Each day, companies depend on the functionality of the trucking industry for timely delivery of products to customers. Whether it is raw materials being delivered for production and assembly or finished goods delivered for use or sale, companies ultimately rely on effective operations from trucks and drivers to keep their businesses running efficiently.
However, transportation solutions are becoming more complex, especially in the trucking industry. Challenges, including regulatory changes, driver shortages, freight delays, spot market rate increases and operating and insurance cost hikes, have caused numerous companies, including many in the Fortune 500, to reevaluate their own supply chain capabilities.
Companies preferring to gain control over their transportation services and cost predictability are choosing a private fleet model and operations over outside carriers. The recent resurgence in the use of a private fleet is offering companies a superior, nimble service and the opportunity for long-term cost management and reliable logistics management. Some companies starting or growing a private fleet are turning to logistics professionals, such as CPC Logistics Inc., to transition and help manage their private fleet capabilities, including the complete sourcing of drivers.
Private fleets offer organizations more control and flexibility over their specific freight logistics decisions and overall business needs, offering less volatility for budgeting and forecasting, and ultimately provide more control over costs leading to overall savings. The pendulum has swung from a “carrier’s market” to a “shippers market” and back to a “carrier’s market” in recent years as capacity in the industry is impacted by various conditions. The recent swing has been significantly impacted by the short supply and increasing demand for drivers. Companies that want to control the impact of the market shifts and establish their levels of service and cost are able to do so through their private fleet.
With our unbundled approach you’re building a different kind of private fleet designed to meet changing marketplace challenges at a level that single-source dedicated (bundled) fleet providers can’t match.
Most companies using or deciding to operate private fleets do so because they have complete control over how, when and where their trucks and drivers will deliver their freight at all times, which allows them to have greater certainty and predictability for timely delivery of their freight to its end destination. Having this level of control over their freight movement ultimately allows them to operate more efficiently and get their product to market faster, which leads to better overall service within their own organization and with their customers.
According to the National Private Truck Council’s 2022 Benchmarking Survey Report, better “customer service” is the primary reason their company operates a private fleet. Customer service (46 percent) and cost control (22 percent) were cited as the two top reasons for operating private fleets.
When optimized to fully utilize their trucks and drivers, private fleets compare more favorably than a dedicated outsourced carrier operation when factoring in all costs associated with private fleets vs. dedicated fleet/outside carriers. Without control over service and freight issues, shipping costs can continue to fluctuate drastically and rise, especially with runaway carrier costs, spot rates and accessorial charges.
In addition, service issues with outside carriers can elevate costs due to lack of drivers and capacity, causing an inability to get raw materials on time for manufacturing or delays in getting product to stores. Recent technological advancements, such as dynamic routing, freight matching software and analytics, and partnership development opportunities, including backhaul securement, are helping to create the cost efficiencies of a well-run fleet.
Unlike the service contracts and restrictions with dedicated carrier services, private fleets are flexible and can adjust capabilities when needed and in short order. Freight volume fluctuations, relocation or changing of product sourcing locations or distribution networks, changes in freight demand or supply of goods and materials, and any other unusual circumstances including economic slowdowns and catastrophic events [ex. the COVID-19 outbreak] are events that require organizations to adapt quickly. Organizations having the ultimate control and flexibility in how, when and where they adjust their business, and specifically their freight movement and distribution operations, are at a significant advantage.
A successful private fleet is dependent upon its ability to hire and retain drivers. Drivers overwhelmingly prefer to drive trucks for private fleets and so recruiting and retention rates are very high in this space versus the overall trucking industry including Dedicated and Truckload carriers. This high demand job with low turnover/high retention allows a private fleet to attract and hire the better drivers out of an ever-declining driver market pool.
Most companies with a private truck fleet are not transportation companies and may not have expertise in the labor side of the transportation business, yet their private fleet operation is a critical and integral piece to the success of their overall core business. Realizing this, many companies with private fleets prefer to choose a model
utilizing the services of logistics professionals to help with the operational oversight and function of their fleet – especially the employment and sourcing of sufficient, qualified drivers.
In this model, the private fleet-motor carrier partners with a logistics provider that sources drivers directly to them on a dedicated, permanent basis, with the logistics provider handling all of the administrative employment and compliance aspects of employing and maintaining a qualified staff of dedicated drivers. This service specifically includes:
Recruiting, screening, hiring, and initial and ongoing driver qualification.
Maintaining Driver Department of Transportation [DOT] files, including ongoing drug and alcohol testing and licensing review.
Paying all wages and providing all employee benefits, including worker’s compensation and health insurance.
Processing state/federal payroll taxes.
Handling all incentives, rewards and discipline, including personal grievances and employment-labor law related claims.
Providing safety and compliance support.
More than ever, cutting-edge companies are choosing Direct Private Fleet Logistics Services to efficiently move their goods and raw materials and promote sustainability. CPC Logistics has been providing this type of service for its private fleet customers for going on 50 years.
CPC Logistics is the leading provider of Direct Private Fleet Logistics Services and works with customers across a wide variety of industries throughout the U.S., Canada and Puerto Rico to help create, transition, expand and manage their private trucking fleets.
Due to the fragmented nature of the tools and techniques related to managing a private fleet, below is a partial overview of the functions CPC plays a role in performing. All of this is customized and specifically designed depending on the fleet’s needs.
Making the business case
-Route/Driver Count Optimization
Setting the Legal Framework
-Obtain Operating Authority
-Customized training for drivers and managers based on customer operation
-Assign safety manager(s) to operation
-Instill safety culture throughout the entire process
Ongoing Management & Measurement Reporting
-Establishing Operational standards & reporting relationships
-Gathering and reporting KPIs (using PowerBI and other analytics tools)
CPC Logistics brings its best resources to the table to identify and understand its customers’ specific needs to help customize specific solutions and enhance its best-in-industry services with additional transportation professionals beyond just truck drivers, including clerical-administrative or dispatch personnel, safety supervisors and on-site management personnel. CPC Logistics can also provide and staff a full fleet management solution with enterprise software.
All drivers and fleet support personnel that CPC Logistics utilizes in servicing its private fleet-customers are CPC Logistics employees, and CPC Logistics handles all of the administrative employment and compliance aspects of employing its personnel in service of its customers. CPC Logistics drivers are recruited using stringent qualification standards above those of the Department of Transportation. The hiring process includes extensive interviewing and inquiries into candidate backgrounds to provide qualified, safe, responsible and highly skilled drivers.
Once recruited and hired, CPC Logistics works to ensure its drivers stay and perform its services for clients on a permanent, long-term basis. CPC Logistics’ current staffing rate exceeds 99 percent and turnover rate is estimated at 50 percent lower than the national average for dedicated fleets.