TURBOCHARGED! Secrets of Expedited Shipping
How carriers move high-priority loads extra fast while holding down costs and keeping shippers in the loop.
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In omnichannel retail, speed is practically a given. Whether next day or same day, consumers want things fast. In the broader supply chain world, though, some people call top speed—in the form of expedited shipping—a necessary evil.
"No supply chain professional comes to work hoping for four expedites that day," says Mike Moss, chief operating officer at Ward Transport and Logistics Corp. in Altoona, Pennsylvania. Ward added expedited transportation to its portfolio in 2017.
"A lot of clients say that 'expedited' is almost a dirty word," agrees Mike Said, president of Continental Expedited Services in Clarksville, Tennessee. "It's always more expensive than standard transportation."
But sometimes there's no avoiding the need for turbocharged transportation. When a factory runs short on components, a patient awaits a donated organ, or a lack of materials threatens to idle construction workers, expedited shipping becomes well worth the added expense.
The important figure is not what it costs to deliver the freight, but what not making the delivery would cost. "While a $2,000 expedite sounds exorbitant, it's pennies compared to shutting down a major manufacturer's assembly line," says Moss. "That can cost $100,000 an hour."
The speedy shipping service that's familiar to every consumer is the kind that delivers small packages overnight. Providers such as FedEx and UPS have perfected that service. But both transportation giants also offer other kinds of expedited shipping.
For example, FedEx provides time-critical ground and air shipping as part of its Custom Critical business. Companies use this service, for instance, to recover from supply chain disruptions by rush-shipping components or materials to production plants.
"We also do product releases, which means ensuring that product hits the market at the time the customer actually wants it to," says Ramona Hood, vice president of operations, strategy, and planning at FedEx Custom Critical in Uniontown, Ohio.
UPS offers several expedited shipping operations beyond its package, freight, and traditional forwarding services. Its Supply Chain Solutions service parts logistics business holds inventory for customers in more than 1,000 forward stocking locations, so UPS can deliver the parts—machine components, surgical kits, and other items—within one, two, or four hours. This helps UPS customers meet their on-site repair and service commitments to their end customers.
Whatever it takes
UPS Express Critical service picks up and delivers critical shipments from huge machinery to donated organs and tissues, via air or ground. "We can dispatch a courier, hand carry it on a flight, put it in the belly of a commercial airliner, or combine options with our air network when commercial routes are unavailable or not fast enough," says David Quintilio, executive vice president for UPS Global Logistics and Distribution.
For customers in health care and life sciences, that can mean a life-sustaining "gift" is delivered while it is still viable, or a critical surgery is not rescheduled.
In addition to putting freight on equipment that can move it quickly, carriers also use a range of other strategies to provide fast service, well-tailored to shippers' supply chain needs. Some strategies focus on employees who work with shippers to choose the right solution for each load.
"In our training program, it usually takes between three and six months until an account manager even provides quotes to a client, just because there's so much to learn," says Continental Expedited Services' Said. A well-trained account manager could help a shipper decide, for example, whether to send an entire expedited shipment by truck, or put five pallets on a plane and use a truck for the rest.
The bulk of Continental's customers are manufacturers that need to move materials and components into their plants. The company uses 53-foot tractor-trailers, straight trucks, and vans, adding air cargo carriers and air charters when appropriate.
Ward Transport and Logistics also stresses training to make sure its employees recommend the right equipment for each load. The company keeps staff operating around the clock, every day of the year. "That is an absolute imperative," says Moss.
When matching loads with equipment, Ward Transport's expedited specialists consider not only when a customer needs a load delivered, but also specifications such as height, width, shape, and whether the freight includes hazardous materials. "We procure that information on the front end so we can craft a solution not only to meet expectations, but also to protect the customer from a cost standpoint," Moss says.
FedEx Custom Critical uses information technology to project its 24/7 staffing needs. "We utilize dynamic staffing tools to determine what our peak call volume or shipment volume will be, and we utilize that information to ensure that we have the right number of team members staffed for the business at hand," says Hood. When volume surges unexpectedly, service representatives have technology available to let them work remotely.
Partners for Capacity
For carriers working to meet tight delivery windows, however challenging the request, another key is to always have access to capacity. At Ward Transport, which operates its own assets mainly in the U.S. Mid-Atlantic, that means putting on its third-party logistics (3PL) hat to call upon relationships with transportation providers across the continent. "Ward has spent considerable time and effort aligning with strategic capacity partners so that we're always in a position to say, 'Yes,'" Moss says.
No matter whose assets it deploys, though, Ward Transport manages the entire shipment. "We own cradle-to-grave execution, including status updates," Moss says.
Continental connects with capacity partners through the software system Sylectus, from Dallas-based Omnitracs. Sylectus includes a transportation management system (TMS) and an online load board. "If we don't have capacity, we can broker it to another partner," says Said.
ArcBest, in Fort Smith, Arkansas, uses both its own equipment and assets owned by partners. Its expedited shipping services consist of two offerings. The first is ground expedited transportation, provided by ArcBest's Panther Premium Logistics fleet. "It includes cargo vans, sprinter vans, straight trucks, and tractor-trailers," says Ed Wadel, executive vice president, asset-light expedited services and strategic capacity at ArcBest. "Shippers using our ground expedite service get exclusive use of the truck."
ArcBest's other expedited offering, time-critical freight, uses assets belonging to the company's less-than-truckload (LTL) ABF Freight fleet, plus a network of partners. "It gives customers access to an array of options for their time-sensitive freight, including day-specific, time-specific, and must-arrive-by," Wadel says.
Along with partnership strategies, creative thinking also helps expedited carriers meet the need for speed in customers' supply chains while controlling costs. One useful approach is to blend transportation modes.
Say a Continental customer wants to charter a flight to move components from the United States to a factory in Canada. If the timing is right, Continental might arrange to terminate that flight in Detroit and then truck the load across the border. "That saves a few thousand dollars," notes Said.
Partnerships and mode-blending can help a shipper and carrier overcome challenges, explains Steve McDonald, director of multimodal services at Averitt Express in Cookeville, Tennessee.
"For example, our expedited team recently provided a unique solution for a customer that was faced with a factory shutdown due to a broken part," he says. Averitt retrieved a replacement part and delivered it to an airport, where it was met by a customer service agent who had already passed a security background check. The agent accompanied the part on the plane and then made the final delivery in person.
"The shipper was losing thousands of dollars per hour while the production line was down," McDonald says. "We knew there was no margin for error."
Here's Where We Are
Two other crucial elements of expedited shipping are visibility and communication.
Expedited carriers use GPS technology, either in onboard computers or in drivers' cell phones, to monitor loads. This tracking data helps to both manage a shipment and keep the shipper informed about the load's progress.
Averitt Express—which provides LTL, full truckload, and air expedited services—uses GPS data, displayed in a mapping system, to determine the most efficient route for each shipment and make adjustments at a moment's notice.
"Additionally, it provides real-time data that can notify our operations team if a driver has deviated from the planned route," says McDonald.
At ArcBest, employees use a custom-built TMS to monitor expedited shipments. "We know where every truck is located at any time and have constant communication with the driver," says Wadel.
The system receives real-time information from sources such as the company's Panther app, onboard electronic logging devices (ELDs), and various partners. "We analyze this information and proactively alert our team so they can respond to potential issues before the customer is impacted," he adds.
Customer service reps at Continental send their shippers hourly emails to keep them informed about the progress of their loads. Although not all clients check those messages throughout the night, when they get up in the morning they're glad to find a string of updates assuring them their shipments are running smoothly, notes Said.
FedEx Custom Critical also communicates with shippers throughout the progress of an expedited load, using technology that supports notification via phone, email, or text message. "We proactively let the customer know when a shipment was picked up, if there's any unexpected delay, and when the freight is delivered," says Hood. Each Custom Critical vehicle is equipped with an onboard computer that transmits location information into the company's shipment management system.
milestone to milestone
UPS is rolling out a GPS-based system that will provide real-time tracking and heightened visibility of shipments for the service parts network and UPS Express Critical service. By integrating that technology with the IT systems of its carrier partners, UPS and its customers can monitor each shipment from milestone to milestone, watch for potential problems, and track deliveries.
"We monitor shipments proactively rather than reactively to make sure we're hitting those milestones," Quintilio says. "And we can do an intercept along the way if necessary."
UPS Express Critical service even comes to the rescue when circumstances delay a shipment on the small package side. This might happen, for example, when weather grounds a plane that's carrying perishable items packed in dry ice, due for delivery in the morning. "We'll get the shipment and drive to an open airport for the next flight out, or put it on one of our planes," Quintilio says.
As expedited carriers demonstrate over and over, the real secret of expedited shipping is the commitment to do whatever it takes to meet shippers' deadlines. With strategies based on well-trained staff, robust partnerships, creative thinking, strong technology solutions, and constant communication, these carriers move mountains to move freight of any kind and size at whatever speed their customers require.