Higher fuel costs are becoming the norm in trucking throughout the pandemic. According to Energy Information Agency, on-highway diesel fuel prices have risen more than $1.00 compared to the first week of February 2021 across all regions. Meanwhile, trucking demand is still climbing, and trucking companies need to find a way to lower their fuel costs. Fortunately, working with freight aggregators can help achieve these goals and maximize profitability in the carrier leaning market. Let’s take a closer look at how this happens for carriers.
Being able to look at a map and know the most direct route between points A and B doesn't require much insight. But what if you had to consider every route, passing through multiple stops? For truckers, such an undertaking can be time-consuming and costly for fuel expenditures.
Enter freight aggregators, or companies that work with small- to mid-sized trucking companies to connect them with loads they would otherwise miss. While the truckers gain access to higher-paying loads than they might find on their own, the freight facilitator also gets a higher cut of each job because it has higher overheads for marketing and technological development. Regardless, the benefits give rise to using technology more throughout the process.
The cost of delay is a significant problem for companies that rely on transportation to move their goods. When trucks are forced to wait in line at a warehouse, it not only costs the company money but also wastes fuel. This problem is only compounded by higher fuel costs. Truckers can save money and reduce their environmental impact by using freight aggregators to plan their shipments and recognize when to arrive at warehouses to minimize the risk of excess dwell time.
As reported by Transport Dive, "OOIDA reported 78% of carriers lost at least one load per month because of detention time. Almost half of carriers lost more than one load per month in 2018." While data for more recent years is inaccessible, chances are exceptionally good that those losses have increased, and if not, the risk of wasted fuel has undoubtedly turned into reality.
One of the best ways that a freight aggregator can help a trucker lower their fuel costs is to make sure that they are loading as much as possible onto each trip. When a driver has more weight on their trailer, it increases fuel efficiency, and since higher weight equals a higher cost, this means higher fuel savings overall.
When a truck owner loads a truck up with one or two deliveries at each stop, then makes multiple trips from those stops, they end up spending more on fuel for those extra trips than they would have if they had been able to load several pick-ups into one trip. In other words: higher volume per trip equals a higher percentage saved on fuel costs.
The use of technology has allowed for the development of freight aggregators. These freight aggregators can provide a higher level of service with technology. This allows for the recognition of when delays or late arrivals may occur. It also helps to optimize resources and eliminate waste along the way. Still, using real-time data to stay informed can help carriers further identify potential later-on stops that may be impacted by such delays. In a sense, it's all about understanding what's happening and using the current truck status to continuously plan, account for potential problems, and develop a more fuel-efficient strategy in lieu of them.
Even with the best-laid plans for managing a trucking company's assets, carriers may still need to consider outsourcing some parts of transportation.
When higher fuel costs cause a trucking company to experience higher transportation expenses, carriers can establish relationships with more freight brokers to find more capacity. This will help the trucking company overcome higher fuel costs and maintain efficient operations. It also diversifies the available services each trucking company offers.
Trucking companies that offer multiple services will be in higher demand than those that only do local deliveries. To be an attractive option for customers looking for a one-stop-shop, service providers need to take all aspects of transportation management into account when considering what they can offer their customers.
That includes knowing when to expand the trucking network and work with more brokers or other carriers to lessen your trucking burden while still finding more profitable loads and getting them to their destination. Together, this helps to mitigate higher fuel costs and enable a more productive supply chain strategy.
Freight aggregators are a key component of the transportation industry. They help truckers find more efficient routes, avoid delays and dwell time, load freight efficiently, track shipments in real-time so they know when to outsource transportation to other carriers. In turn, trucking companies can better manage their assets by reducing fuel costs and improving sustainability while avoiding delays that may result from inefficient routing or lack of tracking data. Find out more about how digital aggregators like newtrul help carriers mitigate rising expenses, including fuel costs, by requesting a demo.