In an increasingly competitive and challenging environment, the efficient design and utilization of transportation fleets require a constant focus on many aspects of specific knowledge. These elements include industry trends and pricing, evaluating equipment lifecycles, and regulatory issues. In fact, remaining compliant in an ever-changing regulatory environment is now an essential part of managing any fleet of transportation vehicles.
Managing the Seemingly Unmanageable
While only one part of supply chain management, the choice between privately owned and dedicated fleets is a crucial decision. Beyond financial issues, effective management of fleets calls for many areas of specialized knowledge. For example, constantly changing regulations and laws make compliance, safety and accountability issues a major challenge, covering a host of areas such as:
- Environmental standards
- Commercial vehicle restrictions
- Licensing of drivers
- Control of driving periods and standards
- Tracking new and pending legislation and regulations
Dedicated fleets generally have the advantage of working within specific regions and networks. This aids greatly in maintaining compliance with local, state and federal regulations dealing with CSA.
A private trucking company in the southeast US will face both similar and very different issues as one located in the northeast. Likewise, a privately owned trucking company in Central Florida may find a delivery to the Los Angeles market requires an understanding of a large number of different CSA rules across states.
The real challenge for any shipper is remaining fully compliant while balancing the needs and expectations of both management and customers, even if they are internal shipping units.
Change as the Primary Constant
Today’s transportation environment also places a premium on continuing education. Only a short time ago, the trucking segment of supply chain management was seen as a fairly static and predictable function. Today, however, it requires skills in finance, analytics, and general management along with industry-specific knowledge. Moreover, the dynamics demand continuing education and constant training. These realities often drive shippers to use dedicated fleet services. From market pressures to regulatory issues, each shipper has unique needs for serving their market.
For example, a shipper involved with an item such as dry bulk cement requires a different solution than another dealing with wet concrete deliveries. The demands of each commodity and shipper dictate a complex analysis to provide the performance the market demands while controlling costs and maintaining CSA compliance.
One indication of this new dynamism facing shippers is the way the federal and state governments approach the issue of CSA. The Federal Motor Carrier Safety Administration now partners with states in its stated effort to:
- Improve safety monitoring
- Make safety evaluation more effective
- Use more responsive intervention processes
This increased focus and more comprehensive approach accelerates the changes that shippers must not only be aware of, they must also anticipate and implement them. While this may sound like a negative factor, the opposite is the case. The statistical success of these initiatives is shown in the steady decrease in commercial motor vehicle accidents and fatalities since 1975. While the transportation function is more demanding from a many perspectives, there is now more control of risks.
Using the Tools
Other encouraging aspects of today’s dedicated fleets are the tools and technologies available. These include professional organizations such as the National Association of Fleet Managers and numerous online sources tracking regulatory initiatives.
In choosing between a private fleet or third party logistics, shippers must understand the complexities are greater than a simple financial analysis. While use of a dedicated fleet can reduce total shipping costs, it also provides access to greater flexibility and knowledge of vital market factors.