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‘From first mile to last mile’: is it time to expand into new applications?

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Jason Morgan is the editor of Fleet Equipment. He has more than 14 years of B2B journalism experience covering the likes of trucking and construction equipment, real estate, movies and craft beer industries.

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The trucking industry is experiencing a boom with no end in short-term sight. The latest report from FTR’s Trucking Conditions Index—which tracks changes in U.S. truck market conditions, including freight volumes, freight rates, fleet capacity, fuel price and financing—is that the y/y Index remains more than triple the 2017 reading of 2.97. The current 10.30 Index reading represents a carrier-favorable environment that is not expected to see any real change through 2018, with even more positive conditions during the second and third quarter.

The consequence is that equipment is hard to come by. New trailer orders are booked nearly through Q1 of 2019 and Class 8 equipment orders are outpacing industry capacity, according to ACT Research, with orders totaling 34,735 units in April. Buying used equipment to keep up with business demands is one option (we offer tips on shopping for used trailers here); another is buying different equipment and expanding into new applications.

The last-mile delivery buzz is reaching a fever pitch. Consumers are demanding that more products be delivered to their front door, and instead of hauling product across the country or state and handing it off to another carrier for front-door delivery, fleets have the opportunity to invest in medium-duty trucks and finish the job themselves.
Of course, expansion should not be entered into lightly. The first step is figuring out if you can handle it. For that answer, turn to your telematics platform of choice.

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“We do see some of our customers looking to expand,” said Kent Norton, who took the reins as chief technology officer at Omnitracs in late January. Norton went onto explain that the truck technology environment of yesteryear was segmented with multiple solution providers whose technology didn’t integrate with one another. Today, that environment has evolved into a more inclusive world where technology and data platforms are expandable.

“As fleets’ businesses expand, whether they’re expanding into first mile or last mile, they could effectively turn on technology, as opposed to implementing another platform,” he said. “On our Omnitracs One platform, for example, it’s essentially a software selection of what features and functionalities you want, based upon where your fleet is at that point in time.”

The most common example of a technology that could enable a move toward last-mile delivery operations is routing. Moving trucks through congested city centers while planning the most efficient route can be a headache for a fleet that has traditionally provided long haul services. That’s where a routing solution comes into play. Offered by numerous technology providers, routing technology combines real-time GPS data with other routing information such as traffic congestion and even weather.

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“We also allow the fleet to edit the navigation maps and provide an overlay where they can have a preferred way to get into a facility or take them directly to a back entrance to get to a dock, for example,” Norton said, “as opposed to a typical navigation system that might route a truck to the front door, which is not the way the truck needs to go.”

The optimal routes feature offered by Omnitracs Roadnet Anywhere, for example, allows users to measure the effectiveness and impact of routing decisions on cost, time and distance. Users can generate theoretical route-level scenarios to compare against actual routes, which can provide insight into the decisions made by routers, as well as highlight instances in which an over-emphasis on customer service has led to overall inefficiency.

For many fleets, expansion is about efficiencies—to develop equipment management processes and habits in new application disciplines. While there are many questions to be answered on the road toward new opportunities, the first answer to find is whether you’re ready for the challenge.

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