Comments on: The Good and Bad of Controlling Fuel Costs http://www.komintlblog.com/archives/7 KOM International Blog Wed, 08 Sep 2010 07:27:08 +0000 http://wordpress.org/?v=2.3.2 By: Consultant http://www.komintlblog.com/archives/7#comment-14 Consultant Mon, 21 Apr 2008 15:51:58 +0000 http://www.komintlblog.com/archives/7#comment-14 Interestingly, but not surprisingly, Transportation and fuel costs were the running theme at this year's FMI Supply Chain conference. It seems that transporation managers are feeling the pinch to save in other areas considering the rising cost of fuel. There are some interesting tactical things being done such as minimizing left hand turns (as mentioned), increasing aerodynamic nature of trucks, controlling speeds, using biofuels, etc. But there didn't seem to be many strategic alternatives. Without reducing service levels or adding infrastructure and/or inventory, it's hard to see where further transport costs can be reduced. The question becomes, what is the tipping point for fuel costs to outweigh warehousing/inventory? Diesel is already around $4 gallon and rising... Interestingly, but not surprisingly, Transportation and fuel costs were the running theme at this year’s FMI Supply Chain conference. It seems that transporation managers are feeling the pinch to save in other areas considering the rising cost of fuel.

There are some interesting tactical things being done such as minimizing left hand turns (as mentioned), increasing aerodynamic nature of trucks, controlling speeds, using biofuels, etc. But there didn’t seem to be many strategic alternatives.

Without reducing service levels or adding infrastructure and/or inventory, it’s hard to see where further transport costs can be reduced. The question becomes, what is the tipping point for fuel costs to outweigh warehousing/inventory? Diesel is already around $4 gallon and rising…

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