2014 FMI/GMA Supply Chain Conference Transportation Panel Discussion. Current and Future Trends Impacting Transportation.
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1 2014 FMI/GMA Supply Chain Conference Transportation Panel Discussion Current and Future Trends Impacting Transportation February 19, 2014
2 Why Are We Here Today?
3 Our Intent Is Simple. To present a forum for industry wide Transportation leaders to discuss current and long term trends, impacting the transportation of products between FMI & GMA partners.
4 What did we say we want to hear about? Alternative Fuels Carrier Capacity Cost Management Driver Retention Driver Safety Regulatory and Compliance Impact Technology in Transportation Transportation Infrastructure
5 Collaboration "Individually, we are one drop. Together, we are an ocean." Ryunosuke Satoro
6 Transportation - State of The Industry Panel Members Vendors Thomas M. Gravelle Director, Logistics, Transportation & Customer Service Hormel Foods Doug Miller Director, PepsiCo HQ Transportation Craig D. McPhee Senior Director Distribution WinCo Foods Carriers/Service Providers Ed Garner Director, National Accounts Old Dominion Freight Line Mike Meehan Vice President of Sales & Marketing Fleet Advantage Kevin Zweier Vice President, Transportation Practice Chainalytics Retailers Glen Keysaw Executive Director of Logistics Associated Food Stores, Inc. Tom Nartker Vice President of Transportation and Global Logistics Safeway
7 Session Agenda Panel Discussion on Topics Parting Shot comments from each panelist Q & A
8 Let s Ask The Panel!
9 Cost Management and Revenue How is your organization utilizing backhauls to generate efficiencies? What technology tools are you utilizing to support this activity? Doug Miller Tom Nartker Glen Keysaw
10 Driver Safety? What successes are you currently seeing in encouraging Safe Driving Behaviors? Ed Garner Tom Nartker Glen Keysaw
11 Initiatives Safety Awareness Process Fleet Maintenance Safety Bonus CSA and Technology Active Oversight
12 Driver Safety Compliance AFS GOOD Training! Driver maintains control and his lane.
13 Driver Safety Compliance AFS BAD Behavior! Driver Following too close.
14 Driver Retention What practices, policies, and efforts are you currently employing to address driver retention and to reduce driver turnover? Tom Nartker Glen Keysaw Ed Garner
15 Old Dominion Best Practices for Driver Retention Provide a modern and well maintained fleet Provide very predictable schedules with a focus on time at home. Provide On Board technology Provide an excellent wage and benefit package Engage our Drivers as part of the sales team Encourage community involvement activities
16 Sharing Transportation Capacity The Consumer Goods Forum and the FMI / GMA Supply Chain Committees have an ongoing and active initiative underway to share transportation capacity
17 Sharing Transportation Capacity What strategies are you currently utilizing to increase backhaul and freight sharing with vendors and carriers? What trends are you currently seeing employed between Manufacturers and Retailers? Kevin Zweier Doug Miller Tom Gravelle
18 Sharing Transportation Capacity Participating Companies
19 Summary of Findings Back-haul opportunities exist, but remain incremental Less than expected geographic proximity in current origin destination pairings Still, Forward-haul opportunities exist, and approaches have been developed Significant density in the destination markets suggests opportunities for co-located warehousing or consolidation Next comes the hard part: A deep dive into the operational considerations of the participants to find true opportunities, and map out the execution
20 Regulatory and Compliance What impact will the recent legislative activity have on carrier capacity? Tom Gravelle Ed Garner Mike Meehan
21 Class 8 Population Shows Capacity 11% Below Peak Levels
22 Regulatory and Compliance Impact of FMCSA Use of technology to impact Basic Scores Opportunities to improve scoring system
23 MPG MPG Government Mandates MY MY Emissions and Fuel Economy Lowered Exhaust Emissions But Reduced Fuel Economy % C.A.G.R Model Year Lowers CO 2 Emissions Which Increases Fuel Economy Model Year 7.62 Link to Emissions Link to Fuel 23
24 Alternative Fuels? What experiences can you share with the group regarding the impact and potential of Alternative Fuel Vehicles? Glen Keysaw Tom Nartker Kevin Zweier
25 Alternative Fuels? What experiences can you share with the group regarding the impact and potential of Alternative Fuel Vehicles? Tom Nartker
26 Alternative Fuels? What experiences can you share with the group regarding the impact and potential of Alternative Fuel Vehicles? Kevin Zweier
27 Parting Comments Doug Miller What technology tools or performance measures are you currently utilizing to ensure that costs are being controlled to meet business objectives? Tom Gravelle What strategies are you employing to leveraging in transportation to ensure freshness
28 Parting Comments Tom Nartker Glen Keysaw What experience or insight can you share with the group regarding Future Technology trends?
29 Parting Comments Kevin Zweier Any final comments regarding the practice of joint shipping by several manufacturers to retailers? Mike Meehan Ed Garner Any final thoughts regarding the impact of the transportation legislative onslaught?
30 Depreciation & Interest 21% Maintenance (M&R) 9% 70% Fuel 30 30
31 Tractor Operating Costs Non-driver operating costs at $4.00 per gallon Fleet ownership costs are comprised of fuel + maintenance & repair (M&R) + depreciation & interest costs Fuel is by far the most significant component of ownership cost At $4 per gallon, a 10% improvement in fuel economy is equivalent to a 33% reduction in depreciation or a 78% reduction in M&R 31
32 Parting Comments Kevin Zweier Any final comments regarding the practice of joint shipping by several manufacturers to retailers? Mike Meehan Ed Garner Any final thoughts regarding the impact of the transportation legislative onslaught?
33 Impact of the Transportation Legislative Onslaught Possible impact to shippers Sleep apnea Vicarious liability
34 Questions from the Audience
35 Thank You! Enjoy the rest of your conference Make a few new contacts from across the table!
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