Five Reasons Why Flatbed Shipping is on the Rise

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By: Kayla Matthews, FreightWaves

In recent years, the flatbed freight sector has seen a massive increase in demand. It’s so high that at times, trucking companies have had to delay shipments and deliver slower performance – they’re inundated with orders.

This growth happens despite a plateau in other areas of freight, where in some cases shipments have declined. One group of carriers, 31 in total, saw an 18.9% revenue boost – to $8.8 billion in 2018, up from $7.4 billion just the year before.

The question is, why is this happening? What factors and trends have led to the upswing in flatbed demand?

Why flatbed freight?

Before exploring the reasons why flatbed freight and shipment options are on the rise, it makes sense to consider why a party would choose it over other shipping and transport opportunities.

Flatbeds, contrary to general opinion, come in several different forms and they’re available across the four major shipping methods – namely, ground, rail, ocean and air. They’re not all necessarily the type of elongated truckbeds that many are used to seeing on highways and public roads. There are also containers, including refrigerated options, trailers, train cars and much more.

Flatbeds are generally used when material loads are bulky and too difficult to lift without heavy machinery. That may or may not include construction materials such as wood, steel, masonry and more.

The stored goods may also be difficult to access, making it challenging to retrieve through conventional means. That also means certain products may only be transported using flatbed options – they’re just too difficult to move around otherwise.

As for what’s contributing to the increase in demand, there are several reasons why it’s happening.

Higher import demands

The first and most prominent contributor to the boost in flatbed use correlates with a high demand for imported goods. Due to current events and supply chain complications, that upward trend may start to taper off soon. Until now, it’s been a significant driving factor. Refrigerated and cold storage flatbeds have been necessary to transport goods coming out of port markets such as Houston, Jacksonville and Savannah. Not only are many of the products coming from overseas of high quality, but they’re also relatively inexpensive compared to domestic options. China, especially, has been a major supplier of imported goods and materials.

Construction activity on the rise

Another major contributor is the healthy and rapid growth of the construction sector. The U.S. construction industry is expected to record a compound annual growth rate (CAGR) of 4.9% and reach a total value of $1,804.8 billion by 2023. Even the residential construction industry is booming, with a CAGR of 9.1% from 2014 to 2018. Higher demand for any construction project means a growing demand for materials, components and machinery, a majority of which must be transported using flatbed freight vehicles. Many of the materials –  including wood, steel and more – will not fit on other transport options.

Oil and drilling booms

In addition to the construction and import sector, the world has seen an increased demand for crude oil. That means both the shipment and import of oil-based goods has picked up, alongside essential drilling operations. Stable energy prices have only exacerbated this trend, as the higher demand for energy means a higher demand for oil and fuel. It’s also helped stabilize oil prices, altogether creating an efficient market. The ecosystem is undoubtedly seeing a connection to these higher demands and activities, and it’s contributing to growth across the board. As one might expect, many of the materials needed in the industry require flatbeds to move the freight, particularly oil drums and containers.

Healthy consumer markets

Yet another trend that might see slower activity going forward due to current events is consumer shopping activity. Until now, it’s been quite the opposite. A phenomenal consumer market has contributed to a higher demand for general goods. Many retailers have been taking on larger and larger shipments of  goods, which has helped to enhance the need for flatbed-type freight containers and vehicles. The 2019 shopping and holiday season saw record numbers, despite having fewer days compared to previous years. Overall, holiday retail sales saw an increase of 3.4%, making it one of the best-performing years in a long time.

Larger goods mean larger transports

Another reason why flatbeds are in high demand is because larger goods are being moved about more openly and regularly. The larger the goods and materials, the larger the transport option needs to be. That makes flatbeds the obvious choice. Everything from furniture and large electronics to online-order building materials is contributing to the need for larger transports. Online retail channels are especially seeing an increase in purchases and activity, and many of the big names are starting to offer new goods. Amazon, for example, has a vast selection of furniture for both indoors and out. Other companies such as Wayfair, Walmart and Lowe’s, for example, carry large items too and offer free residential shipping. As consumers become more comfortable making big purchases online, more goods are being moved about the country – even globally – and it means shipping and freight companies need to step up their game.

Will the trend continue?

While it remains to be seen whether or not this flatbed freight boom will continue, the numbers have been positive for quite some time. Organizations and individuals have had a more pronounced need to transport and move larger goods and materials, which has helped to boost the demand for flatbed freight options. It’s undoubtedly proved fruitful for the entire flatbed freight sector.

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