Long-range load planning is a key to keeping trucks filled
With the entire freight landscape going through major changes, from hours-of-service rules to looming EOBRs, fewer available qualified truck drivers, and increasing freight volume, effective and efficient load planning becomes more than a necessity. The old-school means of sending a truck out loaded on a wing and a prayer that you'll find return freight no longer works. While just-in-time freight works for shippers, finding freight “just” after you unloaded the previous cargo will leave revenue on the docks that your competition will be hauling.
If an operation has been running on the day-to-day plan, the planner typically starts looking for loads only after a truck has delivered its current load. This puts a small motor carrier in constant emergency have-got-to-find-a-load mode. If this is happening with regularity, it puts the trucking company at the mercy of loads that are being posted at the moment. This limits the company to alarmingly fewer loads — and most likely the lowest rate loads — not to mention putting the shipper or broker in control of the hauling rates. And the fewer available loads in an area, the greater control the broker or shipper has over the hauling rate and the lower the revenue out of an area.
Whether one truck or ten are in your fleet, keeping each truck filled and moving with good-paying freight is your major objective. Making a profit is your major goal, but making many phone calls trying to find freight to haul at the last minute is frustrating and time-consuming.
So, what's an alternate plan of attack? The number-one solution is developing specific lanes of operations for each of your trucks. Look for that unfilled niche of freight going in a specific direction. Find multiple customers or brokers who have this niche freight moving in that same direction. This is called diversification, creating multiple sources of revenue within the same area and lane but from different sources. Next, look at the final destination of this niche freight and find several customers with freight headed back in the general direction of your base location or outbound freight.
For the small motor carrier, it's very important to develop your load planning area based on your fleet size. Scale your freight corridor to your number of trucks. The fewer the trucks, the smaller the range of travel you need. Part of the art of load planning is not hanging your trucks out where there's very little or no freight. The only exception to this is if you're receiving round-trip rates to cover deadheading. With a smaller fleet, the shorter the distance to the home terminal (the area your outbound freight is located), the easier it is to absorb the cost of empty miles when they occur.
As you start looking at your trucking business this year, create maximum revenue through long-range load planning and develop specific freight lanes encompassing multiple load sources (shippers, brokers and load board freight). Not only is this a necessity, it's the way to thrive.
Contact Tim Brady at 731-749-8567 or at www.timothybrady.com