Moving Words – Load Planning

Timothy Brady

“In preparing for battle I have always found that plans are useless, but planning is indispensable.”  – Dwight D. Eisenhower

When you think of load planning, what’s the first thought that comes to mind? For most, it’s a concept of having enough shipments assembled going in the same direction to make a profitable load. This is followed by having several loads planned far enough in advance to where you are never placed in emergency ‘got-to-have-a-load-now’ mode. As a concept and goal that’s great, but in reality it’s one of the biggest challenges a dispatcher/load planner faces day in, day out, week after week in the moving industry. As available shipments are dwindling, or at least needed shipments at reasonable rates are more difficult to locate, it becomes time to hone your skills in the Art of Load Planning.

If an operation has been running on the day-to-day plan, the planner starts looking for loads only after a truck has delivered its current load. This will put any moving company in constant emergency got-to-find-a-load mode. If this is happening with regularity, it puts the company/agency at the mercy of loads which are being posted at the moment. This limits the agency to many fewer loads and most likely the lowest rate loads, not to mention the shipper or relocation company is in control of the line haul rate. And the fewer available loads in an area, the greater control the relocation firm or shipper has over the hauling rate and the lower the revenue out of an area.

So, what is an alternate plan of attack to this cycle? The number one solution is concentrating on developing specific lanes of operations for each of your trucks. Look for that unfilled niche made up of the same type of shipments going in a specific direction. Work with multiple customers and/or relocation firms who have this niche freight moving in that same direction. This is described as diversification—creating multiple sources of revenue within the same area and lane but from different customers. Next step is to look at the final destination of this niche freight and find several customers with freight headed back in the general direction of your location or outbound shipments.

To explain: I specialized in high-value electronics, custom store fixtures, and filled in with trade show displays. The areas in the country who manufactured the items we loaded were the San José area of California; Phoenix, Arizona; Albuquerque, New Mexico; Dallas, Texas; Northern New Jersey; and Greater Boston. Backup loading areas were Los Angeles, California; Las Vegas, Nevada; Austin, Texas, Hartford, Connecticut, Northern New Jersey and Long Island. We would build our loads based on running this corridor. Each location had its specialty. The San José area manufactured equipment required by most high-tech clean rooms, which were needed in plants in Phoenix, Albuquerque and Dallas. Once our trucks delivered in Dallas, we picked up cabinets used in telephone switching and large computer server banks. These cabinets were hauled to Northern New Jersey where the other components for the units were manufactured. Once delivered, our drivers would load finished telephone switching cabinets or servers headed back to the west coast, or continue up the east coast to the Boston area to complete the round with additional cabinets from Dallas or clean room components from the San Jose area. The return trip west had some varied possibilities. We hauled digital TV transmission equipment, high-end consumer electronics, store cabinets, medical electronics and mail sorting equipment. The common denominator was that they all required our specialized trailers and handling capabilities. The areas of Los Angeles, Las Vegas, Austin, and Hartford, New Jersey and Long Island became backups if shipments became light or non-existent in any of the other areas.

Let’s analyze this example. It doesn’t make any difference whether you haul electronics, trade shows, office furniture or household goods, the basic principle still applies. Your load planning begins with the customer base you establish. This not only applies to both ends of your corridor, but also must include multiple locations for pick-ups or deliveries in the middle of your travel lanes. Some movers limit their lanes to two or three areas within those lanes. It’s better to be more diversified and have multiple pick-up and delivery locations within your travel corridor, not limiting your available loads to the economic fluctuations of two or three areas. This will provide you with greater opportunity to find the loads you need in advance with minimum deadheading. Using the example above, if the San José area’s shipments suddenly disappeared, we still had the options of locating shipments in Los Angeles or Las Vegas without leaving a truck in the San José area until something became available; or worse, having to deadhead to an unknown area. The same held true in Texas and the east coast for Austin and Hartford, Northern New Jersey and Long island.

For movers of all stripes, it’s very important to develop your load planning area based on your fleet size. In the example above, we had 11 shipping customers (with multiple locations) and 15 trucks. Scale your travel corridor to your number of trucks. The fewer trucks, the smaller the range of travel you need to establish. Part of the art of load planning is not hanging your trucks out where there’s very little or no freight. The only exception to this is if you’re receiving round trip rates to cover returning empty. With a smaller fleet, the shorter the distance to return to the home terminal (the area your outbound loads are located), the easier it is to absorb the cost of empty miles when they occur.

This type of set-up lets you maximize the space on your trailers. This part of the plan is called asset utilization. If the load in your trailer has not met its maximum gross weight and has floor space available, there is usually a partial load which could be placed in the gap in the trailer. Most partials pay a lot higher rate per CWT or cubic space than the rest of a truckload and the money it adds to the overall revenue can increase your bottom line significantly.

Keeping your trucks loaded with multiple, reasonable paying shipments is the name of the game. Honing your load planning skills, maintaining a good travel lane, and asset utilization is what will keep the revenue flowing and profits rolling in.

“Productivity is never an accident. It is always the result of a commitment to excellence, intelligent planning, and focused effort.”

Paul J. Meyer