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Navigating the Increasingly Tangled Web of Supply Chain Laws

Posted by Tim Young on 4/2/18 3:27 PM
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Compliance is a challenge in many industries, but it becomes particularly important — and more complex — when your company transports goods across state lines. Shippers that don’t prioritize compliance can discover too late that they’ve been breaking the law.

Whether it’s regulations on hazardous materials or guidelines on refrigerating perishables, the patchwork of state laws can quickly complicate even the most straightforward supply chain. For example, Michigan’s prominent agriculture industry means the state allows a maximum vehicle and freight collective weight considerably higher than its bordering states. While your gross vehicle weight can legally exceed 80,000 pounds on most Michigan roads, you cannot cross into Indiana or Ohio due to the lower maximum weight restrictions in those states.

Other laws that can be troublesome relate to load size, including restrictions regarding maximum trailer length and maximum payload. Certain states have more nuanced standards, with California posing unique challenges for logistics professionals. The Golden State historically is a lot stricter regarding emissions and agricultural inspections, though newer equipment is designed with these emissions standards in mind.

When shippers need to go one step further and deliver goods internationally to Canada or Mexico, requirements increase exponentially. Between customer paperwork, taxes, and border crossings, the various considerations can create significant delays. While this hodgepodge of regulations can feel overwhelming, a little knowledge goes a long way.

 

A Slow Push Toward Standardization

Despite these complications, the logistics world is slowly moving toward more nationwide standardization. Aside from a few outliers, most states are aligned regarding equipment size, gross weight, and emissions restrictions.

On the federal level, government regulations dictate legal driving hours — and electronic logging devices (ELDs) to ensure those guidelines are met — for anyone operating via a commercial driver's license in the U.S. These devices are designed to automatically track driving time to provide more accurate hours of service for truck drivers.

The next big change coming down the pipeline is the Food Safety Modernization Act (FSMA), which aims to standardize food chain operations. As a response to outbreaks of listeria and salmonella caused by unsanitary freight transportation, the Food and Drug Administration has been empowered to enforce regulations designed to increase safety.

Variety of fresh vegetables on display at a farmer's market, late spring in northern Illinois, USA

Large companies have already been affected by the FSMA, but the compliance deadline for small carriers that make up the majority of trucks on the road won’t take effect until September 17. Food safety is indeed crucial, but the FSMA presents a steep challenge for smaller companies with more limited resources. But a tech-focused approach can help companies of any size implement these changes smoothly.

There will always be some growing pains tied to massive shifts of this sort, but standardization ends up being a net gain for the shipping industry. While some rules are still in flux, there are a number of key regulations that should always be top of mind.

As mentioned before, ELD mandates are forcing carrier compliance as it relates to driving regulations. This will continue to affect shippers — particularly for 400- or 500-mile trips that once were considered same-day shipments.

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Hours of service (i.e., legal driving time) is a law that affects customers and carriers equally. Only 11 hours of consecutive driving is permitted within a 14-hour “on duty” period, after which drivers must take a mandatory break of 10 hours. While shippers might be aware of these regulations, they often overlook that a driver’s wait time during loading and unloading is considered “on duty” time.

These regulations might seem like a lot to keep in mind as you attempt to move products from point A to point B, but it’s important to remember that they’re in place to ensure the safety of drivers and everyone else on the road.

 

How an Outside Partner Can Lend a Hand

Whether you’re trying to move goods between states or countries, you’re going to grapple with a complex web of regulations. It takes intricate knowledge of this web to develop a shipping strategy that is both efficient and realistic.

A dedicated third-party logistics (3PL) firm should be familiar with numerous rules and regulations, including anything that varies by location. When a reliable 3PL engages with your freight program, it will typically complete the following steps:

  1. Define freight requirements.  This includes determining the type of trailer, special shipping needs, and shipping and receiving hours of all participating facilities.
  2. Define transit times and routing of shipments.  This involves securing carriers to complete each shipment. Carriers are qualified by geographical service area, special service offerings, and certifications (e.g., hazardous material endorsement, team driver service, etc.). The 3PL should match carriers that meet all state-specific and federal regulations with your particular freight.
  3. Execute freight shipments.  At this point, the 3PL will monitor shipments, track progress, manage exceptions, and measure and report performance metrics and carrier compliance to shipping rules. While facilitating a customer’s freight program, a 3PL must tackle tricky situations such as working with multiple shipping locations or outside vendors.

Getting all parties fully engaged is one of the biggest obstacles at the outset of any partnership. A qualified 3PL should boast an implementation team of experts who can address these challenges and help set a positive tone for customers and other relevant participants. If you’re interested in partnering with a 3PL that can guarantee this level of service, contact the Sheer team today.

Topics: transportation, brokerage, 3PL

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