Converting From Truckload To Rail Incentive
OMAHA, Neb.–(Sept 17th, 2010) According to the Association of American Railroads (AAR) this week it reports weekly rail car load volume set a new 2010 record for the second consecutive week.
With the slow down in the economy more shippers have been utilizing the railroad as another alternative to saving money. And why not? Unless your product is time sensitive, or needs to be refrigerated, rail can be a perfect option that can save you up to 20-30 percent, and sometimes more. There are even some other ways to save money through rail services.
The downside to rail is the amount of time it takes to transport freight. For example, to transport freight 850 miles could take four to five days using rail service, but only take two days for truck load service.
A good approach to time sensitive freight and thats not temperature control is to offer your customer/vendor a discount for more time to receive their freight. I bet you twenty percent of the time your customer could spare a couple more days, regardless of the discount.
Some other benefits to utilizing rail service can be that of a rolling warehouse, and its ability to provide drop trailers to cut back on the man hours needed to load/unload its freight.
With the economy cutting into your labor costs, drop trailers can be less costly than having to pay drivers overtime sitting for several hours while your short on help due to labor cut backs.
While there are costs associated with having rail containers dropped its can be much cheaper in the long run.
For those looking to save money by freeing up space in the facility warehouse without having to ship their freight earlier than its customer wants it, rail service can be used as a moving warehouse.
Jarrod Marinello* Executive