As a Canadian Head Quartered Supply Chain organisation, we magnified our trucking capability by acquiring assets in the US in the Los Angeles area. This has allowed us to perform interstate transportation in the USA and more importantly triangulate lanes between Canada & the USA at US ports. This can unexpectedly create value, and as importantly improve service and capacity.
The $/mile rates in the market are determined by simPle economics of supply and demand. Often times, the Load to Truck (“L/T”) ratio in shipping point A might be extremely tight, and carriers prefer to go to destinations where they are guaranteed a return trip. Those intermediary points can be used for furtherance to north of the border through cross-docks or trailer interchange agreements.
Example:
We have created a 6% reduction in overall costs on 1,300 mile lane from US to Canada by using both the methods above. The results have been more dramatic during peak seasons, when the L/T ratio shoot up significantly. We have seen opportunities of up to 10% at those times.
