Dedicated Milkrun v. Shared Milkrun
Having a well-planned and executed network of customers, suppliers, and daily routes is key to a successful supply chain operation. Analyzing the way freight is transported from one location to another is a crucial part of any company’s business plan and can also significantly impact a company’s financials. While every company’s most efficient mode of transportation may vary based on their needs, two options are the Dedicated Milkrun and Shared Milkrun.
In a Dedicated Milkrun, a truck will visit the suppliers of only one company. The drawback to this form of transporting freight is that there can be a significant amount of down time for drivers, as well as empty space in the truck while it moves along a lengthy route before it is even close to being full. Once the route is completed, the truck returns empty. These factors lead to wasted space and money.
While a Shared Milkrun is quite similar to a Dedicated Milkrun, there are some added benefits to this form of transporting freight. In a Shared Milkrun, freight is transported for multiple suppliers and multiple customers. This allows for shorter, more frequent routes, which means trucks are full of freight a larger portion of the time. This allows for higher efficiency and more frequent movement of freight. In addition to this, a Shared Milkrun utilizes dynamic routes that allow for flexibility in volume changes.
In a Shared Milkrun, the volume of traffic is reduced within a facility because freight will be shipped during a scheduled window of time. In addition to this benefit, the cost is more efficient due to a returnable container management system that allows the cost of returning to be based on weight.
Comparatively, a Shared Milkrun most definitely has benefits over a Dedicated Milkrun. The amount of freight that is transported is planned in a way that allows for the most efficient and cost effective use of space. That cost saving aspect, combined with the easy returnable container system adds up to a great deal of savings. When you factor in the time and minimal inventory being kept, one can see that there is a financial benefit to taking part in a Shared Milkrun.
In conclusion, the biggest two benefits of using a shared milk run over a truckload shipment are:
1) The cost savings gained both on freight and returnable by sharing the truck with other customers
2) Maximized cube utilization, and therefore efficiency, when sharing routes with other suppliers/plants in the network.
Carter Logistics employs 1,200 logistics professionals and our partner carrier, Carter Express, has over 800 trucks and 1,600 trailers that travel to 7 strategic locations. Contact Carter Logistics today to discuss your shipping needs and evaluate whether or not your supply chain can be improved with a Shared Milkrun.