The Official Blog of Penske Transportation Solutions

As a grocer, food purveyor or foodservice provider, you know that if you don't deliver the freshest food in the safest manner and shortest time possible – with built-in cost efficiencies to boot – you're going to have some pretty unhappy customers. And customer expectations are increasing all the time.

There's a call for longer product shelf life, a consumer demand for the freshest offerings and a growing desire to know exactly where food came from. There's also a need, driven by multiple sources – including the Food Safety Modernization Act – to provide transparency and monitoring of every product from the moment it's harvested until it reaches the consumer's plate.

These are some tall orders, and the pressure is only increasing. But there is good news, and it comes in the form of a refined combination of human expertise and advanced cold chain technologies.

How Do You Ensure Fresh Foods Arrive as Planned?

It's all about process, procedure and reliability. Leveraging the right level of technology is key to creating efficiencies.

When you have reliable equipment, a checks-and-balances procedure, and a firm cold chain process in place, your goal of getting your product where it needs to go – safely, on time and in the least costly manner possible – is definitely within reach.

Technological Innovations

  • Real-time tracking using GPS technology provides accurate temperature monitoring
  • Active monitoring adjusts temperature if there is a fluctuation
  • Passive monitoring provides a report at the end of the trip
  • Bar code inventory tracking systems – down to the item level
  • RFID devices that can be embedded into pallets or individual items

Technology in the Trailer

  • Properly- insulated containers
  • The right reefer unit for the job
  • Proper use of bulkheads, chutes and venting
  • Quality equipment: emissions-compliant trailers for optimum fuel- and cost-efficiency

Human Capital

  • Committed training of personnel and drivers
  • Firm grasp of proper loading techniques
  • Ability to use the available cold chain technology to its fullest capacity

Looking for help? Here are some questions to ask a prospective leasing, transportation or logistics provider:

  • How do I ensure my reefers are properly maintained?
  • What innovations can I employ to extend product shelf life?
  • How can I ensure my products do not carry food-borne illness?
  • How do I handle reverse logistics?
  • How do I configure my supply chain to maintain the visibility required for recalls?
  • What measures can I take to ensure I am FSMA-compliant?
  • How can I make the most efficient use of product transportation?
  • How can I incorporate warehousing into my transportation solution?
  • What tools can I use to determine product conditions during transit?
  • How do I avoid temperature fluctuations or other temperature-related events?
  • What precautions do I need to take in order to avoid product spoilage?
  • What tools are available to identify waste in time and costs through the delivery process?

Getting cold foods where they need to go in a timely, cost-effective and safe manner requires creating a supply chain where every link is secure and efficient. The more you establish a system of reliable checks and balances, the better your outcomes will be – and the more satisfied and confident your customers will become.

How Penske Transportation Solutions Can Help

We have a team of experts ready to help you find the best solutions for your food and beverage needs, including commercial rental trucks and reefers, vehicle leases, logistics services and used trucks.

Today's busy customers demand fresher, more appealing offerings from their grocers and convenience stores. To meet these needs, shippers must guarantee that deliveries will be on time, with built-in flexibility to respond when volumes spike.

To improve operations, shippers can utilize a mix of technology, equipment and expertise to leverage the supply chain, which works to reduce spoilage, offer a wider range of items than they may have had in the past and provide the freshest food products possible, and as a result, focus on their core competencies and better compete within the marketplace.

Maximize Your Food Supply Chain

1. Develop a Separate Cold Supply Chain

Freshness drives the food business. To accelerate that freshness, some companies create separate supply chains for the different segments and profit centers within a store. Here's how this separation works:

  • Pull highly perishable items out of traditional distribution channels and put them in more rapid-replenishment distribution channels, often called fresh or cold chains
  • Use smaller, more agile trucks to make more frequent, speedy deliveries
  • Give the grocer the fuel efficiency benefits of smaller trucks for the rapid-refill items
  • Build smaller warehouses, closer together for quick, easy access

Ultimately, grocers and shippers may create more geographically accessible warehouses to respond to this accelerated perishables track — a shift that would help solve the truck driver shortage, as many more drivers would be able to return home the same day.

2. Route Optimization

Many food shippers require multi-stop, properly sequenced deliveries, adjusting for minimum miles, specific delivery windows and curfews. These efficient delivery routes emphasize the commitment to freshness by serving stores as often as possible.

Here's how carriers optimize routing:

  • Geo-fencing technology, where a truck's onboard computer sends an alert to a store when a driver is within a certain range, can be utilized
  • Alerts allow the store personnel to get organized and be ready for the delivery, adding efficiencies all around

Grocers need to schedule labor, so on-time deliveries are critical in order to have the staffing necessary to load and unload items from the truck and onto the store shelves.

3. Involve Drivers

Deliveries to grocery stores include more driver involvement than deliveries within other industries, so hiring the right type of individual is key.

The driver/grocer relationship can be beneficial to both parties. Here's how you can make it work:

  • Explain to the driver up front the demands of the job, ensuring driver buy-in
  • Provide proper training, especially considering today's rapidly evolving material handling equipment
  • Grocers will appreciate driver expertise and will collaborate for a seamless transfer of goods
  • Drivers will feel empowered and want to deliver their very best

4. Scale Rapidly

Within the grocery segment, volumes often spike during certain times of the year. The ability to scale up quickly enables grocers to keep their shelves stocked, generating consumer loyalty. Volume spike periods include:

  • Seasonal promotions and holiday demand
  • Winter weather forecasts in some parts of the country

To take advantage of the surge in volume, being flexible is a must. Planning extensively in preparation of surges is also an important key to meeting operational needs.

5. Verify Cold-Chain Compliance

The Food and Drug Administration is continuing to craft its final regulations surrounding the Food Safety Modernization Act. Carriers know there will be new restrictions on food haulers, which will add to the complexity of food delivery. These regulations are bound to affect everyone in every segment of the food supply chain. Here are some ways carriers can prepare to be in compliance:

  • Spec newer, late-model equipment and conduct routine maintenance
  • Install on-board, real-time, GPS-enabled temperature tracking devices, designed to monitor and record temperatures within the trailer throughout a route, ensuring food safety from dock to customer
  • Use RFID (Radio frequency identification) technology on pallets or items, for quick, easy traceability in the event of a food safety crisis

By taking these five steps to define and delineate your food and beverage supply chain, you will see greater cost efficiencies and time savings, while creating a more compliant-ready transportation model.

How Penske Transportation Solutions Can Help

We have a team of experts ready to help you find the best solutions for your food and beverage needs, including commercial rental trucks and reefers, vehicle leases and maintenance, and logistics services.

The rise of digital technologies is changing the way food and beverage businesses operate, and advances in everything from artificial intelligence to blockchain have the potential to redefine companies while creating new opportunities. These advances are changing not only what is expected of businesses, but also what is expected of the leaders within the organizations.

The Business Side of Food and Beverage

Tata Consultancy Services calls the transformation Business 4.0. In a survey of 689 responses from senior finance executives in the United States and Europe conducted by CFO Research in collaboration with Tata Consultancy Services, about one-third of respondents ranked their finance functions’ digital capabilities in six categories as "moderate."

The six areas included analytics and measurement; agility and efficiency; business architecture; governance, risk management and compliance; shared services/business process outsourcing; and organizational alignment.

At Penske Transportation Solutions, we’ve focused on the digital capabilities that can benefit our food and beverage customers, and we have several solutions to help business owners capture, manage and utilize information so fleets can access data quickly and easily. This approach is particularly useful during planning, quarterly reviews and an audit.

Visibility and Data: Through Fleet Insight™, our proprietary online tool designed to give customers greater visibility and control of their fleet, business owners can access their data, including invoices, fuel planning information, and safety and compliance records, at any time. In addition, Fleet Insight allows customers to view and download information about any truck at any time.

Financial Reporting: Our billing and record keeping provides easy-to-understand information that is accessible online. This information is readily available for annual planning, quarterly reporting or in the event of an audit.

Fixed Costs: As business owners plan for the future, leasing can increase the reliable financial information they use for forecasting because expenses associated with a full-service lease are established in advance. Leasing can also free up capital that businesses can use to invest in new technology or growing the business.

Truck Technology: Equipment is advancing rapidly with manufacturers adding new safety features each year. By utilizing leases, fleets can keep the average age of their fleet low and take advantage of the latest technological advances, such as collision mitigation technology. This can also reduce insurance costs by reducing the risk of a crash, enhancing driver safety and improving driver retention, which can save on driver recruitment costs.

Data and Connectivity Drive Fleet Health and Improve Uptime

A reliable food and beverage fleet runs on data and fleet expertise. From knowing where your shipment is to ensuring that trucks are running at peak performance and temperature, data is a strategic asset, and Penske is using the vast amount of information from our data platform to improve the health of equipment, maximize fleet performance and improve uptime. That means that shippers who lease or rent from us can rest assured that the trucks delivering their products are up to the job.

Enhanced Fleet Performance

Marrying truck data with maintenance data leads to better uptime. Using data off the truck also enables more proactive solutions, including increasingly predictive maintenance, leading to improved fleet performance. This information is then used to identify failure rates and implement preventive maintenance practices allowing the ability to avoid potential failures and breakdowns altogether, ensuring that your refrigerated truck stays at optimal temperature and all your trucks stay on the road.

The data analysis process factors in the equipment's operating environment, geography and mileage to better identify maintenance needs.

Improve Uptime

And because data improves remote diagnostics, technicians can get to the maintenance faster, get equipment fixed faster and back on the road delivering your food and beverage freight faster. If a roadside event occurs, data from the truck is given to our 24/7 coordinators so they can pinpoint where the truck is, identify the right service technician for the job and ensure the right tools are available.

Connectivity also increases visibility, so we can monitor the timeliness of PMs (Preventive Maintenance), how many trucks are in for repair, the number of road calls on a particular day and overall fleet maintenance costs. Having the capability to identify trucks that may be costing more due to breakdowns and failures provides an additional benefit.

The overall goal is to use data to have greater insight into fleet performance, improve the health of the vehicles and keep your trucks running smoothly.

Increase Supply Chain Visibility to Gain Control

A strong supply chain is central to effective food and beverage operations, but anything from rapid growth to external forces can disrupt operations. When a cold chain is out of control, the right people, processes and technology can bring it back in line to improve service, optimize routes and reduce costs.

See the Entire Cold Chain

Having an accurate line of sight into each part of the cold chain helps keep it in check. Near real-time information is critical and knowing where products are and when they will arrive can speed decision making, ensure freshness, inform orders and help mitigate problems before they occur.

Improved visibility also directly affects inventory management. When all parts of the supply chain are connected, systems can combine data on inventory practices and levels with supplier lead times and anticipated demand to inform food and beverage ordering and production. That, in turn, improves fill rates and reduces backorders while also eliminating overstock and spoilage situations, which reduces inventory costs.

Compare Fulfillment Solutions

Data and visibility help shippers determine the cost service benefit of fulfilling through various means, which is becoming more essential in today's omnichannel environment.

Shippers also must factor in intangible benefits, such as customer satisfaction, public perception and, ultimately, customer retention.

Connect Essential Teams

Visibility lays the groundwork to connect teams, such as customer service, sales, procurement and transportation. That connectivity can identify how individual decisions will impact different stakeholders.

With multiple influences in supply chains, it is valuable to opt for the best overall option over something that may only be beneficial to one aspect of the cold chain.

Connectivity also makes it easier to identify exceptions, creating even more control, while greater visibility offers the ability to assess situations and potential solutions, allowing for more informed decisions.

That, in turn, ensures products arrive fresh and exactly when and where they are needed so no sales opportunities are lost. Having the flexibility to shift fulfillment can be even more important when demand surges.

A Reliable Fleet and Innovative Provider

At Penske, we're built on the strength and expertise it takes to own and maintain more than 300,000 vehicles. With that kind of experience, you can rest assured that we offer some of the best-maintained and reliable trucks, reefers and tractors in the industry. Additionally, Penske has decades of experience in all areas of the food and beverage supply chain.

In a transparent supply chain, every link has access to relevant information on the origins and status of products. Transparency underpins consumer trust—a key relationship at a time when the safety of food supply chains is coming under intense scrutiny.

It's not surprising, then, that achieving supply chain transparency has become a hot-button issue in the food and beverage industry.

Critical Ingredient: Communications

An important feature of transparency is that it depends, to a large extent, on a company's ability to exchange information with partners. It can't be achieved in isolation. Visibility, on the other hand, is less dependent on communication across the supply chain.

Shay Scott, executive director of the Global Supply Chain Institute at the University of Tennessee, makes this clear in the trade journal Inbound Logistics. "Visibility provides a company with knowledge of activities across its supply chain; transparency is what and how it communicates that knowledge to customers, partners, and stakeholders."

Transportation Challenges

There are many ways in which you can enhance supply chain transparency. A notable example is addressing information black holes in transportation legs, where gaps in visibility can lead to transparency issues and loss of sleep for shippers.

For instance, rising less-than-truckload (LTL) and small parcel volumes make it more difficult for shippers to track product flows. An informal survey carried out by Penske Transportation Solutions for our customers in the food and beverage industry indicates that there are five LTL shipments for every single truckload shipment; a ratio that is reflective of the industry as a whole.

There are several reasons for soaring LTL volumes. The incursion of e-commerce into the food and beverage business is one driver. Catering to online buyers requires food companies to ship in smaller quantities. Other drivers include increasing demand for niche products and a general tendency for companies to ignore manufacturers' minimum buy quantities in a volatile competitive environment.

LTL tends to increase shipping touchpoints and cross-docks, reducing supply chain visibility in the process.

Another pain point is mismatches between requested delivery and appointment dates. A company requests a date for the delivery of a shipment, but the receiving dock sets a different date. This mismatch can even occur within the same organization, remaining undetected until a truck turns up at a dock and can't be loaded or unloaded because it's not on the facility's schedule.

A critical area where food supply chains can become opaque is in lot control visibility. This is a major issue in the transportation of products, such as fresh produce, that are supplied by countless growers and prone to bacterial infections. Each batch of product has a lot control number, and failure to keep track of these numbers creates dangerous visibility gaps.

You can play a critical role in addressing transportation visibility issues. You can deploy technology such as transportation management systems to track shipments and disseminate information, analyze freight networks and help shippers identify exceptions and information disconnects. Predictive analytics is one of the tools beneficial when trying to anticipate and avoid problems.

Innovations Ahead

The pressure to deliver improved transparency in food and beverage supply chains is unlikely to abate. Consumers are demanding more information on the foods they buy in retail stores and service outlets. High-profile cases of foodborne illness outbreaks have ratcheted up these demands. In response, regulators are introducing tighter food safety rules. Moreover, shippers need to respond to increasing supply chain complexity with innovative approaches to raising the efficiency bar.

But new tools and methods are emerging. Innovative technologies can provide a wide range of new data on truck performance. Vehicle automation is another source of operational data being mined. More sophisticated modeling that uses technologies such as machine learning is turning this data into actionable intelligence. Blockchain-based solutions are at an early stage of development but could facilitate the flow of information between stakeholders.

We continue to enhance our technology platform while also building industry partnerships. Our expertise and the technologies we employ can help you improve transparency within the cold chain by closing the loop with business analytics and ensuring that information is not lost or overlooked.

From knowing where your shipment is to ensuring that trucks are running at peak performance, data is a strategic asset, and Penske is using the vast amount of information from its connected fleet solutions to improve the health of its equipment, maximize fleet performance and improve uptime.

Connecting Fleets

With our connected fleet solutions, Penske marries the data off of the trucks with our maintenance data to create better uptime. Penske can take data from 300,000 vehicles and begin to see patterns of codes that might indicate an issue. Without that scale, you would never have the amount of data you need to get that benefit.

Enhanced Fleet Performance

Using data off the truck enables us to be more proactive and leads to a more customized maintenance solution for improved fleet performance. Penske uses the truck data to identify failure rates and shape preventive maintenance practices to get ahead of a potential failure. We also know which combination of vehicle fault codes can lead to a breakdown and work with our shops and our customers to proactively schedule a truck for service to get ahead of potential issues before they become a problem.

The data analysis process factors in the equipment's operating environment, geography and mileage to better identify maintenance needs.

Because data improves remote diagnostics, technicians can be more prepared to get equipment fixed faster and get your drivers back on the road faster. If a roadside event occurs, data from the truck is given to Penske’s 24/7 coordinators so they can pinpoint where the truck is, identify the right service technician for the job and ensure the right tools are available.

Connectivity also increases visibility, so Penske can monitor the timeliness of PMs, how many trucks are in for repair, the number of road calls on a particular day and overall fleet maintenance costs. We can drill down to see which truck is costing more and help you determine if it is time to replace that truck.

The overall goal is to use data to have greater insight into fleet performance, improve the health of the vehicles and keep the fleet running smoothly. Penske takes multiple streams of information to make the data actionable. The tools help us deliver a better experience and keep costs low.

A Reliable Fleet

A fleet leasing solution from Penske is built on the strength of the entire Penske fleet. As a company, Penske Transportation Solutions owns and maintains a fleet of more than 300,000 vehicles. With that kind of expertise, you can rest assured that you will be running some of the best-maintained and reliable trucks and tractors in the industry.

Unexpected spikes in food and beverage demand can cause far-reaching supply chain disruptions that affect everything from production lines to grocery store shelves, but challenges can also bring opportunities. Visibility and agility can help you respond to changing market conditions and flex up to meet evolving customer needs.

Adding Transportation Capacity

When transportation demand spikes, there are several ways you can ramp up your trucking capacity depending on the expected duration of the increase. Rental trucks and reefers can provide immediate supplemental equipment for a short-term or seasonal peak. They can also be a useful resource if you want to test a market before making a longer-term commitment.

Leases are another option if you're looking to add to your private fleet. You may even purchase used vehicles. We offer a comparative value analysis, which compares the cost of leasing with that of buying so fleet operators can make the best financial decision for the business.

You may also choose to partner with a third-party logistics provider, such as Penske Transportation Services, to expand your reach and capabilities. In addition to having our own dedicated fleet of trucks and drivers, we have an extensive freight brokerage operation with an expansive network of preferred DOT-authorized for-hire carriers to provide additional nationwide trucking coverage. Even if you're unsure of how much capacity you’re going to need in specific markets, a partnership with us allows you to react when opportunities arise.

Optimizing Your Transportation and Distribution Network

You can also increase capacity by becoming more efficient in your existing lanes. You can improve your efficiency through network optimization and analysis, freight management and backhaul opportunities.

An in-depth view of the full supply chain rather than its individual parts can help uncover inefficiencies. We use network modeling to help you identify which channels should be served by which locations, ideal supplier base locations, and the optimal positioning for brick-and-mortar warehouses.

Securing Critical Warehousing and Distribution Center Space

Recent cold chain disruptions due to COVID-19 have brought renewed focus to inventories and the value of having product readily available, said Michael Zimmerman, a partner with the global strategic management consulting firm A.T. Kearney and lead author of the 31st Annual State of Logistics Report.

The memory of lost sales and insufficient inventory has caused some retailers to increase inventory. That safety stock needs to sit in a warehouse. To help with these surges, we offer strategically located multi-client warehouse facilities and provide flexible space to accommodate seasonal and temporary needs.

How Penske Transportation Solutions Can Help

We have a team of experts ready to help you find the best solutions for your food and beverage needs, including commercial rental trucks and reefers, vehicle leases (including short-term options), logistics services and used trucks.

The refrigeration units on trailers keep products cold to ensure quality and safety, but the equipment can be more demanding than its dry van equivalent. Maintaining the units is the key to success.

At Penske Truck Leasing, we service reefer trailers more often than dry vans. Refrigeration trailers can have more demanding applications with multiple stops. Typically, in those applications, the doors are used more often, and there are liftgates that are used regularly, especially if it is a multi-temp unit that delivers to the food joints and c-stores of the world.

We also regularly check the refrigeration units and the insulation on the trailer and provide all required documentation.

Document and Validate

To comply with food safety regulations, private fleets need to document maintenance on vehicles to ensure they’re in compliance. It is best to check equipment regularly and keep records. For example, if your unit says it is 72 degrees, you better validate it is getting to 72 degrees. Today’s regulations require cradle-to-grave recording or management of the product.

The Influence of Seasons on Performance

We typically service equipment every 90 days or less, depending on the number of hours the unit runs. Maintenance can also vary by season. Summer is more demanding, especially with frozen items, so the unit is going to work a little harder.

Our goal is to keep you moving and ensure your products’ integrity. If you’re using refrigerated units, be sure to make equipment available for service at regular intervals to ensure it will operate properly.

Penske performs regular preventative maintenance on all our leased vehicles and can also be contracted to maintain your fleet to the same high standard.

The way the world does business has evolved and, as a result, it continues to affect the way supply and distribution networks operate in both the short and long term. Stores are experiencing fluctuations in supply. At the same time, groups such as farmers are having trouble with moving goods to the people who need them. Restaurants are adjusting delivery and outdoor seating models to meet current guidelines, while also planning for what the future holds. These ever-evolving changes have affected businesses in significant ways with the need for agility more important than ever.

Having access to the right vehicles can help no matter what your size or type of operation, allowing you to quickly pivot and keep up with rapidly changing landscapes.

Perishable Goods

Perishable goods typically require a refrigerated vehicle, or "reefer," which keep food at a controlled temperature and help maintain freshness and quality, meaning a longer shelf life and less waste.

At Penske, our reefers have up to an 8,000 lb. payload capacity to handle many of your food, beverage and other temperature-sensitive transportation needs. We offer both CDL and non-CDL refrigerated trucks as well as refrigerated trailers in our rental fleet, and they can be rented on a long- or short-term basis.

Non-Perishable Goods

If you are transporting non-perishable goods, choosing the right commercial truck starts with knowing the capacity you need and your delivery route. There are several questions to ask that will determine what's the best vehicle to meet your needs:

  • Will your drivers be operating on busy highways and crowded center-city streets?
  • Do they need a truck that is easy to park and maneuver?
  • Will they require up to 900 cubic feet of vehicle loading space?

Answering yes to any of the above-mentioned questions means a light-duty truck is the right choice to meet your needs. Our light-duty fleet includes high roof panel vans, 12-foot through 18-foot box trucks, along with 16-foot or 18-foot cabover trucks. Our trucks are designed to provide plenty of cargo space and efficient fuel economy. The trucks also feature a tight turning radius, allowing drivers to get in and out of tight spaces while delivering food and beverage products to and from urban stores and warehouses.

Large Non-Perishable Loads

If you need more loading space, 1,700 cubic feet or more, a medium-duty commercial truck might be the best answer for your food and beverage needs. Ideal for larger loads, our medium-duty fleet includes 22-foot, 24-foot and 26-foot CDL and non-CDL trucks. Our late-model fleet of medium-duty trucks will benefit food and beverage customers through improved fuel economy, better overall performance and reliability.

Overcoming the Obstacles of Shipping Food

Whether you're handling variances within the food supply chain, or you're the owner of a restaurant trying to serve your customers, we are here to help you keep your business moving forward. We have the people, processes and vehicles you need to get the job done.

No matter the size of your business, supply chain networks can change quickly, and you must be able to react just as fast. Time-sensitive, fresh-food deliveries, lean supply chains, increased demand uncertainties and shorter product lifecycles all necessitate the ability to adjust food and beverage operations when change arises. Having an agile supply chain can give you a strategic advantage over your competition and allow you to handle disruptions or take advantage of new opportunities.

Here are three scenarios where the ability to address rapid change is critical:

Unexpected Changes to Consumer Demand

Sometimes it is hard to forecast what consumers will want or when they will want it. When the pandemic first hit, for example, there was a surge in demand for toilet paper packaged goods. Severe weather, such as a hurricane, can also cause a run-up in demand as consumers stock up on food and beverage supplies to make it through the storm. Even a chicken sandwich that goes viral or a hot toy that takes off at Christmas can leave shippers scrambling to ramp up production as well as transportation capacity.

Seasonal Spikes

Some industries have expected, distinctive peaks and can plan ahead. Grocers anticipate an increase in purchases around holidays, particularly Thanksgiving, Christmas and Memorial Day. Home improvement stores know that spring and summer tend to be busier. If you know you have seasonal spikes coming, preparing in advance can help you ebb and flow seamlessly with shifts in demand.

Network Disruptions

Natural disasters, factory shutdowns, port closures or even a supplier failure can cause companies to seek out alternative suppliers, which can create dramatic shifts in transportation needs. If this happens to you, you may experience longer lengths of haul, need to find capacity in new routes or regions or seek out a new mode. You could also experience different equipment needs and transition to a larger or smaller piece of equipment depending on your capacity requirements.

How Penske Can Help

We have several options to help you flex quickly with food and beverage market transitions, including commercial rental trucks, truck leases (including some short-term options), logistics services and used trucks. Our team of experts can also help you if you are suddenly faced with a crisis or opportunity, and they can assist in proactive planning, so you're ready before the next surge or shift hits.

The supply chain is a critical component of any business, and supply chains must function even when things don't go as expected. Having a contingency plan enables you to react proactively if an unexpected event or opportunity, such as a surge in activity, occurs.

While planning ahead has always been important, the recent pandemic has only accelerated the need for executive contingency planning – especially as it relates to transportation, warehousing and fulfillment to meet rapidly shifting consumer demand and preferences. There are several critical components of an effective supply chain strategy.

Flexing Up or Down

When creating a contingency plan, you need to give yourself options to flex up or down as needed. We offer several resources you can integrate into your contingency plans, including rental trucks and short- and long-term leases. You can also turn to logistics providers to obtain the space you need through a dedicated or for-hire fleet.

Adding Capacity

You can boost your fleet capacity through rental trucks or short-term leases to handle fluctuations in demand. If there is a sustained increase in demand, you can invest in equipment through long-term leases or used truck purchases.

Removing Inefficiencies

Successful fleet management often includes a combination of rented, leased and purchased vehicles, and you can evaluate routes, delivery days, times and volumes to identify and remove inefficiencies. By drawing on data from historical, current, and predicted routes and volumes, you can make informed decisions about the right mix of equipment and the optimal size fleet. The combination can shift based on seasonal or operational changes.

Becoming More Agile

To increase agility, you can establish and maintain relationships with alternative suppliers. This could require the use of multiple carriers, new routes or different ports. Enabling choice allows you to control costs and service levels in normal times, and it creates flexibility when there is a supply chain disruption.

Optimizing the Supply Chain

To optimize the supply chain, you can review your network design. An effective network can ensure companies operate efficiently during difficult situations or typical growth scenarios.

At Penske, we have invested in sophisticated technology that can use supply chain data to create models to run 'what-if' scenarios using different ports, warehouses or plant locations, as well as alternate suppliers, varying levels of inventories and different modes of transportation to find the optimal network.

Ultimately, contingency planning can mean the difference between success and failure, and is an important aspect of risk management, business continuity and disaster recovery.

We offer numerous resources and solutions for companies creating a supply chain contingency plan, including logistics services such as trucking, warehousing, and transportation management as well as rental or leased vehicles, and used trucks.

The business world is full of unknowns, but there are several ways leasing can help you minimize transportation-related risks so you can focus on your core competencies.

At Penske Truck Leasing, we provide a range of services designed to help you solve delivery challenges unique to the food and beverage industry. From pickup through delivery, we can help you spec the right vehicles and maintain them throughout the life of the lease. Here are a few ways a full-service lease helps you minimize risk.

Control Costs

Leasing provides a lower upfront capital investment and predictable monthly payments, which ensures there are no surprises that negatively impact your budget. Because financing costs are established in advance, there is no concern on what costs will be long-term.

Along with greater predictability, leasing provides increased visibility into overall life cycle cost, allowing you to make more informed decisions regarding your future equipment needs. Leasing also frees up capital for use in a company's core business.

Improve Safety

As part of our overall transportation solution, we provide a comprehensive maintenance approach throughout the term of the lease. A rigorous preventive maintenance program ensures that the equipment is reliable and doing the job it is intended to perform, from the vehicle's in-service date until the end of the lease. That, in turn, helps you attract qualified drivers, promotes your brand, increases customer satisfaction and improves safety.

Safety also protects your brand, reduces reputational risk and can limit liability. If you don't have a full-service maintenance operation covering your equipment, you're exposing yourself to potential litigation liabilities. When you have a reputable third-party provider maintaining the equipment and documenting every repair, you have something of substance to fall back on.

To ensure your entire fleet is optimized and running safely and efficiently, we offer comprehensive maintenance programs for customer-owned vehicles. And with refrigeration units on trailers also playing a critical role in keeping products, we service and maintain them as well, ensuring your food arrives as intended.

Increase Uptime

If today's high-tech vehicles are not properly maintained, you run a higher risk of vehicle breakdowns, incidents or accidents. At a minimum, improper maintenance can result in missed customer deliveries and may tarnish your reputation. If left uncorrected, the consequences can be significant, including reductions in customer loyalty and associated economic drains on cash flow and growth revenue.

In reality, even the best-maintained vehicle may need service or repair while on the road. Through our dedicated, company-owned 24/7 roadside assistance group, we provide hands-on experts to communicate with your driver as well as update your management team throughout the process until your driver and equipment are rolling again.

In instances where the vehicle is temporarily inoperable, we provide a comparable substitute vehicle from our fleet of late-model units to minimize any disruptions to service. If a replacement vehicle is necessary, the speed of delivery is crucial, and we get you back on the road fast.

Protect CSA Scores

Nearly two million roadside commercial motor vehicle inspections were conducted last year, the Federal Motor Carrier Safety Administration reported. A well-maintained vehicle minimizes the risk of a violation at a roadside inspection, which helps you maintain your scores as part of the Federal Motor Carrier Safety Administration's Compliance, Safety, Accountability (CSA) program that calculates fleets' safety ratings and determines which fleets warrant intervention.

Violations Can Cost You

In January 2021, the U.S. Department of Transportation added an inflation adjustment to civil penalty fines charged to commercial vehicle operators who violate transportation industry regulations. Penalties range from $334 to $194,691 with a median fine of $11,125.

Here are some important numbers to know from 2021:

1,784,479 2,707,891 571,810
Total number of vehicle inspections Total number of vehicle violations Total number of vehicle OOS violations

Source: FMCSA, Motor Carrier Management Information System (MCMIS), data snapshot as of January 2, 2022, for the 2021 calendar year

Not only is an intervention time consuming and potentially costly, a portion of CSA data is public and can be viewed by customers, shippers and potential employees.

CSA scores are becoming more important to drivers as inspections now follow drivers for three years as part of the FMCSA's PreEmployment Screening Program. While a number of violations ultimately come down to the driver's responsibility, some are dependent on the carriers and private fleet operators, which is making some drivers more selective about who they will work for. Private fleet operators with the best maintenance ratings are more likely to attract qualified drivers while simultaneously improving their CSA scores.

Obtain the Correct Equipment

To optimize operations and efficiency, it is important to spec the right vehicle for the application.

We will sit down with you to examine historical data and understand routes, capacity, drivers and freight, ensuring everything is covered. With the facts in hand, we work with Original Equipment Manufacturers (OEMs) to build vehicles for optimal performance and fuel efficiency that meet your exact needs. We have the experience and expertise in multiple industries to find the right equipment for the job.

Full-service leasing also provides flexibility in the number of vehicles you keep. Whether it's new customers and unexpected growth, or just your busy season, you can easily and cost-effectively supplement your fleet with our rental trucks. Our lease and contract maintenance customers enjoy discounted rates on Penske truck rentals.

Plus, we proactively support you when you experience changes in your operations or increased customer demand.

Stay Compliant

We also monitor regulations, which helps ensure the equipment you are running is in compliance with state and federal regulations.

Additionally, Penske can help you stay compliant with the requirements of the food safety modernization act (FSMA). According to the act, the design of vehicles and equipment used in transportation operations and the materials used in their manufacture and their workmanship must be “suitable.” Equipment must be “adequately cleanable” to allow the sanitary transport of food. In addition, the rule specifies, “vehicles and transportation equipment must be stored in a manner that prevents harborage of pests or becoming contaminated in any other manner that could result in food becoming adulterated. For food requiring specific temperatures, vehicles and transportation equipment must be equipped, as necessary, to provide adequate temperature control. The FSMA requires shippers and carriers to agree to procedures for monitoring temperatures within the trailer or truck body, when applicable. Penske has extensive expertise in these areas.

Focus on your Core Competency

If your business is like many others, transportation is not your core focus. Utilizing a lease helps you minimize the amount of time you spend managing and monitoring the transportation side of the business. Let us do what we do best: take care of your fleet.

Penske has a team of experts ready to help you find the best solutions for your needs, including commercial rental trucks, truck leases, fleet maintenance, logistics services and used trucks.

July 2016 / Updated January 2022

Penske employees

The Penske Code for Business Conduct reinforces our commitment to doing business in accordance with the highest legal and ethical standards. The Code sets forth general principles on key integrity issues and guides associates in upholding our ethical commitment. A copy of Penske's Code for Business Conduct can be found here.


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Diversity and Inclusion

Penske employees working together

Penske is a company where people help people move ahead. One way we do this is by promoting a culture and an environment that embraces diversity and inclusion. As a result, we are a stronger, more competitive company that better reflects the customers and communities we serve around the globe.

Brian Hard, President and CEO - Penske Truck Leasing


Diversity and Inclusion Mission Statement

Penske is a global company with diverse customers, businesses and associates. We will improve and grow our businesses by supporting a work environment that is diverse, inclusive and respectful, so we can draw from the talents, backgrounds and varied perspectives of all our associates.

This inclusive culture will enhance our ability to attract and retain the most talented leadership and workforce, thereby enabling us to better serve and broaden our customer base, and will solidify our status as the best provider of transportation support and supply chain management services.