LTL has arrived; ... on time

By Staff -- Logistics Management, 8/1/1998

According to the 1998 Quest for Quality survey, buyers of less-than-truckload freight services value on-time performance above all else. Ninety-three percent of all participants measure their LTL carriers' on-time record. Furthermore, in what is good news for LTL carriers, survey participants are more satisfied with their providers' on-time performance than they were a year ago.

The LTL carriers were measured in several service categories, reflected in the accompanying charts. This year, for the first time in the Quest for Quality survey, the scores were weighted to reflect the relative importance of each to shippers. Thus, shippers who responded to the survey rated the importance of each category on a scale of 1 to 5 (with 5 as very important), and the average weight was multiplied by the unweighted score given in each category, based on a three-point scale, to provide a weighted score. Carriers qualified for a "Best of the Best" award by scoring above the average total weighted score for all companies.

As noted, shippers rated on-time performance as the most important criterion for LTL carriers, with an average weight of 4.6 on the five-point scale. (The weights assigned to each category are listed in the footnote to the charts.) Respondents gave an average unweighted score of 2.14 to their national LTL carriers for on-time pickup and delivery performance in 1998, compared to 2.13 in 1997. The score is based on a three-point scale (1 = poor, 2 = average, 3 = outstanding). Multiregional and interregional carriers increased their average unweighted score from 2.04 in 1997 to 2.06 this year. Average on-time scores improved for surface package carriers also, from 2.25 last year to 2.28. (Comparisons are made against unweighted scores as scores in 1997 were not assigned weights.)

This year, buyers were more satisfied with their multiregional/interregional LTL carriers in terms of value--the combination of competitive rates, pricing commensurate with service, and simplified pricing. Average multiregional/interregional LTL value ratings improved from 2.03 to 2.04 in 1998. During the same period, surface package carrier value ratings increased from 2.26 to 2.28 on the three-point scale.

The average value scores for national LTL carriers dropped from 2.06 in 1997 to 2.04, suggesting that shippers have felt the impact of rate increases over the past year. Nearly 90.0 percent of the respondents measure their carriers in terms of competitive rates.

A majority of survey respondents, 58.0 percent, say they plan to pare down to a few core carriers over the next two years. One-fifth of the shippers polled say they will use more national LTL carriers, while 16.0 percent say they will divert more shipments to parcel or express carriers.

The weighted scores for national LTL carriers ranged from 30.52 to 32.72. The average, or score needed to reach the "Best of the Best" designation, was 31.73. The average score for multiregional/interregional LTLs was 30.27 and the scores ranged from 27.59 to 33.41. Among the surface package carriers, the scores ranged from 30.90 to 36.66 with an average score of 33.74.

1998 "Best of the Best" Surface Package Carriers

Carrier On-Time Value Info Customer Equipment Total* Performance Tech Service & Operations

United Parcel Service 11.53 8.67 4.66 6.86 4.93 36.66

Average 10.51 8.46 4.06 6.24 4.48 33.74

*For all charts in this section, totals may be greater than the sums of the individual scores because of rounding.N.B. All scores are weighted. Weighted scores are determined by multiplying average raw scores by average weighted importance of each attribute (1 = least important, 5 = most important). Attribute weights for all charts in this section: On-time performance, 4.6; Value, 3.7; Info tech, 1.8; Customer service, 3.0, Equipment & operations, 1.9.

1998 "Best of the Best" National LTL Carriers

Carrier On-Time Value Info Customer Equipment Total* Performance Tech Service & Operations

Roadway Express 10.13 7.71 4.02 6.62 4.24 32.72

Watkins Motor Lines 10.12 7.43 3.60 6.38 4.27 31.79

Yellow Freight 9.90 7.51 3.97 6.37 4.19 31.94

Average 9.84 7.57 3.84 6.34 4.13 31.73

1998 "Best of the Best" Multi-Regional & Interregional Carriers

Carrier On-Time Value Info Customer Equipment Total* Performance Tech Service & Operations

Jevic Transportation 10.59 8.08 3.71 6.59 4.43 33.41

Old Dominion 9.64 7.74 3.46 6.01 3.93 30.78

Preston Trucking 9.81 7.65 3.57 6.03 3.81 30.87

Average 9.50 7.56 3.42 5.93 3.86 30.27