Less Than Truckload (LTL) logistics is different from that Full truckload (TL). People might think that it is just a size of the load but there are fundamental differences in business models so in the strategic and operational management tools and methodologies should be used.
The baseline LTL logistics combines random short distance pickups and long-distance haulage.
The fundamental difference of LTL logistics is that companies usually organize pickups with city cabs and then consolidate loads in the larger trailers for the long-distance haulage during the week.
In organizing Local pickups two types of operational challenges emerge:
- How to organize daily local pickups so that available equipment could handle the most of loaded mileage and be balanced, in the meantime assuring most accurate appointment times?
- Dynamically rebalance new pickups when loads have already commenced.
Next, pickups usually being consolidated in depots/warehouses in larger equipment/trailers so they can be transported to a longer distance. While timely and safely delivery is a high priority, inefficiencies also arise as planners spent time in assuring the best delivery windows while taking into account available equipment, driver specifications, and a number of other factors. This process is time-consuming, can decrease the accuracy of deliveries and substantially increase costs of operations by underutilizing existing equipment and increasing total mileage.
And finally, one should make sure the interoperability of both parts of operations, assuring the profitability of the business, in the meantime keeping operational expenses as low as possible. It particularly means the ability to plan both inbound and outbound operations simultaneously and establish the best consolidation or cross-docking model that creates optimized short-haul and long-haul loads.
A simple LTL model with pick-ups and deliveries can look like the one in Figure 1 below.
Figure 1 Lessplatform’s multi-stop pickup and delivery sample loads
The planning system should be able first plan multi-stop pickups for each day during the week and then consolidated deliveries.
We have presented problems of planning LTL operations in two graphs below:
As you can see, the system should assure high accuracy of both pickups and deliveries, trying to increase the number of orders in the mealtime keeping high equipment utilization and low driven mileage.
We have implemented quick research to understand how the top firms on the market address these problems of LTL trucking. We have particularly looked at their websites. Some of the top solution providers and their offers are listed below:
Shipment Planning and Execution
Optimize load matching success and customer satisfaction by analyzing load and equipment information such as driver hours (HOS), miles, costs, and availability for both the current load and future scenarios to plan and dispatch loads accurately and easily. Streamline day-to-day load matching so your team can focus on the more complex needs of today’s planning processes. Increase efficiency with load-power optimization planning tools for OTR and multistop scenarios.
A state-of-the-art optimization engine that automatically finds the best solutions for your logistics needs, while adhering to your business requirements and trading partner capabilities.
Create a more efficient and higher velocity logistics network
Plan and execute domestic and international shipments—in one system
Lower rates and manage equipment more efficiently
Optimize the cubic capacity of containers, consolidate orders, and streamline location flow and calendars
Reduce Costs and Simplify Operational Processes
Managing any for-hire fleet is a constant battle between doing what’s best for the customer and what’s right for the business. For less-than-truckload (LTL) fleets, however, this balancing act is even more challenging due to the complex nature of the business. Juggling multiple customers, locations, delivery and pickup times, drivers, and vehicles while controlling costs can be an impossible task without the right tools in place. Thankfully, there are solutions built to simplify operations for LTL fleets while delivering improved efficiency and customer value.
Minimize freight costs and enhance customer service. Improve the efficiency of order and process management and generate optimized, rules-based routing proposals dynamically.
Plan for And Deliver Better Load Building Outcomes
Increase space utilization while cutting freight and fuel costs. Leverage control tower visibility to take the guesswork out of load planning by easily generating precise calculations before shipping. Streamline loading and unloading and minimize labor errors with step-by-step planning.
MercuryGate’s load planning and load building takes into account all facets including weight, dimensions, densities, stackability constraints, and compatibility constraints. This empowers your whole team to significantly reduce the number of freight runs needed, as well as the emission your transportation produces.
Supply chains are only going to get more complex, yet you are expected to consistently deliver while managing costs. With transportation, you can leverage every available asset, drive profitability, and sharpen your competitive edge. Our solutions enable you to transform your transportation operations by managing both inbound and outbound, integrating supplier and carrier collaboration tools, and tackling whatever challenges tomorrow brings.
Almost all of them have planning, dispatch, visibility, 3rd party carrier sourcing, and accounting capabilities for multi-modal business models. Some of them are on the market for decades. All of them have planning capabilities listed on their websites.
Transportation and logistics firms should have robust tools to increase operational efficiency without compromising client service and business goals. LTL planning optimization has limited offerings despite the variety of available TMS and fleet management software on the market. Robust planning toolbox, data interoperability, and visibility through all the business processes could help LTL firms substantially improve their efficiency, make planners and dispatchers life easier, and equipment utilization better.
We understand that total macro instability, current low level of rates, decreased order numbers on certain lanes and for certain clients, and other factors may substantially affect the appetite of the management to improve the efficiency of operations. On the other hand, now is the time to start thinking more about efficiency and prepare for a better harvest when good times are back.
Less® Platform can turn your data into loads within 10 minutes and compare it with your historical results! You can also test all the necessary features for your logistic model and consult with our experts on your challenges.
Vardan Markosyan is the CEO at Less® Platform
MBA from the University of Chicago Booth School of Business
PhD in Economics from the Institute of Economy of NAS RA
He spent decades of research and consultancy on business process optimization and system design