Back in the late seventies when I worked as an Industrial Engineer for LTL carrier Ryder Truck Lines, the Senior Vice President of Operations had on his desk nameplate one word, “Service.” It sent a simple but concise message to everyone: the only thing LTL carriers have to offer their customers is service. How true, if you think about it: LTL trucking is relatively simple. Carriers provide a service of moving a product from point A to point B and delivering it in the same condition as when it was picked up at point A. This article will go into depth about the service beginning at point A and ending at point B the pickup and delivery function (P&D) of LTL trucking.
The primary objective of any P&D operation is to ensure that all loaded shipments are delivered and all assigned pickups are accomplished in a timely and efficient manner. To that end, the key objective is to minimize drive time (sometimes known as windshield time) and miles between each customer stop. P&D routes can be categorized into three types:
• Urban – an inner city route such as downtown Atlanta with short runs (less than one mile) between stops.
• Metro – a route in areas outside of downtown but within a major city’s metropolitan area.
• Peddle – a route which encompasses small towns or communities, usually significant distances from the driver’s terminal.
Carriers typically develop routes for a driver to make up to 20 or more stops in a day. An urban route may have more stops due to reduced miles (50-60) and depending on the location of the terminal, while a metro route driver may drive 90-100 miles, and a peddle route may encompass 150-200 miles or more.
In most cases the routing of delivery stops is more efficient because the carrier already knows all the stop locations and can route the driver in the most effective travel path. However, delivery appointment stops can require a carrier to totally revise the stops and may result in a less than optimal route. The normal procedure is for a driver to empty his unit of deliveries at the farthest point of the route before starting to make pickups. Pickup stops in many instances require backtracking on the route as pickups are relayed to the driver.
Carriers collect cost data on each stop. In years past, it was as simple as a driver manifest on a clip board, but today the most high tech carriers utilize on board computers and handhelds. Carriers measure the drive time between stops, time at the stop, and delays. P&D route metrics include stops per hour, miles per stop, and shipments per stop. The metric that can have the most impact on your pricing is shipments per stop. It costs a typical carrier $120-130 per hour to have a P&D unit on the street. When a driver utilizes 30 minutes to make a stop (driving and time at the stop) then the stop cost would be $60. If two shipments are picked up, then the average allocated cost per shipment is $30; however if six shipments are picked up, the average shipment cost would be $10. Keep in mind it may take a little longer to load six shipments versus two, but the cost allocation point is made.
The carrier’s P&D operational cost will typically absorb 12-15 percent of a shipment’s revenue depending on size of the shipment and length of haul. Therefore, the P&D operation is vital since it is the start and end of all shipments.
Next time, I will discuss a LTL carrier’s dock operation.
The primary objective of any P&D operation is to ensure that all loaded shipments are delivered and all assigned pickups are accomplished in a timely and efficient manner. To that end, the key objective is to minimize drive time (sometimes known as windshield time) and miles between each customer stop. P&D routes can be categorized into three types:
• Urban – an inner city route such as downtown Atlanta with short runs (less than one mile) between stops.
• Metro – a route in areas outside of downtown but within a major city’s metropolitan area.
• Peddle – a route which encompasses small towns or communities, usually significant distances from the driver’s terminal.
Carriers typically develop routes for a driver to make up to 20 or more stops in a day. An urban route may have more stops due to reduced miles (50-60) and depending on the location of the terminal, while a metro route driver may drive 90-100 miles, and a peddle route may encompass 150-200 miles or more.
In most cases the routing of delivery stops is more efficient because the carrier already knows all the stop locations and can route the driver in the most effective travel path. However, delivery appointment stops can require a carrier to totally revise the stops and may result in a less than optimal route. The normal procedure is for a driver to empty his unit of deliveries at the farthest point of the route before starting to make pickups. Pickup stops in many instances require backtracking on the route as pickups are relayed to the driver.
Carriers collect cost data on each stop. In years past, it was as simple as a driver manifest on a clip board, but today the most high tech carriers utilize on board computers and handhelds. Carriers measure the drive time between stops, time at the stop, and delays. P&D route metrics include stops per hour, miles per stop, and shipments per stop. The metric that can have the most impact on your pricing is shipments per stop. It costs a typical carrier $120-130 per hour to have a P&D unit on the street. When a driver utilizes 30 minutes to make a stop (driving and time at the stop) then the stop cost would be $60. If two shipments are picked up, then the average allocated cost per shipment is $30; however if six shipments are picked up, the average shipment cost would be $10. Keep in mind it may take a little longer to load six shipments versus two, but the cost allocation point is made.
The carrier’s P&D operational cost will typically absorb 12-15 percent of a shipment’s revenue depending on size of the shipment and length of haul. Therefore, the P&D operation is vital since it is the start and end of all shipments.
Next time, I will discuss a LTL carrier’s dock operation.
