1. ask the right questions
whencuttingtransportationcosts,
asktherightquestions.
The following is a list of questions every
transportation leader should be asking.
Getting the right answers is critical
to the success of those organizations
that rely on private carriers to keep the
supply chain in motion.
theright
questionstoask
whencutting
transportationcosts

2. ask the right questions
What you need to ask What you need to do about it
What is the financial
stability of your carriers?
Review current carrier base for financial stability.
Seek carriers with a long history who know how to
weather tough economic cycles.
Look for carriers with a solid cash position.
Look for carriers with a network that closely matches
your distribution needs.
Have you appropriately
identified the costs
of your fleet and how
much capital you
are spending on a
noncore capability?
Do a cost analysis with your insurance provider, and
run the cost of premiums with or without your fleet.
Review maintenance costs, replacement costs and
average age of equipment.
Complete a risk assessment of your private fleet with
a third-party consultant or a dedicated fleet provider.
Review your fuel costs, fuel surcharge program.
Are you using the same
carriers you were using
five years ago?
Put your transportation business out for bid to better
understand what the market will bear for running your
fleet on a “periodic” basis.
Explore modal shifts to save costs. Less-than-truckload
shipments could be consolidated and shifted to lower-
cost full truckloads. In some cases, over-the-road freight
could be shifted to intermodal and private fleets could
be shifted to dedicated contract carriers.
How many carriers
are you using?
More carriers mean more time spent and more cost
invested in managing each relationship.
Consolidate freight with fewer core carriers to improve
negotiating position.
What is your carrier’s
safety record?
Look beyond preventable accidents to driver injuries,
product damage and cost of regulatory compliance.
Do an assessment relative to your capability to
impact these results. Do you have the right people
with the right skill set to actively manage driver
safety related issues?

3. ask the right questions
What you need to ask What you need to do about it
How does your driver
pay compare with going
market rates?
Calculate pay per mile for your drivers using
advertised rates in driver magazines and the
mileage your drivers currently log.
Use third-party compensation consultants.
Is your fuel surcharge
program accurate and fair?
Find out how your provider is calculating the
fuel surcharge.
Work with your carriers to ensure you are
paying for the fuel associated with moving
your freight.
Are you getting
optimal utilization on
all your equipment?
Look at the number of out-of-route miles
logged for each truck in your fleet.
Adjust your distribution strategy, optimizing
delivery schedules to move the same amount
of freight with fewer trucks.
What is your carrier’s
approach to equipment
life-cycle management?
Look to optimize maintenance spend.
Ask your carrier to explore the advantages
of purchasing used equipment.
What is your transportation
cost to serve your customers?
What percentage of the
product cost is built in for
transportation? Are you
recovering those costs?
Review pricing and distribution strategy
given your review of the costs mentioned
above. Make sure you have the appropriate
numbers built into your pricing strategy.

4. ask the right questions
3101 South Packerland Drive
P.O. Box 2545
Green Bay, WI 54306-2545
Phone 800-558-6767 schneider.com
To learn how Schneider’s cost-reduction strategies can
bring considerable advantages to your bottom line,
e-mail DedicatedServices@schneider.com.
Work with your carrier to Eliminate cost in these key areas of
your fleet operations.
Cost Percent of Total Cost
Driver pay & benefits 34%–42%
Fuel 17%–24%
Equipment
Tractor
Trailers
Maintenance/Permits
6%–12%
1%–5%
3%–5%
Safety 6%–10%
Other items to consider
Facility
Tolls
Driver recruiting
Management systems
1%–3%
1%–5%
1%–4%
6%–8%