DC Velocity - May 2018

where capacity is as dear as can be, shippers
may be willing to pay to make it worth-
while for the carrier, experts said.

BACK TO BASICS

Perhaps lost amid the crisis, and the innovations being developed to combat it, is the pressing need for shippers, third par-ties, and truckers to better manage the daily blocking-and-tackling. The capacity problem has been “festering for years,” said Charles W. Clowdis Jr., a long-time transport executive and consultant who heads his own consulting firm. That’s because many shippers grew complacent and negligent in a two-decades-long buyer’s market and failed to make their freight “carrier- and driver-friendly” long before it became a current-day marketing slogan, he said.

Failure to move drivers on and off the docks within an hour or two, or even providing drivers with an attractive level of amenities to pass the time, has come back to bite shippers now that truckers and drivers can effectively cherry-pick their loads, Clowdis said. He estimates that the inability to address and resolve these basic issues is the cause of half of the current crisis.

Another long-timer, Larry Menaker, whose consulting firm specializes in dedicated service, said shippers shouldn’t count on an endless supply of dedicated capacity. “There is only so much capacity right now. If carriers are offered new dedicated opportunities, and to meet those needs requires them to pull equipment from satisfactory volume, they may be hesitant to do that,” he said.

Menaker added that the trucking indus-
try’s public line that the driver shortage
psychological barrier to overcome.”
appears to be in full flower. Capacity
is assured for a multiyear period,
price increases are negotiated ahead
of time, and good providers can find
loads to fill backhauls so the custom-
er—who in the traditional dedicated
model pays for round-trip capaci-
ty whether the equipment is
utilized or not—is shielded
from a potential financial hit
if it lacks adequate return vol-
ume. NFI, a Cherry Hill, N.J.-
based trucker with a strong
dedicated carriage footprint,
is using the capacity crisis
“as an opportunity to lock
up good business,” said Bill
Mahoney, the company’s senior vice
president of sales. Mahoney added
that NFI is marketing dedicated’s
value as it always has, but the dif-
ference today is that “it’s taking less
convincing” to get customer buy-in.

Another relatively new model is
“volume LTL” or “partial truck-
load,” which are options for ship-
pers with loads that are too heavy
or dimensionally outsized for an
LTL trailer but are smaller than
a full truckload. There are factors
that could make partial truckload
a more cost-effective buy than vol-
ume LTL, especially if a shipment’s
profile falls outside the optimal size
for an LTL trailer. One caveat is that
the program isn’t suitable for moves
of less than 250 miles because the
short-haul may not be worth it
for the carrier. However, in a cycle