Published: 06 October 2020 | By Lorryz.com
Backhaul basically refers to the return trips made by a vehicle that has delivered goods to a specific destination. As per Merriam Webster, the definition focuses on the return movement of a vehicle from their original drop-off location where they have transferred a load, the route being: all the way back to the pickup location.
While traditional and obsolete methods of transportation will point towards backhauling or ‘backloading’ as a somewhat effective way to get goods transported by applying discounts, schemes. But these roundtrip hauls are not always a good way to get things transported. Firstly, the routes can never be pre-planned, in some cases it is also based on a hunch if whether there will be the availability of orders, mapping out the routes with no prior information while at the same time increasing driver and vehicle utilization.
Now, if you think about it, there are certain costs associated with these specific return trips where transporters have to bear the cost of fuel used for traveling all the way back to the original destination, traveling empty miles where trucks are transferring any goods rather than just coming back without actively fulfilling an order in these times. This minimizes the total efficiency of what these trucks could actually be doing rather than just covering the distance back.
The percentage is alarmingly higher where companies end up discounting backhaul rates to make up for lost profits. Bill Mathews in a recent article negates the idea and usage of the term ‘Backhaul’ altogether, exclaiming that companies discount backhaul rates by at least 40 percent providing a vague image of the company itself because they end up losing price control in the markets that these companies are operational in.
Furthermore, one of the aspects that companies determine their Key Performance Indicators in logistics is by comparing the backhaul empty miles, which doesn’t provide much relevancy as this is not always evident and ends up being vague when it comes to making smart business decisions about the scope and direction of current projects to achieve defined goals of the company.
One thing that tech-based logistics management services have initiated is the eradication of these backhauls with their instant transportation solutions that aid in increasing overall profitability.
Lorryz tech-based solutions have also allowed truckers to be a part of efficient logistics. How this works is that truckers can pick their locations via the App once they have completed an order and delivered goods on the assigned destination and then they don’t have to make a trip back, instead, they can simply make themselves available for another order that needs to be picked up in the same vicinity. How the system works is that it will assign the nearest available trucker the order at hand and they can accept it and start their trip once the cargo is picked up. This can be a continuous cycle of planned trips for the truck drivers where they can decide their routes based on their needs as well as the orders they have accepted. This completely eradicates any empty return trips.
Lorryz makes sure that their truckers are given prior information on their next load destinations. Predictive analysis has made it possible to do this and with more enhanced Artificial Intelligence systems, this process will be streamlined even further. This has enabled our logistics management to properly take care of supply and demands while also reducing CO2 emissions focusing on a greener logistics infrastructure.
The benefits of a system like this do not only allow the stakeholders involved with more leverage to make decisions but also be a part of a disruptive technology that is allowing businesses to refrain from incurring any additional costs while transporting goods. With a tech-based system such as this, vehicle owners save up on fuel, time, energy and using valuable resources on other valuable operations.
Truckers are able to take advantage of achieving the desired number of miles each day that adds to their bonus. With this system, it’s important to mention that human resources are being utilized at an optimal level. The truckers and fleet owners invest the amount of time that is suitable to them, delivering goods and refraining from wasting fuel on empty trips all the way back. It’s really a win-win!