On our way back from our extended weekend break, we passed by a newly-built distribution center, with many trucks, seemingly new, parked outside.
Why there are that many trucks lying idle seems unusual. It may be the Undas long weekend, but it doesn’t necessarily mean truck drivers are on a break, too. Perhaps it is the best time to get goods delivered, as there is less traffic on the roads.
Only then did it dawn on us: it’s very possible that these trucks are all parked outside not because the drivers are on a break, but because there are no drivers to begin with.
We’ve talked a few times in this column about the problem of a shortage of truck drivers—and it’s a problem more keenly felt again in the closing months of the year, as manufacturers, retailers and logistics providers work to deliver products in time for the Christmas rush. While it may seem the supply chain sector is in robust health, as signified by the entry of major conglomerates into the logistics space, the reality is that there are more players fighting for slices of a shrinking pie, at least when it comes to those working on the ground, the movers doing the leg work, physically bringing raw materials and finished products from one point to another.
We also have a better idea of why this is the case. We know about how congested the roads in Greater Manila are (and, increasingly, in other urban areas too) and how it prevents trucks from making their deliveries, completing their trips, and earning their wages. Other factors—how our supply chain networks are designed, how we pay our truck drivers, how we determine what kind of trucks are allowed on which roads and at what time of the day—come into play as well. Earning a wage has become difficult for some that they have decided to let go of their trucks and drive something else. There was Uber, and there is still Grab. For the next few months, at least, there is Angkas—and do note that the costs of acquiring a brand new motorcycle is lower.
This is the reality not just in Manila but in other parts of the country as well. We mentioned a few weeks back how truck drivers in Cagayan de Oro are upping sticks and moving to other countries, particularly in the Middle East, where they can earn much more for doing the same jobs they’ve done here. These drivers become more appealing prospects, too, because they undergo intensive training before going on the roads—a necessity in the provinces, where access to these programs are limited.
As the movers move away to better-paying jobs, we in supply chain are faced with a conundrum. Our best drivers are leaving because the conditions prevent them from finishing the job, and we are left with drivers who are not as experienced. The demand for these personnel are not just limited to the peak Christmas season, or the flurry of online shopping sales starting today: as one of our members have remarked, logistics providers are in a “constant peak season”, with trucks (and warehouses) in high demand.
While there are new services providing the supply chain manager with more options to transport their goods, especially at short notice—take services like Lalamove, Transportify or Mober—they may not be an ideal solution for businesses who are hoping to have better visibility of the quality of their products as they move through the chain.
Addressing this problem requires many approaches. The public and private sectors are teaming up to provide better training programs for prospective truck drivers, and the question of which trucks are allowed on the road are forever being grappled with. (New trucks tend to cost more, after all.) But whether these drivers can travel remains to be seen: the construction of new roads to increase capacity is promising, but the confusing and inconsistent regulations on when trucks can ply these roads (if at all) offsets that. And as we’ve seen over and over again, these new roads will soon not be enough, and the cycle will start all over again.
If we do not address our issues with the availability and ability of the people who actually, physically, move our products, how do we expect to have competitive supply chains?
Supply Chain Perspective in Davao City: We hope to see you this Friday, November 15, for Supply Chain Perspective, our day-long conference to be held at the Apo View Hotel in Davao City. Mindanao Development Authority chief Manny Piñol and Davao del Norte governor Edwin Jubahib are our keynote speakers; also speaking are DTI regional director Ma. Belenda Ambi, Logistikus’ Raymund Acedera, Lazada’s Petrus Carbonell, and halal advocate Marilou Ampuan. To register, visit scmap.org.
General Membership Meeting: We will be discussing best practices and challenges in supply chain network design on our next General Membership Meeting on November 21, 1pm to 5pm, at the EDSA Shangri-la Manila. Among speakers at the event are JLL Philippines’ Tom Over. To register, visit scmap.org.
Henrik Batallones is the marketing and communications executive of SCMAP. A former board director, he is also editor-in-chief of the organization’s official publication, Supply Chain Philippines. More information about SCMAP is available at scmap.org.