All this reminded me of a couple of fables:
http://smithdickson.com/news-resources/articles/article-the-hot-dog-vendor/
or
https://www.business2community.com/strategy/the-good-old-hot-dog-stand-story-028751
Some versions have the hot dog vender cutting down on the condiments, pickles etc to save money.
The basic moral is if you if you give the customer (shipper) a better product (on time and reliable) you will incease your profit. No one wins in a race to the bottom.
Here in the Chicago area, a man started a hot dog business in a trailer in Villa Park in 1963 in a strip mall parking lot. I moved to the area in the sametime period. He recently sold his business at age 74. Per this 2014 Chicago Tribune article, The size of the deal was not disclosed, but Reuters reported Tuesday that Berkshire was in talks to buy Oak Brook-based Portillo's for almost $1 billion, citing people familiar with the matter. Neither party confirmed that the deal was an outright acquisition. Dick Portillo is expected to remain actively involved in the business. One of his nearby stores has a drive-up window that has cars lined up two abreast with order takers out in the line taking the order, making change and and three or four order deliverers getting the orders to the cars. He greatly exceeds the volume of most McDonalds and delivers what the customer wants.
tree68The problem with running trains every two hours is that you need (for sake of argument) 12 crews (times HOS and other considerations).
Many class 1 trunk lines operate 50-100 trains a day.
tree68If you aggregate all those cars into, say, four trains, you save yourself eight crews and their associated costs.
Assuming of course that all the trains come from and go to the same place. If you have to split them up at both ends of the crew district you can lose more in yard time than you gain.
tree68And if there aren't any/enough cars, you don't run the train at all - more savings.
Maybe. Maybe not.
If you typically run 12 trains east and 12 trains west and you annul one EWD trains then that could put you one set of power, one crew and one EOT short to come west the next day.
One of the quickest ways to cholorform a terminal is to annul a bunch of the inbound trains to save money. Then you waste it all the next week trying to recover the terminal because they went under being short power and crews.
Dave H. Painted side goes up. My website : wnbranch.com
Fred Frailey said Santa Fe did this experiment for one year. Was this experiment ever written up anywhere and where can i get this articule. Why didn't John Reid fix any problems and keep it going? Gary
SFbrkmn Not sure on other carriers, but occupation on codes bnsf for train crew workers are 01 rd engineers, 03 condrs, 05 brkmn, 11 yd engr, 13, yard foreman, 14 yd helper, 15 yd pilot, 18 utility man, 29 is BN yardmaster. If one wants to beome creative, 02 is a fireman.
Not sure on other carriers, but occupation on codes bnsf for train crew workers are 01 rd engineers, 03 condrs, 05 brkmn, 11 yd engr, 13, yard foreman, 14 yd helper, 15 yd pilot, 18 utility man, 29 is BN yardmaster. If one wants to beome creative, 02 is a fireman.
Thanks to Chris / CopCarSS for my avatar.
Murphy Siding SFbrkmn Running fewer trains means less jobs needed. It is already a fact that some bnsf pool boards are calling for fewer 01 & 03's compared to the past. Not good. Can you explain what 01 & 03's means?-Thanks
SFbrkmn Running fewer trains means less jobs needed. It is already a fact that some bnsf pool boards are calling for fewer 01 & 03's compared to the past. Not good.
Running fewer trains means less jobs needed. It is already a fact that some bnsf pool boards are calling for fewer 01 & 03's compared to the past. Not good.
Can you explain what 01 & 03's means?-Thanks
Anyone? Please?
_____________
"A stranger's just a friend you ain't met yet." --- Dave Gardner
I had to do the yearly bonus reports for all divisions here in the last few weeks. Guess what division costs the most to run and contributed most of our profit. Our custom blending unit. Yet every day an expert in logistics tries to tell my boss to get rid of it. He's like why it makes me a profit the other guy's like but it takes 150 people to run it. That's how stupid modern managers think. Just because something is labor intensive it's not a good thing.
greyhoundsIt's finding that balance and keeping it that is the art.
Personally, I have no argument with this, or anything else you say in that particular post.
Activist investors working an agenda might try to skew priorities a little more to their liking, however.
Convicted OneRunning a railroad vs. paying larger shareholder dividends,...where is the priority?
Really, the goal is to manage a railroad, not run a railroad.
Good management is required to serve the several constituent groups involved. Investment is required, so the investors need to be satisfied. Customers are required, so the customers need to be served well. Labor is required, so it needs its due. Suppliers are required, so they need to be paid in full on a timely basis.
Management needs to balance the requirements of all these groups to maintain a successful, ongoing operation. Giving excess priority to one above the others will eventually destroy the railroad (or any other business). It's finding that balance and keeping it that is the art.
charlie hebdo BaltACD Paring costs is one thing - paring costs that generate revenue that more than covers the costs and brings dollars to a black bottom line is stupidity. Such is a way to create a 60% operating ratio - cutting costs without regard to revenue. Foolishly paring costs without regard to revenue is what someone does who lacks a basic understanding of accounting terms. In your example, the OR would not be reduced. Rather it would be increased.
BaltACD Paring costs is one thing - paring costs that generate revenue that more than covers the costs and brings dollars to a black bottom line is stupidity. Such is a way to create a 60% operating ratio - cutting costs without regard to revenue.
Foolishly paring costs without regard to revenue is what someone does who lacks a basic understanding of accounting terms. In your example, the OR would not be reduced. Rather it would be increased.
Once the 'sharp pencils' worked it over - the OR would have been reduced.
Never too old to have a happy childhood!
BaltACDParing costs is one thing - paring costs that generate revenue that more than covers the costs and brings dollars to a black bottom line is stupidity. Such is a way to create a 60% operating ratio - cutting costs without regard to revenue.
zugmannDepends. What time is it?
Reading Fred's piece in the March 2019 issue, where he talks about rail's declining share of transportation revenue, it sounds like he thinks Cinderella better be heading for the door.
That really wasn't my point though. It just seems that with the likelihood of activist investors chanting the mantra of precision scheduled railroading anytime dividends appear "lean", the option of what's best for the railroad seems to be subordinate to stockholder greed.
To that end, fewer and longer trains leading to fewer crews and smaller payrolls appears to serve the interests of said stockholders.
Asked the question "should we put more money into a larger workforce or alternately into stockholder's pockets instead?" The prevailing mentality leaves little question to what the most likely answer will be.
Costs vs. Profits
A little over 40 years ago I was involved in creating the Baltimore Terminal Services Center - the initial foray into a computerized full customer service operation for the Chessie System for the City of Baltimore.
In trying to understand all the attempts to perform a similar function in prior years I came across a 'Wiz Kid' study of the Curtis Bay Coal Pier operation that called for the operation to be abandonded because it was costing about $4M a year to operate - that study totally overlooked that the cost of $4M yearly was generating revenues in excess of $20M annually at the time.
Paring costs is one thing - paring costs that generate revenue that more than covers the costs and brings dollars to a black bottom line is stupidity. Such is a way to create a 60% operating ratio - cutting costs without regard to revenue.
Depends. What time is it?
It's been fun. But it isn't much fun anymore. Signing off for now.
The opinions expressed here represent my own and not those of my employer, any other railroad, company, or person.t fun any
IA and easternIt seems to me an ideal way to run a railroad.
Running a railroad vs. paying larger shareholder dividends,...where is the priority?
NOnononnononono.
That's last yeat's thinking. This year it's about precision, schedules, and dwell time! You will run a crew 25 miles to retrieve that one empty.
The problem with running trains every two hours is that you need (for sake of argument) 12 crews (times HOS and other considerations). If you aggregate all those cars into, say, four trains, you save yourself eight crews and their associated costs.
And if there aren't any/enough cars, you don't run the train at all - more savings.
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
Fred said that Santa Fe railroad years ago used to run trains every two hours. Where can i find more information on this how to run a railroad.It seems to me an ideal way to run a railroad. More trains not less would make more sense. Gary
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