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FUEL SAVINGS * USA - Increasing efficiency boosts savings
Big companies in the lead of the ground-freight-moving business, such as J.B. Hunt Transport Services, UPS and FedEx, have long focused on fuel costs and used such tools as sophisticated software and Global Positioning Systems to optimize routes
McLean,VA,USA -USA TODAY, by Julie Schmit -1 May 2008: -- ... Now even smaller companies — and those not specifically in the freight-moving business — are focusing more on fuel... They're making changes by:
• Combining deliveries. The Truckee-Tahoe Lumber company in Truckee, Calif., has suffered a triple whammy: a drop-off in new home construction, record low lumber prices and record high fuel prices. "I'm working on trying to understand how to remain profitable," says Steve Stevenson, vice president of the 68-employee company. Truckee added new delivery charges this month that run $15 to $50 for some orders under $500. It's also asking customers, primarily home builders, to plan ahead so it delivers once a week, vs. two or three times. Some of Truckee-Tahoe's suppliers have also reduced delivery frequency, Stevenson says... Audiovox sources most of its electronics in Asia. Sea containers that aren't full are being held more often now than in the past until they are full, Moffett says."If it's something we really need, I may say let it ride. If not, I say wait," he says. So far, delays haven't led to product shortages, he says... Even flowers are being affected. Hoogasian Flowers in San Francisco now asks customers for two delivery dates instead of one so Hoogasian can, if possible, combine trips...
• Reconfiguring routes. Office Depot handles 24 million deliveries a year from warehouses to stores or customers... Three years ago, the retailer deployed software from a division of UPS to design routes to maximize the number of deliveries on each while minimizing time and distance, says Yalmaz Siddiqui, director of environmental affairs. One trick: restrict left-hand turns.The results? Office Depot now makes 180 to 200 deliveries per truck over 80-to-100-mile routes. That's up from 125 to 135 deliveries over the same distance, Siddiqui says.Waste Connections, which services 1.5 million customers in 23 states, has likewise pumped up route efficiency. Over the past two years, it's reconfigured a fifth of its 2,700 daily routes, Mittelstaedt says.Before, routes were often based on customers' preferred days for garbage pickup. New routing software helped Waste Connections devise more efficient routes. The company is also urging customers to change pickup days so that it travels less to the same regions."We've gone to customers and said, 'Either you switch your day, or your price is going to double,' " says Mittelstaedt. In some cases, customers got discounts for switching...
• Improving fleets. In the past three years, Office Depot has replaced 90% of its 600 box trucks with smaller vans that are 40% more fuel efficient, Siddiqui says. FedEx has also optimized fleets so that more-fuel-efficient vehicles are on longer routes. So far this year, it has achieved an 8% gain in fuel efficiency over last year on FedEx Express routes, says Mitch Jackson, director of environmental affairs...
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