What is lane density? This is a term you may or may not have heard in the course of doing business as a trucker. But as you’re about to see, it’s very important in determining whether you are profitable or not. This applies to a single truck operation or multiple unit dispatch.
Lane density is the art of load planning, which keeps the truck full with profitable tonnage whenever it is rolling. It’s documented that over 40% of all OTR trucks traversing the American highway are partially or completely empty. This is an indication that efficiency is not a part of the plan. Lane density should be one of the dispatch plans every trucking operation implements, regardless of size. The PLAN is simple: keep your trailer loaded every mile it has tires rolling on highway pavement. This means you’re looking for return tonnage while considering what you’re going to load outbound. Better yet; you’re looking two or three or more trips into the future, planning loads for each truck, so that every trailer has a load assigned to it long before it has reached its destination. The plan is to eliminate dead-heading and unnecessary sitting by maximizing lane density. Don’t allow the truck or your loads to select your downtime, or contribute to unpaid or under-paid miles.
In today’s market, there is less tonnage than there are trucks available. Any trucking company or individual Owner/Operator who isn’t charging round trip miles on any outbound load when going into an area with a high truck-to-load ratio is going to be left behind. Shipping management articles are advising companies to contract with several different trucking companies of all sizes to insure their loads get covered. The days of the exclusive hauling contract are coming to an end, and the number of drivers is stagnant or sliding downward. With this happening, there has never been a greater opportunity for quality, service-minded trucking companies and Owner/Operators to earn the revenue to be truly profitable.
Every mile a truck is driven costs money, whether loaded or not. Once a load is delivered, both the number of days from that delivery date and the number of miles required to complete the next trip all belong to this new load. Regardless of whether you’re hauling paying tonnage or sailboat fuel, deadheading or traveling to your next pick-up, every time the truck is rolling there’s money going out the exhaust. To maintain lane density you must think in straight lines, keeping that loaded truck on the most direct path between pick-up and delivery; minimizing distance traveled, thus saving on operational costs and driver’s Hours of Service. The idea that a straight line is the shortest distance between two points works here. You must match your loads; as the truck starts pick-ups and deliveries, it deviates very little from the straight line. When it has to stray from the line to pick-up or deliver, the rates charged reflect the time and distance required out of route. Small package trucking companies do this, why shouldn’t you? Don’t be fooled by the rate per mile of a specific shipment or load: what counts is the actual distance the rubber rolls and the amount of time required to accomplish the entire trip. A rate per mile is nothing more or less than a means by which you figure the amount to be charged the customer. That rate per mile is usually figured on some arbitrary mileage table that has absolutely nothing to do with the actual miles to be covered. You must compare your revenue to the actual miles to be driven and time required to complete the trip. Moreover, those miles and time must start from the place and time you delivered your previous trip’s load; not from origin to destination, but from destination to destination.
Here’s that four letter word again....PLAN! But don’t get caught with the wrong plan! Most truckers and small fleets run on the day-to-day plan. In the morning, they determine which trucks are going to be empty that day and start searching for loads for them: a plan, but not a good plan. You’ve got to have a Lane Density Strategy: one that not only looks at today, but one that looks as far into the future as possible. If you haven’t located the return load before you accept the outbound load… you have a failing plan. To set into motion the best plan you must be prepared with the right strategy.
Your Lane Density Strategy should include the following:
1. Set up dedicated routes that maintain lane density.
2. Look for tonnage along these routes before you need it.
3. Find loads long before you need them.
4. Always have more tonnage available than trucks.
5. Set up a bread and butter run for each truck and driver(s).
6. Don’t look for loads at the last minute.
7. Always plan two to three loads ahead for each truck.
8. Think multi-directional, outbound, return, and in-between.
9. Don’t send a truck out without a return plan.
10. Provide quality service so shippers are calling you back.
11. Always look beyond the horizon.
Lane density is a means of setting up a dedicated lane within which you operate. This is the first step to developing your freight lane strategy. You must be the expert in the lanes you operate; you should know about every load of your type of freight that is shipped in your lane whether you haul it or not.
Your Lane Density Plan is your first defense against hauling cheap freight.
Please share some of your ideas and thoughts on how you apply a “Load Density Plan” in your operation.
Timothy D. Brady is
· A 20 + year award-winning trucking veteran.
· Trucking Expert on
· Heard in podcasts on http://AmericanRigRadio.com .
· Author of best-selling trucking business books and columnist for top trucking industry publications.
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