Trucking company performance metrics are important because they are the key to improving the business until it becomes a crucial player in the supply chain of the US.
KPI monitoring helps to identify problems and make corrections within company operations.
But, with so many things happening in the company, the problem is that it’s not easy to find which metrics to track.
As the owner of the company, you don't want to be distracted by irrelevant figures and statistics.
Here are the most popular trucking company performance metrics that you want to check and see if they can help your company grow.
Differences in the transportation performance metrics
To increase profitability for your logistics company, unfortunately, nobody can tell the exact performance metrics that you have to track because each trucking company has different challenges and goals.
For example, large fleet carriers may analyze everything from load weight to routing because, on a large scale, these factors shape delivery costs and achieve noticeable gains.
On the other side, the small fleet owners won't benefit from this level of granularity due to a low number of tucks. That's why they should focus on tracking KPIs that affect their bottom line.
Or, for example, the goals that you set for short-haul drivers would differ from the goals set for long-haul drivers.
One clue is to determine what information is actionable so that, after applying it, you can track its performance.
Find your best performance metrics
You can gather data about the performance of your trucking company from your accounting software, telematic dashboards, and electronic logging devices.
To determine the best KPIs for your unique operation case, examine as many performance indicators as possible.
Compare and analyze these KPIs and select the best performance metrics that have the best result on investment for your company.
Once selected, integrate them throughout your organization and focus employee attention on the importance of maximizing performance.
KPIs should match your company’s strategy and goals.
Metrics that help your financial analysis
The following KPIs can help you set a budget that matches your real-world cost of operations.
These are bottom-line KPIs: data related to money coming in and going out.
1. Total revenue
This metric is the most important performance indicator measuring the success of your company.
Knowing your company's gross and net profits helps you to understand whether your trucking company meets its financial goals or not. Also, it sets the foundation from where you can create a budget or financial plan for the next business year.
2. Fixed Costs
Your truck payments and insurance costs remain the same whether you are moving or not. Also, you may pay your drivers a salary. Those labor expenses are another important financial metric. Drivers who are paid by the mile would classify as a variable cost. Keep track of these core expenses.
3. Variable Costs
Fuel and DEF aren’t the only costs that change over time. You may need to pay for truck wash, fluids, or tools and supplies. Track these figures as well. You’ll need this data to figure out the most important trucking company performance metric of them all: cost per mile.
4. Total revenue vs target revenue
To understand how well your fleet is performing, compare the projected revenue with the actual revenue generated and monitor the discrepancies between these two numbers.
5. Tolls
If your routes include toll roads, track those costs. Knowing the expenses for tolls, you may have to pick between avoiding tolls and on-time delivery.
6. Revenue per driver per week
The revenue per driver per week is yet another simple and effective freight KPI for carriers. It’s the sum of all revenue divided by the total number of drivers. And it indicates the overall productivity of drivers.
7. Cost per mile (CPM)
This KPI measures your cost to keep your truck moving driving a single mile. To find out the CPM for your trucking company, add up all the overhead and operating costs associated with keeping your trucks on the road and divide this number by the number of all miles (loaded and empty miles) you covered in the same time. By knowing your CPM, you can multiply it by the length of a potential.
Diesel and fuel expenses
8. Fuel and diesel exhaust fluid (DEF) costs
This metric tells you how much of your budget DEF eats up.
Even though the actual prices may vary over time, it's still advisable to track the average cost of DEF per gallon.
9. Average Miles Per Gallon (MPG)
Track your fleet's average miles per gallon. When you know your fleets MPGs and DEF costs, then you can estimate the total cost of hauling a load a certain distance. That helps bidding and planning your loads and budget more accurately.
Truck maintenance to control fleet utilization
10. Truck Downtime
Watch for patterns in maintenance downtime, especially if you run older vehicles. Longer periods of downtime may mean that you need to rent a substitute or to avoid bidding on certain types of jobs.
11. Preventative Maintenance (PM)
You can address any irregularities before they turn into maintenance problems on the road. Depending on the type of maintenance required, you may set different PM schedules based on mileage or date intervals.
Additionally to that, your trucks and trailers require a DOT annual inspection. To prevent any issues with the truck, plan for these predicted interruptions and ensure that all PM is completed on schedule. You also want to track what you spend on maintenance.
Truck driver KPI examples
12. Control the driver speeding behavior
Anomalies in truck driving speed can indicate delays along a certain route, which will play into your scheduling and transit time goals. They may also help to explain the higher or lower MPG figure.
When in doubt, talk to your drivers to find out what’s leading to these changes.
13. Control the engine idle time
Trucks that aren’t outfitted with auxiliary power units (APUs) need to idle during breaks and rest periods.
Evaluating engine idle time and the fuel costs associated with it can help make decisions about whether it's better to invest in APUs.
14. Engine Runtime
This metric records the time that a truck’s engine spends running. It can provide visibility into maintenance requirements, driver behavior, truck utilization, and overall operational efficiency.
15. Acceleration and braking
Rapid acceleration and/or braking can indicate safety hazards on the road. As a driving style, they can also diminish fuel efficiency. Track these metrics for visibility into both scenarios.
16. Employee satisfaction
Happy employees work harder, more productively, and remain on staff longer. Measure employee satisfaction through surveys and other metrics such as interviews and reviews.
Load management metrics
Load planning allows you to make sure your trucks are where they need to be, when they need to be there. Tracking the following KPIs can help you be a more reliable carrier.
17. Transit time
By projecting transit time goals for your routes, you can help to stay on schedule. When drivers fail to meet these goals, the telematics addressed above may have some clues as to why; maybe there’s construction on a certain route, in which case you may want to temporarily adjust your projected transit time, for instance.
18. Shipper/receiver time
Some customers load or unload freight quickly; others won’t. By keeping track of loading and unloading times—and maintaining a running average for each client—you can improve trip planning to avoid missing appointments and improve your rate of on-time deliveries.
19. On-time delivery (OTD)
This is a yes/no question, but tracking your OTDs can help with customer retention and expose potential operational problems. One way you can track OTD is to assign a value of 1 (for an OTD) or 0 (for a missed target) to create a percentage average over the year.
Track customer KPIs data
20. Customer acquisition cost
To find this figure, divide your total cost of acquisition, including marketing, sales, etc by the number of new customers you secured over a fixed period. This data helps you to understand how much does cost to bring in a new client. Using this data you can optimize your marketing tactics by focusing on the most cost-effective channels.
21. Customer lifetime value
CLV is the prediction of the total profit that you can expect to receive from a client throughout your working relationship. That way you can optimize the ways to bring new clients in and help retain an existing pool of customers.
22. Driver turnover rate
Determine your DTR by dividing the number of drivers who have departed the company by the average number of drivers in your pool. If you have a high DTR, spend some time examining your workplace culture, compensation package, and benefits.
Loaded and empty miles
23. Percentage of loaded miles
The percentage of loaded miles is the complete opposite of the percentage of empty miles. As the percentage of loaded miles increases, it indicates improved carrier profitability and better fleet utilization.
24. Percentage of empty miles
Empty miles mean lost money. And trucking carriers should track the percentage of empty miles compared to the overall volume of miles driven.
TMS and Telematics dashboards in fleet and transportation management
Generally, fleets that move from tracking their carrier KPIs manually to using a TMS dashboard, have an opportunity to reduce their total fleet operating costs by 10% to 30%. That level of operational cost reduction is achieved by analyzing the data gathered through TMS dashboards.
A TMS dashboard gathers a lot of data that can be analyzed and taken action upon.
Telematics is a system installed on the vehicle that collects vehicle-specific data and transmits it to fleet managers.
In that way, fleet managers can track truck performance on a moment-to-moment basis. That data helps to notice any operational challenges as well.
Data gathered through KPI dashboards and telematics doesn’t have a direct impact on the company's operation cost savings but correct fleet and transportation management analyzes this information, identifies, and attacks various areas of inefficiency.
When these key performance indicators are monitored effectively, managers can have greater control of their fleet aspects such as:
- Safety
Many truck drivers avoid using dangerous driving habits and drive more safely. - Costs
Fleet managers can make changes to cut down on costs.
- Customer service
Effective fleet management translates to improved customer service and fewer complaints.
Conclusion
The above list performance metrics is just a popular list among trucking companies.
If you don't use TMS dashboards to analyze your data, choose the ones that makes sense to your trucking business and incorporate them into an Excel template so that you can analyze it during a longer period of time and take action upon it.
