Shippers can save big by utilizing facility-level data insights to bolster performance

Posted on September 9th, 2022.

Shippers often lack visibility into the day-to-day operational performance of their facilities. Gaining access to data that allows them to uncover – and solve – consistent issues can be a gamechanger. One consumer paper products manufacturer, for example, managed to reduce expensive dwell time by 60% in just four weeks after partnering with Convoy to better inform their transit time model per lane. 

Convoy’s facility insights helps shippers identify — and solve — issues in their facilities early, avoiding heaps of unnecessary expenses, frustrated carriers and unsatisfied consumers. These insights are made possible by Convoy’s GPS-enabled app, which collects over 1,000 data points for every shipment, including carrier performance, dwell times, carrier reviews, carbon and more. Since carriers are required to use the app to haul with Convoy, the company is able to collect and surface key insights to shippers for all of their Convoy shipments. 

For the paper products manufacturer, facility insights uncovered that massive amounts of volume were being scheduled to leave the facility at the same time of day (i.e, what we call “stacked volume” versus “smooth volume” throughout the day), causing backups and detention time surges. From there, the shippers were able to identify solutions and optimize their operations. 

Lack of visibility into facility performance — coupled with inefficient processes and delayed communication — can easily lead to frustrating and costly problems, including high detention times, incidental charges and appointment scheduling mishaps.

All of these issues lead to wasted time and money, but detention (and any subsequent unplanned layovers that result from extreme cases) is a particularly insidious issue at warehouses across the country.

Detention is one of the industry’s most costly inefficiencies. According to ELD data FreightWaves sourced from various technology partners, long detention times could be costing carriers as much as $560 per truck/week – or nearly $28,000 per year. 

Wait times at logistics facilities across the country are up significantly over the beginning of the year, and there haven’t been any long-term improvements in this area over the past four years. As of Aug. 7, truck drivers across the U.S. were waiting an average of 121 minutes to load and unload their trucks, down just seven minutes from the same week in 2018. 

High wait times lead to lost wages for carriers and increased driver burnout, which can lead to safety issues. The detriments of detention time do not just affect carriers, however. Shippers are both directly and indirectly impacted by surging wait times. If a driver is left waiting too long, a shipper can accumulate costly fees, damage their relationships with carriers and take a customer satisfaction hit when products are not delivered to end consumers on time. 

Shippers are not unaware of these consequences, but working toward solutions while managing day-to-day operations can be challenging.

Often, companies have trouble managing their individual facilities because they are relying on inaccurate data accumulated though manual or self-reported check-in times, making it difficult to identify negative patterns. Other times, shippers rely too heavily on network-level analyses, neglecting to break data out on a facility-by-facility basis. This can be especially true for shippers with large networks and skeleton back-office staffs, as they often do not have the time nor resources to drill down deep into the data themselves. 

Since it is difficult for shippers to identify issues at individual facilities early, it can be extremely costly when problems do finally surface. Additionally, even after issues are identified, it can be difficult for companies to figure out the root cause. 

Not too long ago, gaining actionable insights into dozens of different facilities would be a laborious, time-consuming undertaking. Now, however, there are tools on the market that enable shippers to ensure every facility in their network is functioning properly. 

With Convoy’s interactive facility insights dashboard, shippers can gain granular visibility into wait times and on-time performance at each of their individual facilities with the click of a button. They can then focus on their lowest performing facilities and get recent carrier feedback, including verbatim reviews and star ratings. 

Additionally, shippers can identify trends by tracking metrics like incidental spend per shipment. They can then dig even deeper by breaking this data down by incidental type, day of the week or time of day, helping pinpoint exactly what needs to change in the operations. 

In a recent webinar, Convoy explored how its next-gen facility insights offering helped the consumer paper products manufacturer mentioned above clean up their operations. In addition to reducing dwell time, the shipper was able to cut incidental spend by 69% and excess transit time by 53%. 

Before partnering with Convoy, this shipper was seeing declining carrier engagement and increased incidental spend, with incidental spend per shipment averaging $43.30. Carrier feedback indicated that these issues were due in large part to scheduling problems and overall operational inefficiencies; one driver even noted that it took them 11 hours to get loaded. 

Convoy worked with the company to uncover the root cause of their issues and strategize solutions. Those changes made a world of difference for both the shipper and their carrier partners. 

“We had a bet that better planning, more attractive freight and modified facility features and operations were going to probably influence carrier behavior,” Sam Morales, Convoy Senior Manager of Carrier Programs, said.

When Convoy first started working with this shipper, the company’s average bid price was rising, with truck costs fluctuating up to 16% month over month, despite wider market softening. After implementing Convoy’s recommendations, truck prices dropped 18% in just four weeks.

“We realize there is a softening market, but there is also data to show that, once we implemented this change, those same carriers that were hauling this freight — what we call frequent haulers — were now bidding because of the improved facility and freight characteristics,” Morales said.

It is clear to see how shippers benefit from having granular visibility into their facilities. They save money, improve their relationships and generally reduce the tension surrounding their daily operations. 

Carriers also benefit when shippers take advantage of modern technologies like the facility insights tool. When facilities run smoothly, carriers save time, money and frustration thanks to shorter wait times, happier drivers and fewer late or damaged loads.

Source: Shippers can save big by utilizing facility-level data insights to bolster performance 

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