While the effects of the recession have pushed many in the trucking industry to rein in spending on all but the essentials, it’s a testament to the financial viability of the growing ‘green’ movement that while virtually every frill has been left on the side of the road, green has survived.

It comes down to one thing: there’s an undeniable return on investment.

There was a time when sustainability was a “check-box on an RFI,” says Jim Butts, senior vice president, C. H. Robinson Worldwide, Inc., a leading global 3PL. “Customers only wanted to know if we had a program in place.”

Much has changed, however, from both the shippers’ and the carriers’ perspectives. For C.H. Robinson, the appreciation for sustainability stretches back to the company’s origin as a produce broker in 1905. When there’s a long-standing and inherent awareness of sustainability throughout an organization, there’s evidence of green behavior at every level.

For example, the company appoints ‘green captains’ in each of the organization’s branches, who are responsible for simple initiatives like eliminating Styrofoam, increasing recycling efforts, setting up carpools, and converting paper-intensive operations to EDI.

On a more sophisticated level, C.H. Robinson relies on load optimization tools to get the most efficiency out of its network of transportation providers. “Whenever there is a piece of equipment engaged it has to legally haul, in terms of weight and dimension, as much as it possibly can,” explains Butts. That also extends to choosing the right mode and making sure if a shipper has an inbound shipment that there’s an opportunity for the carrier to transport freight outbound too, he adds.

Furthermore, as shippers’ needs and information requirements have evolved, so too have the systems capabilities provided by C.H. Robinson. “For many of our customers, we’re measuring emissions at various levels, including the regional and enterprise level, with transportation modeling techniques,” says Butts. “We’re also consulting with customers to find the trade-off between higher costs and reduced emissions, and we can perform this analysis not only in North and South America, but throughout Europe as well.”

Last year, C. H. Robinson took their commitment to sustainability further by partnering with Cascade Sierra Solutions, a non-profit organization that helps motor carriers reduce fuel consumption and carbon emissions, typically by installing U.S. EPA SmartWay technologies to reduce idling and improve aerodynamics. For its part, C.H. Robinson is providing financial support to Cascade Sierra Solutions and is helping promote the non-profit’s services to C.H. Robinson’s network of over 45,000 contract motor carriers. In addition, C.H. Robinson has set up a Customer Match Program that matches a percentage of C.H. Robinson’s eligible customers’ donations to Cascade Sierra Solutions.

“We found that many small- and mid-sized carriers lacked the resources and the wherewithal to become SmartWay certified,” says Butts, “and that’s what piqued our interest in finding an organization like Cascade Sierra Solutions. We’re really pleased with the program. They walk the talk.”

While acknowledging the powerful tools on the market today, Butts nonetheless emphasizes the importance of “getting back to basics.” It’s a focus on fundamentals, like greater equipment utilization, he points out. “There’s also a lot to be said for better planning in the supply chain, so that the things you’re ordering are the things that you need.”

Easier access to high-tech tools

Simply put, a big part of the goal is to keep trucks loaded and moving efficiently. The robust transportation management systems on the market today makes that possible, while the software-as-a-service (SaaS) model has made it easier and cheaper.

In December, LeanLogistics introduced GreenLanes™, a transportation and freight optimization program designed to improve sustainability and reduce empty miles for shippers and carriers across the U.S.

“Private fleets generally have deadhead ratios of about 20 to 30 percent, while over-the-road fleets run in the 8 to 15 percent range,” notes Chris Timmer, senior vice president, business development and marketing, LeanLogistics. “What we’ve seen with our network is that we can get deadheads down to around 3 to 5 percent.”

According to Timmer, “The beauty of utilizing our technology is that everybody—all of the data, all of the connection points from a shipper and carrier perspective—resides on the same platform. GreenLanes aggregates that information and then identifies shippers that collectively work effectively with the carriers. So, it might be that Shipper A and Shipper B have commensurate lanes that they’re running freight on, and Carrier A could potentially provide service because it meets up well with the shippers’ networks. We’re essentially ‘hyperoptimizing’ transportation between shippers and carriers, but as an agnostic player—there’s no bias towards the shipper or the carrier. We’re just taking both entities’ information and aligning the resources to run more effectively.”

Where the rubber meets the road

For Steve Phillips, senior vice president, operations, Werner Enterprises, a green fleet is an aerodynamic fleet. “Eighty-eight percent of our fleet is aerodynamic. By that I mean full fairings, top and bottom, and approved as ‘aerodynamic’ by SmartWay. We have been purchasing SmartWay approved aerodynamic trucks for some time, and as we continue to sell off older equipment and buy new trucks, then sometime within this year, 100 percent of our fleet will be aerodynamic.”

Phillips says the company is also looking at the benefits of aerodynamic trailers, specifically those that are outfitted with skirting. “We are currently testing three different manufacturers’ skirting, including one of our own designs.” While the actual fuel savings associated with trailer skirting is up for debate, “there’s enough proof that it does improve fuel savings,” he says.

Phillips believes that new regulations from the California Air Resources Board (CARB) are largely responsible for jumpstarting the move to trailer skirting. The regulations will be phased in over 11 years—between 2010 and 2020—and are designed to reduce greenhouse gas emissions produced by heavy-duty tractors pulling 53-foot or longer box-type trailers. Equipment owners are responsible for replacing or retrofitting their vehicles with SmartWay-compliant aerodynamic technologies and low rolling resistance tires for operation on California highways.

“Manufacturers are claiming their trailer skirts will cut fuel consumption anywhere from 5 to 7 plus percent,” Phillips says, and while that’s admirable, cost has been an issue for some. “You’re looking at $1500 to $2000 for a set of skirts; but that cost will likely come down as they become more prevalent.”

Tires are also where carriers can see some real results. “Right now, we’re buying all low resistance tires, and we have been for some time. The latest are super single tires that offer even lower resistance. Although super single tires aren’t widespread yet, we’re seeing some very positive impacts.”

Inflation systems are another worthwhile tool, says Phillips. “Drivers do a pretty good job of checking tire pressure on their tractor, but a pretty poor job on the trailers. Tire inflation systems are a very good investment because not only do they improve miles per gallon they also reduce tire wear. An improperly inflated tire is going to have half the durability of a properly inflated tire.”

Electric auxiliary power units (APUs) are also growing in popularity, Phillips says, as are single-drive axels. But, one product that hasn’t quite been accepted is biofuel. “It may be in part because the $1 tax credit expired on January 1st of this year,” posits Phillips.

As it turns out, biofuels have been sputtering for some time, and a new study by Rice University’s Baker Institute of Public Policy is particularly critical of its future. For starters, the study questions the economic, environmental, and logistical basis for the billions of dollars in federal subsidies and protectionist tariffs that go to domestic ethanol producers every year.

On the topic of environmental and health impacts, the study asserts that the addition of ethanol to gasoline will impede the natural attenuation of BTEX (benzene, toluene, ethylbenzene, and xylenes) in groundwater and soil, posing a great risk for human exposure to these toxic constituents if an underground storage tank leaks.

In addition, there are logistical challenges as well. While gasoline in the U.S. is distributed mainly by pipeline, the current U.S. ethanol distribution system depends upon rail, barge, and truck, which is more costly than pipeline.

Meanwhile, there are some more promising developments on the horizon. Last month, the U.S. Department of Energy announced that it would give $187 million to nine projects to improve fuel efficiency in heavy-duty trucks and passenger vehicles.

Cummins Inc. will receive $53 million for two projects: improving Class 8, or so-called “super trucks,” by developing a cleaner diesel engine; and developing new technology for powertrains for passenger vehicles.

Most of the funding, about $115 million, will be spent on projects related to fuel efficiency for the super truck. In addition to the grant to Cummins, the Department of Energy awarded grants to Indiana-based Navistar to develop technologies to cut fuel use in half for heavy-duty trucks and trailers, and Daimler Trucks North America of Portland, Oregon, which will work on shrinking the size of the engine. wt

Sidebar: Green At Last, by Lori Lockman

The good news: sustainable logistics initiatives often wind up being cost-effective, too. The bad news: many of the most potentially powerful—reconfiguring a DC network, building LEED-certified facilities, or purchasing more fuel-efficient equipment—may not be immediately feasible for numerous companies.

“Although green improvements frequently offer an excellent return on investment over time, the operative terms are ‘investment’ and ‘over time,’” says Will O’Shea, chief sales and marketing officer of 3PD Inc. “Given today’s economy, a lot of businesses aren’t at a point where they’re comfortable making any extra financial commitments, especially ones that take a while to deliver bona fide savings.”

Thankfully, that doesn’t mean having to forgo green efforts. According to O’Shea, there are several easy ways companies can start reducing their supply chains’ carbon footprint right now without spending substantial sums. And, many are in the “last” place they’d think to look….

Last-Mile Redelivery. At a time when many companies have begun to expect 99 percent inventory accuracy and on-time shipping levels as a matter of course, the last-mile industry average for productive stops is still a less-than-stellar 90 percent. 

A whopping one out of every 10 last-mile shipments has to be redelivered because a recipient isn’t on site to receive it—consuming considerable extra fuel and potential profit margin in the process.

“Although companies can’t directly control the behavior of customers who choose to ignore delivery appointments, they can reduce the percentage of customers who simply forget—or forget to reschedule if something else has come up—by using a combination of inexpensive pre-delivery reminders such as automated pre-calls, e-mails and even text messages,” says O’Shea. 

Many companies who routinely send two or more of these messages per customer find their productive stop rate improved by as much as 7 percent—and their associated carbon footprint reduced by just as much.

Delivery Optimization. There are times when even the highly efficient process of optimization can be inefficient.

“A lot of companies automatically assume that their customers place orders or make purchases from the retail location closest to their homes, and these companies optimize deliveries accordingly,” says OShea, citing one example. “Each store’s deliveries wind up getting optimized individually, resulting in too many overlapping delivery routes—and more miles traveled and fuel consumed than necessary.”

The solution? Build loads and routes for multiple stores or company locations at once.     Not only will this minimize the use of fuel, it could also help companies streamline their use of equipment and delivery personnel. 

This strategy is equally helpful for companies with multiple divisions, many of which often operate separate but similar supply chains that could benefit from better integration.  

Last-Mile Customer Service. When it comes to logistics, few things are less green than customer returns—especially those that could have been prevented. Depending on how far a returned product has to travel back up the supply chain—and where a replacement product has to come from—it can tack on substantial fuel demands ranging from an extra last-mile delivery to three long-haul transits instead of one.

“Anything companies can do to make a first delivery the only delivery is a huge win for supply chain sustainability,” O’Shea says. 

For example, although distribution centers can’t fix products that are truly broken, they can authorize their delivery personnel to offer small damage allowances at the time of delivery if it turns out a delivered product such as a refrigerator has minor cosmetic damages. Such allowances may be the difference between a customer deciding to keep the product or requesting a pristine replacement.

They also can teach their delivery teams how to help customers get their purchases up and running—either by assembling product, providing a short instruction session or both—to prevent some of the many returns that happen as a result of customers not being able to make perfectly good products work. 

Above all, they can make sure their delivery teams run on time. More than one delivery that’s already in-transit has wound up having to be returned to a DC simply because a frustrated customer got tired of waiting for a shipment that should have arrived long before—and angry enough to cancel his or her order.

Outsourcing. Even if your company isn’t ready to pursue the aforementioned practices itself, it can still reduce its transportation-related carbon footprint simply by working with last-mile carriers and other 3PLs that do.

“It’s one of the new advantages of outsourcing” says O’Shea. “Many 3PLs have already invested in the kinds of systems and processes that lead to greener supply chains and that can take significant financial pressure off of their clients.” 

Look for providers that are involved in the EPA’s Smartway, LEED, or other far-reaching environmental initiatives. Consider including sustainability in some of your annual KPIs with existing providers. And, don’t underestimate the power of the frequent correlation between cost and carbon footprint reduction.

“It’s not always true. But more often than not, if a carrier’s found a way to reduce costs through greater efficiency, it’s also found a way to reduce energy demands as well,” says O’Shea. “It may not be couched in those terms. But, the sustainable advantages are still there just the same.”



Lori Lockman is a freelance writer specializing in logistics.