Fuel consumption represents nearly 37% of average per-mile trucking costs. In today’s time, with the advancement of technology, more and more companies are tapping in to technologies that allow for better risk management to improve efficiency and lower the risk of avoidable scenarios that were once considered “the cost of doing business.” Many large companies such as Procter & Gamble and Whirpool have begun working with companies such as Breakthrough Fuel, which work with many shippers across the country to help provide strategy on fuel management.
Clients using Breakthrough Fuel’s model only pay actual fuel costs for particular routes on particular days, this allows for a savings on fuel consumption. Breakthrough Fuel also has multiple locations from which a manufacturer can ship from which allows manufacturers to ship based on distance from their destination or the cheapest trucking costs. To help aid in the transfer of shipments, there has been mass improvements to inventory tracking such as with the use of radio frequency identification (RFID) technology.
With the use of RFID technology and GPS, shippers can know exactly where a certain item is within a container. This use of RFID chips helps alleviate errors in packaging and shipping such as when working with
parts for bigger items. Think about a time where you will be able to place all of your groceries in a shopping cart at the supermarket and as you walk out, an RFID scanner will automatically scan all your groceries for you and display a price for each item without the hassle of you having to wait in line. With the use of RFID technology I really believe that soon that is how our shopping will be. What do you think are some other good uses for RFID technology?
Firms that ship in less-than-truckload (LTL) amounts need to make sure that they are shipping goods quickly in order to meet the high demand from their customers. This idea of using LTL services provides shippers a way to send out shipments more quickly but at a higher price. With the use of RFID technology, a shipper can carry multiple loads from different companies and be able to manage and control where each individual package gets delivered. Say Walgreens and Dominick’s both need a certain brand of product, the manufacturer can use a logistics management company such as MIQ Logistics to make sure that their product gets to both Walgreens and Dominick’s stores in a certain location with the help of RFID chips to track and monitor the packages. Certain transportation companies even provide their drivers with mobile devices to manage the inventory within their truck. Shippers are working on delivering shipments damage free, within a reasonable amount of time, and with confidence that their shipment will arrive in the right location when needed.
What can you see as the advantages or drawbacks to using the LTL technology described above? Do you see any ways of improving this system?
“Science Comes To Shipping.” Fortune Magazine 8 Apr. 2013: S1-S4. Print. (Also available here: http://www.timeincnewsgroupcustompub.com/sections/130408_Freight.pdf)