Partial Truckloads: What It Means For You
I am the owner of Green Transportation in Holland Michigan and like most truckload carriers we struggle with finding qualified drivers to keep my/their fleet full let alone being able to see some continued growth of our fleet. I think that the majority of others truckloads owners are in the same position as us and many will put drivers that are not fully trained into a power unit out of shear desperation.
I also am sure that most carriers are very much in agreement that there is a critical driver shortage that will only get worse down the road especially if the carrier does long haul where drivers are out longer than what they would like. As a result a tremendous amount of resources and money is spent fighting over trying to entice these drivers to work for them instead of who they are currently working for. They all have some kind of sign on bonuses promises of maximum miles and additional perks that may or may not happen and the churn of driver turn over continues at an alarming rate of 80% or more just to find out the grass is not always greener with a different company.
I keep very up to date on a variety of methods that carriers use to attract drivers as well as trying different methods to increase their fuel efficiency to offset some of these very high expenses of increased wages benefit insurance costs etc which is what they must do to stay in businesses which is becoming more and more difficult especially with smaller fleets. Customers are very concerned about rising prices time to get to the customers and damages that may occur by having their product handled far to many times before the customer product in finally delivered. In fact our customer base on long haul business is shrinking as these customer are seeking out closer vendors to eliminate some of these issues.
The average person not in the industry assumes that all of these large tractor trailers are full of product and this is simply not the case. I am not sure what the percentage of full vs not full these loads are but I am absolutely certain that that this number is very high and in general we do not fully utilize our driver resources. Yes we have customers and brokers that will try and piece or match partial head loads together but this is iffy not consistent and sometimes not always available to the customer especially when volumes are heavy.
There are also many customers that do not trust the carriers in general and they think that the only way to get their product delivered on time and safely is to send as an “Exclusive “ in which many of these loads consist of one or two pieces maybe 10/12 feet of a trailer and spending 50% more than needed because we as an industry have not supplied them with better and safe options. Our overall reputation is not that great and the customers just don’t trust us when we offer up something innovated or new because we usually fail and the customer never try’s it again.
I have attached some examples of shipments that Green received that would have been shipped as a full load until we used our optimization program to give the customer the safe and on time service that they have requested and not charge the full truckload rate so their product because less expensive and they do not lose their competitive edge and lose the business because of cost. At Green as well as Zip Xpress (An LTL carrier)have teamed up to fill these loads (With the customers knowledge)without the extra cost and a huge increase in revenue per load with just a small amount of extra cost for the carrier so as a result our loads have double the revenue for basically the same amount of miles and cost.
We have been doing this successfully since 2001 and produce a carbon footprint report for them to use within their sustainability section of their companies and they love it and as a matter of fact use this report to gain business from others that have some sensitivity about the environment. I hope that all of you know that diesel emissions are the worst polluters on the planet. We are a small company however each and every week we optimize 6/8 prior truckloads that makes the like amount of drivers available to us and to others as well. This is not a sales pitch but instead a plea to think smarter and be more innovative.
I personally want to start the process of healing and not have the mindset of the more loads available drives prices up so why do anything that’s going to change this because the majority of thinking is the more loads the merrier so they can charge what the market will bare. This is simply not long term sustainable as much of this business will disappear for all the reasons I outlined.
I am also putting out a challenge to the mega LTL carriers to get more innovated as well.They all have an LTL division a truckload division and a brokerage division all operating separately without a clue of trying to do what Green Transportation/Zip Xpress does on a daily bases . The thought of coordinating their individual resources with each one of their divisions is just not discussed even though there is a pot of gold just waiting to be collected and more importantly a large amount of drivers will be available for their use more revenue can be generated and growth will also be attainable. These big carriers need to move out of the 50 or so years of inefficient transportation.
If we can do this with our limited resources they can as well with their enormous amount of funding and smart people in their employment. As I mentioned earlier this is not a sales pitch but rather an operating model that works and produces operating ratios that I believe are some of the best in the industry. I have been in this business for over 55 years and still have the passion to make it a better place and renew our reputation. I have much more on this subject to be shared in another post and would be willing for free to answer any questions or concerns on how the process is done including videos of actual optimized shipments that I am will to share. I can be contacted at 616-836-9209 or email me at email@example.com.
The driver situation is going to get worse and this is our opportunity to help ourselves have better profits and keep our customers.Thank you in advance for any interest that you may have