The capacity crunch of 2018 shined an unforgiving light on the issue of detention – making drivers wait excessively for their trucks to be loaded or unloaded at shipping docks. The ugly truth – poor planning practices by shippers increased anxiety with an already stressed-out driver community, created unnecessary inefficiencies and extra costs, and left badly-needed capacity sitting idle for an unacceptable amount of time, wasted on the sidelines.
And in a market already short of drivers and tight on capacity, drivers have a choice: put up with shippers who waste their time, or reject those loads and gravitate to shippers who respect and support the driver, turn them around quickly with quality loads, and recognize for drivers, time really is money.
According to industry research, at peak in 2018, the average truck hauled 3.73 loads per week, leaving reasonable room for 1.27 more loads if it weren’t for excessive detention time. That equates to a potential additional $1,417 in revenue for the driver. How could this additional income impact carriers?
It’s absolutely critical for small carriers, those with five trucks or less as well as single-truck owner-operators. These are business men and women. The opportunity to handle more loads in the same available time through lower detention make more efficient use of their time and helps them sustain a profit. When they sit, they are essentially losing money. And when that happens, we lose them as providers and that capacity either goes away or to someone else.
Today a typical over-the-road truckload driver actually drives about 6.5 hours of the 11 hours available in a day. By one industry estimate, average detention times can range from 2 hours to as much as 5.5 hours. The same research showed that only 3% of detention time invoices gets paid to carriers, leading to very low profitability or even losses. That is why carriers are self-selecting to work for the more efficient shippers.
If detention time comes down by even 1 to 1.2 hours, pushing actual driving time up to 8 hours per day, that potentially could add up to 20 percent more available truck capacity into the supply chain. It’s just better utilization of what we have today, without adding any more resources. And it puts that much more money in the driver’s pocket, keeping them in the game.
The other upside for shippers: the potential for lower rates, or moderated rate increases.
How can this be in a tight market? Today, the carrier bakes into their freight pricing the projected cost of detention. As detention comes down the carrier doesn’t have to account for this cost, an efficiency gain which ultimately is reflected in the rate. To unlock this hidden capacity requires no other investment that shippers being more responsive and effective in planning for efficient, fast-turn driver loads and unloads. And giving that driver the proper respect earned for a difficult job well done.
It’s also good for the carrier, which may seem counter-intuitive. Think of it this way. If you can increase capacity by reducing detention time, the carrier could potentially move another 5 extra loads a month. And even if rates moderate, and profit per load is marginally less, the driver is moving more loads in the same total available hours – and overall making more money.
Less detention time also increases accurate predictability of when the shipment will make delivery, and when that truck becomes available for the next load. So the trucker is securing more loads earlier, and faster, with less time waiting in between.
At the end of the day, lower detention means more available capacity, assets better utilized as more freight moves with the same number of trucks, and drivers earning more. That’s a winning formula for all the players in ever more cost-effective supply chains.
(For another perspective on detention and its impact on trucking capacity, read this story at Freightwaves.com)