Many companies have a mistaken notion about what dedicated contract carriage (DDC) is. They reject the idea of switching to DDC not because it is wrong for them but rather because they misunderstand how dedicated actually works.
The reality is that the DDC takes away the problems of operating a fleet of trucks as an adjunct to your business. Under a DDC model, the provider acts as the transportation arm of a company assuming responsibility for all transportation-related functions including equipment, drivers and maintenance, safety, human resources, etc.
One thing many companies get wrong about DDC is the cost because they may not fully understand all the things that DDC encompasses. Or they fail to include the cost of HR functions like driver recruiting and retention since the HR department recruits for all positions within the company. The DDC also takes over responsibility for ensuring compliance with safety regulations, DOT inspections, FMCSA regulations and insurance, removing the regulatory compliance piece from the company. Being a specialist in transportation allows the DDC to keep costs down compared to a company handling the transportation function in-house.
Another misconception is that a company loses control of its trucking operations when it moves to DDC and that it also loses branding opportunities. The reality is that the DDC works in partnership with the company, hand-in-hand to ensure the company’s standard operating procedures are adhered to and that there is no denigration in the service to the customer’s customers. In addition, the DDC is in a better position to evaluate the amount of equipment and drivers the company needs and can save the company money by optimizing both. The DDC is an extension of your company; your customers are our customers.
DDC can also adjust equipment and drivers to accommodate seasonal demands. It can bring in extra trucks as demand peaks and then remove those trucks when demand returns to normal. The company has less ability to do that and in times of low volume can end up with trucks parked rather than making deliveries.
As for branding, a DDC brands the vehicles in the manner the customer requests. Often the name of the customer will be on trailer just as it would if the company owned the trucks. Drivers uniforms can be badged with the customer’s logo so that the customer’s customer sees the driver as an extension of the customer and not as an employee of the DDC.
Moving the transportation function to a DDC allows the company to focus on its main business and turns over the management of the transportation function to an expert who assumes all responsibility for seeing that the company’s goods are delivered cost efficiently, safely and on time.
