Truck and Track Autumn 2022 www.truckandtrack.com 20 DESCARTES High fuel costs are a global problem, making it a painful time for logistics-oriented companies like retailers, distributors, carriers and logistics services providers. But the good news is there are many ways to lessen the impact of high fuel costs. Most take nothing but time and the gains will continue long into the future, whatever the fuel price forecast. For all strategies, keep in mind that high fuel costs are a company-wide problem, not just an issue for the transportation department. Indeed, many of the causes of fuel consumption are dictated by departments outside of transportation. In particular, those responsible for customer relationships need to be engaged as they can have the greatest impact on mitigating high fuel costs. Another important department to involve is the finance team, who can help determine the impact of fuel cost mitigation strategies and is likely to have a significant influence over other parts of the business. Quick wins, no extra cost: 1. Surcharge for incremental fuel costs. Many companies have fuel surcharges already built into customer contracts. Don’t be shy to use them; apply them to new purchases or renegotiate existing agreements. Customers may push back, but even a percentage of what was originally requested can make a big difference. 2. Offer a lower level of customer service. This is one of the strategies that should go hand-in-hand with fuel surcharges. Customers may not want to pay more, but they likely will accept lower levels of service if it keeps the costs from rising. Choose slower transportation modes and longer delivery lead times. Delay shipments to look for consolidation opportunities with other orders from the customer or customers nearby. Change the transport management system (TMS) or route planning system optimisation parameters to focus on selecting slower modes and reducing distance. 3. Focus on driver performance. Drivers can create unnecessary fuel consumption through their driving style. Focusing on reducing speed, idling and off route driving and 14 ways to cut your company’s fuel costs now By Chris Jones, EVP Industry & Services, Descartes Systems Group Inc Chris Jones, EVP Industry & Services, Descartes Systems Group Inc
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