Drop Trailer Masters (DTM) is a 10 year old haulage firm that specializes in the transportation of cargo to and from seaports and airports around the country. DTM has offices in all major industrial cities and next to all the key ports in the country with fully automated services. The company has a qualified and experienced staff that offers clients the most professional haulage handling processes and the management team includes notable members of the haulage sector. DTM’s clientele includes medium sized and large companies that regularly transport cargo around the country and to points of entry and exit.
Last year, DTM had a turnover of $10 million and is set to surpass that level with the increase in trade occasioned by the improving economic conditions. Among DTM’s services are drop trailer facilitation, pack and move, rail long haul and full truckload services. As will be explained below, these capabilities are the best in the market and have greatly improved the performance of numerous clients.
In this proposal, DTM will illustrate to XYZ Company that the drop trailer delivery method is much better than the current system of live unloading that it uses. The drop trailer method involves the dropping of empty containers at a client’s warehouse and collection later when they have been filled with cargo. This is much better than the system of live load in which haulage trucks come to the warehouse and have the cargo loaded into their containers as they wait (Consulting, MariNova).
At the current location, XYZ is experiencing challenges that are affecting performance and the response in the market shows that many firms would rather not engage with it. Asking transporters to turn up at 1 pm on weekdays and 6 am on weekends is quite inconveniencing since this means that they lose on two fronts. First, the lunchtime traffic in the vicinity of XYZ warehouses is quite costly in terms of time lost. It would be better for the appointments to be scheduled for 11 am at the latest. Secondly, the 6 am weekend appointment affects the scheduled loading from ships at the docks which happens at the same time.
The short lead time that XYZ gives transporters is also a big challenge since it leaves little room for maneuver. In expecting transporters to deliver goods within one week of notification, XYZ is steadily building a reputation in the transport sector as a client that demands too much from service providers. Out automated systems can help quicken the process but XYZ’s expectations need to be according to sector standards (www.sap.com). Frequent breakdowns of open slots affect service providers adversely since this increase the amount of time spent at one warehouse by trucks sent to serve XYZ. This prevents truck drivers from heading to other clients and even affects subsequent appointments with other warehouses.
Lastly, XYZ has built a bad reputation among haulage firms for its unrealistic Must Arrive By Date (MABD). The changes that the maritime authorities have implemented in collaboration with the Dock Workers union have drastically reduced the amount of cargo being processed at the port. This means that the delivery of imports to clients like XYZ takes much longer.
From the attached projections, DTM will show that XYZ can turn to the drop trailer system and boost its performance. In response to the appointment problem, DTM proposes that the loading take place at a fixed time of 10 am daily. As the delivery trucks come to pick loaded containers, they can drop the empty ones to be collected the next day. By incorporating the drop trailer method, projections based on the Drop Trailer Factor show that XYZ’s performance will improve by a minimum of four percent in May 2011 and steadily increase up to December when it will hit eight percent with the potential of rising higher.
To deal with the lead time problem, XYZ can make a provision for a two week notification period. This will provide its partners with a flexible arrangement that benefits both sides. DTM is happy to inform XYZ that it also provides certain clients with open slots at affordable rates. These are usually placed at the client’s premises until the contract comes to an end or is terminated. According to the Taylor Hold Period performance projections, if XYZ reduces these hitches, it should expect to see a performance improvement averaging 5 per cent every month.
To deal with the short Must Arrive By Date, XYZ needs to inject flexibility into its system. This will enable service providers to overcome the port hitches so as to deliver cargo within mutually agreeable time periods. Research figures of monthly averages show that the combined performance of all XYZ warehouses is still below par and sometimes drops as low as 73 per cent. If the Drop Trailer system is adapted, the company can boost its performance at the rate of three per cent per quarter or 12 per cent per annum according to its Double Exponential Smoothing-Holt Selected Forecast.
In conclusion, XYZ company has a lot of potential but its performance is being hampered at its various warehouses by the live unload system it uses and DTM has a reliable solution. Use of drop trailer will quickly place XYZ among the beneficiaries of a system that has boosted the performance of global titans like
Consulting, MariNova. Social and Economic Impact of Marine Atlantic Drop Trailer Service. 2010. Web.
www.sap.com. Transportation and Delivery Scheduling. 2001. Web.