Heartland Express & the U.S. FTL Market: Partials and Dedicated Contracts
Former VP of Transportation at Walmart
inpractise.com/articles/heartland-express-and-the-us-ftl-market-partial-loads-and-dedicated-contracts
Former VP of Transportation at Walmart
Interview Transcript
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Why is that?
Many trucking companies are truckload-focused. At least on the brokerage side, we're trying to introduce a concept called a partial. It's similar to LTL to compete against it. As a shipper, if you don't have enough freight to fill a full truck but have more than a pallet, you might have three or four pallets. For example, if your manufacturing facility is in Portland, Oregon, and you're shipping to Kansas City, Missouri, you would partner with a service provider, typically a brokerage, that offers partials. It's very LTL-like. The provider can find three or four similar-sized companies in Portland or a large shipper with room for two or three more pallets. You do multiple stops at the origin point, load up a full truckload, and take it directly to Kansas City, making multiple deliveries. This is typically faster than LTL, with fewer damages, and it's priced to appeal to smaller shippers. The largest shipper in that truckload has essentially paid for the truck, allowing you to offer discounts to the other shippers relative to LTL costs.
This is a snippet of the transcript.Contact Salesto get full access.
And that's because the cost of the truck and the freight has already been paid for by the large shipper.
If you say 24 pallets will fit on a 53-foot dry van trailer, sometimes 26 if you pinwheel the pallets. As a shipper, I always had about 12 pallets. We found that if I have 13 pallets, I'm going to ship the truck half empty for all practical purposes. But that is a cheaper proposition than shipping those 13 pallets via LTL because of the LTL's super high cost. It's high-cost freight to ship, and the break-even depends on lanes. In general, if you can fill up half a truck, it's cheaper to go point-to-point than to go through an LTL provider network. You're probably going to get the freight there a day or two faster.
This is a snippet of the transcript.Contact Salesto get full access.
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