Retailers and wholesalers are finding one of the best ways to take costs out of the supply chain is through the nozzle of a gas gun and better management of transportation's lifeblood: fuel.
Faced with rising costs of fleet maintenance and gas prices, distributors are getting more serious about conserving fuel. Through a combination of new technologies and better operational controls, distributors are improving fleet mileage rates and reducing fuel waste at the warehouse level.
"We are looking to improve our ability to account for fuel usage," said Douglas Pope, vice president of warehousing for Seaway Food Town, Maumee, Ohio. "We want to do a better job of determining which of our units get the most miles per gallon, which are operating most efficiently and why.
"We want to be able to identify problem areas early, before they become more expensive problems," he added.
Such forward-thinking companies are taking several routes to improve fuel usage. Among them:
Automated Driver Monitoring: Systems that remotely monitor mileage and engine performance enable distributors to analyze individual driver performance, pinpoint wasteful practices and identify failing equipment.
Heightened Security: Limiting the number of employees who can access fuel through increased security measures reduces both theft and accidental spillage.
Enhanced Engine Performance: Distributors can reduce fuel usage simply by calibrating their truck engines so they operate at maximum efficiency within designated speed limits.
Brookshire Grocery Co., Tyler, Texas, is improving fleet mileage rates by using electronic monitors to record truck performance.
Greg Nordyke, director of transportation, said the monitors enable Brookshire to determine each truck's driving speed for each segment of a route. If a driver exceeds the top authorized speed, logistics personnel are automatically notified.
Brookshire officials also use the system to determine frequency and duration of engine idling time, a sometimes-hidden cost that can add up.
"The biggest thing we do for fuel economy is not so much controlling the speed of the truck itself but trying to control the driver," Nordyke said.
Fairway Foods, the wholesale division of Holiday Cos., Bloomington, Minn., has experimented with a system that regulates engine idling by monitoring the presence of a driver in the cab.
"The system was pressure-sensitive to the driver's seat. If no one was in the seat for a given period of time with the tractor running, the system would shut down the engine," said Chester Harkonen, vice president of distribution for Fairway Foods.
Fairway Foods is now considering a move to on-board computers to more accurately monitor the amount of idling time and travel distance in each trip, Harkonen said.
"Prior to now we have not been able to cost-justify it," he said. Such an investment may first "require expansion of our fleet and prioritization of capital expenditures. We would test it first in one of our facilities that has the most room for improvement," he said.
Already, Fairway Foods has had good success through awareness programs alone. "We have worked hard on reducing idling time just by educating the drivers" and rewarding fuel-efficient practices. Along with driver performance on the open road, distributors are finding better fuel management can also be achieved at the warehouse level.
Associated Grocers, Seattle, is now rolling out an automated fuel dispensing system that records crucial data as trucks are refueled.
"The system will keep track of our fuel usage, odometer readings and miles per gallon with ease," said Peggy Laremore, fleet supervisor. She said payback on the system is expected in the next two to five years.
As the pump dispenses fuel, it records such information as time, vehicle number, amount and type of fuel, mileage at the time of fueling and engine hours. The system then downloads the information into a corporate-level data base.
By automating the entry of fuel-dispensing data, Associated hopes to slash up to a half hour per day of clerical labor time, as well as improve its record-keeping. "There are times when we don't have any record [of a truck fueling] because the driver forgets to write it down," Laremore said.
"We can be off by as much as 1,500 to 2,000 gallons of diesel fuel per month" due to incomplete records, she added. The wholesaler uses about 90,000 gallons each month.
Associated will also reduce labor costs and safety risks by no longer requiring fuel handlers to climb up onto a tractor to read the odometer.
Other distributors, such as Brookshire Grocery, are stepping up security measures at the pumps, often requiring employees to swipe identification cards to access fuel supplies.
"We have [designated] employees who fuel all the trucks. No drivers or unauthorized personnel have access to the fueling system," Brookshire's Nordyke said.
Retailers and wholesalers intent on expanding or enhancing transportation operations are more frequently turning to fuel-efficient electronic engines. "We have electronically controlled engines that prevent drivers from exceeding a specified speed," said Jerome Pesek, vice president of distribution and transportation at Randalls Food Markets, Houston.
Seaway Food Town, for its part, is now upgrading its fleet with engines designed to exact specifications for maximum fuel usage and operating efficiency, Pope said.
"The new engine has tracking capabilities which we use on an as-required basis," Pope said. "We now have the ability to control speed and idle time, which has also contributed to fuel economy," he said.
The new truck engines limit drivers to a maximum speed of 57 miles per hour. Coupled with a more efficient engine design, Seaway has achieved a 27% increase in miles per gallon for its new trucks, Pope said.
Both Fairway Foods and Hy-Vee, West Des Moines, Iowa, calibrate their truck engines to a maximum speed of 62 miles per hour. "We run periodic exception reports on fuel use by unit that allows us to target those [trucks] that appear to have substandard performance," Harkonen said.
Brookshire's Nordyke said monitoring trucks also yields soft benefits, such as safe driving practices. "Our trucks carry our name on the road. There is a great deal of public relations value in maintaining control over them," he added.