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Dimitre Kirilov is president, consumer services, at Montway Auto Transport, where he brings a focus on technology to his role, overseeing logistical and shipping developments to deliver transportation services to all 50 states and Europe. After joining the company in 2010, he quickly demonstrated innovation in growing the retail market and business-to-business portfolio.
Kirilov got his professional start in logistics working for a trucking company, while simultaneously becoming a real estate agent and broker, maintaining his license until 2014. He brings experience with brokers and business partners in the freight industry, as well as a customer service background, to his work at Montway.
David Maloney, Editorial Director, DC Velocity 00:01
Keeping drivers happy. Shippers adjust their packaging. And Walmart makes new investments in a trucking fleet.
Pull up a chair and join us as the editors of DC Velocity discuss these stories, as well as news and supply chain trends, on this week's Logistics Matters podcast.
Hi, I'm Dave Maloney. I'm the group editorial director at DC Velocity. Welcome.
Logistics Matters is sponsored by Rite-Hite. How are you helping to keep your workers on the dangerous drive approach safe? Approach-Vu from Rite-Hite detects backing motion in the drive approach and presents an immediate clear, audible, and visible warning to pedestrians in front of the loading dock. For more information, visit RiteHite.com. That's R-I-T-E-H-I-T-E dot com.
As usual, our DC Velocity senior editors Ben Ames and Victoria Kickham will be along to provide their insights into the top stories of this week. But to begin today: with employment rates at near historically low levels, companies must find ways to hold on to their employees, whatever it takes. That's especially true with trucking firms, which for years [have] faced a shortage of qualified drivers. What should these companies do to attract and retain the drivers that they need? To find out, here's Ben with today's guest.
Ben.
Ben Ames, Senior News Editor, DC Velocity 01:27
Freight capacity in the U.S. trucking sector has been historically tight for the past year, leading to high prices and space crunches for retailers and shippers. But that cycle may now be coming to an end, judging by the latest trucking sector statistics. Despite those macro changes, our guest today says that trucking as a career is recession-proof, even when high demand subsides. To learn more, we have our visiting speaker Dimitre Kirillov, who's president, consumer services, of Montway Auto Transport. Dimitre, thank you for joining us.
Dimitre Kirilov, President, Consumer Services, Montway Auto Transport 01:59
Thank you for having me.
Ben Ames, Senior News Editor, DC Velocity 02:00
To begin, maybe you could describe your company, Montway Auto Transport and the role it plays within the greater trucking sector. Since Of course, there are many categories in that area, you know, truckload, flatbed. It goes on and on.
Dimitre Kirilov, President, Consumer Services, Montway Auto Transport 02:16
Now, the official name of the company is Montway LLC. It was created exactly 15 years ago, and we've been growing and making the Inc. 500 and 5,000 lists through the years. We specialize in auto transport. Biggest part of the businesses in the retail, privately owned vehicles transportation, but we also work on the B2B side with movie rotation companies and dealerships, OEMs, auctions, and so on. And this has been a growing sector for us, rapidly, in the past few years. That being said, you know, we basically have two customers, the shippers and the carriers, and we're kind of in between them, making sure that everybody's happy in the process, and, you know, we must be doing something right, because we've been rapidly growing, and we're one of the top five auto broker services in the United States.
Ben Ames, Senior News Editor, DC Velocity 03:22
Gotcha. Thank you. Now, we've all heard a lot about the driver shortage, and you say that recruiting new drivers and reducing turnover once you have them is now a priority for companies large and small. It's even gotten some attention in Washington, D.C., as lawmakers and regulators and the industry looks for ways to speed up the overall supply chain. How's that going?
Dimitre Kirilov, President, Consumer Services, Montway Auto Transport 03:49
Well, any help is welcome, including and specifically from Washington, D.C., because, you know, a lot of the issues cannot be resolved without their help. You know, there's infrastructure issues, there's modernization of the ports, of roads, parking availability, and so on that are very difficult to be resolved without government help. There's also, you know, they've been working specifically on changing the requirements of how you can obtain a CDL license, which is also important, because in many cases those are very difficult to obtain. There [are] specific requirements, you know, for age, for example, where, you know, many people would have already chosen a different career before they were eligible to become a truck driver. There's still a huge issue with insurance, because even if the government allows you to get a driver's license when a younger age, so you know, they can tap into the younger workforce, the insurance compan[ies] are not exactly jumping over each other to ensure such drivers, so that's a that's a big issue, as well, that needs to be addressed.
Ben Ames, Senior News Editor, DC Velocity 05:09
Yeah, interesting. I can imagine that. Despite that increased focus, it's really a hard challenge that the long-haul trucker lifestyle can be demanding, of course. Can you give us some ideas of changes that can make a difference?
Dimitre Kirilov, President, Consumer Services, Montway Auto Transport 05:26
Yes, so some of those, again, Washington, D.C., is already working on, you know, making sure that military, former military personnel that has worked on, with heavy-haul equipment in the military can almost, without much of jumping through hoops, can get the CDL, and it's actually a great career for somebody coming back from the military, because, you know, one, they're kind of used to being away from home, and unfortunately, you know, that's one of the drawbacks of the long-haul drivers, is being away from home. It is a good-paying job, but it is demanding. And, you know, there are other steps that the government is taking, but at the end of the day, it's more of a PR advertisement, if you will. I mean, back in the '80s, Sylvester Stallone was a truck driver and the hero in the movies. Now, you know, the best that they get is being the stalker, or, you know, the mass murderer in TV shows. So it's also a big part of the PR perception, of people, how people perceive, you know, get this perception of the trucking, the trucking industry, and what truckers are, and in reality it's actually a very good, stable paying job, that, you know, you can support your family without having to go five, six years through college and make, you know, a very nice salary.
Ben Ames, Senior News Editor, DC Velocity 07:01
Right, right. No, that's a great point about the public relations and the movie and TV roles that you see on that. That's striking, when you say that. But you're saying that both current and future truck drivers really want to have a more satisfying work experience. That's true, probably, for all of us, regardless of our career choice. But what makes trucking different in terms of sort of the day-to-day experience?
Dimitre Kirilov, President, Consumer Services, Montway Auto Transport 07:29
Well, it's mostly about being away from home. And part of the issue, actually, is not so much the lack of drivers, even currently, but it's the lack of over-the-road, or the long-haul drivers. There's so many opportunities for last-mile deliveries that still pay pretty well, you know, locally, and, you know, allow you to spend the night at home, versus driving across the country and sleeping in your truck or in a motel. So, you know, companies like Amazon, and everything that we've kind of gotten used to in the past four or five years, overnight deliveries or next-day delivery, however you want to call it, or sometimes even same-day delivery, is basically drawing from the pool over-the-road drivers and shortening the, you know, the supply in that focus. And because our infrastructure is so old, there's no, really, at the moment, we cannot supplement that, because the railroads' infrastructure is 100 years old, nothing has really dramatically changed in the past 100 years in it. The ports are your grandfather's ports, pretty much, you know, compared to other ports across the world, you know, they're not that, they're much less digitized, they work shorter hours, versus 24 hours in other ports and other places. So, there's many places where the supply chain actually hits on a hard issues, and at the end, even if everything gets out of the ports, right, unless it gets on a truck immediately, you know, there's really no storage spaces where it could be stored for the time being. So, it's kind of a vicious circle, right? And, again, you know, needs the government intervention to invest in that infrastructure to be modernized so all these could work as well-oiled machine, right, and there's some room for error. Because even before the pandemic, the whole supply chain was just barely surviving and working and getting the capacity, basically working at maximum capacity, so any small deviation from that was bound to bring up big, big issues, right, like the 30, 40, 80 ships waiting to be unloaded, then, you know, not enough truckers to get the loads out of there. And, you know, even the railroads being overwhelmed to take some of this in the right direction.
Ben Ames, Senior News Editor, DC Velocity 10:23
Those are some great points about the aging infrastructure and about the sort of, the delicate edge of the just-in-time system there. As a last question for our conversation here, one of the ways, you know, with all those challenges, to make any work more satisfying is to have a fair paycheck at the end of the day. Is that true in trucking, and what needs to happen to let more workers know about it,
Dimitre Kirilov, President, Consumer Services, Montway Auto Transport 10:49
It's never been more true than it is today, because everyone is competing with each other to bring truckers, to bring drivers to their fleet. I've been reading advertising recently of now paying 95 cents per mile, and, you know, a trucker will generally do about 2,500 a week without having to work every day of the week. So, you know, that amounts to roughly 100-plus thousand [dollars], depending on you know how you calculate it, for the year. So, it's never been more true. So, 15 years ago, when I started my career in logistics, the best drivers and the most experienced drivers were getting roughly half of that. So obviously, we have gone a long way into the fair paycheck, but there are other things, like, again, for me as a driver, you know, the government introduced the electronic logbook, so, you know, if there's no infrastructure for me to stop and rest, I'm faced, you know, I'm coming to the nearest parking lot, right, and I have another, let's say, 30 minutes to drive for the day, and the parking lot is full. So, now I have a choice to either park illegally, and potentially get a ticket, or drive to the next one that may be more than 30 minutes away and get a ticket because I'm over hours, right? So, there are the challenges, again, with infrastructure and internally for the companies, of how we can, they can make the driver life easier and more appealing for them to take roles, because trucking, long-haul trucking is not going away anytime soon, so we have to figure out everything that we can do to make this more appealing to people to sign up for.
Ben Ames, Senior News Editor, DC Velocity 12:49
Yeah, those are some really great points, and subjects that we will continue to to cover on the magazine. Dimitre, I really appreciate your taking the time to have a conversation with us today.
Dimitre Kirilov, President, Consumer Services, Montway Auto Transport 13:01
Well, thank you very much for having me, and enjoy the rest of your day.
Ben Ames, Senior News Editor, DC Velocity 13:06
Appreciate it. Our guest today on the podcast has been Dimitre Kirillov from Montway Auto Transport. Back to you, Dave.
David Maloney, Editorial Director, DC Velocity 13:13
Thank you, Dimitre and Ben. Now let's take a look at some of the other supply chain news from the week. Victoria, you wrote this week that with rising costs and disruptions for packaging supplies, companies are making changes. What more can you tell us?
Victoria Kickham, Senior Editor, DC Velocity 13:29
Yeah, happy to share this information, Dave. So, a survey of 300 packaging-industry decision makers shows that most are shifting their priorities in response to inflation and supply chain disruptions over the past year. The survey, which is titled Unpackaging Reality Report, was published this past Wednesday by printing and packaging company RR Donnelley and Sons. Now, the decision makers they surveyed were U.S.-based procurement, marketing, and packaging-engineering professionals from, really a variety of industries. One of the main findings was that 90% of those surveyed said they've changed how their packaging is sourced in the past year. The research also found that increased prices for materials and supply shortages presented the biggest hurdles for the industry, with more than half of respondents reporting they have been strongly affected by those kinds of challenges. The bottom line, according to the research, is that the packaging industry has changed in some big ways over the past year, and those include becoming more innovative in a variety of ways, changing in response to e-commerce pressures, and the industry also has made what the researchers referred to as "surprising strides in sustainability despite the cost pressures" they've been under.
David Maloney, Editorial Director, DC Velocity 14:48
Victoria, can you give us some details on those issues?
Victoria Kickham, Senior Editor, DC Velocity 14:52
Absolutely. So, on the innovation side — and this largely has to do with sourcing, which I mentioned at the outset — 62% of respondents said they have diversified suppliers in the past year; 42% have outsourced manufacturing and fulfillment; 39% have consolidated suppliers; and 26% say they've reshored their manufacturing to the U.S. What's more, there is what the researchers called a "broad willingness to pivot to different packaging material[s] in light of the supply chain sourcing challenges." More than a third of industry professionals said they were extremely willing to use alternative materials, as one example, and in doing so, most of them are turning to their suppliers, vendors, or even directly to material manufacturers, for advice and insight on that. When it comes to online ordering and e-commerce, the majority of respondents said they experienced an increase in e-commerce orders over the past one to two years, which is not surprising, and for nearly all of them, I think it was something like 92%, this resulted in an increase in their packaging needs. And that led to many of them increasing their inventory, expanding warehousing, changing materials, and increasing staff. On the environment, the authors said the survey findings contradict the sentiment that sustainability initiatives fell to the backburner, you know, as companies have been grappling with other priorities, or pressures. And we've heard this quite a bit over the past year, but what the research found is that almost all of the respondents agreed that sustainability is a key consideration in packaging and label decisions, with two-thirds saying they shifted to more sustainable packaging than what they used to use. When considering, you know, going this route, budget is the top influencing factor, more so than any external relations or even consumer preferences. And the research says that suggests that, you know, cost-effective, eco-friendly materials are really what's in high demand now. So, just a lot of changes going on in the packaging industry, and our listeners can see the full report on the RR Donnelley website, and there's a link to that in the story that we posted this past week.
David Maloney, Editorial Director, DC Velocity 17:08
Great. And we'll also include a direct link to that report in the show notes that's available on many of the podcast platforms, so look for that there. Thanks, Victoria.
Victoria Kickham, Senior Editor, DC Velocity 17:17
You're welcome.
David Maloney, Editorial Director, DC Velocity 17:18
And Ben, we talked earlier about truck driver retention, and you wrote some additional stories this week on trucking trends, including an investment from Walmart in their trucking fleet. What can you tell us?
Ben Ames, Senior News Editor, DC Velocity 17:31
Exactly, so and, you know, like the old ad used to say, "When EF Hutton talks, people listen," and I think the same is true to some extent for Walmart. They're obviously a huge presence in the U.S. or even the world retail market. In this case, it's what Walmart is doing around trucking. We've been talking about that a lot lately, and it's for some obvious reasons. The trucking sector has had very tight freight capacity for many months now, so it's been hard for shippers to move their inventory on time, or a different price, decent price, when they can move it. And now that it looks like economic growth is slowing with those higher interest rates in order to cramp inflation, it looks like freight demand might also be slowing, but at the same time, costs are continuing to rise, both for that scarce labor and for the expensive gas. So, it's complicated out there. You know, in that context, where retailers are struggling to get their goods onto the store shelves, and that's where all this comes down to Walmart. So, we learned this week that Walmart has decided to install a touchscreen computer tablet in every vehicle of its private fleet. And again, as I was saying, it's not just any fleet. We're talking about 9,000 tractors. They also have 80,000 trailers, and about 12,000 drivers to move all those. They need that kind of scale, because, of course, Walmart is big. They have 200 distribution centers and about 10,000 stores. So, to get those computer tablets into the truck cabs, Walmart used a transportation tech provider called Platform Science. It's actually a San Diego startup that's backed by Daimler, of all people, and as well as some venture capitalists. And Platform Science also provides some of that fleet-management software in trucks that are built by Daimler itself, so.
David Maloney, Editorial Director, DC Velocity 19:31
Ben, that's a pretty big installation of tablets. How will it actually help Walmart's trucking challenges?
Ben Ames, Senior News Editor, DC Velocity 19:38
Yeah, here's how it works, in Walmart's view: Each tablet computer is integrated with a driver-workflow, software application, and this is something that was developed by Walmart. So, put together, that system will provide near real-time visibility, the company said, of where the trucks are, and of course all the inventory on them. So, Walmart said that that data will let stores anticipate the arrival times, just, specific truck by truck, so they can plan their labor levels around the truck deliveries. The key to how that works is automated notices. So, as each truck driver approaches the store destination, on the highway or whatever, the tablets use geolocation technology to send a push notification — perhaps a text or an email — to store associates' handheld computer devices, and so that allows the labor on site to plan for a quick unload and turnaround. From the drivers' point of view, Walmart said, the approach removes some of the manual tasks they usually have to do, so the drivers can spend more time driving the truck and less time waiting. Walmart also said the system could help drivers by coordinating that kind of scheduling with the navigation so they can get turned around and hit the road to the next destination, for example, without having to key in the new address. So, Walmart said that quote, "Like any job, unplanned activities sometimes require the driver to do more than just steer the truck." So, with the new tablets, the company said that drivers are compensated for any miles or nondriving activities beyond what was originally planned. So, that's according to Walmart, not the drivers, but it seemed to have you know, all the different parties in mind here, the drivers, the inventory, that the labor on the ground, so if they can bring all those working together, it could maybe be one part of solving that complicated truck picture.
David Maloney, Editorial Director, DC Velocity 21:37
Yeah, definitely. And it's interesting to see how technology continues to impact our space. Thanks, Ben.
Ben Ames, Senior News Editor, DC Velocity 21:39
Yep, interesting stuff.
David Maloney, Editorial Director, DC Velocity 21:46
We encourage listeners to go to DCVelocity.com for more on these and other supply chain stories. And check out the podcast Notes section for some direct links on the topics that we discussed today.
And again, our thanks to Dimitre Kirillov of Montway Auto Transport for being our guest today. We welcome your comments on this topic and our other stories. You can email us at podcast @dcvelocity.com.
We also encourage you to subscribe to Logistics Matters at your favorite podcast platform. Our new episodes are uploaded each Friday.
And speaking of subscribing, we encourage you to check out our new sister podcast series Supply Chain in the Fast Lane. It's coproduced by the Council of Supply Chain Management Professionals and Supply Chain Quarterly. We have a new series of program launching next week on supply chain digitization. So subscribe to Supply Chain in the Fast Lane wherever you get your podcasts.
And a reminder that Logistics Matters is sponsored by Rite-Hite. How are you helping to keep your workers on the dangerous drive approach safe? Approach-Vu from Rite-Hite detects backing motion in the drive approach and presents an immediate clear, audible, and visual warning to pedestrians in front of the loading dock. For more information, visit RiteHite.com. That's RiteHite.com.
We'll be back again next week with another edition of Logistics Matters, when we'll discuss all of those products shortages we've been experiencing this summer, including the baby formula, and what can be done to stabilize our supply chains, so be sure to join us. Until then, have a great week.
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