Dayton Freight Awarded 2013 Quest for Quality Awards

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1 In This Issue... Pg. 1 - Dayton Freight wins Quest for Quality Award Pg. 2 - NASSTRAC Report Carrier Selection process Pg. 3 - NASSTRAC Report Cont d Pg. 4 - Carrier of the Year Awards, Hours of Service Rules Pg. 5 - Carrier Profile Mode Transportation Pg. 6 - Carrier Service Metrics Dayton Freight Awarded 2013 Quest for Quality Awards Dayton, Ohio Dayton Freight Lines, a leading provider of regional less-thantruckload (LTL) transportation services, has won the Logistics Management s 2013 Quest for quality in the Midwest/North Central Regional LTL Category. This is the fourth time Dayton Freight Lines has been honored with this achievement. And for the first time Dayton has won the 2013 Quest for Quality Award in the Expedited Motor Carriers Category. The Quest for Quality awards are voted on by readers of Logistics Management magazine, and are regarded as one of the most important measures of customer satisfaction and operational excellence in the transportation industry. Each year, the study evaluates and measures transportation service providers across the nation utilizing criteria such as on-time performance, value, information technology, customer service and equipment/operations. These particular awards are meaningful because they are based on customers opinions, says Dave Brady, VP of Sales. Dayton Freight is committed to helping our customers with their transportation needs quickly, accurately and with total freight visibility. Our culture is one of servant leadership, and we are proud to serve so many great companies. 1

2 NASSTRAC State of the Industry Report: Freight Transportation Carrier Selection Process As an industry association providing education, advocacy and provider relations, NASSTRAC is committed to helping its members stay abreast of key transportation issues and emerging trends. To this end, the association recently conducted a survey of industry professionals and has published this as the NASSTRAC State of the Industry Report: Freight Transportation This unique report, sponsored by NASSTRAC, explores shipper s perspectives of emerging trends in freight transportation. It addresses related to supply chain strategy, mode use, rates, capacity and more. Here s a snapshot of the key findings in these areas. Shippers Weigh In On Critical Criteria When asked to name their top three criteria for selecting carriers, shippers responded resoundingly with rates (50.9%) and reliability of on-time delivery (47.4%) as the top two on their lists. However, there was less widespread agreement on the third ranking criteria. For manufacturers, it was financial Stability, retailers selected knowledge of shippers needs, and for wholesalers/distributors, total time in transit (speed) took top billing. Clearly, the research results show that while rates and service weigh heavily in the carrier selection process, companies consider a variety of variables, perhaps developing a decision matrix with sensitivities around any points. The selection criteria for NASSTRAC s annual Carrier of the Year program illustrate key considerations that shippers say are most important to their selection of carrier partners: Customer Service overall responsiveness, employee attitude, problem-solving, dependability, and sales force support. Operational Excellence transit time standards, on-time delivery flexibility, billing accuracy, and claims reduction. Pricing price competitiveness, pricing structure, flexibility, contract language. Business Relationship strategic partnership, national account manager effectiveness, years in relationship. Leadership/Technology electronic capabilities, visibility tools, industry innovation, leaders in new services offerings. Most Important Carrier Selection Criteria By looking at a range of factors, oftentimes including those above, shippers are most likely to find the optimal carrier relationships. Most survey respondents say that performance measurement is an important component of their carrier relationships, with 91.5% currently benchmarking rates and service. The majority of them (61.3%) use benchmarking services to gauge effectiveness, while another 24.7% use informal surveys and conversations with providers. An additional 11.3% use other methods, including reviews, rate analysis, and metrics review. Rates Reliability of On-Time Delivery Financial Stability Reliability of On-Time Pick-Up Geographic Coverage Knowledge of Shipper Needs Safety Records Total Transit Time Reputation For Dependability Other (%) Presented with special thanks to NASSTRAC 2

3 NASSTRAC State of the Industry Report: Con t Mode Use Survey results indicate that companies leverage various modes as part of their transportation mix. Respondents use Truckload (59.6%), LTL (58.8%, ground or air parcel (57%), heavy weight air (52.6%), rail/intermodal (51.8%), and/or ocean transportation (50.9%). Shippers are exploring their mode alternatives, driven predominantly by price and efficiencies. In the past year, a majority of shippers have shifted freight to different modes (66.2%). Manufacturers made the greatest shift with 78.6% shifting to a different mode, compared to 53.8% of retailers and 43.8% of wholesalers/distributors. Moving to rail/intermodal was the most common choice for 37.7% of respondents overall. Just 13.2% shifted to full truckload, and 4.4% shifted to LTL. This shift is reflective of a growing industry trend. Intermodal growth continues to accelerate as the railroads make significant investments in infrastructure. Domestic container volume for the fourth quarter in a row in Intermodal continues to be a growth sector in transportation. Survey respondents offered similar explanations for their mode shifts. Seeking a more cost-effective means of transportation (41.2%) was, by far, the most common reason for the shift. Respondents also mention more capacity (10.5%), improved reliability (8.8%), more efficiency (8.8%) and shifts in transit time (6.1%). There is still more change to come. Of those surveyed in NASSTRAC s study, 57.7% anticipate a modal shift in their transportation strategy in Clearly respondents are recognizing that a multimodal strategy can help them meet goals for delivery and transit times, cost control and more and build a stronger supply chain. Rates and Capacity How Many Shippers Expect Rate Increases Respondents foresee increased rates across all modes in Truckload and LTL are expected to see the greatest increase. In fact 45.6% of shippers said they anticipate truckload rates to increase while 47.4% say LTL rates will increase. The increases may be needed to help off-set rising costs associated with the driver shortage and driver retention, rising insurance premiums, diesel fuel prices and equipment purchases and maintenance costs. Rate increases are also expected for intermodal (32,5%), ocean (28.9% and air cargo (23.7%). LTL Truckload Intermodal Ocean Air Cargo (%) Not surprisingly, survey respondents expect truckload capacity to be an issue in the coming year, with 34.2% expecting it to decrease. According to several NASSTRAC shipper sources, CSA compliance issues have already reduced industry capacity. Higher equipment prices are also affecting the fleet size. The driver shortage and increased driver turnover, compounded by reduced driver productivity due the new Hours of Services rule, will also contribute to capacity issues. Industry observers forecast that new trucking regulations and slowly rising freight volumes will cause a tightening of capacity, resulting in higher rates for shippers. These conditions are likely to result in a difficult scenario for shippers in Capacity is expected to increase, however, ocean (21.9%), intermodal (18.4%), and LTL (15.8%) offering an additional incentive for shippers to explore a multimodal strategy. For more information on how to become a member of NASSTRAC, contact Brian Damiani, VP Logistics, Simplified Logistics and also NASSTRAC Executive Board Member at or 3

4 Our friends at have taken the time to try and explain the new hours-of-service rules for us to better understand. THE NEW HOURS-OF-SERVICE (HOS) RULES WILL HAVE A BIG IMPACT... HOW WILL THE HOS RULE CHANGES AFFECT OVER-THE-ROAD FREIGHT? Hours-of-Service rules for truck drivers are changing on July 1, These changes are likely to impact travel times via truckload. In particular, it will be important to consider the new driving limits and rest times when booking a load. Depending on the situation, delivery times could be affected by 34 hours or more. HOS KEY CHANGES DEFINED* ITEM CURRENT RULE NEW RULE POSSIBLE IMPACT Limitations on Minimum 34-hour Restarts None Two rest periods must occur between 1am and 5am Reduces driver s maximum hours by 12 per week (15% reduction) and will mostly affect night-shift and long-haul drivers 34-hour restart may only be used once per week Shippers need to be aware they may not start with a fresh driver and this could affect delivery time Rest Breaks None, except as limited by other rule provisions Drivers must stop for at least one 30-minute rest break per 8 hour driving period Shippers may see tightened driver availability when drivers meet their hour limit On-duty Time** Includes any time in Commercial Motor Vehicle (CMV) except sleeper-berth Does not include time resting in a parked vehicle Reduces available daily on duty hours to approximately 13 or 13.5 (down from 14) - subject to number of breaks required Does not include up to 2 hours in passenger seat If a driver has 50% of their drive time left, there may be substantial time added to their ETA, especially long-haul shipments For more information, go to *Source: fmcsa **Effective on February 27,

5 Carrier Profile One Source. Many Modes. Endless Solutions. Logistics Services Founded in 1989 In April, 2011 became a wholly-owned subsidiary of Hub Group Expanded service offerings to include entire Supply Chain product lines Rapid growth fueled by surge in global outsourcing Consistently rated a Top 3PL provider Deep understanding of customers needs The right blend of technology and supply chain experience Asset light-based Intermodal and Truckload equipment 24,000 Intermodal 53 ft containers 500 Intermodal Refrigerated trailers 2,000 Tractors Our TMS technology, TR ITAN works for our customers in many ways for both their inbound and outbound freight TRITAN includes reporting tools, self-service options, 24/7/365 track and trace via the internet and even SmartPhone access TR UCK L OAD (refrigerated, dry, flatbed, high, wide, heavy and hazmat) We are the asset-light provider of choice with trucking companies in North America. Contracts with over 22,000 truckload carriers Access to over 1,000,000 pieces of equipment Buying Power: leverage volume from many customers to provide committed capacity and economic savings Technology capable carriers Flatbed equipment relationships with over 1,500 flatbed carriers Access to 130,000 flatbed trailers Over -dimensional and oversized moves Specialized Equipment - including pad & strap and logistics trailers Seasonal & peak management Private and dedicated fleet capacity and utilization INTE R MODAL (drayage, refrigerated, dry and railcar management) Mode Transportation s vast intermodal network covers North America. We provide solutions and action plans tailored to fit your supply chain. IM has become the global standard for moving freight across the world s docks and back into the heartland for deeper distribution. Flexibility is key since Intermodal carriage adapts to diverse locations, co mmodities, packaging, and schedules. Variety of End-to-End services customer driven solutions Mode Transportation moved over 135,000+ loads in 2012 Ability to cover freight with a wide range of intermodal carriers IM is the most green mode of transportation: one gallon of fuel now moves one ton of freight about 420 miles. Railroads contribute only 2.2 percent of greenhouse gas emissions Chalfont, PA:

6 Carrier Service Metrics 2 nd Quarter Averages % On Time ABF Conway Dayton Fgt. Extes Express NEMF Old Dominion Pitt Ohio SAIA Southeastern UPS Freight Ward Trucking YRC Freight Carrier Thank you for subscribing to our quarterly Newsletter. If you have any questions, please contact us through the information below. Simplified Logistics, LLC Clemens Rd. Suite 220 Westlake, OH

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