If you’ve ever shipped your products on pallets, you’ve probably come across CHEP. With their recognizable blue color, the company’s pallets move all sorts of goods – consumer, retail, fresh, bulk liquid and dry, automotive and industrial – throughout 54 countries.
CHEP USA is the arm of the company that transports pallets around the US. Given the amount of product it moves (nearly 400 million pallets per year to customers) and the number of industries it services, the company’s supply chain changes significantly month over month, which causes inconsistency in lanes. That makes it more difficult to find quality carriers that won’t fall off.
CHEP USA knew this was the case, but was operating in reactive mode up until about five years ago. That was when it started to make changes to its technology.
“The biggest change I’ve seen over the last several years, is that CHEP is now using data and technology to become proactive and predictive,” said Fabian Lugo, linehaul transportation manager at CHEP USA. “Today, we’re a heavily data-driven company.”
He should know. He’s been with CHEP over 11 years, and continues to be part of implementing new strategies and technology to better CHEP’s operations.
He continued, “Not only is this coming from the transportation perspective, it’s also coming from the planning side, which helps with carrier consistency. If we have consistent lanes, it’s easier to find drivers who won’t fall off. We’re really dipping into technology to do this and to create better driver experiences.”
CHEP is focused on using technology to become a preferred shipper to its many carriers, and to create better driver experiences in all of its facilities. It’s because of that focus, the company was recently selected as a Convoy Shipper of Choice, as voted on by our network of carriers and drivers.
A Convoy Shipper of Choice makes an ongoing effort to better the experience of carriers who are servicing their freight. Convoy launched the recognition program for shippers that have specifically leveraged the exclusive data and insights from our platform to improve the experience of carriers at their facilities. It’s why we look to our carriers and drivers to tell us which of our shipping partners is making the the changes with the biggest impacts to their experiences.
Based on improvements made at its Pico Rivera facility in California, CHEP is the first company we’re recognizing.
How CHEP made changes to its facilities to become a shipper of choice
In 2018, Convoy’s account team reached out to Fabian and his colleague Yvonne Correa, linehaul transportation analyst, with feedback about the Pico Rivera facility.
Convoy had been working with CHEP for about a year and found that drivers using the Convoy app were unhappy about service quality and wait times at the facility. Some drivers even went so far as to refuse loads going to or coming from the location.
When Convoy looked into the issue, we found that the average wait time to pick up was 4.4 hours and the average time to drop off was 2.6 hours.
We took this data to Fabian and his team at Pico Rivera. It turns out the site was over planning capacity.
After learning about carriers’ negative experiences, the facility made changes to its planning capacity. The facility decreased loading and unloading times and prioritized service for carriers.
Within three months, the average pick up wait time had fallen 70% to 1.3 hours, and the average wait time at drop off was down nearly 58% to to 1.1 hours. The facility’s reputation also changed quickly – for the better.
We sat down with the CHEP USA team to learn more about how they are using technology to become a shipper of choice, and why being a shipper of choice is a good business strategy. Here is what they said.
Convoy: Tell us about your approach to carriers, and why being a shipper of choice matters.
Fabian Lugo: Becoming a shipper of choice matters, because it exposes CHEP to a larger population of carriers that fit well into our network. If we’re a preferred shipper, it’s easier for us to to find carriers that help mitigate hyperinflation. They know what we can do, and we’re easy to partner with, so they’ll give us capacity before going to a shipper that is not so easy to do business with. Having a shipper of choice recognition that comes from the drivers is a big deal to us. That means they want to do business with us over our competitors.
Convoy: What else are you looking at or doing to become a shipper of choice?
Yvonne Correa: The way the transportation market is right now, is that a lot of other transportation service providers aren’t focused on driver happiness. They may preach it, but they don’t practice it. If you don’t have happy drivers, you have a lot of issues, angry drivers and angry service center people. We like the programs that are focused on drivers.
Fabian: We are pushing to make the driver experience better. We are automating much of the drivers’ experience in the next couple of years – everything from kiosks where whey can tap in their POD, to giving them directions on which loading dock to head to, and automating the process to the forklift driver as well. We want to automate the experience to make it easier – even the documentation, such as a BOL.
Convoy: What do you do when a facility isn’t performing the way you want it to?
Yvonne: We just went and saw one yesterday. There’s a great plant manager there. He saw a problem with drivers not knowing where to go or what to do, and took steps to solve it. He installed new signs that give directions in nine languages.
We’re the liaisons between our logistics coordinators, the carriers and the service centers. It helps to get everyone together to figure out how we are going to solve the problem..
Convoy: Let’s go back to automation for a second. How have you seen it change the industry so far?
Fabian: Automation, and technology really, picked up momentum with the ELD mandate, which went into effect on April 1, 2018. While there was a lot of uncertainty when it rolled out, we’re past that. Now, we’re seeing the benefits from it. It was a big eye-opener to the entire industry.
In general, automation has made it easier and more attractive for the younger generation to come in since they can use apps on their phones. It’s now part of their daily routine. Trucking companies are giving drivers tablets for work, and to help them keep in contact with their families. They can make video calls during their DOT breaks.
The industry as a whole is absorbing technology and spinning it to make it advantageous for drivers and shippers to make the process easier with fewer touches.
Tell us, how are you becoming a shipper of choice?
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