Wednesday, April 30, 2008

Beer and Chips: Optimizing Truck Loading

Optimizing truck loading

If you think your trucks are running full, you probably have not met Tom Moore. A logistician with a keen eye for the critical, overlooked detail, Tom knows the importance of getting an extra pallet on a truck that is about to depart Memphis for Miami, and he has helped some of the world's largest manufacturers find creative ways to load their trucks to the legal limit.

Truck loading involves an exquisite set of trade-offs between weight, volume, balance and compactness that even some of the most seasoned supply chain experts do not fully appreciate. U.S. federal law, for example, limits the gross vehicle weight of a tractor, trailer and its cargo to no more than 80,000 pounds when traveling on the interstate highway system. Safety regulations of the federal government and the various states further restrict the dimensionality of trailers and tractor-trailer combinations, such as by limiting the length of a single trailer to 53', the length of tandem trailers to 28', the total length of tractor-trailer combinations, etc. There are even restrictions on the way cargo weight must be distributed across the truck, with no axle allowed to bear more than 34,000 pounds.
(Similar regulations apply in other countries.) Consequently, loads invariably reach one legal maximum before they approach the constraints imposed on other dimensions. They "weigh out," for example, before they "cube out."

Most supply chain practitioners have developed rules of thumb that help them navigate these restrictions without paying fines for overloading trucks. A brewer, for example, may program its order management system to limit its truckloads to 44,000 pounds of finished product, estimating that the weight of the tractor, trailer and "dunnage" (pallets and packing material) will consume 36,000 pounds of the 80,000 pound limit. A logistician like Tom, however, is troubled that this "full" truckload would in a real sense be nearly half empty, as it would be composed of some 22 pallets of beer, each weighing about 2,000 lbs., stacked 5' high and loaded on the floor of the trailer. Above the tab-tops of this glistening load of cans he would see 4 feet of empty space from the front of the trailer to the tailgate.

On the other hand, if the brewer were also delivering potato chips, boxed and stacked in 4-foot high, 1000-lb. pallets, it could replace 11 pallets of beer on a truck with 22 pallets of potato chips and still obey its size and weight restrictions. And, by mixing this light and heavy freight on each truck, the beer and snack food manufacturer could deliver 44 pallets of potato chips (a full truckload) and 22 pallets of beer (two full truckloads) in only two trucks, thereby saving 1/3 of its linehaul shipping cost.

Moore has developed and implemented a software solution for this classic loading problem that
selects freight from a list of upcoming orders to optimally configure truckloads. He has saved his clients, including such sophisticated shippers as Procter & Gamble, from 4-10% of their total freight delivery costs. That pays for a lot of beer.

To read more about our work in supply chain consulting, please refer to our Profile and  Case Studies.

You may contact us directly here.

What do logisticians do for FUN? Try your hand at this game and see how many pallets you can get on a trailer without tipping the scales.

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JP Farrell & Associates, Inc. said...

Tom points out that the model suggests a solution in the simpler case where there are no chips but there is excess capacity as when, for example, the trailer has a capacity of 45,000 pounds and is filled with 22 pallets of 2000 pounds, with 1,000 pounds of capacity wasted. Simply replace one 2,000 pound pallet with 2 1,500 pound pallets and the load is full!

google1 said...

very informative post, mixing goods in this fashion can really help to make sure you are getting as much product as possible on every truck without putting too much on your platform scales!

freight guru said...

Thanks for great information you write it very clean. I am very lucky to get this tips from you.
Truck Loads, Ship Full Truck Load