Competing on price is the ruin of the sector

Foto de João Jesus en Pexels

Let’s be realistic: we almost always compete on price, so it has become the only thing we value. And that is the ruin of the whole industry.

Obviously changing is not easy but we need to focus more on the importance of transportation, improving the quality of transportation and recovering margins. Acquire new technologies and understand the needs of our customers and those of our customers.

If we continue to act in the same way, it will be difficult to change our view of transport services.

Digitization is key

It’s not a cliché, it’s the reality, digitization is key. And with few exceptions, the industry does not know how to identify this opportunity. We have a relatively high level of technology in tractors and trailers, highly technical driving systems to reduce consumption, etc. But we do not have digital tools aimed at the management or process of the business related to the load and the service of the same. In a few moments you can know the condition of the tires of a vehicle by accessing the manufacturer’s platform, but when it comes to notifying a delay in a delivery, the thing is impossible.

And for customers the most important thing is to have visibility on the load. If your customer’s customer has an intense flow, this cargo being transported is vital to operations. Knowing exactly what time it will arrive is more than important, even essential for the workflow.

We must now focus on the quality of the information service we provide. And escape the myth that control tower-type technological solutions are a mechanism for monitoring my work, a “spy” sitting next to you, and so on.

These types of tools represent two vectors of improvement for your business:

An intern. Where it helps me better manage my business. With fewer resources and more reliability. How many miles do I run on average? What is my punctuality rate? These are vital questions about running a business, even if you’re “only” on the road. How I communicate work with drivers. How do I implement digital CMR and avoid all this management. Etc.

And an external one. During the time I carry a load, I need to be aware that this load requires tracking. It’s not that they follow me, they follow my charge, in order to determine if I will breach the agreements with the client. Magically some platforms have managed to break away from transport. And this is bad for everyone because “because it has no value” because we separate it. But for many others, delivery is part of the job and that’s where we add value.

Highlighting is key

If we don’t want to compete on price, we have to compete on other factors. The quality of latency has a very high benefit. Even if we fail in certain tasks, if we warn in time and manage the situation well, it will not be considered a failure, on the contrary. It is considered good information management.

And while you can’t always fail, you can’t always be right. And the question is clear, who do you trust more, the organization you need to call to find out where your load is, or the one that warns you in advance that there is a problem?

Get started

Hardman allows for a very fast adoption of technology and is sold as a service so it does not require large investments. The price of fuel is out of our control but the way we work is that we can control it, so you better focus on that.

You can no longer wait

For now it is a law that is not fulfilled, a pact that is not known if it will come. But when it does, it promises to be the most controversial point and the most difficult to fulfill. All the agents are so accustomed to inaccuracies that principles are going to be costly. But let’s be honest. Nowadays, who goes to the hairdresser without time? The times change.

But waiting is a very vague term, it is difficult to establish when the counter starts and above all who makes whom wait.

For this, organizations have to take a step back and order their docks. That thing about you’ll arrive and I’ll charge you won’t work in the future or work now. The implementation of time windows has a large number of advantages and among them, although it is not the best, is the clear definition of who makes people wait and since when they wait. Let’s take a basic example:

Manufacturer

  • It makes available to a carrier the availability of a load from 11:00 in the morning until 15:30 in the afternoon. He does it because he won’t have the watermelons until 11:00 and at 15:30 the melons arrive and all the watermelons have had to leave by then.
  • And he gives these options for charging: 11:00-11:30, 11:30-12:00, 12:00-13:00 and 15:00-15:30. He has defined them based on the number of forklift drivers he has, the equipment he has, etc. Obviously here we are going to skip that not all loads can go to all windows or all docks, incompatibilities, etc. We skipped it in the example, the platform takes everything into account.

Carrier

  • Analyze his previous commitments, his subsequent commitments and determine that he will load from 12:00-13:00. This allows you to arrive from your previous load and does not put at risk either the disk or the commitment to deliver the merchandise.

Let’s analyze what the agents have achieved.

The charger has defined a working capacity and has made available to everyone a clear mechanism of charging times, rules, etc. Stop “wasting time” adjusting the loading hours of your carriers, since it is the system with all the restrictions that we want to give you that allows and validates the slot reservation.

The carrier is not subject to a schedule that he will not meet, he is given degrees of freedom so that he understands that he will not be made to wait but that he will not be attended to before.

And now comes the best, the metrics.

When the truck arrives before the stipulated time, that is lead time. We might think that’s a good thing, but arriving 3 hours early is not. It is a waste of time and the carrier has the option to work and improve this aspect since it directly influences productivity.

We also know in this case that the upload commitment ends at 13:00. If at 13:00 the truck is not loaded, this delay time is directly attributable to the shipper.

But we must also be clear that if at 12:00 the truck was not registered, the delay is the fault of the carrier and the delay is his responsibility.

We also know the theoretical duration of the loading slot and the actual loading time, so we can determine if our logistics operator in the warehouse is complying. We can even assess the time between the call to the dock and the correct position of the truck to start operations.

You will think, this is very strict, but it is that a window system is used for this. So as not to waste time in the hairdresser’s or in the parking lot of a platform. So that each party becomes responsible for its part and so that when it does not do so, it assumes that cost.

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Digitize logistics and transport

In the last two years, mainly due to the health crisis, discourses related to the digitization of logistics and transport have increased. However, the reality is that supply chains still do not have complete operational visibility, manual processes continue to be paper-based, communication procedures are slow and inefficient, and customers receive segmented and delayed information.
Since 2014, the European Commission has monitored the digital progress of the Member States and annually publishes the reports of the Digital Economy and Society Index (DESI). The 2021 report indicates that Transport continues to be part of that group of sectors in which digitization is a pending issue.
DESI 2021

There are digital solutions on the market that improve the operational capacity of companies and perfectly cover the planning, visibility and traceability needs of the agents involved in the supply chain, also reducing the environmental impact. However, the percentage of transport companies that invest in technological resources barely exceeds 14% in Spain. What is the main impediment?

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Logistic / Supply chain tower control

Logistics-oriented control tower or supply chain

A logistics control tower is a centralized solution with the organization and the adapted processes needed to centralize and process the data of all the agents involved in the chain. In order to give visibility and automate short and long term responses.

The concept of control tower has evolved over time. The first control towers, the 1.0 had as their purpose the centralization of information.

The control towers with telemetry, real-time information were the 2.0.

The 3.0 were those that included management elements, kpi s, etc.

And finally the 4.0 control towers. Those who can “anticipate” risk situations. That is, detect anomalies before they occur. These use artificial intelligence to detect such situations.

What is a control tower?

A system that concentrates all the information related to logistics operations. It has access to all data and all systems report their data. Sometimes some providers call this a data lake and the different systems would be rivers that feed the lake. In our culture the concept of data mountain is more understandable, this big lake, is actually a huge data mountain, difficult to manage. This is demonstrated by the enormous cost of controlling ordinary operations. That is, even though everything is going well, traffic departments have to devote many hours to making sure everything is right, that it arrives on time.

This is where the power of the following control tower versions comes in. In his ability to work with this data and extract the extraordinary from the ordinary.