Embracing Green Initiatives = Increased Supply Chain Efficiencies

As a third party logistics provider, Access America Transport has taken a new approach to increasing supply chain efficiencies by providing sustainable solutions. It is a common misconception that today’s economic climate is slowing the momentum of companies considering implementation of green processes. Access America Transport continues to look for synergies that are lean, sustainable, and environmentally conscious.

As a company, we take a holistic approach to doing business with our customers and carrier partners. We have implemented processes that benefit our company, customers, and carriers. Access America, like many third-party logistics providers, continues to embrace initiatives such as load optimization and rail-to-truck conversions. These practices take into consideration efficiency and cost, while delivering value-added green services to our customers. However, our most far-reaching green concept has been the conversion of private non-for-hire fleets into for-hire carriers.

Private fleet assets make up roughly 50% of the trucks on US highways. Two years ago, Access America started a program to encourage our customers who operate private fleets to obtain for-hire authority for their equipment. We noticed that many of these fleets operated at much lower asset utilization levels than similarly sized common and contract carriers. According to the National Private Truck Council, the average deadhead percentage for private fleets is 28%. This is substantially higher than typical deadhead for-hire carriers. Private fleets often look at their assets as a fixed cost that is necessary to effectively service their customers or to address complexities in their own supply chain model.

Access America began marketing this additional capacity to its customers and worked closely with these private fleets in understanding their dedicated freight lanes. We have been successful in locating backhaul revenue sources that align with these dedicated freight lanes.  In many instances, we have been able to increase asset utilization by over 20%. This increase in asset utilization has resulted in small increases in fuel expenditures and greenhouse gas (GHG) emissions from these fleets, but has been more than off-set because these lanes were previously hauled by for-hire carriers. This increase in private fleet utilization decreases the number of for-hire carriers on the highways, which leads to an overall reduction in the industry’s carbon footprint. In addition to our success here, we also noticed many intangible benefits for our customers due to the regularity of utilizing the same trucks and the very low rate of driver turnover.

It is our belief that private fleets are an emerging market and present a tremendous opportunity to reduce the number of trucks on the road. This practice has enabled Access America to provide its customers with an opportunity to reduce their net environmental impact. According to the American Transportation Research Institute, there were over ten billion loads of freight hauled by for-hire trucking companies in 2007. If we assume that 95% of these loads were hauled by common or contract carriers, it is feasible that a 1% shift in volume to private fleets could reduce common and contract volume by 95 million loads per year. This type of reduction in volume has the potential to remove over 200,000 trucks from US roadways each year and reduce greenhouse gas emissions by over 25 million metric tons of GHG emissions.

We believe the practice of utilizing private fleets is here to stay. Access America is continuing to search for new avenues to take more trucks off the road. These steps have helped us solidify our customer partnerships and created sustainable relationships that are mutually beneficial to each party. We continue to put resources into developing our intermodal and load optimization programs. We feel these initiatives and many more will allow Access America to contribute to the overall greening of the supply chain while helping our customers maintain a lean and efficient transportation model.

Bibliography:
American Transportation Research Institute
American Trucking Association
Environmental Defense Fund and NAFA Fleet Management Association
National Private Truck Council
Research and Innovative Technology Administration (RITA) / U.S. Department of Transportation