Above the Fold: Supply Chain Logistics News (September 6, 2019)

By Adrian Gonzalez

Why aren’t there any B batteries?

I heard a comedian ask that question in a YouTube video. We have AA and AAA batteries, and C and D ones, but no B batteries (at least not here in the US). Why not?

I’ll share what I learned at the end. In the meantime, here’s the supply chain and logistics news that caught my attention this week:

Truck Driver Detention Getting Worse

Shippers talk a lot about trying to be more carrier friendly, but it seems like they’re not trying hard enough, at least when it comes to driver detention. According to research published this week by The American Transportation Research Institute (ATRI), based on over 1,900 truck driver and motor carrier surveys conducted in 2014 and 2018:

Drivers reported a 27.4 percent increase in delays of six or more hours.
Female drivers were 83.3 percent more likely than men to be delayed six or more hours.
There was a nearly 40 percent increase in drivers who reported that the majority of their pick-ups and deliveries were delayed over the past 12 months due to customer actions.
The average excessive detention fee per hour charged by fleets was $63.71, slightly less than the average per hour operating cost of $66.65 found in ATRI’s Operational Costs of Trucking.
The negative impact of detention on carrier revenue and driver compensation may be greater among smaller fleets (<50 power units) with 20 percent reporting that they do not charge for excessive detention in order to stay competitive with larger fleets.

And while most carriers/drivers charge hourly detention fees, which typically start after two hours of detention, receiving the money from brokers and shippers is a challenge. According to the report, and as I’ve heard many times over the years from drivers:

It was expressed often by drivers that the detention compensation was not adequate for covering fuel expenses, or lost wages. Furthermore, a plurality of respondents reported that it is often difficult to generate the detention payments from customers. These respondents were often required to make additional phone calls to brokers or have to “fight for it” with customers.

In fact, getting paid for detention is one of the selling points that Uber Freight, Convoy, and other “digital freight” startups use to attract drivers to use their platform. However, as Rachel Premack reported recently in Business Insider, “some truck drivers who use Uber Freight say a July pay policy change is making it more complicated to get that detention pay.” Here are some details from the article:

According to a July 11 email sent to Uber Freight drivers and seen by Business Insider, truck drivers who use Uber Freight must do the following within 24 hours of the job to receive the full detention pay of $75 an hour:

– Book their load through the app
– Upload a signed bill of lading with “in” and “out” times as well as a proof of delivery
– Send continuous GPS tracking updates through the app while driving

If truckers using Uber Freight miss any of those steps, they are paid only $50 an hour. Uber Freight truckers are eligible to up to four hours of pay, or $300 maximum.

So, what’s causing the driver detention problem? Here’s what the drivers surveyed by ATRI said (emphasis mine):

When asked what actions caused delays, respondents in both the 2014 and 2018 surveys had similar answers. In both surveys, drivers provided a plethora of negative comments – lazy, slow, apathetic, taking too many breaks – to describe dock workers at customer facilities, in addition to facilities constantly being understaffed. Secondly, almost one in five drivers complained that their preloaded trucks were not ready by the time of their appointment, products were not ready, or were still being manufactured. The third most common complaint in both driver surveys pertained to shippers and receivers overbooking appointments, booking more trucks than there is space/docks, and not having enough equipment to load and unload trucks.

Simply put, the root causes are many and not new: lack of workers, lack of equipment, poorly optimized appointment scheduling processes, and poor synchronization of manufacturing, warehousing, transportation, and yard management processes. The fact that many companies still use Excel spreadsheets and homegrown software built in the 1970s to run their logistics operations certainly doesn’t help.

Another issue is that drivers and carriers historically haven’t had a data-driven way to provide shippers with feedback about their problem facilities. That’s starting to change thanks to the rise of real-time freight visibility solutions, electronic logging devices (ELDs), and scorecarding capabilities like those offered by Uber Freight and its Facility Insights Report.

Even so, in a recent survey we conducted with our Indago members, the majority (53%) are not receiving any feedback from carriers regarding their performance as a shipper, and only 7% reported receiving feedback from “most” of their carriers. As one of our members commented:

“We have been soliciting feedback [from our carriers] for years, but often do not receive much. Recently we’re seeing a more favorable response and it’s much appreciated, and it does help. We really need to move away from the ‘we’re the customer’ mentality and this feedback can help change the attitude of the organization.”

Therefore, the first step is for shippers and carriers to sit down together, review and discuss the data available in a constructive way, and then formulate a corrective action plan, focusing first on the locations that have the most problems.

Easier said than done.

And with that, have a happy weekend!

Oh, yeah, about those B batteries. They did exist here in the US, but according to Matt Soniak in Mental Floss, “when smaller batteries came along [AA and AAA], [they] were the right size for the growing consumer electronics industry, so they caught on. C and D batteries also found a niche in medium- and high-drain applications. The mid-size A and B batteries simply didn’t have a market and more or less disappeared in the U.S.”

Song of the Week: “It’s You” by Air Traffic Controller