Leak 09 · Freight & Cost-to-Serve - Unprofitable emergency deliveries
A driver spends two hours delivering a $90 part because the customer’s line is down. It was the right call once. It is now a habit nobody prices.
Diagnostic note. Symptoms, the records to bring, and a practical first check with your team.
What is it?
Emergency deliveries are part of the service that justifies buying from a distributor instead of online. The leak is not that they happen. It is that they are unmeasured, unpriced, and concentrated among a few customers who have learned that “urgent” costs them nothing extra.
- Family
- Freight & Cost-to-Serve
- Primary owner
- Operations Manager
- Secondary owners
- Sales Managers, CFO
- Primary impact
- EBITDA
- Typical data source
- Delivery logs, driver time, order values
- Detection difficulty
- 30-day measurability
Ask yourself
Do you know how many same-day or hot-shot deliveries you ran last month, and what each one cost?
Yes, partially, no, or don’t know. “Don’t know” is the most useful answer, because it points at the test below.
What does it look like?
Look for these patterns, then use the check below to trace the issue in your own records.
- Same-day and hot-shot runs that are not coded differently from routine deliveries.
- No emergency delivery fee, or one that is routinely waived.
- A handful of customers who account for most of the urgent runs.
- Drivers pulled off scheduled routes, delaying other customers.
What data do I need?
The minimum viable set. Most of it is already in your ERP.
| Field |
|---|
| Delivery record: order, customer, date, delivery type |
| Driver time and miles for the run |
| Order value and gross profit |
| Fee charged for the delivery |
The initial check
Start with a small sample. Ask the person who owns the records to gather the exports and agreements, then work through these steps together.
- 1Ask dispatch or the drivers to list last month’s unscheduled runs from memory or the log.
- 2For each, note the order value, the gross profit, and the hours and miles involved.
- 3Estimate the run cost at your loaded driver rate plus mileage, and compare to the fee charged.
Loss per run = (driver hours × loaded rate + miles × per-mile cost) − delivery fee charged
Then ask one question: Which three customers generated the most emergency runs, and are they your most profitable accounts or your least?
How much could it be costing us?
A conservative range, not a headline. The goal is a number management can trust enough to investigate.
Emergency runs per year × average unrecovered cost per run × share you can reasonably charge for or consolidate
Common root causes
Fixes fall into three layers. Not every problem needs software, and almost none needs AI first.
- Process
- No definition of what qualifies as an emergency and no fee policy.
- Data
- Delivery type is not recorded, so emergency runs cannot be counted.
- Technology
- Dispatch is a whiteboard or a group chat, not a system.
What should we do?
Start with the simplest intervention that could solve it. Move down the list only if the one above is not enough.
Level 1
Visibility
Code every delivery by type and report emergency runs monthly by customer.
Level 2
Policy
A published emergency delivery fee, with a short list of accounts where it is waived by decision.
Level 3
Workflow
A dispatch tool that records the run, applies the fee automatically, and shows the customer’s recent history.
Where AI helps
- Identifying customers whose emergency pattern suggests a stocking or consignment conversation instead of a fee.
Where AI probably doesn’t
Counting runs and charging a fee needs a log and a policy, not a model.
Before you call it a leak
- For key accounts, emergency service may be the reason they buy from you. Price it into the relationship deliberately rather than removing it.
Think this might be happening in your business?
Turn the finding into a next step.
If the numbers say there is something there, send us what you found and we will help you decide whether it is worth a full investigation. No transaction files needed for that conversation.
Related leaks
- Leak 08 · FreightFreight recovery leakageYou pay the carrier $100 and bill the customer $60, or nothing. Across every shipment in a year, the gap is often a six-figure line that never appears on any report.
- Leak 06 · PricingSmall orders priced below their cost-to-serveA $40 order with $12 of gross profit costs $25 to pick, pack, invoice, and deliver. Multiply by thousands of orders a year.
- Leak 10 · FreightExcessive split shipmentsOne order, three boxes, three carrier charges, one freight charge to the customer. Backorders and branch stocking decide it, not anyone in particular.
- Leak 12 · FreightExcessive customer-specific handlingCustom labels, kitting, special packaging, portal data entry, certs with every shipment. Real service, real labor, and usually free.
Let’s start with one thing.
Give your team more time for the work that needs them.
Show us the quoting, order-entry, or follow-up work that keeps piling up. We’ll map it with you and find a practical place to start.
Start with a free workflow conversation with Alex.