If you work outside of the logistics industry, you may or may not have heard the term 'backload'. So what exactly is a backload, and why are backloads so essential?

What precisely is a 'backload' anyway?

In simple terms, a backload is the load transported on the return journey of a delivery truck. Once a delivery vehicle has delivered the goods it set out with, it is often a considerable distance away from its base. The vehicle operator then has the choice to run back empty at a cost, or take on a backload to give the vehicle extra revenue.

Historically, companies would run their distribution vehicles back empty to prepare for their next job. Traditionally this would work as companies would accept paying to cover some empty mileage on the return leg.

As customers become more and more connected and informed, the pressure fell on companies to reduce their distribution costs. One solution companies adopted was to find other goods that they could carry on the return journey. Thus, backloading became an increasingly popular way to find a competitive edge against competing companies.

Why are backloads so essential?

The invention of the internet has given companies an abundance of information at their fingertips. At the click of a button, they can use social media platforms, search engines and other tools to get very competitive pricing from several competing companies. If you are running vehicles back empty, you are operating your business inefficiently.

If you are running vehicles back empty, you are operating your business inefficiently.

Now you may be telling yourself that the reason you don't reload your fleet is that you are,

• 'service focused.'
• 'trying to keep the customer happy.'
• 'not sure it is worth it.'

These are the things we tell ourselves to justify taking the path of least resistance. Whether we like to admit it or not, a very substantial component of a service or product is price. Value is the original item at the top of a customers shopping list. We don't need to be the cheapest, but we do need to provide great value for the prices we charge.

We are kidding ourselves if we think that our customers will consistently pay over the odds because they like us. Eventually, they will open the door to one of the suppliers continually knocking. When they do, you had better hope they see real value in your product or service, or they are going elsewhere. One way to do this is to remove all unnecessary waste in your business.

Can you see where I am going with this yet? You need to remove empty mileage wherever possible. I have witnessed companies running 40-50% of their distance empty, that can be hundreds of dollars of waste per customer order. I can only describe that inefficiency as postponed suicide for your business.

The real reasons that many companies frequently run vehicles empty are:

1. It is harder to plan and more complicated than running back empty.
2. Employees lack the knowledge of where to find backloads.
3. The people making the decisions at an operational level have no respect for the financial side of the business.
4. Staff have had no specific instructions from senior management to do so.
5. It requires skilled, well-trained staff to do correctly.

Where to go from here?

Companies looking to optimise their delivery networks should look at the following possible solutions:

1. Communicate with your staff the need to reduce empty mileage. Monitor the results with some form of metric and feed it back to staff for full effect.
2. Synergise with other businesses in high volume areas so you can utilise each other's vehicles to reduce your combined empty mileages.
3. Sign up for one of the multiple transport exchange sites for backloads.
4. Keep your fleet local, outsource distance.
5. Get an expert in to analyse and redesign your distribution network. Many people overlook this option, but a leading expert will have access to tools and relationships that your business may currently lack.