Cargo theft is not a new phenomenon but has become rampant in recent years. In 2023 alone, close to $130 million worth of cargo was stolen in the US — a 57% year-over-year increase. It could be more, but since reporting cargo theft is not mandatory, we may never know.
Although cargo theft is a major source of supply chain disruption, the primary concern is its effect on businesses and their customers. Shippers lose their products to cargo theft, which impacts them in many ways, including delayed recovery, loss of reputation, and damaged customer relationships.
In this context, trucking businesses and brokers are continuously seeking ways to mitigate or reduce cargo theft. Most of the solutions have been tech-enabled, which is unsurprising in today’s digitally driven world.
But what happens when the solution becomes a part of the problem?
Isn’t it interesting that despite all the promises of technology, people and businesses still face the similar problems they faced before the advent of technology? This time, though, it is only at a more sophisticated level, which then ramps up positive tech advancement, and the cycle continues.
Undoubtedly, technology has made logistics and supply chain operations easier for all parties involved. Tools like load boards, trackers, telematics, and the internet have made transporting cargo faster, seamless, and more productive.
However, load carriers and brokers aren't the only ones these tools appeal to. Criminals can now steal from a distance, considerably reducing risks while increasing the rewards. It shouldn’t be surprising that cargo theft has also ramped up recently.
Now, criminals are deploying cyber scams, identity theft, and sophisticated strategies that help them steal cargo from unsuspecting carriers and drivers. This type of cargo theft is known as strategic cargo theft, and, according to CargoNet, has seen a dramatic 430% increase year on year. Although other categories also saw a similar increase, strategic cargo theft was by far the largest.
Although cargo theft has dramatically risen, so much so that it has gotten the attention of Congress, it is not without cause. During the pandemic, there was a huge spike in consumer goods, leading to increased demand for truckers and load carriers.
To meet demands, trucking businesses increased capacity by bringing more capacity to the market. However, with the pandemic gone and changing consumer preferences, freight demand has plateaued, creating a conundrum.
With low demand, truckers are left with an infrastructure that can do so much more but does too little. This leads to low prices and a temptation to cut corners just to stay in business. The current rise in cargo theft is not isolated but enabled by the situation or environment these truckers and load carriers have created. Some of them are:
Because of low demands and too much capacity, carriers put several orders together to save on resources and lower expenses. However, this is usually done without the broker or customer's consent, exposing their goods to unknown factors. As you can imagine, it will lead to longer travel times, potential damages, and, most importantly, it can lead to theft.
Cargo thieves now have access to social engineering as a tool and can use it to reroute deliveries. Sometimes, they fake Identities or impersonate brokers. They are also deep into cyber hacking, which is often made possible by obtaining information such as the origin and destination of the transported goods.
Double brokering happens when a broker employs the services of another broker but refuses to pay on time or when due, which forces the second broker to abandon the transaction. As you can imagine, this causes many problems for all parties involved and exposes the cargo. Another issue with double brokering is that customers are forced to deal with a broker they have no idea about.
Sometimes criminals rob the old-fashioned or traditional way, looting trailers and drivers of their cargo. Although this is not as common as strategic cargo theft, it still happens and could cause many problems for the broker and trucker.
While 2022 hit an all-time high in cargo theft, 2023 quickly topped those numbers. Unfortunately, 2024 seems to be on track to follow the same trend. 2024 is well on track to see 600 cargo theft incidents before the end of february. To put that into context, 2023 saw a total of about 2,806 incidents.
The spike in early 2024 might be a continuation of the end-of-year spike in cargo theft for 2024. After all, customers aren’t the only ones shopping during the season. It is also a good time for looters, especially because of the tendency for truckers to unwind or park their trucks for longer periods. Getting into unmanned trucks isn’t too difficult at that time of the year.
Whatever the case, though, it seems like truckers are stuck with the problem, at least in the near future. Whether or not it is ideal, it is a problem that truckers must face head-on in order to find a solution otherwise, the potential loss will only continue to ramp up.
At first glance, the highways may seem like a safe and inconsequential geographical location, but they have suddenly become a battleground for truckers. They are not just transporting goods but are locked in a battle of survival with cargo thieves. And they cannot afford to lose or give ground on it.
The impact on load carriers could be astronomical. But what can be done? How can these carriers fight back and prevail?
For starters, cleaning up the lapses and investing in security will greatly benefit these businesses. Many of the thefts have been due to negligence on the part of truckers and the need to make a quick buck.
No matter the investment in security by a trucking business or broker, if there isn’t a coordinated effort to clean up transport operations and eliminate lapses, it may all be for naught. This is why more businesses are reviewing their transportation process to reduce opportunities for theft from an operational end.
It all ties back to technology. Yes, criminals are taking advantage of some tech advancements to cause problems for trucking businesses and brokers, but with better tech solutions, innovation, and security, these businesses can sway the battle in their favor.
EKA Technology makes the transportation process safer, more efficient, flexible, profitable, and sustainable. Digitizing the world of supply chain operations with a people-first focus, EKA connects the relevant operators – carriers, brokers, and shippers – to a secure and protected cloud infrastructure. With this, all parties can enjoy a transparent, secure, and efficient process.
Reach out to us to discover how we can assist you in safeguarding your cargo and optimizing your transportation operations.
