In today’s podcast, Earnest and Santosh focused on how Prologis is looking to solve the problem of detention costs and related waste. Detention time, in its simplest definition, is the idle time that a truck spends at the point of origin, and then at the drop-off point. To this day, no organization has been able to successfully aggregate how to improve the efficiency of a trucker’s ability to pick up and drop off goods. Generally, two hours are accounted for both at pick-up and drop-off, but in reality, it is actually seven hours where a driver is unable to take on another load or job. This is costing fleets on average $28,000 per truck annually.
Prologis Ventures is the largest logistics real estate owner in the world. The company has real estate in 19 countries, with 772 million square feet. They lease modern distribution facilities to over 5,200 eCommerce customers, including manufacturers, retailers, transportation companies, third-party logistics providers, and other enterprises with large-scale distribution needs.
Earnest started his career in investment banking as an equity research associate in 2007, right before the economy in the United States started to recess. He worked for a Canadian based bank and was able to weather the storm, and take time to learn about the various asset classes. That said, his eyes were on becoming an entrepreneur with a focus on start-ups. He moved to San Francisco in 2013 with the goal of getting into venture capital. He worked for some accelerators to hone his skills before landing at Prologis at the beginning of 2017.
By partnering with FreightWaves based out of Chattanooga, TN, Prologis is looking at how to use data to improve the problem of detention time. FreightWaves has partnered with data providers across the freight marketplace to aggregate hundreds of data sources, which can be used to create efficiency in the trucking process.
With this challenge and the lack of visibility and transparency as to where trucks are in the shipping process at any given time, it is nearly impossible to properly estimate and indicate where this lost time should be billed. Currently, the carrier is charged and can’t charge the shipper. This often means that detention costs aren’t being paid to the driver. This confusion can create chaos and conflict in the system that can be avoided with future efficiencies and automation.
In addition to solving or the challenge of detention time, Prologis is also looking to design the truck-court of the future. The truck-court is the area adjacent to a shipper or receiver’s loading docks, where trucks are able to maneuver. But today’s truck courts are designed based on how a driver actually drives the truck. So, how does the truck-court of the future look when trucks are automated, being driven by computers instead of human drivers? Prologis is taking the time to talk to start-ups that are automating the yard management process, start-ups that are building automated and autonomous trucks, and customers, to better understand the various use cases within logistics real estate.
Prologis is looking to take the trucking and logistics supply chain into the future, and we are excited to watch how they will get there.
You can hear the full episode here to dig deeper into how Prologis is looking at these challenges, and to understand how Prologis determines where they are going to visit. To learn more about what Earnest and the team at Prologis are building, visit their website.