Warehousing and transportation: Creating a perfect marriage
Tuesday, June 10, 2014
The value of a foot of space in a trailer, boxcar or plane is always higher than the value of a foot of warehouse space. Therefore, carriers must try to load a maximum amount of cargo into the vehicle. In general, the longer the trip, the greater the incentive to maximize cubic space use in the transport vehicle.
As logistics technology progresses, shippers and carriers find ways to decrease the time needed to unload and reload a transport vehicle.
The invention of the container ship and the high-speed marine crane have allowed ship lines to reduce time in port from several days to a number of hours. Unitization of cargo on pallets, slipsheets or clamp loads has allowed trailers to be unloaded in minutes, rather than hours. Air carriers use "igloos" that allow cargo to be preloaded, resulting in less ground time for aircraft.
These technology advances allow the carrier to keep vehicles in motion, rather than parked at a dock.
Just in time to wait
In spite of the available technology, the most prevalent and preventable frustration in dealings between warehouse operators and transportation companies is delay at loading and unloading docks. Because most truck drivers are paid by the mile, delays at warehouse docks create dissatisfaction among drivers who are losing revenue.
When the problem is unresolved, the truck driver looks for another job, adding to the already high personnel turnover in the motor freight industry. Furthermore, the carrier loses revenue because the equipment is poorly utilized.
Other roadblocks to efficient flow
Human failure — not technology — is the source of many continuing problems between warehouses and transportation providers. The traditionally adversarial relationship between shippers and carriers still exists today.
Buyers of logistics services are dedicated to finding the lowest price for transportation. As the carriers are squeezed by their customers, they seek ways of improving their margins by compromising their service.
Warehouse service providers are under similar pressure as they work with adversarial customers. The warehouse operator might alter the work schedule to reduce overtime, but those changes may increase the operating costs of the carriers serving that warehouse.
Another roadblock occurs with poor communication. Lack of collaboration among warehouse operators, transportation service providers and customers results in lost opportunities for integration and synchronization. Carriers and warehouse service providers cannot be effective without information that allows them to plan ahead and synchronize their schedules with those of the customer and the consignee.
When the warehouse operator does not know what product is on the inbound vehicle, the receiving and checking process becomes slower and less accurate. Technological advances now enable an advance shipping notice (ASN) to arrive at the warehouse prior to the truck. Some major retail buyers refuse to handle any inbound truck that arrives in advance of the ASN, but a large number of warehouse operators continue to struggle, compensating for lack of information on inbound loads that should be readily available.
With smartphone and computer technology, it is easy for both carriers and warehouse operators to maintain a scheduled truck dock. Still, most warehouse operators are forced to deal with constant surprises.
Some claim that they can use a dock appointment system with carriers but not with customer trucks. Given the obvious advantage of using appointments to maintain a scheduled truck dock, it seems inevitable that private truckers, as well as common carriers, will find ways to make delivery appointments and eliminate surprises.
Creating a driver-friendly warehouse
A warehouse operator can create an operation that is effective and attractive to the truckers moving product in and out of the distribution center, by following eight simple rules outlined here.
1. Increase the number of available truck docks: Frequently, dock congestion is caused by poor scheduling, not lack of sufficient doors. Extending the hours for shipping and receiving is usually the least expensive way to improve truck dock utilization.
2. Create a trailer storage yard, and a "drop and hook" system: Sometimes the dock utilization and flow of trucks can be improved by the installation of a "drop and hook" system. Each trucker drops or picks up a trailer in a storage yard, and a shuttle tractor is used to move the trailers between the yard and the truck docks.
This procedure is particularly effective in a continuous process plant that does not enjoy availability of motor freight services at night or on weekends. The drop-and-hook procedure allows the warehouse to load outbound trailers during the weekend, thus eliminating the warehouse congestion that would otherwise result.
3. Insist on unitization for both outbound and the inbound freight, with no floor-loaded vehicles allowed: Given the prevalence of unitization, it is difficult to understand why any shipper would floor-load a vehicle. Warehouse operators can discourage floor-loading by requiring that every shipment be unitized before it is delivered to the warehouse.
4. Refuse to handle any truck without a dock appointment and/or prior receipt of the ASN: Dock appointments also improve the utilization of dock doors. They should be required not only for common carriers, but also for customers who make warehouse pickups or who return product to the warehouse.
There may be unexpected incidents like severe weather, accidents or traffic congestion that require a scheduling adjustment, but most truck drivers have the communication equipment that allows them to report the need to change their appointment time.
5. Move all truck traffic in a counterclockwise direction on the warehouse grounds: When trucks move in a counterclockwise direction, the driver is never required to back a trailer into the dock from the blind side.
6. Maintain a log of loading and unloading times, and review every job where the time was excessive: Dock utilization depends on predictable scheduling. Some warehouses establish a standard time for handling each highway trailer. When the manager notes that the standard time may be exceeded, steps can be taken to expedite the load. When time is excessive, the reasons for the delay should be determined.
7. Record and investigate all instances of delay caused by lack of cooperation from shippers or carriers: When delays are caused by actions originating with carriers or shippers, the warehouse manager should work with them to identify the causes.
8. Maintain a clean and comfortable driver waiting area, including restroom facilities and telephones: Just as the foundation of a happy marriage is effective communication and teamwork, collaboration is the key to a successful relationship between the warehouse operator and the provider of transportation services. Surveys have shown that only a small number of customers and warehouses are responsible for the majority of delays causing higher costs and driver dissatisfaction.
Sometimes, financial incentives can be used to reward efficiency in loading and unloading. In effect, the carrier offers a favorable price to the customer who is efficient in loading and unloading. In other cases, a contract will provide penalties for the delay of trucks. In the extreme cases, a carrier may refuse to serve an uncooperative customer.
It is clear that when warehouse operators and transportation providers work together to smooth the flow, they can create good "marriages" and strong partnerships.
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