Baton said the truckload carrier CRST International saw dwell times in the Los Angeles area decrease 83 percent to less than 30 minutes during a month-long pilot of its service. Photo credit: Shutterstock.com.
The concept of drop-and-hook operations is gaining popularity in a US truckload market where rates are high and capacity valuable, but where the most precious resource may be a driver’s time.
Last month, for example, digital freight broker Convoy announced an expansion of its nationwide drop-and-hook service, where a truckload carrier drops an empty trailer at a shipper facility and picks up a pre-loaded trailer, or picks up an empty trailer after dropping off a loaded one.
In that environment, San Francisco-based technology provider Baton, founded in 2019, set out to resolve the issue of wasted driver time. The company’s model revolves around the concept of drop yards, where carriers can drop and pick up long-haul trailers, allowing first- and final-mile delivery in congested urban areas to be handled by Baton’s network of contracted local fleets.
The company, which raised a $3.3 million funding round in January, currently offers service in Southern California and the Atlanta area, but plans to launch in Dallas and Chicago in 2021. Baton estimates that its software and drop-off service can increase customers’ asset utilization by anywhere from 25 to 50 percent on days when it is due to make a delivery.
In November, Baton said the truckload carrier CRST International saw dwell times in the Los Angeles area decrease 83 percent to less than 30 minutes during a month-long pilot of its service. “After just one week, CRST elected to triple volumes and quickly expanded to a second Baton yard,” the software company said in a statement. “Baton provided full shipment visibility and status updates on each load it delivered to CRST’s customers, demonstrating that Baton’s software platform could deliver a non-stop ‘white-glove’ service throughout this period.”
The pilot also showed that CRST drivers were able to cut down on what Baton called “in-transit dwell,” which is “slack time drivers bake into their schedules in order to hit appointments on time, and inter-appointment dwell, time drivers spend waiting for a backhaul. Allowing for both can add up to as much as an additional three to seven hours of wasted time.”
Different flavor of drop-and-hook
The concept of using a relay model with pre-staged trailers to better utilize a driver’s time is not necessarily unique, Erik Malin, head of operations at Baton, told JOC.com. Along with Convoy, a number of brokers, including J.B. Hunt, have invested in drop-and-hook programs.
“No one has thought of it in this particular flavor,” Malin said. “If you look at the major truckload carriers, most do it to some degree, but they’re siloed. They do it for themselves. But companies will peak and valley at different times of the year and even month. When drivers have to drop a load and pick up a trailer, it takes an incredible amount of time.”
Malin’s contention is that by working across a set of truckload carriers, Baton can ingest more data and thus drive down the amount of time drivers waste on the first or final stretch of their journey into metro areas and improve on-time performance to a carrier’s customers.
“It’s not that this hasn’t been thought of before, but the level of data you need to make this a scalable tech play wasn’t available until recently,” he said.
That data is not available due to the “amount of GPS data in the marketplace. There is data flowing all around,” he added.
Carriers drop off and pick up loads at Baton’s drop zones, and Baton’s software coordinates the operation between carriers, drop zones, warehouses, and local drivers.
“The way we manage the network and software we’ve built helps us manage the interacting components,” Malin said. “We spend little time making a decision on which driver to use because we have the data. We’re out in front of it. The customer makes a request, and within seconds we’re responding. With multiple drop lots, it means we’re able to pull from our immediate inventory of trailers.”
Malin said a key to the model is that Baton has to be “obsessed with facility-level information. Knowing things about which facility will be faster and why, down to the level of ‘this trailer is in this position at this facility,’ or ‘the line is going to be this long at this facility,’ and so we need to account for another hour. Those are the things directly within our control. Yard operations, even though we don’t own the yards, the things we develop will be incredibly helpful to get drivers in and out with as little downtime as possible.”
The things not in Baton’s control are harder to manage. “That’s where developing a playbook [to build the model in other markets] is important,” Malin added. “It’s building relationships with facilities and building the brand so local drivers in those markets understand our value.”
Contact Eric Johnson at [email protected] and follow him on Twitter: @LogTechEric.
