The competition is getting tougher in the transportation industry. The rising fuel prices are resulting in decreased profit margins. In such circumstances, business owners need to bring efficiency in their fleet in order to get more profits.
When it comes to transportation, even small factors can increase the cost of operations significantly. For example, drivers may leave the truck engines running while taking rest or they may be taking alternate long routes. All of this results in increased operational expenses.
In this article, we will discuss how business owners can improve the efficiency of the fleet and earn more profits.
1. Run Lean
If you want to make your drivers efficient, or choose better routes and manage loads. Then you need to hire the fleet which incorporates lean practices. You can make maximum out of your capital assets by smartly choosing the routes and transforming your inbound and outbound transportation network.
2. Put empty miles in the rearview mirror
Another major expense the companies bear in transportation is empty miles. When you send a truck for delivering the goods then it comes back empty. It is not generating anything and it adds up to the expense. You need to develop a strategy to minimize the empty miles. You can find a vendor who needs transportation service to your area. In this way, you can cover the expense of empty miles.
3. Rightsize your fleet
If you have vehicles parked at your yard then it chances are your fleet is larger than your needs. These extra vehicles are costing you money without earning something. You need to rightsize the fleet in order to reduce the expense and increase the profits.
4. Reduce wait times
You need to reduce the wait times by making the load or unload process faster. The poor planning leads to fleet idle time which is wasted on the loading or unloading the truck. Find smart ways to load and upload the inventory to make the process faster.
5. Sideline engine idle time
In the transportation industry, fuel is one of the biggest expenses. A large portion of the fuel is wasted during idle time. Make some standard operating procedures (SOPs) like turning off the engine during loading/unloading and during driver breaks. You can save a good amount of money with these smaller adjustments.
6. Maintain a state of perfect flow
Make sure everything is streamlined properly and running smoothly. Your people, materials, equipment, and processes should flow smoothly in order to provide quality services without any delay. If any of thing is getting delayed your whole process will suffer and increase lead times.
7. Get connected
You should use the latest technology in order to make the maximum out of your available fleet. Use technology like Keeptruckin ELD to get real-time data about vehicles, drivers, and traffic conditions. The technology also allows you to keep your drivers and trucks on route or ease them through traffic snarls to reach their destinations faster.
Using these tips, you can make your business process smooth and you can increase profit margins in the competitive market.