Managing rising milk haulage costs

milk haulage costs

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As truck driver shortages and supply chain vulnerabilities continue to dominate media coverage, haulage operations – already operating on tight profit margins – face increasing haulage costs.  Milk hauliers are no different and are forced to increase salaries to retain and recruit drivers while ensuring that every drop of raw milk is collected and delivered to processing plants in time.

A typical, commendable approach in the dairy industry is to put customer service above all else, which means to focus on farm production volumes and factory requirements over haulier transport costs.  After all, the alternative could mean wasted milk and significant losses for dairy farmers and processors.

Milk transport planners may therefore prioritise customer service over operational costs when it comes to creating or updating route plans.  Of course the lowest cost plan is preferred but this is ‘easier said than done’ when planning a complex transport operation such as raw milk collection.  Without a decision support system specifically designed for milk haulage it is almost impossible to find the optimal plan in a reasonable time frame.

A purpose built route optimisation platform can help planners achieve the best of both worlds : a cost effective plan which maintains the traditional high levels of service levels.  Here are some factors which should be included in a milk collection route plan which helps with managing rising milk haulage costs:

Vehicle costs

Not all milk trucks were created equal.  Any route plan created for milk collection transport should not only cater for different size vehicles from a weight and farm access perspective, but also cater for different running costs for different types of trucks.  By knowing the most cost effective truck combinations, routes can be planned accordingly. 

Waiting times

Waiting to access farms or factories is not only time consuming and annoying for drivers – it is a significant cost.  Enforcing maximum waiting times during route planning, for example 15 minutes, not only minimises or removes this cost, it could free up more collection slots if there is capacity left on the vehicle. 

Scenario modelling

Milk haulage planning is complex and therefore it takes a lot of time for manual planning and indeed re-planning.  Purpose built software can provide planners with multiple scenarios, including the lowest cost scenario, in a fraction of the time.

To learn how OptaHaul helps milk haulage planners to optimise milk collection logistics and managing rising costs milk haulage costs, get in touch today.

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