Running a Private Fleet
Is No Cakewalk

by Mike Starling

What are the issues a transportation manager faces every day in order to be able to effectively operate his company’s private fleet?

#1. Equipment Availability Status

How many vehicles are operational and available to handle the workload for today? Typically there is a set expectation of what should be readily available on a day to day basis, based on known operational requirements.

 [Image: These drivers are unavailable.]

#2. Driver Availability Status

How many drivers are available to accomplish today’s workload? Typically there is an expectation concerning which drivers should be readily available on a day to day basis, based on known operational requirements.

#3. Last-Minute Changes

What last-minute changes do I need to make to adjust and finalize my routes today? (Order change/cancels/adds? New Customers? Adjustments for vehicle shortages or driver shortages? Adjustments because vehicles are in maintenance? )

#4. Route Changes Due to Driver or Equipment Issues

This requires the manager to physically make adjustments, shifting orders from the “missing” vehicle onto other vehicles, and requiring the other vehicle/driver to alter their route and lengthen their drive time. If a driver is absent or missing, is there a back-up, “floater” driver available? If so, how well does he/she know the route, customers, and stores on the assigned route?

#5. Federal/State/Local Regulatory Compliance

The manager must be conversant with both Federal and State safety regulations that govern the vehicle, the driver, the products being transported, and must ensure regulatory compliance. This would include at a minimum DOT, OSHA, and EPA, as well as local ordinances related to vehicle/trailer size, street and parking restrictions, hours of operation restrictions, etc.

#6. Safety Compliance

Here, the emphasis should be on prevention. This means that the drivers must do pre-dispatch safety checklist inspections daily to ensure that any safety issues are detected and corrected before vehicle dispatch on the delivery route. Similarly a post-route safety inspection should be done upon return to the yard, and any safety issues that have occurred during the course of driving the route (rock in windshield, flat tire, windshield washer empty, truck broke down requiring road-side assistance for restart, etc.) must be reported so that corrective actions can be taken and maintenance can be done before the vehicle is dispatched again.

 #7. Equipment Maintenance and Repair (Scheduled and Unscheduled)

Here, we are talking about disruptions to the normal route delivery routines. In the worst case scenario, a truck has broken down and will not be available for days. Do you have a spare vehicle to fill in when needed? Do you have to rent a replacement vehicle? How quickly can such a vehicle be made available? Vehicles must occasionally be taken offline for routine maintenance. This disrupts the normal route delivery schedule, and while a manager in this case faces many of the same issues mentioned above, he has lead time to plan for how he will cover the delivery and driver requirements.

#8. Dependence Upon Warehouse/DC

To get daily orders picked, packed, staged, and loaded to meet daily dispatch cutoff times, does the company adhere to a daily cutoff time for customers orders to be picked and shipped same day? Does the DC pick, pack, and stack to meet both shipping and safety requirements and/or customer-specific delivery requirements? Are the individual truck-loads staged and ready for loading by a set cutoff time each day? Who is responsible for the actual loading of the trucks, the DC or the drivers? Who is responsible for the sequencing of the load in the truck (i.e., the last load off is first load in the nose of the trailer)? Who reviews or approves the load for dispatch (i.e., do we have everything on the truck that’s supposed to be there today?)? If the DC does not enforce the order cutoff time for last-minute picks, this cascades down the entire out-load sequence, and can result in dispatch delays or promised same-day shipment items getting left on the dock.

#9. Contingency Plan(s)

If a delivery vehicle breaks down or has an accident while on the delivery route, what is Plan B? How do you recover quickly from the loss of a vehicle that is already on its delivery route? Where does the replacement vehicle come from? How are customers notified of the delay? Who is responsible for ensuring the orderly and complete transfer of product from the dead vehicle to the replacement vehicle? Do I also need to replace the driver? Who is responsible for the on-site accident report information gathering and reporting?

#10. Expense Control

The Private Fleet Operations is an expense line on the SG&A portion of the Financial Reporting Documents. The Vehicles, if owned, are fixed assets. Depreciation comes into play as well. But the Fleet Operations Manager has to worry about keeping expenses WITHIN BUDGET. Planning for Private Fleet Expenses is somewhat straightforward, and relies on past fleet history and industry standards to project what expenses will be for the Calendar or Fiscal Year. There are several things that can blow the budget out the window. Poor operational control and discipline will allow for “unnecessary” expense to be incurred (driver overtime is an excellent example; not having or enforcing a route delivery schedule is a contributing factor as well). Unexpected expense, such as a major breakdown of a vehicle or replacing a vehicle lost due to an accident, can have a major impact on budgeted expense. Operational control can be enhanced through utilization of software tools (TMS, Fleet Routing, EBOR, etc.) that track and record operational execution and allow the manager to enforce standards to bring discipline to Operational Control, and thereby stay within budgeted guidelines.

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