This industry segment is further subdivided based on distance traveled. Local trucking establishments carry goods primarily within a single metropolitan area and its adjacent non-urban areas. Long-distance trucking establishments carry goods between distant areas.
Local trucking comprised 27,000 trucking establishments in 2004. The work of local trucking firms varies with the products transported. Produce truckers usually pick up loaded trucks early in the morning and spend the rest of the day delivering produce to many different grocery stores. Lumber truck drivers, on the other hand, make several trips from the lumberyard to one or more construction sites. Some local truck transportation firms also take on sales and customer relations responsibilities, in addition to delivering the firm's products. Some local trucking firms specialize in garbage collection and trash removal or hauling dirt and debris.
Long-distance trucking comprises establishments engaged primarily in providing long-distance trucking between distant areas and sometimes between the United States and Canada or Mexico. Numbering 39,000 establishments, these firms handle every kind of commodity.
Specialized freight trucking provides over-the-road transportation of freight, which, because of size, weight, shape, or other inherent characteristics, requires specialized equipment, such as flatbeds, tankers, or refrigerated trailers. This industry sector also includes the moving industry—that is, the transportation of used household, institutional, and commercial furniture. Like general freight trucking, specialized freight trucking is subdivided into local and long-distance components. The specialized freight trucking sector contained 46,000 establishments in 2004.
Some goods are carried cross country using intermodal transportation to save time and money. Intermodal transportation encompasses any combination of transportation by truck, train, plane, or ship. Typically, trucks perform at least one leg of the trip. For example, a shipment of cars from an assembly plant begins its journey when they are loaded onto rail cars. Next, trains haul the cars across country to a depot, where the shipments are broken into smaller lots and loaded onto tractor-trailers, which drive them to dealerships. Each of these steps is carefully orchestrated and timed so that the cars arrive just in time to be shipped on their next leg of their journey. Goods can be transported at lower cost this way, but they cannot be highly perishable—like fresh produce—or have strict delivery schedules. Trucking dominates the transportation of perishable and time-sensitive goods.
Warehousing and storage facilities comprised 13,000 establishments in 2004. These firms are engaged primarily in operating warehousing and storage facilities for general merchandise and refrigerated goods. They provide facilities to store goods; self-storage mini-warehouses that rent to the general public also are included in this segment of the industry.
The deregulation of interstate trucking in 1980 encouraged many firms to add a wide range of customer-oriented services to complement trucking and warehousing services and led to innovations in the distribution process. Increasingly, trucking and warehousing firms are providing logistical services encompassing the entire transportation process. Firms that offer these services are called third-party logistics providers. Logistical services manage all aspects of the movement of goods between producers and consumers. Among their value-added services are sorting bulk goods into customized lots, packaging and repackaging goods, controlling and managing inventory, order entering and fulfillment, labeling, performing light assembly, and marking prices. Some full-service companies even perform warranty repair work and serve as local parts distributors for manufacturers. Some of these services, such as maintaining and retrieving computerized inventory information on the location, age, and quantity of goods available, have helped to improve the efficiency of relationships between manufacturers and customers.
Many firms are relying on new technologies and the coordination of processes to expedite the distribution of goods. Voice control software allows a computer to coordinate workers through audible commands—telling workers what items to pack for which orders—helping to reduce errors and increase efficiency. Voice control software also can be used to perform inventory checks and reordering. Some firms use Radio Frequency Identification Devices (RFID) to track and manage incoming and outgoing shipments. RFID simplifies the receiving process by allowing entire shipments to be scanned without unpacking a load to manually compare it against a bill of lading. Just-in-time shipping is a process whereby goods arrive just before they are needed, saving recipients money by reducing their need to carry large inventories. These technologies and processes reflect two major trends in warehousing: supply chain integration, whereby firms involved in production, transportation, and storage all move in concert so as to act with the greatest possible efficiency; and ongoing attempts to reduce inventory levels and increase inventory accuracy.