With U.S. truckload capacity tighter than it’s ever been, it’s important for transportation managers to be aware of the things that can have a significant impact on their costs – and jobs.
10. Using a Single Logistics Solution
The freight market has always been competitive. But with so many acquisitions and mergers, logistics providers are vying to create the ultimate “one-stop shop” for all freight services. Though their solutions and reasons to consolidate seem compelling, there’s one thing that no one single company has cornered the market on: capacity. Different providers have different access to capacity, and drivers will give priority to the shippers and logistics providers of their preference. That said, it’s important for transportation managers to keep options open and diversify their freight coverage with different providers. This also helps foster competition to keep freight providers honest.
9. Shipping End-of-month / End-of-quarter
Most organizations push to close and ship on their sales goals by the end of the fiscal month. Drivers and carriers typically charge a premium to move during this time. Transportation managers should communicate with their sales department and ship as much as possible before month-end. Even with contract carriers and contract rates, nothing is sacred at the end of the month when rates soar.
8. Inaccurate Load Information
Not verifying things like weights, commodities, and temperatures before booking a load can cost precious time and money. Despite how obvious this one may seem, one of the leading causes of unplanned costs for transportation managers is the relay of inaccurate load information to their logistics providers. Good providers will do their best to watch their customers’ backs,but they should be the last line of defense.
7. Shipping Last-minute
When a customer places an order at the eleventh hour, there’s little you can do other than try to be accommodating. It’s understandable that last-minute orders are frequently unavoidable. Unless you have a fleet on standby, finding a driver to pick up a load that same day can be challenging. On average, you’ll pay more to book a load on the date it’s picking up. This is especially true during holiday season and the end of the month, as market capacity starts to get booked 3-5 days in advance. Those trucks that remain on your ship date have a large number of loads to choose from, and you may find yourself in a price war to win a truck for your load. Educate your salespeople and customers concerning same-day freight bookings, and help them develop a workflow based on planning ahead.
6. Shipping all your Freight on Friday
Friday is typically the busiest freight day of the business week. Naturally, it’s because many businesses want to clear their docks before the weekend. Of course you will have to ship on Friday frequently. But learning to pace your freight so that it mostly ships on other days will help lower your transportation costs. The best day of the week to catch drivers that are ready early and fresh on hours is Monday.
5. Taking the Weekend off
If you don’t already have loading staff available on the weekend, it may be worth looking into. While there are less drivers looking for loads on the weekend, there’s also less competition for your freight, since most load planners take the weekend off. Drivers get stuck or miss pickups on Friday and still need to get moving, and they’re pretty open-minded when that happens.
4. Getting a Late Start on your Same-day Freight
As a general rule, the peak coverage time for same-day freight is between 6am and 10am central. If you’re not getting same-day loads tendered over in that timeframe, it becomes more difficult for your carriers and providers to lock down capacity. The adage, “The early bird gets the worm” really bears sway in the freight industry.
3. Lack of Empathy for Drivers
We’re still 15-20 years from fully-automated trucks having any impact on our industry here in the states. Until we get there, the driver shortage will only get worse, and demand will increase. That said, it’s important to treat drivers with a little understanding and patience. Thanks to the Information Age, a handful of angry drivers on your company’s google business landing will inevitably work against you to ward off drivers in the future. As capacity tightens, shippers of choice will get first dibs on available capacity.
2. Failing to listen
There are a hundred things (at least) that have to work right for your freight to get from point A to B safely, efficiently, and in one piece. You will frequently hear from your people in your transportation network concerning the timely transfer of your freight. It’s important to listen with the intent to make adjustments and improvements as needed.
1. No Flexibility
In 2014, while the economy was still recovering and the freight market was unusually slow, shippers could do whatever they wanted. For some businesses, hiring a “bulldog” to run their transportation division might have been heralded as a smart move. Today however, the “my way or the highway” ideology might not yield the best results. The industry is undergoing a lot of changes right now, from regulatory norms to driver capacity and demographic changes. Expect these changes to directly impact your business and plan to make changes of your own to keep the transportation link in your supply chain strong.