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In a supply chain, every decision depends on data, so data integrity is critical. Accurate and timely data ensures supply chain partners hit their targets, comply with internal processes, make informed decisions and streamline processes while controlling costs.

“Accurate and timely data allows you to make educated and smart decisions about your business. If the data is inaccurate, it portrays a different truth than the reality. In some cases, this can have a dramatic impact on results,” said Vishwa Ram, vice president of data science and analytics at Penske Logistics.

The Importance of Data Quality and Monitoring Tools

In the 2024 Annual Third-Party Logistics Study, more than half of respondents — 57% of shippers and 52% of third-party logistics providers — said they’ve experienced issues with data quality. Managing data is especially important for logistics providers, who often draw on their customers’ data but are significantly impacted if it’s incorrect.

The report found that third-party logistics (3PL) providers are more likely than shippers to leverage data monitoring tools, use IT staff to check and resolve data quality concerns and have built-in data monitoring capabilities that automatically detect and notify stakeholders of data quality issues.

Potential Setbacks in Data Quality

Without accurate and transparent data, a business can experience any of the following, which creates more work to resolve.

Lack of Trust

Errors and missing or inaccurate data all harm data integrity, and one of the most obvious identifiers of bad data is a lack of trust. “If you do not have confidence in the data and information generated from the system of record to make business decisions, then you probably have a data integrity issue,” said Rowland Myers, vice president of DCC strategy and support services at Penske Logistics.

Human Error

Penske Logistics has established key measurements to ensure data accuracy and has several methods to verify data, depending on the source. Myers said the validation process starts at the beginning. “From an accuracy standpoint, we can confirm that it was put into the source system correctly,” he explained, adding that some of the biggest challenges center around areas where human touchpoints are needed. “If a driver has to punch a data point into the phone, there is an opportunity for error.”

For example, if a driver needs to hit a button on their phone when they arrive at a location but fails to do so until well after their arrival time, it creates inaccurate information. “If something shows it is out of tolerance, it will flag it, and we can find out what happened. In some cases, the solution is better training to create habits that drive accuracy and timeliness,” Myers said.

Ram said machine data capture is always more accurate than human data capture. “We’ve done a number of things to turn as much of our data capture as possible into machine capture, but we’re always going to have humans involved, so we do have to focus on the human element,” he added.

Missing Data Elements

With information transmitted via electronic data interchange (EDI), Penske has created automatic message processing and business rules. “We look for missing data elements and flag those,” Ram said. “In some cases, we go back to the customer. In others, we are reviewing what the data should be.”

Missing data — a misalignment between what is needed and what is available — can be a process error or a case of something not being captured. “For example, if a customer doesn't provide data, it is hard for us to give them an accurate analysis on the cube of their trailer,” Myers said. “We may have to go back and understand the requirements to start tracking additional information, or we can quickly show how to improve the data through process rigor or additional training.”

Automation can also improve data timeliness, which is critical in supply chains. “If you don’t get it in real time, it loses its impact,” Myers said. “In our business, on time is one of the most sought-after compliance metrics to make sure we’re getting products from A to B. If we don’t have the timely data, you don’t have the visibility to give the customer information.”

Delay in Product Movement

More importantly, real-time data allows logistics providers to mitigate risk and keep products moving. “We want to be proactive and let the data predict an issue before it happens,” Myers said.

It isn’t enough to just capture information. It must also be transmitted to everyone who needs it. “If somebody is sitting in LA traffic and is going to be late in Denver, capturing that information in real time, sharing it to our various systems and sending a message to a customer isn’t something that is trivial,” Ram stated. “Even though we as a society have come to expect these things, it still remains a complex endeavor. We have invested millions of dollars in the right systems, architecture and analytics to make it all happen.”

Data Integration Barriers

There are countless data points in today’s operating environment, which is why architecture is critical. “We have to funnel that information into a single place accessible to all parties to get the single source of truth,” Ram said. “We have broken many of the integration barriers and integrated with a lot of vendors and technology providers over the years.”

According to the 2024 Annual Third-Party Logistics Study, integration barriers are among the top challenges shippers and 3PLs face when sharing data. “A lot of our customers have had those challenges, and one of the reasons they come to us is because we have expertise in integrations,” Ram said.

The amount of data generated within the supply chain continues to increase, and future success depends on having the right platform to absorb all data sources, including streaming data, which is also on the rise. “Getting streaming data is not easy if we’re not architected correctly. That is how we’re making systems future-proof,” Ram said.

The Future of Data Integrity

As technology changes, it will be necessary for systems to identify which data is human-generated and which data points are generated by artificial intelligence. “We also have a lot of data in an unstructured format. Being able to capture that and generate meaningful insights from it is a huge undertaking. From a technical standpoint, that is different from what we’re used to,” Ram said. “The key lies in developing an overarching strategy to integrate our processes and technical capabilities to unlock business value.”

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Spot and contract freight play essential roles in the movement of goods, and both options offer different value propositions for shippers. Recently, freight market volatility has challenged both shippers and carriers with fluctuating demand, natural disasters, economic shifts and more, making it difficult to forecast costs accurately.

Additionally, wide swings in trucking capacity have further complicated freight management, requiring shippers to monitor and strategically utilize both spot and contract options. Understanding when to utilize which solution can help shippers maximize freight spending, meet service levels, optimize shipping strategies and mitigate risks during uncertain market conditions.

Understanding Contract and Spot Rates

With contract rates, shippers commit freight to a carrier or logistics provider, and the carrier or logistics provider commits capacity for an agreed-upon rate. Contracts provide the security of price and capacity and make up the majority of freight moves. Contracts tend to last six months or longer.

A spot rate is the one-time, on-demand, transactional price a carrier or provider charges to move freight from point A to point B. Spot rates are based on the current market conditions and can change day to day or even hour by hour. The spot market can be highly volatile. Severe weather or unexpected disruptions can drive prices higher quickly.

Like most things, supply and demand factor into the prices of both contract and spot rates. When trucking capacity is tight, spot rates tend to increase and contract rates experience upward pressure. When capacity loosens, spot rates typically fall and future contract rates decrease. Spot rates, which are instantaneous, are a leading indicator for contract rates, with contract rates tending to lag behind spot rates by about four to six months.

There are times when the spot market provides more competitive pricing than contract rates. Some shippers “channel shift” and move to the spot market to take advantage of lower rates. However, disruptions experienced over the last few years have shown how critical long-term relationships are to the successful movement of goods during challenging times.

Determining the Best Option

Market uncertainty is expected to continue for the foreseeable future, and shippers will want as many channels as possible to move goods.

Contract freight offers guaranteed capacity at a predetermined, agreed-upon price, making it easier to forecast freight expenses. Contracts also provide opportunities to negotiate rates and fuel and accessorial charges, which are typically fixed in the spot market. Entering contracts also allows shippers and their logistics partners to develop strong, reliable relationships that can help ensure access to capacity during peak periods, improve service and uncover additional opportunities for savings. Overall, strong relationships can be critical to long-term success.

The spot market offers shippers flexibility and can provide valuable space when there is a planned or unplanned surge in demand, new shipping lanes develop faster than anticipated, or incumbent carriers reject loads. The spot market may also work best on some lanes, especially if they are inconsistent.

Volatile market conditions often drive freight into the spot market, and brokers can connect shippers with thousands of smaller carriers working primarily in the spot market. Because of the flexibility brokers offer, shippers don’t have to commit to more capacity than they need until they need it. Plus, utilizing all available carriers is critical to the functioning of the entire supply chain ecosystem.

Factors to consider include:

  • The overall network
  • The amount of freight to move
  • The consistency of freight
  • The level of service/specialization needed
  • Seasonal surge demand
  • Anticipated growth
  • Contingency plan needs

Developing a Strategy

Penske Logistics can work with shippers to evaluate their overall network and identify opportunities to increase efficiency, such as consolidating multiple less-than-truckload shipments into one cross dock. From there, the Penske team can review capacity needs, individual lanes, planned surges, anticipated growth, and current market conditions to help shippers determine the right mix of contract and spot freight for their operations.

Change can be hard, especially in complex operations with multiple moving parts. In transportation and logistics, the stakes can be even higher — ensuring business continuity, maintaining legacy knowledge and business data, and retaining staff are all top priorities when a transition occurs. Penske Logistics has transitioned hundreds of companies to its dedicated contract carriage services and has developed critical best practices to minimize disruptions and maintain continuity.

“One of the most critical things we do is ensure we have a good communications plan,” said Jeff Jackson, president of Penske Logistics. “We have a dedicated project management team that runs the implementations, and we put together robust customer-specific plans that provide full visibility so they can see where we are with the launch and have full transparency.”

One of Penske’s more significant transitions involved 35 sites and 400 drivers and was done in one day. “We sent teams to 35 sites to make the announcements and train and onboard drivers. We had over a 90% stick rate, meaning we kept nine out of 10 drivers,” Jackson said.

Retaining Talent

Employees are critical to a smooth transition. “In most cases, our objective is to retain all the customer’s existing drivers, provided they meet our hiring requirements. Our driver hiring center is engaged early on and provides a white-glove treatment to new drivers. We have a centralized team that does nothing but engage with drivers, which helps with continuity concerns.”

Additionally, Penske has over 11,000 drivers on staff and offers a breadth and depth of talent for any additional needs. “We also have an elite driver program with 100 drivers in various parts of the country and dispatch them for three to four weeks at a time. We can leverage that program to bring drivers in early to fill any gaps,” Jackson said.

As a best practice, Penske errs on the side of caution and tends to over-resource initially, pulling in extra drivers and equipment from its internal resources to reduce the risk of disruptions. “We have a dedicated person with Penske Truck Leasing who works with logistics and will handle the transition. It takes a huge burden off to know we have equipment available, and we’ll have priority when the fleet utilization is high,” Jackson said.

Penske also has a full suite of training videos covering various topics, from leadership to core functionalities. “It is easy for our team to train new staff quickly, which leads to a clean transition early,” Jackson said.

Maintaining Knowledge

It is essential to maintain critical data and information, which include electronic data and employee knowledge, and successful integrations are key. “We like to connect IT to IT, and HR to HR, and have those teams work together directly. They speak the same language and can run testing before the implementation starts,” Jackson said.

Penske Logistics has made extensive investments in technology and has expertise in IT integrations to ensure nothing is lost. “We have integrated with all kinds of TMS and ERP systems,” Jackson said.

On the labor front, Penske wants to understand the current compensation and benefits packages. “We have our own, but we want to know if ours is superior or inferior. We want to keep drivers whole,” Jackson said, adding that Penske’s strategy is not to move wages backward and this makes the compensation process as easy as possible. Plus, some customers fund retention bonuses to incentivize employees to stay.

Emphasizing Communication

A large part of a project’s overall success comes down to communication, starting with the request for proposal. “When companies put an RFP out, they need to have confidence that it represents the real solution. That is a common pitfall,” Jackson said, adding that the best start-ups happen when the customer looks at their processes and data before they come in so they can communicate them clearly. “The more transparent they can be with us, the better we can be. It takes both of us to partner to get the transition done.”

External communication is also important, so the customer’s sales department must understand the reason for the change and the value it will provide. Then they can articulate it to their customers. “Sales cannot be out of the loop. Customer communication is key,” Jackson said. “You have to build trust, and you need to build it quickly.”

With a robust communications plan, access to a wide range of internal and external resources, and extensive experience transitioning companies to dedicated contract services, Penske Logistics possesses the tools and experience to ensure a smooth transition with minimal disruption.

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The Food and Drug Administration (FDA) has issued new requirements for additional traceability records for certain foods, ranging from nut butters to cut veggies to shrimp, under the Food Safety Modernization Act (FSMA). The requirements, which take effect on Jan. 20, 2026, create new traceability record keeping requirements beyond those in existing regulations for certain foods. All entities in the supply chain will be subject to the Food Traceability Rule.

The FDA said the changes, which require entities to share information with others in the supply chain, will allow for faster identification and rapid removal of potentially contaminated food from the market, resulting in fewer foodborne illnesses and/or deaths.

The list of foods includes some cheeses, eggs, certain vegetables, including cucumbers and leafy greens, some fruits, including melons and tropical tree fruits, fresh-cut fruit and veggies, some fish, nut butters, and ready-to-eat deli salads, such as egg salad, potato salad, pasta salad and seafood salads.

In preparation for the new requirements, which are less than three years away, it’s essential to start evaluating current warehouse management system (WMS) capabilities now to be best prepared for the near future. Since traceability in our food supply chain is essential to providing better service to our customers and end consumers, and a detailed record-keeping system is important for all the foods we handle in our food chain, making updates now will lead to a seamless transition when the new requirements become mandatory.

Key Data Elements and Critical Tracking Events

As part of the rule, those who manufacture, process, pack or hold foods on the Food Traceability List (FTL), must maintain and provide to their supply chain partners specific information — called Key Data Elements (KDEs) — for certain Critical Tracking Events (CTEs), in the food’s supply chain.

For example, if a distribution center (DC) receives the repacked fresh cucumbers from a produce processor, it must keep records on the receiving KDEs of the fresh cucumbers. Since the DC will be shipping the cucumbers to a retail store, it must maintain KDEs related to the shipping of the cucumbers to the next point in the supply chain, the retailer. The DC must also send the KDEs to the retailer.

Records must be kept regarding where the shipping event began and where it ended, meaning where the food was received. Still, the FDA said it is unnecessary to have records of the food's route, including any instances where it may have been moved from one carrier to another. Also, for cross-docking situations where food is arranged for transport from point A to point B but is briefly placed on a loading dock at point X at the DC to be transferred from one truck to another, records don’t need to be kept for point X.

Key Data Elements for those receiving food include:

  • Traceability lot code for the food
  • Quantity and unit of measure of the food
  • Product description for the food
  • Location description for the immediate previous source (other than a transporter) for the food
  • Location description for where the food was received
  • Date the food was received
  • Location description for the traceability lot code source or the traceability lot code source reference
  • Reference document type and reference document number

Key Data Elements (to maintain and provide) for those shipping food include:
  • Traceability lot code for the food
  • Quantity and unit of measure of the food
  • Product description for the food
  • Location description for the immediate subsequent recipient (other than a transporter) for the food
  • Location description for the location from which the food was shipped
  • Date the food was shipped
  • Location description for the traceability lot code source or the traceability lot code source reference
  • Reference document type and reference document number (maintain only)

Traceability Plan

All parties covered by the rule must create a traceability plan, and several are specific to those holding the food, such as a DC. The plan must include a description of the procedures used to maintain the required records, including the format and location of the records. It also needs to have a description of the procedures used to identify foods on the FTL and a statement identifying a point of contact for questions regarding the traceability plan and records. Traceability plans must be updated as needed to ensure the information reflects current practices and previous traceability plans must be maintained for two years after an update.

The Importance of Equipment, Technology and Training

There are several layers to the FSMA, which was signed into law in early 2011, and several requirements apply to the transportation and storing of food. All parties in the supply chain need to ensure they’re complying with current requirements and prepared to meet upcoming compliance dates.

FSMA includes requirements surrounding vehicles and transportation equipment, which must be “adequately cleanable” to allow the sanitary transport of food and “must be stored in a manner that prevents harborage of pests or becoming contaminated in any other manner that could result in food becoming adulterated.”

The ability to track and trace products is at the heart of several requirements, making the right WMS a vital resource. Tier 1 systems provide information on where products are stored and have embedded algorithms that can find ways to maximize productivity and the movement of product in and out of the warehouse.

It is also important for those transporting and storing food to be current on the latest requirements and best practices. Penske Logistics has earned Cold Carrier Certification, adding to its strategic approach to safety. The certification, which is the first of its kind, recognizes cold trucking carrier companies that comply with the Refrigerated Transportation Best Practices Guide from the Global Cold Chain Alliance, a trade association representing all major industries engaged in temperature-controlled logistics. Additionally, Penske associates undergo regular training to ensure food safety.

Foods on the Traceability List

Foods that will be subject to greater requirements in 2026 include:

  • Cheeses, other than hard cheeses
  • Shell eggs
  • Nut butters
  • Cucumbers
  • Herbs (fresh)
  • Leafy greens (fresh and fresh cut)
  • Melons
  • Peppers
  • Sprouts
  • Tomatoes
  • Tropical tree fruits
  • Fruits (fresh cut)
  • Vegetables (fresh cut)
  • Finfish
  • Smoked finfish
  • Crustaceans
  • Molluscan shellfish, bivalves
  • Ready-to-eat salads

Learn more at:

https://www.fda.gov/food/food-safety-modernization-act-fsma/food-traceability-list

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Freight Management FAQs

What is freight management?

A: Freight management is the process of efficiently and strategically moving freight across a network from its point of origin to its desired destination using various modes of transportation, intermediaries, and technologies. The process employs logistics and supply chain expertise, physical assets such as trucks, distribution centers and warehouses, and technology to move freight efficiently and cost-effectively.

Why has freight management become such an important component of business?

A: The ability to deliver freight on time to the right destination, in the right quantity, damage-free, and at the lowest possible cost, has always been critically important to businesses. In today’s competitive environment, this ability is more important than ever due to factors such as leaner shipper inventories, just-in-time manufacturing, rising warehousing and labor costs, tighter delivery windows, and consumer fulfillment expectations driven by ecommerce.

What modes of transportation do freight managers use?

A: Freight mangers ship cargo by air, rail, road, and water. Combinations of these modes, often referred to as intermodal transportation, are also used to provide optimal logistics and delivery solutions. Within the United States, roughly 70% of freight is transported by commercial trucks.

What are the different road transportation options?

A: Ground transportation comes in many varieties but common choices for shippers are full truckload (TL or sometimes FL), less-than-truckload (LTL), and parcel. In TL transportation a shipment fills an entire semi-truck trailer, whereas LTL shipments only partially fill a semi-trailer and can be comingled with other various other appropriate freight to make up a full load. Parcel refers to the transportation of small and mid-size package units. Each option requires a different freight management approach.

What are the different freight management options via truck?

A: The three primary freight management options by truck are: private carriage, common carriage, and dedicated contract carriage. Shippers that choose private carriage elect to manage their own trucks and drivers. In common carriage, freight is moved by multiple third-party trucking carriers on an as-needed and transactional basis. Dedicated contract carriage (DCC) — an increasingly popular method — provides the same fixed capacity and control as private carriage but shippers fully outsource the operation and management of their fleet to a third-party logistics provider (3PL) or lead logistics providers (LLP). In the instance of DCC, the 3PL operates and maintains the truck fleet, hires and manages the drivers, and ensures the safe, on-time delivery per the shipper’s requirements.

Visibility is a common supply chain term. What is it?

A: Supply chain visibility is essentially the ability to track the status and location of parts, components, and products as they move from origin to destination. It’s difficult to overstate the importance of supply chain visibility. It underpins excellent customer service and enables companies to drive cost out of supply chains by, for example, anticipating and avoiding operational disruptions.

Transparency is another widely used supply chain term. What is it, and how does it differ from visibility?

A: While visibility covers the monitoring of units flowing through supply chains, transparency refers to how companies share their freight information with other trading partners in the supply chain. This may include manufacturers, distributors, trucking carriers, 3PLs, upstream and downstream suppliers, freight brokers, freight forwarders, regulators, or even customers themselves. The concept of transparency within the supply chain ensures the smooth, efficient hand-offs and shared knowledge of everyone working within a logistics network. Transparency has become especially important in consumer-facing industries such as retail, CPG or food where shipping has become ever more complex, and customers are demanding more information into the products they buy. The evolution of trends like blockchain are clear evidence of a greater desire for transparency.

How can a shipper maintain high levels of visibility and transparency?

A: Technology is a critical piece of the visibility and transparency puzzle. 3PLs and LLPs use tools such as transportation management systems to track and trace the movement of freight and disseminate this information to authorized parties as quickly as possible. Leading 3PLs and LLPs also use advanced tools such as artificial intelligence to spot anomalies in freight networks and notify shippers of potential disruptions or delays.

What is a transportation management system (TMS)?

A: A transportation management system (TMS) is a platform for managing freight and freight flows. One of the most important tools in the logistics toolbox, TMS technology has evolved rapidly over the last decade. Modern systems support day-to-day freight operations as well as strategic decision-making through advanced analytics.

How is Internet of Things technology applied in freight management?

A: Internet of Things (IoT) is the term used to describe technology that connects everyday objects to the internet via sensing devices. Products and components moving through supply chains as well as assets such as trucks can be tracked using IoT-based sensing systems. These systems provide companies with real-time or near real-time location data and status updates such as the temperature of loads.

What is a routing guide?

A: A routing guide is a guide to which carrier or carriers a company chooses to move its freight. Routing guides come in many forms, but generally include preferred carriers that align with the shipper’s logistics needs.

What is a spot market rate in trucking?

A: Spot market rates are one-off rates quoted by truck carriers to haul a particular load or loads. Unlike contract freight rates which are fixed according to a pre-negotiated agreement between shipper and carrier, spot market rates fluctuate. Using the spot market to move freight is usually the more expensive option. Maintaining comprehensive routing guides is one way to lessen a shipper’s dependence on the spot market.

What are accessorials?

A: Freight accessorial charges are charges incurred outside of regular load pickup and delivery activities. Examples include fees for packing or unpacking cargo or a charge imposed by a carrier for unplanned delays at a loading dock. These extra fees can significantly inflate logistics costs.

What is a preferred shipper?

A: Trucking companies generally prefer to do business with companies that are efficient, financially sound, and highly collaborative — commonly called preferred shippers. The accolade translates into a competitive advantage. For example, a preferred shipper is more likely to find carriers to haul its freight during periods when carrying capacity is in short supply. There are various ways to become a preferred shipper. One is to keep loading/unloading delays to a minimum (see accessorials above).

How can a freight management partner save time and money for shipper clients?

A: There are numerous ways in which freight management partners deliver significant time and cost savings. For example, leading 3PLs and LLPs help shippers to negotiate the most competitive freight rates to minimize costly supply chain disruptions, and to ensure that freight networks run to maximum efficiency.

What should I look for when choosing a freight management partner?

A: It is vitally important that shippers choose a freight management partner that has the right level of logistics expertise and is compatible both culturally and organizationally. Here are some notable red flags:

  • Does the 3PL / LLP have a long and successful track record of managing different types of freight?
  • How responsive is the 3PL / LLP to market changes and trends as well as supply chain disruptions?
  • What resources does the 3PL / LLP offer in terms of infrastructure, technology, and personnel?
  • Does the 3PL / LLP have a strong presence in multiple industries? Cross-industry expertise is extremely important in today’s highly competitive logistics market.
  • Is the 3PL / LLP an innovator in terms of the logistics solutions it has implemented and the technology it deploys?
  • Can the 3PL / LLP show that it is ahead of the technology curve?
  • Is the 3PL / LLP financially sound and well-insured?
  • Does the 3PL / LLP have a strong reputation and brand in the marketplace?

As one of the top-ranked third-party logistics provider (3PL) and one of the industry’s original lead logistics providers (LLPs), Penske's team draws upon 50 years of experience helping market-leading shippers succeed with safe, on-time and efficient deliveries. Our freight management specialists create customized freight management plans to best meet the specific needs of your business — whether that is improving service levels, driving down costs, enhancing operational performance and driving change, or some combination of these common needs.