Roll Up and Save: Roll-up trailers key to 20%-40% freight savings»» A STRIVE TRANSPORTATION BRIEF

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1 Roll Up and Save: Roll-up trailers key to 20%-40% freight savings A STRIVE TRANSPORTATION BRIEF

2 Freight shippers are missing a relatively easy way to slash freight costs on high-volume lanes. By being open to the use of roll-up door trailers, versus the more prevalent swing door trailers, shippers can save 20%-40%. The bias toward swing door trailers comes down to payload. Roll-up doors eat up an average of 6 inches at the top of a trailer and 4 to 5 inches on the sides but only near the door. Use of roll-up trailers could reduce the pallet count on fully loaded trailers from pallets in swing door trailers to pallets in the roll-up trailers. Retail suppliers don t like to push back on customers, so if Sam s Club says they want 30 pallets per shipment, that s what they get. For that reason, swing doors have become the industry standard for J.B. Hunt, Werner, Covenant, U.S. Xpress, and other major for-hire carriers. Through the use of roll-up door trailers, shippers can cut freight costs 20%-40% But here s the problem and the opportunity. A large portion of U.S. trailers use roll-up doors. Most of this roll-up capacity is with private fleets. To operate efficiently, private fleet managers need backhauls to fill unused capacity. But the bias toward swing doors means much of this capacity is deadheading back home after deliveries. According to Brian Swearingen, Director of Private Fleet Operations for third party logistics provider Strive Logistics, 30%-40% of private fleet deliveries come home empty. Private fleets with for hire authority are filling about 78% of their backhaul miles. Private fleets with roll-ups have more of a challenge and are filling only 50%-65% of those miles. That s where shippers need to recognize an opportunity, says Swearingen. No one wants to load roll-ups, so private fleet managers are willing to offer very aggressive rates to squeeze at least some revenue from these empty trips. ANALYZING THE SAVINGS OPPORTUNITY WITH ROLL-UPS Let s say you can fill and deliver a trailer for $1,000 using a standard 53 swing door trailer and for $700 using a roll-up trailer. There are a variety of situations where you don t even need the extra bit of capacity a swing door trailer offers over roll-ups, especially if you ship heavier products. You ll weigh out far before you cube out, so you ll pocket every cent of that info@strivelogistics.com strivelogistics.com 1

3 carrier rate break. That s $2,400 over just 8 shipments. Even if you assume that you lose the full four pallets per shipment using roll-ups, you ll need to ship an extra load every 9th shipment. That s $6,300 to ship the same volume of freight as your 8 swing door shipments a $1,700 savings, or 21%, If you lose only 2 pallets per shipment, that s an extra load every 16 shipments at a total cost of $11,200 compared to $15,000 for swing doors a $3,800 savings, or 25%. As a shipper, you need to wrap your head around this opportunity. In most cases, you re not losing volume with roll-ups, you re gaining substantial savings. ROLL-UPS ALSO SAVE TIME, AND TIME IS MONEY While freight savings are the most compelling argument to shift to roll-up capacity, roll-ups are also faster and easier and give shippers and carriers more flexibility when dropping off and receiving loads. With swing doors, for every delivery the driver must get out of the cab to open the doors and hook them against the sidewalls before re-entering the cab to back into the loading dock. Then, after handling the cargo, he must pull away from the dock slightly and leave the cab again to close and secure the doors. For longer runs with few stops, this is not a big deal. But for regional, multi-stop runs, this time adds up. Roll-ups can also offer a distinct advantage for drop and hook deliveries. If a retailer has the available dock doors, drivers can simply bump the dock and the trailer is ready for loading/unloading. With swing doors, a yard jockey is required to pull the opened trailer to the door, creating delays and inefficiency in the yard. No one wants to load roll-ups, so private fleet managers are willing to offer very aggressive rates to fill empty backhauls. THE DISADVANTAGES OF ROLL-UP CAPACITY Swing doors are the standard for a reason: they allow maximum use of space in a trailer. Shippers need to decide if the cost savings from using roll-ups is worth the following limitations that come with the use of roll-ups. In most cases, it is. Less loading space in trailer. You might lose from 75 to 150 cubic feet on a total of about 3800 cubic feet for a 53 trailer. Take a look at your freight, and you may realize that you are not utilizing this capacity regardless. Those that do can periodically ship an extra load and still save a minimum of 20% to move the same volume of freight. info@strivelogistics.com strivelogistics.com 2

4 More susceptible to forklift damage. Roll-up trailers have a lower clearance, so items like large paper rolls, which require clamp trucks with high booms, may be a problem. That said, the cost savings from roll-ups is so compelling that an investment in new clamp trucks would deliver a return on investment in a matter of weeks. WHO ARE THE BEST CANDIDATES TO SWITCH TO ROLL-UP CAPACITY? 1. Cost-driven shippers. If cost reduction is your main goal, you can t ignore the freight saving potential of roll-ups. 2. Regional shippers. For runs under 600 miles with multiple stops, roll-ups offer significant convenience and time savings. 3. Sustainability-driven shippers. By using the empty backhaul capacity of roll-up trailers, you reduce the number of trucks on the road by carrying more freight with existing capacity. 4. Shippers who lack adequate dock space at the plant. Roll-ups allow you to easily put product on the trailer and use it as a temporary warehouse. 5. Shippers using drop and hook. It s more convenient when a roll-up trailer can be bumped to an empty dock for immediate loading/unloading without the need of a yard jockey. 6. Heavy commodity shippers. Why pay more for trailer space you are not using? TO CAPITALIZE ON ROLL-UP SAVINGS, PARTNER WITH THE RIGHT 3PL Most roll-up capacity is found in private fleets. According to the U.S. Department of Transportation, there are 662,544 private carriers in the U.S. versus 408,782 for-hire carriers. This significant private fleet capacity is available to you at a significant rate advantage if you know when and how to look for it. Walmart, for instance, has 50,000 roll-up trailers in its fleet. info@strivelogistics.com strivelogistics.com 3

5 It comes down to having 3PL partners with the tools and resources to capture the backhaul capacity of these private fleets, and then match up this capacity with your needs. Let s face it, most transportation providers don t work this way. They aren t calling private fleet managers daily to learn about backhaul needs. For them, it s get the load first, then find capacity. According to Strive Logistics Swearingen, whose primary job is to uncover private fleet capacity for freight customers, shippers have been conditioned to expect less from brokers and therefore miss out on the huge savings opportunities that more advanced 3PLs can deliver. Today s modern freight management 3PLs are using technology to match shipper needs with the market s hidden freight capacity, he says. There are private fleet operators and regional carriers that are absolutely hungry for backhaul partners. The trick is to work with a 3PL who has documented this capacity and can match it with demand. NEXT STEPS If you want to explore the cost-saving potential of roll-up capacity for your business, start small. Identify the right 3PL partner one with access to private fleet capacity and present your lane of concern. The 3PL can load your requirements into its database and determine where matches exist with its documented backhaul capacity. The resulting rate analysis will indicate the savings potential from switching from standard swing door trailers to roll-up door trailers. Try it on one lane and see how your customers react, then consider expanding the strategy across your network. When you roll it all up, the savings will be very hard to ignore. info@strivelogistics.com strivelogistics.com 4

6 ABOUT STRIVE ABOUT Strive Logistics is the best third-party logistics company because we combine technology, innovation, and industry expertise with amazing customer service to deliver world-class transportation services. Since 1995, clients across North America have relied on our efficient, effective, and easy-to-use solutions to deliver their business. CONTACT US HEADQUARTERS: CHICAGO, IL 3008 N Lincoln Ave Chicago, IL Phone AUSTIN, TX 111 W 6th St, Ste 100 Austin, TX Phone Powered By: EXPERTISE EVERY STEP OF THE WAY We dedicate a team of logistics professionals to make sure your freight is managed from every angle. You ll work with members of our Customer Sales, Strategic Sourcing, and Customer Operations teams each with the experience and knowledge to make shipping as easy as possible. [Strive has] a customer service and operations team second to none with constant communication and accessibility to accommodate our needs. TECHNOLOGY THAT DELIVERS SUCCESS LoadRunner provides you with access to one of the most powerful transportation management systems in the industry. LoadRunner reduces operational costs while increasing market opportunity through business analytics and real-time freight matching. With LoadRunner, you don t have to wait days to hear from us we match your freight with available capacity in seconds. TRUSTED CARRIERS Our exclusive partnerships and experience with premium suppliers allows us to be proactive in choosing the carriers we work with. We carefully screen our carriers to ensure that you receive a consistent, reliable, high level of service. We maintain a Carrier Scorecard in LoadRunner and utilize our matching system to ensure we put the most compatible carriers on your freight so you never have to worry about carrier management we ve got you covered on every load. PRIVATE FLEET Transportation Operations Manager, Food & Beverage Industry Reduced capacity, seasonality, and driver constraints can disturb your supply chain. We offer exclusive partnerships with private and dedicated fleet providers that remove service volatility and help deliver a consistent and reliable experience year round no matter what. INDUSTRIES SERVED From produce to paper products, we have experience shipping for every industry: Building Materials Commodities Consumer Packaged Goods Food & Beverage Produce Glass, Plastic & Packaging Materials Hazardous Materials Beer, Wine & Spirits Paper & Corrugate Piping Steel Automotive Many more info@strivelogistics.com strivelogistics.com 5