Logistics Planning Combines Technology with Common Sense
YOUNGSTOWN, Ohio — Drive past a rest stop in the morning and you see them: trucks, parked nose to tail, along the drives to and from the highways. Go by an interstate exit at dinnertime and you see trucks there too. They rumble through downtowns and chug across rural roads.
And none is where it is by accident.
In an industry that moves 10.5 billion tons of cargo every year and drivers’ odometers record some 279 billion miles, nothing moves at random. Given that many of the trucking companies are small businesses – 97% of the country’s 1.5 million carriers operate fewer than 20 trucks, according to the American Trucking Association – the margin of error in planning is razor thin.
Their destinations and the routes to and from them are the result of meticulous logistics that incorporate years of industry experience and new technologies.
Hauls are generally broken into two legs: fronthaul and backhaul, the latter being the return trip. For many years, Bill Strimbu says, the attention was on making sure trucks were loaded for fronthauls, for the deliveries they make. After a truck left, the trucking company would find loads that needed to be brought back to the area near headquarters.
“Now, a lot of times we’ll get a good backhaul and we’ll find something to get us there. We try to fill lanes both ways,” says the president of Nick Strimbu Inc. in Brookfield. “But the end result has to be the same: you have to fill the lane and you need to be filled almost every mile.”
Strimbu aims for his fleet to have 14% deadhead, the industry term for moving a truck without a load, although with expedited shipping that can reach up to 30% and refrigerated shipments are around 12%.
“The big carriers that haul freight, their mark is around 3% or 4%. They’re a price play,” he says. “They come in with the low prices because they need volume. We’re not about volume, so we try to build profitable lanes and keep it profitable by limiting deadhead.”
Scheduling backhauls is split between the driver managers and the drivers, usually done before a driver hits the road.
Some drivers, through years of experience, know something will be available to bring back when they arrive with their fronthaul, says Spencer Strimbu, director of finance and risk management. Other times, it’s handled by a driver manager or by the computer systems companies use.
Among all the systems Strimbu uses, the company is working to add yet another, Sphere, that not only serves as “lane optimization” – finding the best route – but can find cargo at the other end of a lane as well, helping to ensure drivers aren’t returning to Brookfield empty.
While getting a shipment can be complex and not always guaranteed, the routes trucks take are pretty standard. For long distances, trucks follow the interstates as much as possible.
Most companies use a combination of technology and, as Aim Integrated Logistics Chief Operating Officer David Gurska calls it, “the common sense factor” that eschews the computer-generated optimal route for local knowledge.
“We can say, ‘Stop A is in Pittsburgh, Stop B is here and Stop C is there.’ But you may know we can’t do Pittsburgh first because of the traffic,” he explains. “There’s local knowledge.”
The next step in GPS technology is providing real-time updates to help drivers navigate around congestion and construction. Through the Sphere program, for example, Strimbu will be able to analyze past traffic patterns to avoid traffic.
“Things can change quickly,” Spencer Strimbu says. “This mapping will look at historical patterns and know that at this time near Washington, D.C., it’s rush hour and tell you to avoid it.”
Strimbu uses pre-approved routes but does give drivers some variance when it comes to which paths they take, usually for avoiding toll roads.
“If we can find an alternate route that’s nontoll that’s within 5% or 10% mileage, we’ll take that to save costs,” Bill Strimbu says. “But if it’s an expedited shipment that needs to go the shortest route regardless of cost, we’ll go that way. We let the driver pick his own route, but it has to be acceptable.”
For the most part, drivers and companies already know how to get somewhere, the result of personal experience. A driver leaving from Girard doesn’t need a GPS system to tell him to take Interstate 80 west if he’s headed to Chicago.
“Drivers that are on the road every day know where to avoid. There isn’t anything we use,” Aim’s Gurska says. “Our central operations, if they know of a road out there doing poorly, we’ll send it out to everybody and say to maybe avoid that route.”
That knowledge also means there are places companies won’t go.
“We steer away from places like New York City. The five boroughs – we don’t touch that,” says Falcon Transport Co.’s director of operations Larry Long. “There are bridges and tolls and traffic. You’re setting a driver up to fail because the windows are so tight.”
Because of limits on how many hours a driver can spend behind the wheel and be on duty, making sure drivers can easily get from one destination to the next is near the top of the list when planning.
Having a driver go two hours out of his way with an empty truck to pick up a backhaul means two fewer hours he can spend delivering and could mean an overnight stop, further delaying the cargo.
“The determination on that is based on the window for pickup and delivery. A lot of times, [shipments from] steel mills are [picked up] early in the morning because that’s how they run,” Long says. “Then you have to figure out how far you can get before you need a fresh set of hours.”
Meticulousness extends beyond the destinations. Drivers know where they can stop, either for breaks or to sleep, at rest areas or truck stops. At Falcon, even the gas stations are predetermined.
“We purchase a lot of fuel – it’s our No. 1 cost – so we can command a discount,” Long says. “I only fuel our drivers at Pilot and Flying J because that’s where we can get the best discount. Seven hundred trucks will do that.”
Technology is playing a larger and larger role in the business, Gurska adds. Standard at his company is GPS planning and tracking system Appian and PeopleNet, an electronic logging system that monitors how many hours truckers drive and the status of deliveries, along with many other features such as messaging, alarm notifications and fleet security.
Aim also uses an in-house system, LogisticsPro, that combines with PeopleNet to provide drivers with all the information they need.
“We push the loads through LogisticsPro into PeopleNet so when the driver shows up in his truck, he’s got his manifest and it pulls up his first stop,” Gurska says. “As he hits those stops, PeopleNet updates so people know what he’s doing every day.”
Aim has also developed an app that allows customers to log in with their shipment numbers to receive updates on where those shipments are, eliminating the guesswork of when a truck will arrive.
Near the end of the year, electronic logging systems such as PeopleNet will be federally required throughout the industry as part of an effort to improve safety on the roads.
Among other regulations, drivers are limited to 11 hours of driving time and a 14-hour workday. Further, they are not allowed to work more than 60 hours in seven days or 70 hours in eight days. Taking a 34-hour respite from driving resets the workweek.
“The biggest problem is that we’re the only ones who are regulated. If a steel mill gets a lot of business, they can have their guys work doubles, 16 hours,” Falcon’s Long says. “Our drivers are limited to 11 hours and within a certain time period you have to have that 34-hour restart.”
In the Strimbu fleet, trucks are equipped with safety cameras that monitor the driver and the road in front of him. They can be activated manually or automatically when there’s a sudden change in force, such as slamming on the brakes or getting hit by another vehicle. They’re also equipped with modules that monitor how a driver uses his truck.
“We can see if a guy is kicking it out of gear to go 81 miles an hour down a hill. … We can see any sort of abuse to the engine,” Bill Strimbu says, allowing him and his office staff to keep better tabs on unsafe driving habits.
But perhaps the biggest change in logistics planning is the drivers. It used to be, Long says, that drivers were on the road for months at a time, traveling from one delivery to the next.
“What you’re seeing is a lot of companies switching to the model for relays so they can keep guys in the truck longer because they value home time,” Long says. “We burn a pretty good track between the Chicagoland area, Pittsburgh and Cincinnati. We have guys that run the triangle and never leave those states who are home every weekend.”
Pictured above: Nick Strimbu Inc. uses tools ranging from GPS to engine monitors to keep its fleet efficient, say Bill, Spencer and Harrison Strimbu.
Copyright 2017 The Business Journal, Youngstown, Ohio.
Published by The Business Journal, Youngstown, Ohio.
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