With the stagnant economy and the impasse in Washington, putting together a business strategy for 2014 has been a challenge. Each hauling segment, region, and lane is going to have its own set of circumstances. To forecast freight volumes in 2014, here’s a list of questions to which you need answers:
What if competition becomes tight and rates go down in the lanes within which you operate your trucks? Do you have an exit strategy in place? This is about finding a new, better and more profitable direction in which to take your business or a way to gracefully get out of the business with the least damage to your finances.
Trucking’s a very interesting business in which few carriers survive and thrive from decade to decade. Think of the trucking companies that ran for 40-plus years, but when deregulation hit in the 1980s, many of those “old” companies didn’t exist by 1990; however, there are a few still running strong today. Why did they not only survive but continue to grow year after year?
Calculating workable hauling rates is one of the biggest business challenges facing most micro or small trucking companies. Many smaller carrier owners and managers are under the impression brokers and shippers are responsible for low freight rates, when in reality there are multiple forces fighting in both directions. The trucking company is trying to get the highest freight rate possible; shippers are trying to get the lowest rate they can; and the broker, in many cases, is trying to please both while getting as big of a piece of the rate pie as possible.
The unpredictability of the truckload segment continues to be the biggest challenge faced by many trucking executives—whether they’re running a Fortune 500 company or one truck and trailer. The last three years have been one heart-pumping ride on this highway we call trucking. It seems like every time we think we have a handle on our business, on customers’ needs, and on the right mix of equipment and truck drivers, something throws us into a downhill ride of epic proportions.
There’s a rumor circulating that the micro-trucking companies and owner-operators (O/O) are becoming a fast-dying segment of the trucking industry. But as a business coach, I’m finding these small-business entrepreneurs are very adaptable.
When it comes to a small business, and especially so as a startup company, you’re a one-man operation. You’re looking for loads and you’re trying to find clients for whom to haul stuff. You’re trying to get things leveraged. You’re trying to schedule loads, drivers, maintenance and repairs. You’ve got to keep track of things for taxes and CSA compliance. You’re tracking all those little invoices and receipts—from fuel purchases, to repairs, to maintenance.
Our entire industry needs to wake up. The purported driver shortage, driver pay, working conditions, and highway safety are all interconnected. To solve one of these problems, it’s necessary to address and resolve them all.
According to many studies on the subject, you’ve got fewer than 30 seconds to make an impression on someone. In business, this can mean the difference between losing, landing or keeping a customer. So, ask yourself, “What would impress me?” If the initial contact is by phone, then that impression is determined by the manner in which you handle the phone call.
- Do you answer the phone in a professional, business-like manner?
- Do you speak clearly and slowly enough so the listener has time to understand what you are saying?
The days of parking a truck in the lot and tearing down an engine are long past. Instead, the best course of action for the micro- and small motor carrier is investing time in finding, hauling and delivering loads.
There are no guarantees when it comes to making money as an entrepreneur. It’s a learning process that continues every time you pick up a new skill or knowledge. Each enterprise develops a life of its own, equally as true in trucking as in any other small business. The hardest lesson to learn is that it takes years to grow a start-up to the point where it’s generating a sustainable profit and enough revenue to cover costs.
The marketing approach that works in one location isn’t necessarily the method that will work in another. This statement is true whether you’re establishing a bricks-and-mortar retail business, a service provider, or a trucking company. Learning the uniqueness and similarities of a market is crucial to the success of any expansion into a new area.
The day will come when you realize that the multiple tasks required to operate and grow your small trucking company require more time and energy than one person can muster. In other words, it’s time to start building a sales team. So, how do you find the person who will represent your company, forge strong professional bonds, and help maintain, sustain and grow your company?
Driver turnover and retention in the trucking industry seems to be at an all-time high. The myth: Training more truckers will solve the driver shortage problem.
Putting more unsuspecting, newly trained truckers on the road won’t solve the retention problem. If any other industry had annual employee turnover exceeding 100%, industry leaders would demand major changes.
The fabrication: Some industry organizations and large carriers are perpetuating the myth that there’s a shortage of qualified, trained truckers.