Actually, there is truck capacity available, says Bill Catania, chief executive officer of OneRail. It's just a question of making use of existing services through enabling interoperability — and ensuring visibility of orders in transit.
Asking about the root cause of the truck capacity shortage is “a bit of a trick question,” says Catania. Actually, there is capacity in the marketplace, but it’s not being managed efficiently. Few private fleets are utilizing their capacity at better than 30% full, he says.
Demand for capacity is up, but courier networks aren’t geared to meeting it. Shippers might assign a single courier to a given zip code, creating “a single point of failure,” Catania says. “You’re hardwiring capacity instead of having flexibility and dynamic capacity.” What’s needed is a system that can create a “deep bench” of providers, moving on to the next candidate in line if a particular carrier can’t handle an order. Without that capability, it’s a “total guess” as to how many carriers are available.
For retailers, the stakes are high. They’re the ones who are blamed by the shopper — not the courier — if orders aren’t delivered quickly and on time. And delivery failures translate into permanent lost business from the frustrated customer.
To become nimbler, shippers and carriers need to set clear expectations with customers, who often care less about getting their order quickly than being assured that it will arrive at the promised time. Many will pay less for slower service if they have that assurance. In addition, Catania says, it’s vital that buyers have access to information on where their orders are at any given moment. They need a system like the pizza tracker developed by Domino’s Pizza, offering (in theory, at least) pinpoint status updates on the progress of every order.
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