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www.dcvelocity.com MAY 2020 DC VELOCITY 29taining—the balance between the rate,the payload, and loaded miles, he adds.“If you can increase your payload [pertrailer] by 10%, for every 10 loads youget a free load,” Baksa says, adding:
“The cheapest mile is the one you
don’t run.”
A QUESTION OF BALANCE
Bart De Muynck, research vice president, transportation technology, atresearch firm Gartner, also emphasizes finding the right balance betweenfactors that include priorities, needs,product perishability, velocity, management commitment, and the profileof freight within the shipper’s supplychain. He brings a unique perspective,having previously worked for manyyears in PepsiCo’s transportation grouphelping implement technology solutionsbefore joining Gartner, where he servesas a leading transportation technologyanalyst.
“Companies in general who haveprivate fleets [see] transportation as avery important part of execution,” henotes. “If you have your own fleet, youare guaranteed to execute, you don’thave to worry about [tender] rejections.” Quality factors into it as well, headds. Shippers invest in private fleets for“high-quality, reliable service” and theguarantee of committed capacity at arelatively fixed cost.
Another benefit is attractiveness todrivers. “Private fleets pay better andhave better driver retention,” offeringstable runs, regular miles, and consistenthome time, De Muynck says. He seesprivate fleets as ideal for scenarios suchas intercompany transport, where truckloads move on regular routes betweenwarehouses, factories and DCs, and/or retail locations, or where you havefinished goods going from factory towarehouse, then raw materials movingin backhaul lanes to the factory.
Yet private fleets are not without risk,
he warns. Shippers essentially are build-
ing and running a trucking operation
within the larger enterprise. That means
capital investment in rolling stock;
building a team with specific trans-
portation management skills, systems,
Not every business is will-
ing to make that leap. Which
is where dedicated operations
often become a viable solution,
De Muynck notes. “Dedicated is
almost like a private fleet—assets
are dedicated to you,” he explains.
“You can optimize routes, but the
great thing is you don’t own the
asset, you don’t have the upfront
cap-ex investment or [responsibil-
ity for] hiring additional people.
It’s [a good model] for having
[secure] capacity, especially when
the market tightens up.”
At the end of the day, opines
Schneider’s Bozec, the decision
on what route to take—private
fleet, dedicated, common carrier,
or a hybrid combination—comes
down to one overriding goal: “It’s
what I want to do for my business
to win in the market.” n
