Study: Business Logistics Costs Rose 3.4% in 2012

The Council of Supply Chain Management Professionals (CSCMP) has released its 24th annual “State of Logistics Report,” presented by Penske Logistics. The report reveals that total U.S. business logistics costs rose in 2012 to $1.33 trillion, a 3.4 percent increase from the previous year, remaining at 8.5 percent of the U.S. gross domestic product (GDP).
 
The report, authored by transportation consultant Rosalyn Wilson of R. Wilson Inc., has tracked and measured all costs associated with moving freight through the U.S. supply chain since 1988. This year’s report presents an overview of the economy during the past year, the logistics industry’s key trends and total U.S. logistics costs for 2012. It also suggests that the U.S. is no longer in recovery mode, but rather in the “new normal” for the economy and supply chain industry as a whole, according to Wilson. The research concludes with a brief overview of industry indicators for the remainder of 2013. The annual “State of Logistics Report” is now available for distribution.
 
This year’s report discloses that transportation costs were up 3.0 percent in 2012 due to weak and inconsistent shipment volumes and pressure to hold rates. The trucking industry is maintaining a tenuous balance between supply and demand, a balance that will likely be disturbed when the U.S. Department of Transportation’s new Federal Motor Carrier Safety Administration (FMCSA) hours of service regulations go into effect July 1, 2013, according to Wilson. The impact of these regulations will be to reduce existing drivers’ productivity, leading to a capacity contraction. Truck transportation costs rose only 2.9 percent in 2012; however, expected capacity pressures will push rates up quickly.