Real-time traffic information services now coming to market offer shippers and carriers additional opportunities and tools to shave time and expense off freight deliveries. The new services may appeal to smaller companies in particular, offering them the chance to use technology to bolster their own services and compete with larger carriers.
Relatively inexpensive global positioning systems and computerized mapping products have taken their place on commuters’ dashboards and in the cabs of small, local parcel trucks. But ABI Research Principal Analyst Dan Benjamin said the next generation of services — with increased bandwidth for interactive, real-time services including road speed and traffic flow data — should get an enthusiastic reception from logistics operators and delivery fleets that could save thousands of dollars by cutting road transportation delays by only a few minutes a day.
“Advanced real-time traffic information services must handle complex two-way data transfers, requiring much more bandwidth in both directions,” Benjamin said. “It remains to be seen whether consumers will be willing to pay for that.”
“If content providers such as Navteq, Tele Atlas, Inrix, LandSonar and Traf-fic.com can deliver highly accurate road speed and traffic flow information, they will find a huge market in the commercial world,” Benjamin said.
Jenkins said UPS has long embraced the value of sophisticated traffic management strategies, and there’s not much room for improvement.
“Our delivery routes are so heavily engineered that saving 10 minutes a day would be a great savings,” Jenkins said. But UPS has already done much of the heavy lifting of analyzing different routes, recognizing rush hours and slack times so drivers avoid congestion rather than contributing to it. At this stage, the Atlanta-based carrier is developing and implementing systems to re-route traffic in response to exceptional events, such as accidents, downed power lines and catastrophic service disruptions that lead to delivery delays. “It’s more what service delays can we avoid, what service enhancements can we plan,” said Jenkins.
Of course the new generation of traffic services could offer big improvements in speed and efficiency for carriers less experienced and resourced than UPS. And, Benjamin said, “there are integration issues to be resolved, and the traffic data providers are going to have to deliver on their promise of high quality information.
“But given that logistics companies already have — and are paying for — advanced telematics systems, they should be ready to pay a premium for traffic information that will enable them to use their resources to the fullest,” Benjamin said.
Some operators already have finely tuned traffic management systems in place that could mitigate the new products’ appeal. “The whole idea that traffic is important to fleets that cover the territory we have has been an issue for a long time,” said Rhesa Jenkins, strategic planning manager at UPS, a long-time leader in such technology. “A lot of these things are just the nature of the way we do business which have made sense for a long time.”
National food distributor Nash Finch is creating a supply chain management group that will be responsible for the company’s warehouse, transportation and procurement operations.
The $4.6 billion company says it plans to focus aggressively on emerging opportunities for its military distribution business. Jeffrey E. Poore will head the new group, after previously running Nash Finch’s military distribution operations. Minneapolis-based Nash Finch gets 85 percent of its sales from military and wholesale distribution. It serves independent retailers and military commissaries in 31 states, the District of Columbia, Europe, Cuba, Puerto Rico, Iceland, the Azores and Honduras. Nash Finch also owns and operates a base of retail stores, principally supermarkets under the Econo-foods, Family Thrift Center and Sun Mart trade names.
A new military distribution unit led by Edward L. Brunot will be formed within the supply chain management group. Brunot came from AmeriCold Logistics and served in the U.S. Army.
The Fortune 500 company (No. 457 in 2006) also announced its CFO will resign her position after an executive search firm has located a replacement; named as chief information officer the former CIO at AmeriCold Logistics; and elevated its interim general counsel to the permanent post.
Nash Finch President and CEO Alec C. Covington said the organizational restructuring and executive appointments will strengthen operations across the company.
“With a tighter, more focused organizational structure and a highly qualified team of seasoned professionals who bring unparalleled industry expertise and leadership skills to the company, we can now leverage talent more efficiently to achieve our business goals,” he said.
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