Dedicated fleets offer many benefits, including improved on-time delivery performance and reduced transportation costs. Having extra hands handling transportation management also allows your personnel to focus on other business operations. Here are some things to consider when deciding if a dedicated fleet would benefit your company:
- Seasonality – A network-based fleet may be affected by seasonality. Under-utilization of resources may occur when all of the network’s lanes are affected.
- Type of Delivery – Local deliveries of less than 100 miles are great for dedicated fleets because there are often minimum charges with common carriers. Regional and long haul deliveries benefit from using a dedicated fleet when there are backhaul opportunities.
- Network Loads – Dedicated fleets are most beneficial for networks with a large volume of loads. Short haul networks need to have at least one load per day, while regional deliveries can benefit from one load per week as long as there are backhaul opportunities.
- Mode of Transportation – Dedicated fleets would be beneficial for intermodal shipments using rail and truck transportation. Dedicated carriers could be utilized on the dray portion of an intermodal shipment to improve network and service costs.
- Common Carrier Rates – Freight transportation rates through common carriers can be very high in specific lanes and geographical locations. Using a dedicated fleet in these areas can reduce costs significantly. CSCMP’s Supply Chain Quarterly offers the following formula for finding net savings: “net savings = cost of using common carriers – cost of dedicated moves – cost of empty moves”.
- Equipment – Dedicated fleets can be beneficial in moving certain types of specialized equipment or loads through the use of flatbed or refrigerated trailers.
Dedicated fleets are an effective way to guarantee capacity and reduce transportation costs. Please feel free to contact us to discuss your transportation needs.