Home Month and Year May 2024 The Dynamic Logistics Hub

The Dynamic Logistics Hub

The logistics industry is a dynamic

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The Edmonton region has the geographical advantage that it takes for a robust logistics sector to thrive, grow and succeed. On the flip side, economic growth in the Edmonton region requires an efficient logistics sector to provide businesses with a vital, reliable and effective link to suppliers and target markets. Today more than ever, the vital importance of the supply chain – and the logistics sector which makes it all happen – is a critical factor.  

 

The logistics industry is dynamic. With the pace of supply chain changes accelerating at warp speed, agility has emerged as a critical trend in the logistics industry. Supply chain agility refers to a company’s ability to quickly adapt to changes in demand or disruptions.  

 

“Trucking is very important, especially in supporting the oil service sector,” notes Dr. Edy Wong, Alberta School of Business – International Office, U of A. “The equipment and inputs the sector requires are usually transported by trucks from ports to points of use. Trucking is the main way of transport for oil services. It allows for speed and the movements of smaller loads that rail cannot efficiently serve.” 

 

“Rail is important for exports of agricultural products and air allows us to connect with the Asian market,” he adds. “The location of the Edmonton region allows us to connect Prince Rupert to the hinterland. That explains the advantageous position of Edmonton as more transport routes, in addition to the port of Vancouver, are needed to increase the flows of goods from Asia.” 

 

He notes that air has become an important way to move and import products over a longer distance with speed and that Edmonton’s location also makes it the shortest distance for air traffic to Asia and allows for transshipment services to the Asian market. 

  

“Air is a key component of Edmonton’s logistics hub because it is utilized for both industrial and consumer goods. E-commerce has also created a higher demand for air transport services,” he says. “In fact, air traffic allows us to be efficiently connected to e-commerce networks such as Amazon. It is a requirement for the growth of e-commerce in the Edmonton region, although it may be more of a consumer-oriented service than an industrial one.” 

 

Wong is blunt about the pros and cons of relevant factors about logistics modalities.  

 

“The disadvantage of air is clearly its cost. It is the most expensive transport option among the three, but when time, speed and distance are considerations, air is the method of choice.”  

 

While rail is a significant component of Edmonton’s logistics advantage, the unavoidable and practical fact is that rail is cheap but slow. He explains that Alberta has a shortage of rail services during certain times of the year, moving agricultural products to port, and the practical fact of rail also requires connections to other transportation modes due to its fixed positions. 

 

Matt Faure, CEO of Trimac Transportation, the Alberta-based trucking company with more than 100 branches throughout North America and operating more than 2,500 tractors and 4,000 trailers, highlights the tremendous changes in the logistics sector in the past five years or so, particularly Edmonton’s emergence as a logistics hub. 

 

“Being central to most service industries, we tend to be reflections of the markets around us. Not surprisingly, the needs of our customers are evolving along with the environments they operate in. Freight visibility is becoming tablestakes to do business nowadays, which has forced a more technology-forward approach for carriers.” 

 

He emphasizes that logistics efficiency can mean many things, “but from the carrier lens, because trucking is such a capital-intensive business and the assets have long life spans, it is about maximizing the utilization of assets.” 

 

Faure highlights the Edmonton advantage and its growing rank as a logistics hub.  

 

“Edmonton is home to many large operational centers for logistics companies, especially relevant in bulk trucking. It provides access and proximity to many different forms of industrial production, which require freight movement, both inbound and outbound, from some of the large facilities in the surrounding area. It also offers the infrastructure in terms of potential employees, maintenance facilities, OEM solutions and more to support some of the more remote operations that surround the greater Edmonton area.” 

 

As with most aspects of business combined with key aspects of logistics, he acknowledges transformations in the trucking sector. 

 

“Trucking has increasingly become a story of survival, where inflationary costs are seemingly disproportionately challenging the industry. Technological disruption and increasing environmental demands all come at a cost,” he says. 

 

Yet, Matt is upbeat and points out that the positive differences about operating in Canada versus other countries is the stability of Canada’s supply chain. 

 

A dynamic example is Parkland County, west of Edmonton. It continues to earn a global and industry reputation for being a logistics hub. 

 

“Our logistics advantages, combined with our supportive and business-friendly, low-tax environment, make Parkland County a desirable industrial area to set up business in,” says Mayor Allan Gamble. “Parkland benefits from being located at the nexus of the CANAMEX trade corridor and the TransCanada Highway. CN’s mainline runs directly through the County, positioning our many intermodal access points as links to the entire region. This includes access to the flourishing Port of Prince Rupert, which has taken off due to constraints at the Port of Vancouver.” 

 

The mayor adds that Parkland’s logistics sector is diversifying, thriving and growing. According to business trends and stats, the Acheson Industrial Area is Parkland’s beating heart and home to over 400 businesses, with most playing a direct role in the logistics sector. 

 

“Parkland’s logistics boom was a response to the entrepreneurial spirit of our forward-thinking development and business community,” he explains. “Businesses were seeking the perfect balance of proximity to key transportation corridors and the greater Edmonton region, combined with cost-effective land to build and operate on. The boom continues with long-term businesses such as Myshak Crane and Rentals, Gregg Distributors and Standard General, to newer market entrants like our world-class Amazon, Save-on-Foods, Fountain Tire and Home Depot distribution centres. Thousands of residents are employed in this sector, delivering the goods we need to support our economy,” Gamble notes.   

 

Wong is confident that Edmonton will continue to grow as a vital logistics hub.  

 

“Trucking will be important for local industries and the importation of consumer goods. Rail will be important for agriculture exports but also for supporting the growth of the Edmonton region. Our exports to, and relations with, Asian markets will be a big factor in determining the growth of the air cargo market,” he concludes. 

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