Business Intelligence 101 – Trailer Utilization.

The ratio of trailer to tractors and getting a good handle on trailer utilization is a difficult task.  So much depends on the customer’s needs and the need to keep trailer pools at shipping locations.  Therein lies the ‘issue’, creating a trailer tracking procedure to keep a good handle on all of this.

Too many trailers at one location will be a waste of equipment and too little will mean you miss loads with a desirable customer.

For mid-size companies, managing the trailer pool and tracking equipment can be a full time job.  Before the use of GPS, it was not uncommon for a trucking company to ‘lose’ or ‘misplace’ a trailer for weeks or even months at a time until a truck stop or shipper would call and advise dispatch of the ‘abandoned’ unit.  GPS tracking of the untethered trailers is a very powerful and valuable service.  Not only will it prevent loss and theft, but will provide you with the ability to make better use of your trailers.

I recently read a study that reported a shipper that needs a pool of 30 trailers, will ask for 35 or 40 trailers to prevent a shortage for their location.  Then the trucking company in the best interest of the customer, will provide a pool of 45 or 50 trailers to insure the customer is well stocked.

The end result can be up to 20 excessive trailers at a location that are not being utilized.  A costly mistake for any trucking company.

By using a GPS trailer tracking service, you can monitor your equipment daily without making request of the shipper or asking a driver to stop and inventory your units.  Monitor how long it takes for a trailer to get loaded, deliver, and return for the next shipment to determine the volume of trailers you need.

Let me exemplify a common workflow and provide a simple formula for you to work this out: Lets say a shipper has 15 loads per month for you.

  • A trailer is dropped at their facility
  • A few days later it is loaded.
  • Your driver hooks to the loaded trailer.
  • Delivers.
  • Gets a return load.
  • Lastly, he delivers the empty trailer to the original shipper.

Estimate the longest acceptable time for this to occur.  Let’s say 2 weeks.  Therefore, one trailer will take care of two loads per month for this customer.  15 loads divided by 2 = 7.5. Round up and you will need 8 trailers minimum to service this account.   So each trailer can make two rounds per month.  The average truck can make one round per week, therefore 4 rounds per month.  That would mean you need 2 trailers for every one truck. Simple right?

 

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