Private Fleets Realize Substantial Benefits When They Switch to Dedicated Contract Carriage

There is an inherent but necessary burden in ensuring your product is transported to its destination in a timely and safe manner. Here is a way to relieve that burden while still achieving your ultimate goals.

The more you can focus on your core business, the more strategic you can be in your overall decision-making. But when you need to spend considerable amounts of time, money, and resources on transportation, that cuts directly into your bottom line. Add in the costs of telematics, state-of-the-art equipment, and logistics technology, and you begin to understand why many shippers have decided to outsource their transportation needs to a third-party, dedicated contract carriage (DCC) provider.

Whether you decide to turn to this option instead of implementing or replacing a private fleet, you should feel confident that you are still in control. You have all the advantages of a private fleet without many of the most cumbersome burdens. With pricing, equipment, and drivers provided for a set amount of time by the DCC carrier, you are assured of rates and capacity as well as a quality customer experience. And that provides the information necessary to better manage your working capital and control your cash flow.

Realizing the benefits of DCC

There are a significant number of similarities between owning your own fleet and outsourcing your transportation needs. That being said, it is the differences between the two that will lead to greater operational and resource optimization.

Similarities between DCC and Private Fleet

Both types of fleets:

• Guarantee capacity.
• Provide flexibility.
• Require staff to hire and ensure regulatory compliance.
• Require maintenance.
• Could be branded to advertise your company.
• Can be customized for your shipping needs.
• Have customer service and fleet management personnel.
• Require insurance.
• Require regulatory compliance.
• Require ELD’s and a TMS.

Differences between DCC vs. Private Fleet

With DCC rather than a Private Fleet:

• The cost of expensive assets and technology is included in the provider’s pricing. That means you don’t have to purchase and manage these items on your own.
• Risk is assumed by the carrier. That is significant as one accident can incur major costs in settlements and litigation.
• Capital is freed up since you no longer have to purchase and maintain trucks and trailers. That capital can go towards expanding and growing your business.
• You limit the number of employees necessary to answer your transportation needs. That is the responsibility of the carrier.

Worried about giving up control? With DCC, you get greater control minus the burdens.

As noted earlier, with DCC, you don’t give up control over your deliveries; in fact, you will gain more control over both deliveries and costs. You will still have control over shipment deliveries, freight spikes and customer-specific pickup and delivery requirements. Instead of requiring multiple employees to handle your transportation needs, you’re able to get those costs from a single source. This gives your existing staff the time they need to focus on more value-added tasks. If you are the type of business that has seasonal ebbs and flow, you won’t have to worry about scaling up or down when it comes to employees.

Having a “vested” DCC provider is like having your own fleet. But to be successful and to optimize the relationship, you need to ensure that this transportation “partner” is regarded as an extension of your company. Make clear what your goals and initiatives are and provide ample runway for them to exhibit their expertise in logistics to meet and exceed them. Include them in discussions regarding your internal logistics and supply chain. Using DCC means more benefits, less burdens.

To find out how Dedicated Contract Carriage could be the answer to your transportation needs, contact Brad Mackler via email or phone at 248-705-0500.