In the fast-paced world of logistics, efficient transportation is paramount. Every inch of unused space and every minute of idle time translates to lost revenue and a larger carbon footprint. To stay competitive and sustainable, businesses must maximize their transportation vehicle utilization. But what exactly does this entail, and how can it be achieved? Let’s delve into the intricacies of vehicle utilization and explore strategies for optimization.
Micro-Level Data: The Key to Unlocking Efficiency
At the heart of maximizing vehicle utilization lies the analysis of micro-level data. This granular information provides invaluable insights into how your vehicles are being used, allowing you to identify areas for improvement. Two crucial measures applicable to this level of detail are space utilization and productive time.
Space Utilization: Are Your Vehicles Packed to the Brim?
Space utilization, or vehicle fill, is a critical metric that can be measured in various ways:
- Pallet numbers and height: While common, this method can be misleading depending on cargo density. Low-density, bulky items may fill the available space (cube-out) before reaching weight limits, while dense items might hit weight limits before filling the space.
- Deck-area coverage: This measures the percentage of floor space used by cargo and is particularly relevant when stacking height is restricted.
- Cube utilization: This comprehensive measure considers both height and deck-area coverage, offering a more accurate picture of the total space utilization.
However, measuring space utilization presents challenges:
- Lack of volumetric data: Comprehensive data on freight volume is often lacking, hindering industry-wide analysis (McKinnon, 2003).
- Warehouse constraints: Warehouse racking systems, especially in the fast-moving consumer goods sector, often have standard slot heights that limit stack height in vehicles (McKinnon, 2006).
Productive Time: Are Your Vehicles Working Hard Enough?
Productive time measures the actual hours and minutes a vehicle is in use. Ideally, you want your vehicles operating continuously, but factors like loading/unloading, maintenance, and driver breaks make this impossible. Research indicates that a significant portion of a truck’s time is spent idle or empty (McKinnon and Ge, 2004; IGD, 2003).
Other Measures to Consider
In addition to space utilization and productive time, consider these metrics:
- The efficiency of vehicle usage (tkm/mkm): This ratio factors in both the weight of the vehicle and its payload, indicating the amount of transport capacity used (Léonardi & Baumgartner, 2004). However, it requires specific data that might not be readily available.
- Overall Vehicle Effectiveness (OVE): This comprehensive metric assesses vehicle availability, performance, and quality of delivery, offering a holistic view of effectiveness (Simons et al., 2004).
The Bottom Line
Maximizing vehicle utilization is a multi-faceted challenge that requires a data-driven approach. By meticulously analyzing micro-level data and considering various measures, businesses can identify inefficiencies and implement targeted strategies for improvement. This leads not only to cost savings and increased efficiency but also contributes to a greener and more sustainable supply chain.
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References:
- Department for the Environment, Transport and the Regions. (1999b). Road Freight Transport and the Environment.
- IGD. (2003). Supply Chain Benchmarking 2003.
- Kearney, A. T. (1997). Efficient Consumer Response in the European Grocery Industry.
- Léonardi, J., & Baumgartner, J. P. (2004). Indicators for Sustainable Transport.
- Mackie, P. J., & Harding, A. (1983). Goods Vehicle Operating Costs.
- McKinnon, A. (2003). Road Freight Transport: The Wider Economic and Social Impacts.
- McKinnon, A. (2006). Decarbonising Road Freight: The Challenges.
- McKinnon, A., & Campbell, J. (1997). The Demand for Road Freight Transport.
- McKinnon, A., & Ge, Y. (2004). Food Transport KPI Survey 2004.
- Samuelson, S., & Tilanus, B. (1997). Freight Transport in the Netherlands.
- Samuelson, S., & Tilanus, B. (2002). Road Freight Transport: Current Trends and Future Challenges.
- Simons, D., Mason, R., & Gardner, B. (2004). Improving the Effectiveness of Transport Operations.
About the Author – Dr. Muddassir Ahmed
Dr. Muddassir Ahmed is the Founder & CEO of SCMDOJO. He is a global speaker, vlogger, and supply chain industry expert with 19 years of experience in the Manufacturing Industry in the UK, Europe, the Middle East, and South East Asia in various Supply Chain leadership roles. Dr. Muddassir has received a PhD in Management Science from Lancaster University Management School. Muddassir is a Six Sigma black belt and has founded the leading supply chain platform SCMDOJO to enable supply chain professionals and supply chain teams to thrive by providing best-in-class knowledge content, tools, and access to experts.
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