After outsourcing a large percentage of its private fleet for two years, Unisource Worldwide has brought the fleet back in-house — a move that is producing valuable dividends.
Unisource is the leading independent marketer and distributor of commercial printing and business imaging papers, packing systems, and facility supplies and equipment in North America. “The goal of our company is to allow customers to reduce suppliers, simplify the ordering process and lower…cost,” says Rick Gilchrist, CTP, Director of Transportation. “We can deliver what your business needs when you want it. The importance of on-demand transportation in making this happen cannot be overstated.”
This being the case, why give up the private fleet in the first place? “The focus on efficiency…and cost control was at the heart of Unisource's strategic move. Our thinking was that outsourcing our private fleet in favor of dedicated contract carriage would alleviate some of the risk and potential liability, and thereby reduce our insurance and worker's comp costs,” Gilchrist says.
The company ultimately decided on three dedicated carriers, which hired the majority of the Unisource drivers. It didn't take long for Unisource to discover that the providers “weren't making the money to provide the value-added service solution we were looking for,” says Gilchrist.
After two years, Unisource decided to pull the plug on the outsourcing initiative and re-establish its private fleet. The reason was two-fold: All contracted performance objectives were not being met by the outside carriers and, most importantly, a new management team at Unisource believed the private fleet could better help the company achieve its customer service objectives.
“We were in business to serve our customers and the best way to accomplish that was with our own private fleet,” says Gilchrist. “If your own employees are dealing with your customer in your truck, it creates a level of ownership that someone from the outside may find hard to emulate.”
With the private fleet back under its roof, Unisource is taking no chances. The company has applied what it learned from the outsourcing arrangement and strengthened its commitment to private fleet success.
The first example of that commitment is operational focus. The 500 truck units will now be responsible for doing the pedal runs between the company's 70 distribution facilities and making deliveries from those distribution centers. Unisource took its renewed commitment one step further by opening up its regional long haul movements to the private fleet.
“In the past, we never controlled the inbound side of our freight movements,” Gilchrist explains. “But when we looked deeper at [how] our vendors…matched up with our distribution system, we found synergies that could help improve the utilization of our private fleet through the strategic use of these backhauls.”
Unisource also uses its fleet to handle internal distribution requirements at night, re-positioning freight and helping to boost customer service guarantees.
But perhaps the greatest benefit of the experience is that Unisource now fully appreciates the private fleet's value. “By resuming control of our distribution network and showing we care about our people, they have taken our service-focused message to heart,” Gilchrist explains. “And that gets passed on to the customer.”
Gary Petty is President and CEO of the National Private Truck Council. The council's web site is www.nptc.org. His column appears monthly in FLEET OWNER.