5 Methods CARRIERS BENEFIT FROM CONTRACT LOGISTICS
Dedicated vehicle – Where a group of drivers and equipment are assigned to a specific set of lanes or devices – this is probably the way of the future. We are seeing an increasing number of lorry carriers, which add specific options to their fleet capacity services to reduce volatility in the ever changing freight market.
It is not difficult to understand, Why Intelligent dispatchers, contract logistics companies (3PLs) and carriers recognize the long-term benefits of specialist logistics, many of which are now contracting to prepare for future growth. For shippers and 3PLs, specialist operations help to guarantee the available capacity at a fixed price throughout the year – even during peak periods. For freight forwarders, they can keep them in a consistent business year and avoid cyclical variations.
Although senders have been operating RFPs for many years, many 3PLs offer more specialized loads in the same way by transferring contractual opportunities to their carriers. For this reason, carriers are increasingly relying on the 3PL mix to ensure year round access to goods.
1. Continued demand leads to better planning. Freight transport is extremely seasonal and cyclical, causing high demand variability for lorries. In addition, unforeseen circumstances – such as extreme weather, trade union strikes or sudden changes in consumer trends – can lead to further volatility. Lorries have high fixed costs, so contracting is a way of easing fluctuating demand and better forecasting revenue. 3PLs with access to a large group of carriers add value by providing flexible levels of bespoke opportunities based on the carrier’s ability at any given time. In dedicated workplaces, carriers know exactly what type of equipment they need and how much money they earn, leading to better year-round planning and efficient use of assets (Logistics Management).
2. Fleet can focus on improving operations. As prices and asset acquisition are fundamentally excluded from the equation, certain fleets can place more emphasis on improving their operations – such as reducing delays, reducing empty mileage, using trailer programs, maintaining equipment, and so forth. operations that feel automated in a sense. In addition, a steady stream of revenue allows carriers to invest more with confidence in business growth. For example, if they know that money will come, they may be more willing to make a loan that will enable them to increase the size of their fleet.
3. Helps keep the driver. Putting drivers in designated lanes is a big incentive because regular driving provides a certain level of stability that is difficult to achieve in the trucking industry today. Maintaining qualified drivers is particularly important with government regulations such as the forthcoming ELD mandate. Purposeful pathways are consistent, predictable, and often shorter, allowing more time and work life balance (Contract logistics management).
4. Carriers can become experts in a particular area. Expertise comes with repetition. A particular fleet has a unique opportunity to focus on one type of transport and build credibility in this area of expertise – whether it be dry loads, poultry loads, food safety, temperature-controlled trailers, stage equipment or something else. Creating a niche is a great way for carriers to differentiate themselves from their competitors and win businesses from customers in a particular industry segment.
5. A repeat business creates a lasting relationship. Specialist business activities tend to be long-term, with no typical annual turnover rate of 15-20%, which takes place in simultaneous transport (Contract Logistics Management). For this reason, carriers can establish a genuine connection with their customers. Beneficiaries look forward to seeing the same drivers come to their facility a week after week, which ultimately leads to contract renewal and a lasting relationship.
Transporters who have long invested in dedicated transport services can benefit from great benefits and can help you get started. Freight carriers have access to shipping opportunities from the largest carriers in North America, fast payment conditions, and a team of experts is committed to providing hyper-targeted shipping games and continuous volume. Contracts are adaptable and dynamic, which means we will work with you to create a solution that will make sense to your business.
Whether you are looking for a contracted logistics provider that will bring long routes, short distances, dry or temperature controlled opportunities, registration with us is quick and painless.