Monthly Archives: December 2017

Your Week In Trucking – The Latest Updates As 2017 Comes To A Close

Wow, it certainly has been quite a year, has it not? The trucking industry has seen a lot of growth and change as it evolves to accommodate a shifting transportation landscape. But the year isn’t over yet! We’ve got the latest and greatest news that impact the trucking industry, from moves in California to moves in Washington D.C.

We’ll start on the West Coast, where it seems just about anything California decides to do has an impact on the trucking industry. This time, there may be some movement regarding port company truck driver misclassification.

The L.A. Misclassification Debate

Well, it’s official. On December 12 the Los Angeles City Council voted unanimously to investigate a ban put in place to address trucking and warehouse companies it was believed may be breaking employment laws, whether local, state, federal or otherwise. The motion specifically applies to any businesses who are operating on city property.

Specifically, the motion requires that City Attorney Mike Feuer submit a written report regarding the situation. This report is to then be delivered to the City of Los Angeles. It is expected that the council will be briefed on options governing fair wage and fair working conditions for workers operating in the Port of Los Angeles.

Fueur also as a mandate to closely examine the city’s land use laws, and whether those laws can be used to deny access to a company if they are found to be in repeated violation of standing employment laws. Whether or not there will be any findings supporting using the law in such a way is still up for debate. The motion aims to zero in on companies that have already been accused of anything from denying truck drivers fair wages or benefits – especially where it relates to their employment status.

In making their decision, the City Council referenced a USA Today report that may have pointed to abuses at the Ports of LA and Long Beach. While trucking companies and other industry stakeholders came out firmly against the report, pointing to the large numbers of truck drivers who succeed as independent contractors.

In their summary, the City Council noted that since 2010, approximately 1,150 port truck drivers have filed small claims lawsuits in civil court. They may have also filed complaints with the labor commission. They continued by referencing statistics that shows judges side with truck drivers nearly 97% of the time.

As to what the result of the new investigation, and how it will impact both trucking companies and the owner-operators that work for them, no one yet knows. But it is worth noting that this is an issue that the City Council has set firmly in their sights.

The TRALA ELD Waiver Win

Have you heard? The Federal Motor Carrier Safety Administration (FMCSA) recently announced a 90-day waiver program for motor carriers operating short-term rental trucks. In their ruling they defined short-term as 30 days or less. What does this mean?

Trucking operations that operate within this situation will have until March 18, 2018 to figure out how they will proceed. On the other side, companies that rent tractors will have another three months to ensure their rental vehicles are compliant.

This win comes as a big victory for the Truck Renting and Leasing Association (TRALA) who won this concession with one week to go before the mandate is set to go into effect. The notice of the 90-day waiver is set to be published in the Federal Register as soon as the terms are written up.

In praising the decision, TRALA stated in a news release that the waiver is “welcome news to truck rental companies that have been spending the past few months trying to put together strategies and plans to address the fact that FMCSA only granted part of TRALA’s original request for a five-year exemption for short-term rental trucks.”

We had originally reported on a waiver for rentals of eight days or less, as opposed to the 30 days TRALA was originally asking for. TRALA worried that many of its members would not have enough time to respond to the changes and ensure their customer’s needs were met in a compliant fashion.

Many thought the 8-day ruling on the matter was the final word, but according to TRALA’s statement, they continued to discuss the matter with the FMCSA in the hopes of winning a final concession. They admitted needing to make “multiple calls” and initiated “face-to-face discussions” in order to come to an agreement.

TRALA President and CEO Jake Jacoby went on to call the interaction between his organization and the agency an “open, honest, and productive dialogue [that] really helped our membership and I know our members appreciate the agency’s understanding of the unique challenges this rule presents to rental trucks.”

Truck leasing companies have also come out in support of the waiver, citing the extra time given as a critical factor in ensuring they are able to stay in compliance. One of the major concerns both TRALA and industry lobbyists referenced was the unique nature of companies that rely on tractor rentals, as well as the limitations imposed when two different ELD systems cannot talk to each other.

TRALA points out that if a rental company uses one ELD system but then a business uses a different rental company who uses a different system, it could present unfortunate compliance issues. Others point out that providing the extension doesn’t rob the mandate of its efficacy, but merely ensures companies who have an interest are able to prepare in time.

Your Economic Update

Interest rates were raised again in early-December. The Federal Reserve doesn’t seem to be concerned that the economy is in any danger. The larger target interest rate is now at 1.5%. The current increase represents the fifth one the Fed has made since they reduced rates to zero following the Great Recession.

How will the change in the federal funds rate impact trucking? Mainly the relation is with inflationary pressures. The goods that go back and forth between parties creating and buying those goods happens on the back of the trucking industry. As the economy goes, so goes trucking.

Fortunately, there doesn’t appear to be any danger on the horizon. If you track inflation across a 12-month rolling cycle and take a historical peek back in time, it is still below the Fed’s target 2%. In other good news, unemployment remained muted and wages showed moderate growth. Still, economists wonder why there has been such a lack of inflationary pressures considering the liquid environment our economy has been in for the past decade.

The one slight dip appeared in the Institute for Supply Chain Management’s Manufacturing Index, which slightly declined, but not enough to send it into negative growth territory. The manufacturing sector appears to continue a healthy run.

Obviously, the economy changes and gradual movements on both the micro and macro scale could change the paradigm, but for now, despite bumps from major weather events, both the overall economy and trucking sector appear to be on pretty good footing.

Trucking Continues to Show Strength

Measures related to freight movements completed by for-hire transportation companies shows another rebound to start the fourth quarter of 2017. The Freight Transportation Services Index (TSI) released by the Transportation Department, saw an increase of 0.2% better than economists and industry watchers were expecting.

Significant increases in freight movement, from trucking, to rail, and intermodal all saw big jumps. This all takes place amid a backdrop of increasing economic strength. Adding to the good news was the Fed’s Industrial Production Index, which saw a rise of nearly 1% over the reporting period. From housing starts to savings, the American economy has been doing well and trucking benefits.

In fact, the Freight TSI measure in October was the third all-time high measurement the industry has seen. The four-month period from August to November 2017 saw huge levels of Freight TSI growth. These types of numbers have not been seen either ever or in a long time.

In fact, many industry insiders are expecting more explosive growth for the trucking industry, warehousing, and other sectors related to keeping the supply chain humming. Many companies have stated that they intend to expand operations in the new year, signaling more growth, more jobs and a healthy transportation sector.

What does this mean for the overall state of the industry? If the economy continues to do well, freight activity and supply-chain growth appear to be a dependable constant. While no one can predict the future, all signs point to a prosperous 2018.

A Closer Look At Commercial Heavy Duty Truck Leasing

Traditionally, trucking fleets often own their own vehicles, yet leasing is also an option. Today, we will look at the benefits of leasing and why it may be right for your fleet. Whether it be through the freeing up of additional capital or gaining better insight into the total cost of ownership, leasing has its benefits.

In today’s trucking market, ask just about any fleet manager and he or she will tell you that keeping truck costs low is at the top of their priority list. Of course, this can easily be handled through more effective route planning, cutting down on idle time or installing speed limiters, but another option is through truck leasing.

The Truck Rental and Leasing Association (TRALA) recently did a study and found that nearly a quarter of all Class 8 commercial motor vehicles on the road were leased or rented. All told, that’s nearly 189,000 vehicles. Out of that number, almost three fourths were under a commercial lease.

Overall, that represents a very large number of Class 8 commercially leased vehicles on the road, yet there is much farther to go, simply because leasing a vehicle does come with benefits, and we aren’t talking about only reduced cost.

Above all, it’s up to the fleet manager to make the final determination on whether a lease is right for your fleet or not. So, what exactly are the benefits of leasing? Let’s look at them when viewed through the lens of buying.

Lease Benefits as Opposed to Buying

Fleets aren’t in existence to manage vehicles, they are there to fulfill the duties of their company mandate, whether it be to deliver food, fuel or provide some other service. Leases are beneficial because they generally come as part of a package deal, or with side benefits.

While many a trucking executive is wedded to the idea of a fleet owning its own vehicles, there is cause to believe this isn’t the best situation. Eventually, the fleet won’t have to keep paying a truck payment, but it will have to finance or pay for the vehicle up front, which ties up capital, time and resources.

Where a lease provides greater benefits over buying is that it requires a lot less cash to be put up front. Ongoing lease payments are also typically quite lower than regular truck payments through a financed option.

Lower payments free up cash flow and reduces overall fleet capital expense for other parts of the operation. There are also some tax advantages to leasing, though it is advisable that the back office verify this for your lease.

By Bank or Not By Bank

Of course, a fleet can choose to go through a bank to arrange vehicle leases, but generally fleet management companies are able to do better than a bank by offering additional services besides just financing.

Many companies offer the full vehicle lease, but may also throw in maintenance, licensing, handling title issues, and many other services that pertain to operating a heavy-duty Class 8 commercial motor vehicle day-in and day-out.

This creates a great value prospect, because then the fleet not only doesn’t have to deal with the heavy up-front financial burden of buying the truck, but they get additional services thrown in as well. Truck leases allow fleets to minimize staff time on truck-related issues that the fleet management company can easily handle.

Fleet management companies have also become very good at spec’ing CMVs according to the needs of their clients. They also have the tools required to keep the truck maintained and help reduce lifecycle overhead while increasing operational efficiency.

Consider training, as well. Your leasing partner will not only have the tools and the wherewithal to manage your vehicles, they may also be able to assist in training your truck drivers, which both increases safety and saves on fuel costs over the long-term.

When Maintenance Matters

Fleets spend a lot of money in the shop. Freeing up that time and leaning on your lease partner can be hugely beneficial. Not only can they advise on the proper maintenance program for the vehicle in question, but they can also provide preventative maintenance guidance and assist in scheduling shop time.

Leasing companies have also negotiated price for parts far in advance of your business with them. What you would pay as a small- to mid-range fleet for a transaxle or bearing would be far higher than a leasing company paying for the same parts. Many also come with roadside assistance programs built-in.

We recently reported on the shop of the future. Companies are now entering the game with mobile mechanic setups that alleviate a fleet from even needing to keep a fully staffed shop. Maintenance options can be either in-house, outsource, full-service or mobile programs.

By freeing up maintenance costs, you’re again able to shift the money around and push it towards uses that may yield greater benefit. The next benefit lies within the numbers.

Leasing in the Land of Big Data

If there is one thing that every fleet has on their mind right now, it’s likely one word: Data. As trucking inevitably moves from the paper to the digital era, data is being generated in huge amounts. Companies are coming to bear and parsing the data and generate actionable outcomes across the fleet.

This is where fleet management companies have another advantage. They are better able to capture real-time data about their trucks, analyze it and better use it to help the motor carrier they partner with better improve their operation, from spec to fleet size.

In a world where telematics is the new name of the game, lease partners can help implement full-scale telematics solutions for their clients. Whether it be ELD usage or otherwise, as technology and trucking continue to mash together, expect leasing companies and telematics providers to continue upping their game.

Analysts generally sit on the other side of the wire, ready to identify trends and truck driver behaviors. Through instantaneous tracking of each vehicle and everything that happens with it and a full analytical back office, leasing companies come “ready-made” and can hit the ground running with little to no learning curve.

What is a Full-Service Lease?

Beyond helping with financing or maintenance, truck leasing companies also operate in an administrative capacity, alleviating your back office from basic documentation and tracking duties.

When you partner with a company that offers a full-service lease, you can expect that they will handle most – if not all – fleet operational needs. They also can handle insurance claims, fuel card programs and fleet compliance requirements.

If your operation doesn’t have the scale or resources to handle administrative duties of this scale, fleet management companies can fill the gap. They come with fully-fledged industry relationships that can be leveraged for the benefit of your fleet.

All the services required to start a trucking company, or streamline an existing one, can be bundled together into one, simple, low-cost solution and consolidated into one billing cycle.

When a fleet management company owns the data, maintenance, accident, training and implementation requirements for a fleet, they can better answer vehicle life-cycle cost questions. By doing this, they can help lower the overall cost of ownership for the vehicle.

A fleet leasing and management company not only helps with asset acquisition, maintenance and back office work, but they can also assist in selling the truck at the end of the leasing period, since they will typically have partnerships with vehicle auctions and remarket sales companies.

Depending on the type of lease, which we will get to in a moment, the fleet may earn or owe some money at the end of a lease. Obviously, the goal is to owe nothing, but that also calls for better forecasting to ensure the truck was removed at the right time.

It may be easy to assume that getting a net earn on the lease is preferable, but that would mean you had less money on the other side for other aspects of fleet operations. The goal is to ensure as little inaccuracy in forecasting and modeling for a vehicle’s life cycle.

The leasing company wants to ensure the truck’s life-cycle time is maximized. This benefits not just the leasing company but the fleets they partner with as well.

The Two Lease Types Explained

There are two major lease types a fleet can enter. One is called a close-ended lease and the other is an open-end terminal rental adjustment clause (TRAC) lease.

An open-end TRAC lease puts the depreciation risk onto the lessee, but they also generally come with far more flexible terms, which is why these are also called finance leases. They allow the lessee to assess the CMV’s service life after a predetermined amount of time.

After the predetermined time has passed, the lease can be terminated at any moment with no penalty to the lessee.

A close-ended lease puts the depreciation risk on the lessor and has more restrictive terms. The lease agreement should show the monthly rental amount over a predetermined period.

While leasing may not be for everyone, it certainly has inherent advantages. Always take careful measure of your fleet’s needs before deciding on a lease option.

How Telematics Can Be Used To Reshape Your Fleet

Although some refer to advanced telematics systems as GPS systems or even mistake them for ELDs, the word telematics encompasses a whole host of different things.

Properly utilizing telematics isn’t just about tracking a vehicle’s location or logging time, telematics systems – whether in-house or outsourced – are generally robust software or web-based solutions that allow fleet managers and other decision makers to quickly access customizable reports, vehicle and truck driver alerts, virtual dashboards, maps, and a host of other tools used to fine-tune fleet operations.

But what’s a fleet to look for in such a system? With a host of providers out there all promising the best option, it can be tough to properly assess which solution is right for your fleet. Yet, this is the most important step of all.

There are basic options that should automatically be included into any self-respecting telematics solution:

  • Vehicle/fleet fuel consumption;
  • Vehicle alerts;
  • Vehicle maintenance statuses;
  • Attendant vehicle data and maintenance information;
  • On-road truck driver performance;
  • On-site vehicle location information;
  • Route information, and;
  • Fleet utilization data.

The fact is, most telematics system vendors know what the trucking industry needs. By the day, more providers come online, addressing needs the industry may not even know it needed addressed.

All of this is born out of the original target, one all fleets struggle with, whether big or small, and that’s fuel consumption.

Telematics to Save Fuel

Fuel is, after all, one of the largest operating experiences a fleet contends with. If there’s one thing that will make a motor carrier smile when they are spec’ing a vehicle or assessing operational efficiency, it’s finding ways to reduce fuel use.

Telematics providers contend that their solutions provide fleets with a measure of insight and visibility in many key areas, and especially fuel consumption, from idle time to out-of-route driving. Let’s look at each individually.

  • Speeding: Every 5 mph over 50 mph adds twenty-four cents per gallon of fuel. Multiply that by the size of your fleet over the course of their lifetimes and you can see that it adds up to no small amount.
  • Idling: When a vehicle runs idle, it wastes approximately one gallon per hour. It’s a veritable gas guzzler and the tractor doesn’t even need to be moving.
  • Maintenance: A system that can give you insight into vehicle alerts and potential maintenance issues is a good find. Consider tire pressure. Under-inflated tires lower fuel economy by 0.2 percent for every 1 psi drop. That’s huge.
  • Unauthorized Fuel Use: Whether it be through the unauthorized use of a vehicle or the improper use of a company fuel card, unauthorized use can be wiped out by using a card attached to a telematics solution.
  • Out-of-Route Driving: The best way to figure out if a truck operator is taking the most fuel-efficient route is if a system figures it out for you. Finding the best route equals less vehicle wear-and-tear and decreased fuel consumption.
  • Fleet Utilization: To get the most out of your vehicle’s time in service, you want to make sure it is always engaged in productive work. Telematics systems can provide valuable insight, which allows fleets to figure when the best times are to deploy certain fleet assets.

While saving on fuel and deploying useful data is important, there’s one other aspect that should sit above all else in the hierarchy: safety.

Putting the Safety into Telematics

If you are operating with workers who are out on the road, their safety, and that of those around them, should be at the top of anyone’s priority list. When an accident occurs, there are so many ways it impacts not just the fleet, but potentially the community the accident occurred in.

From reputation to litigation to loss of morale and lowered productivity, accidents also have a negative impact on your bottom line. So, what drives the accident, and how can you leverage technology to help lower them?

Let’s first look at the main two reasons most accidents occur: driving behavior and maintenance problems.

Truck drivers respond to training. They provide an outstanding level of service and performance when they are treated well and given the tools to succeed. Those tools come in the form of better training and When everything about what a vehicle is doing is being recorded, the data being analyzed, and behaviors trained to, it’s far easier to get buy-in from the truck drivers in your force.

Telematics allow you to better respond to issues that arise, say, if an engine blows or if there is an accident, even if that accident wasn’t caused by your truck driver. Having that immediate information is key to getting help quickly, getting in touch with the authorities and, of course, your truck driver.

Once the situation is under control, trucks with advanced telematics systems installed can yield a vast amount of data related to the incident. When combined with video and sensor systems, telematics deployment can provide you with the critical data you need to understand what happened in the event of an accident.

Addressing Productivity Through Technology

It’s important to immediately point out that telematics is designed to complement what the truck driver is doing, to help them stay engaged and even give them a tool to encourage their own development through interaction with the system.

Although regulations are in a state of flux because of recent political events, many fleets are still moving forward with technologies that let them easily remain in compliant with HOS, ELD and DVIR regulations. They are considering this as a the new normal, no matter who is in the Oval Office or occupies the halls of Congress.

Not only is compliance important, but so too is efficient route planning. One of the first things a fleet manager will want to know is how efficient the company vehicles and employees are throughout their day.

Could a load have been routed better? Is there a vehicle that spends a lot of its time sitting idle? These are the types of questions (see: symptoms) that can be addressed using advanced telematic systems and their attendant software programs.

One example could be a large, decentralized motor carrier that runs on either a service or delivery-based model. By utilizing a telematics system, the company can identify the nearest respondent to a call based on the vehicle requires, who the truck driver is and the tools on the truck, then plot the closest route to get there, all within a matter of a minute or two. This ensures a quick response, cutting down on lost time and needless driving.

It could essentially refine the best routes for each vehicle, depending on mileage and load. This would cut down on miles driven, fuel usage and wear-and-tear and company vehicles. It’s the basic principle of doing more, with less.

Said motor carrier could also use the same system to optimize their back-office duties, automating processes that before required a ton of paperwork and eliminating a huge number of hours in labor and paperwork handling.

Utilizing Telematics to Enhance Your Maintenance Game

When it comes to keeping your vehicles in good shape, there are two kinds of maintenance: scheduled and unscheduled. Here’s the secret: if you manage the first, you decrease the instance of the second.

Of course, any fleet manager will tell you the first thing on his or her mind is keeping downtime to a minimum. Downtime has a negative effect on everything else downstream in the operation, from customer service to how individual truck drivers are managed.

This is where automated maintenance procedures come into play. When you can use telematics in concert with your highly trained fleet technicians, the shop turns into something extraordinary.

Imagine your technicians sitting in an advanced shop setting, air-conditioned and cooled, they utilize their slim desktop and portable devices to manage fleet operations, all with the help of advanced data analytics and AI-assisted route-planning and load management systems.

When a shop supervisor can count on a complete understanding of all the factors that have an immediate impact on the uptime of vehicles under his or her prevue, it becomes far easier to turn reactive maintenance into preventative maintenance.

A shop technician can quickly and efficiently pull up oil temperature specs across a wide range of vehicles in the fleet at a moment’s notice. Even things as seemingly as small as individual tire pressure ranges on specific vehicles can all be tracked in real-time from a central operations center. Problems can be managed before they ever become bigger problems down the road.

Still, even as we extoll the virtues of new technology and the future of telematics, we understand that adoption time is still required. Not every motor carrier will adopt technologies at the same frequency or even use the same technology, which brings up another question. What will the standards be?

The fact is, many questions remain unanswered, but the promise of telematics rings true. There is a lot of potential in going digital. Will your fleet be ready?

How Technology Is Reshaping Dump Truck And Warehouse Design

Everywhere you look, technology is reshaping the way industries operate, and trucking and warehousing are no exceptions. Today we’ll look at how technological innovation is reshaping two staples of the trucking industry: the good ole’ dump truck and the warehouse.

Remember when you were a kid? Surely you had one of those Hot Wheels dump truck toys, right? Many a young boy can remember having their own toy dump truck at some point in their lives. They were ubiquitous at one point. Today, you’ll more likely see a child looking at a screen than playing with a dump truck.

These Class 8 heavy duty commercial motor vehicles (CMV) play a vital role in building the economy. Still, generally when a new piece of technology of this scale comes online, it has to spend some years proving its functionality, especially vocational vehicles.

Technology is now changing not just on-highway CMVs, but also vocational vehicles such as dump trucks, garbage trucks and more. This has been a response to both regulatory pressure and the long march of advanced technological adoption.

While a lot of this has to do with the common bodies and components that on-highway and vocational CMVs share, it also has to do with vocational fleets facing many of the same problems as their counterparts. From fuel savings to better route planning, technology can help.

So, what does the new dump truck look like?

The Dump Truck Evolves

This new dump truck can handle the same heavy hauls in tough conditions – often over tough terrain – but can also remain wirelessly connected and equipped with smart devices. All this while still exhibiting a good level of fuel economy and a focus on safety.

In fact, where over-the-road fleets focus more on fuel economy, it could be said that for many of these large vocational vehicles, safety is first and foremost in the mind.

The technologies involved include everything from simple step and grab-handle packages to extremely complex truck driver assistance programs with full-vehicle sensor coverage. Many vocational operators now consider collision avoidance systems a requirement, as these vehicles operate closer to road vehicles and other obstructions.

One example is how a fleet can configure a CMV with an automated manual transmission in such a way that prevents it from going into gear when the crane boom is lifted or extended. In the case of a dump truck, software can prevent the dump truck from exceeding 5 mph is the dump body is raised.

By using technology, companies operating dump trucks are benefiting from better all-around visibility, maneuvering assistance and even automated interlock functions – such as those used in dump truck operation.

Even systems previously unheard of in vocational applications are being applied in their use, from tire pressure monitoring systems to satellite or GPS communication technologies that allow the truck to communicate with the home office.

What Makes Dump Trucks Unique

The reason why we’re focusing on dump trucks as opposed to other types of vocational CMVs is because dump trucks go through a unique level of abuse. Technologies used in their operation must be able to withstand a lot of jostling and hard hits.

But dump trucks don’t only operate on the job site, requiring low-gear, locked differential labor, they often can put in up to 200+ miles of on-highway travel as well. The demands required when shifting between applications can be rigorous. Dump truck operators demand maximum uptime in order to see a profit hit their bottom line.

Once these devices are introduced on the job site, other factors also come into play. For on-vehicle sensors, keeping them clean is a problem. The places dump trucks operate are obviously very dirty. If a sensor gets covered in a layer of dirt, does it compromise the entire system?

These types of questions contribute to why fleets are often slow to adopt new technologies. They would rather not overcomplicate the work their truck drivers must do or wind up with a CMV that finds itself far too often sitting in the shop.

Truck Driver Comfort and Fault Detection

Still, as technology matures, safety comes back to mind, and safety isn’t just about high-tech systems. Consider ergonomics as well, especially in a time of increasing truck driver shortages.

Things as simple as steps and handles can go a long way to pleasing a trucker who has to get in and out of that vehicle multiple times a day. Fleets should study how to best organize their vehicle ergonomics for maximal operator comfort.

There’s also an area inside the cab called the “primary zone.” This area is where the dials, knobs, buttons and other control equipment is located. Are the controls and switches intuitively designed or are they difficult to operate or awkwardly-placed?

Technological advancement in truck design also allows for the addition of fault codes and onboard diagnostic systems that continually monitor the dump’s status and send a notice to the fleet manager or truck driver if, say, a truck hauling hot asphalt is in danger of overheating. With this knowledge, the truck can be moved to the front of the line and unloaded before even more catastrophic damage occurs.

The fact is, OEM and truck body builders are at the very beginning stages of what this will eventually look like in practical application. At the same time, vocational truck operators are taking even greater advantage of these technological advancements than ever before.

Technological Change A-Cometh

Now that we’ve covered how technology is reshaping a moving application, how about changes happening at a standstill? And by that we mean, in the warehouse.

It used to be that warehouses were nothing more than a large, static building with rows and rows of shelves. Workers would get what they needed using loading jacks or other tools.

Today, warehouses have turned into “smart” storage and staging areas. Whether it be a regional warehouse, an urban distribution center or a brick-and-mortar store, the robotic and technological transformation continues unabated.

According to the latest State of Logistics Report, we are rapidly “moving toward a fully digital, connected, and flexible supply chain optimized for e-commerce and last-mile, last-minute delivery. The next-generation supply chain will enhance fulfillment capabilities and drive efficiencies through technologies ranging from big data and predictive analytics to artificial intelligence and robotics.”

The main driving force behind the change has been the steady increase in package volumes. It’s no secret that most of the country has moved their retail shopping online. As they do so, new, more regional distribution centers will take over from the traditional large warehouse.

Companies offering traditional warehousing services are under increasing pressure to keep goods moving at an ever-faster pace and meet customer demands for same-day delivery.

The Meaning of a Smart Warehouse

But what exactly is a “smart” warehouse? Typically, these are defined as warehouses that deploy some sort of automation or robotic process alongside warehouse management systems. These systems will generally be interconnected with big data systems and software analytics for optimal efficiency.

To get more specific, smart warehouses may use such technologies as pick-to-light (which is a light-directed technology), voice-directed or otherwise completely automated picking and delivery systems.

New mobile apps will allow managers to monitor distribution floor activity with relative ease. Where before paper was used to track and log movements, in the smart warehouse, all of this is done electronically.

Other apps can be used to benchmark efficiency and performance standards across the warehouse floor. Warehouse managers can optimize their labor costs in real time, with little fuss.

Self-guided robots are also looming on the horizon. The fact is, the smart warehouse is here, and guess what? It isn’t being built in a vacuum.

How the Smart Warehouse Touches Everything Else

As warehouse operators begin to maximize the potential of these new technologies, the new software and cloud-based applications will reach far beyond the warehouse and even on to the partners and trucking companies they do business with.

Advanced cloud-based systems can effectively gather data upstream and transport it just about anywhere. Whomever is operating in that supply chain could potentially have access to a fully integrated model ready to respond quickly as customer or supplier needs change.

This includes trucking companies. A lot of the wireless communication and data transfer technology used in warehouses is also used in trucks. This is where cross-communication can be vital.

The fact is, the technology isn’t going away and the smart warehouse is here to stay. According to a recent Warehouse Vision Study, seven out of 10 warehouse operation companies say they plan to dramatically increase their use of these technologies by 2020.

As these warehouses change, so will they complement the technological shifts happening in the trucking industry. Operators become smarter through technology and optimize the efficiency of their operations. When this happens, everyone stands to gain.

The whole package of smart warehousing technological innovation has implications for everyone along the supply chain, including trucking companies. Where will the technological innovation end? At this point it looks as though the sky is the limit.

Thinking Of Outsourcing Your Trucking Maintenance Needs? Run A Pilot Program

Are you running an in-house maintenance program but are considering moving to an outsourced solution? If so, there are many steps you must go through to ensure the fit is right. The fact is, how your trucking company runs their maintenance program is critical to other aspects of fleet operations, such as safety and truck driver satisfaction.

That’s why getting the most out of your budget while keeping your expensive heavy-duty commercial motor vehicles (CMV) properly maintained and well-looked-after is of utmost importance. It’s another reason why you should never take chances in this area. As we will discuss in a moment, the type of fleet maintenance program you run is likely based on your fleet’s size and function.

Many larger fleets, flush with excess capacity and plenty of available real estate on their side, run in-house maintenance programs, simply because their sheer size demands it. Whether it be huge shops ready to pull in-and-out dozens of trucks a day for a fleet of hundreds or otherwise, the big guys often like to retain control over their maintenance programs, if for nothing else than to appease the accountants in the back office.

Keeping It In-House

For large fleets, in-house maintenance programs allow them to control everything from product procurement to technician hiring.

As they bring in new vehicles – and perhaps new technologies – keeping technician programs in-house keeps training and development departments busy and provides for quicker response times and better management over the care of the most important part of your fleet: the trucks and their truck drivers.

Still, there are advantages to outsourcing your fleet’s maintenance program, you just have to know how to find them. This holds true even for larger fleets. You don’t have to be a tiny operator to put your CMVs in the hands of those who know how to handle them. But shouldn’t you be conducting your due diligence. Of course, so you’ll want to conduct a pilot program.

First, let’s take a crack at the larger question, which is: What is a Pilot Program?

Piloting the Program

A pilot program is really nothing more than an experiment. Whenever a business – regardless of size – tries a new product, service or initiative, they do it through a pilot program. This is also why new televisions programs generally start off with what is called a “pilot” episode.

Where business is concerned, pilot programs are small-scale and are generally run over a pre-set trial period separated from the overall business operation – in this case, the day-to-day operations of a motor carrier. This way they do not disrupt overall business operations.

Some examples could be a motor carrier testing a new type of fuel or running through a series of ELD options before the hammer of the mandate falls. Another could include dispatchers installing a new software platform that includes real-time fleet tracking. Integrating these components are often a job within itself, hence the need for patience.

Now imagine this expanded out to include a fleet’s maintenance cycle. There’s a lot to lose, but also a heck of a lot to gain. To do it properly, you must take a very careful and deliberate approach.

It’s important that a fleet shop manager define the goals of their fleet maintenance pilot program as the first step in the process. Make sure to have goals set out that are not only actionable, but attainable.

Your goals should, of course, take your return on investment in mind. One such example could be to decrease your overall fleet maintenance costs by 5% in the first year. So, once you’ve set out your goals, what’s next?

Identifying Your Vendors

There are validated research companies that you can contact to help you compare providers and vendors. Asking for a list of references is also recommended. If you choose to go with an outsourced maintenance option, perhaps you should be considering the outsourced company’s customer service record.

If the vendor’s pricing structure has changed, how much and how often has it changed? Does the vendor offer an impressive variety of fleet maintenance services? What kind of price-per-value can you expect?

Whether you are meeting with a company representative in person or speaking to a customer representative over the phone, don’t hesitate to ask your potential partner vital questions. After all, you need to ensure they are the right choice for your fleet.

Does the vendor have multiple locations? Furthermore, do you have multiple locations that you require a maintenance group to service? You’ll need to make sure your outsource provider can meet your needs.

And not only that, but are they available during the hours that you work? The vendor you choose needs to be available when you need them to be available, especially in case of an emergency. Your routes are at stake.

Your final consideration is the one you likely have least control over, and that’s affordability. Are you getting what you pay for in the value offered? Are there hidden fees or “subscription” costs? Is the vendor charging you based on weekly, monthly or annually – these are questions you need answered for the sake of how you run your business.

Choosing a Site and Setting a Time

If you are a small fleet with only one vehicle, the answer should be clear, but when you are a large motor carrier with hundreds of vehicles, choosing a location to run your pilot program may be a little harder.

The same holds true for fleets who have a mixture of different vehicles that they use in day-to-day operations. Whether light-duty trucks, to sedans or heavy-duty vocational equipment, you want to ensure your maintenance pilot program addresses the needs of all your vehicles.

Also consider the people you will have at the chosen location. Your onsite manager needs to be fully open to the pilot program and whatever changes you plan on adopting.

When you are choosing to go with an outsourced maintenance program, you want to ensure your onsite manager won’t just say yes to anyone. You need someone who will oversee the pilot program with a critical eye and not be afraid to make vital recommendations – or speak up when something doesn’t seem right.

Overall, the site you pick for the pilot program will depend on what your maintenance goals and options are. Utilize your outsource partners to help you find a site, especially considering it is their services you will count on to upgrade and improve upon your business.

Also, when considering when and where you are going to host your maintenance outsourcing pilot program, consider the duration. Programs like these last anywhere from three months to a full year, depending on your fleet. What will be your pilot program duration?

The time it takes to assess a product or service should run parallel to your end-result goals. It’s for this very reason that proper goal-setting at the beginning of the process is so important.

If you are working with a larger vendor, make sure they have benchmarks in place to ensure assessments can be made at certain points during the pilot program, whether it be one, three, six months or more, depending on the duration of the pilot program.

Correlate Efficiency and Cost

When it comes to the two most important things behind any change in a fleet management program, you can expect cost and efficiency to be at the top of the lists for what their concerns are.

For smaller fleets that must show a return on investment in a shorter period, leveraging cost and efficiency becomes more difficult. Larger fleets typically have a higher level of maintenance capabilities and expanded resources. They can standardize their procedures at a far greater pace and with more ease.

Therefore, no matter your fleet size, if you are considering outsourcing your maintenance operations, make sure you find a partner who fits your customized needs. A provider worth their salt in CMV maintenance will not be caught off guard when you require something for your smaller fleet; something that much larger – and perhaps more frequent – customers might not request.

Why Outsource Pilot Programs Matter

The last thing you want to do is hire a partner that you have trouble working with. Not only does a pilot program let you test a product or service, but it provides you with an opportunity to see how the company you are about to do business with reacts in real-world scenarios.

The results of a pilot program could reveal hidden problems you might not have uncovered otherwise. Getting better at responding to unanticipated issues also creates a more flexible, responsive and ultimately more profitable organization.

Also consider that you are making a large investment into the future of your organization and its partnership with another, separate organization. This isn’t something that should be taken lightly.

In actual real-world fleet decision-making, you need positive, facts, figures and results if you are going to either switch from or switch to an outsourced fleet maintenance solution. The pilot program, when combined with a clear line of communication between your fleet and the vendor can provide just the information you need to determine if the partnership will be successful. And this before any significant investments on either side. What’s not to like about that?