Industry Innovation: July 18, 2017
How Seasonal Changes Impact Logistics
By: Fuel Transport

Anthony Perrella, Director of Operations, discusses how seasonal changes impact logistics – and Fuel’s approach to problem solving this shift.

Summer is the time of year when people can enjoy the reasonably priced fresh produce that is so scarce during the colder seasons in much of the United States and, well, all of Canada. It’s a treat that arrives on store shelves from the fields of warm-weather states in the south. The demand is so significant and the flow of fresh produce is so great that it has a dramatic effect on much of the transportation and logistics system across the region.

Faced with the risk of their crops going to waste, farmers and shippers will pay extra to ensure carriers can move their produce north as quickly as possible. When shippers in, say, Georgia start paying more to move their watermelons north, there is a ripple effect across the region—rates go up in the Carolinas, along with and Alabama and Tennessee.

This is a real problem for shippers that operate out of the area year-round and are suddenly faced with paying a lot more to move their freight. “Whatever clients we have that ship out of those areas, it makes it harder to secure trucks for them,” says Anthony Perrella, director of operations. “There are carrier companies out there that run the spot market… They wait and wait to get whoever is going to pay them the most.”

Building stronger, long-term relationships

But Fuel doesn’t operate that way. Indeed, that kind of near-sighted, short-term and transactional behaviour is the opposite of the way Fuel thinks things should be done. Fuel believes in long-term commitments leading to more sustainable models, increased efficiencies and better results—for everyone.

“Other companies try to drive up profits during the season, but we are not about that,” he says. “If a client says I can give you 400 loads a year out of Georgia for the next two years, it is kind of hard to charge them more in two months of the year just because it’s produce season.”

Rather than chasing the elevated rates available during produce season, Fuel would rather move loads year-round for clients, year after year. Then, as Fuel gets to know the client better and how their business is effected by seasonal shifts, the company can identify synergies within its network that moderate those inflationary seasonal forces. “We can find different ways of moving their freight and, bottom line, we find ways to save our clients’ money,” he says.

Moving product season after season

Melon season isn’t the only challenging time of year for Fuel. In the late summer and into the end of October, for example, the pace becomes break-neck as retailers race to ensure they can stock the shelves with Christmas product while the kids are still out trick-or-treating for Halloween. But even then, the pressures aren’t the same because the loads are moving pretty much across the continent, says Perrella. There isn’t the same concentrated market distortion we see with the produce and watermelon market in the southeast U.S. in late spring and early summer.

Regardless of the timing or specific variables of the season, Fuel’s goal is to ensure its clients aren’t adversely affected. For a little while, it makes their jobs a little tougher. “But it is our job to get it done at the contracted rate,” says Perrella.

Creative problem solving for clients

 If a client needs five trucks in Georgia next week, Fuel will find a way to get five trucks down there to deliver the client’s loads at the rate they pay year-round. “We make sure we come up with a game plan to secure capacity in those areas, not to have it impact our clients,” he says.

It’s another example of the “never say no” mantra that defines Fuel and drives the operations team day-in, day-out. “What helps us out is our outside-the-box thinking,” says Perrella. “When we are faced with a challenge, we’ll always figure out a way to get it done and there is nothing more rewarding to our team than to find that solution.”

“The team is driven by it,” he says. “They know when someone else is having a problem moving a load and everyone starts talking to try and figure out a way to solve it. Can we move it half way or maybe incorporate our own assets in a switch situation? There are many other ways of thinking about it if your team gets creative. But we’ll always figure out a way to do it. It’s not easy but we always find a way.”