Now's the time to take stock of your operation
Where's the light to lead us out of this cave of declining shipments, moribund revenue, and rising fuel costs that began as far back as the fall of 2007? It's time to reevaluate where you're hauling, who you're hauling for, and what you're hauling. A hauling sector, as it's known, can be anything from the lane you haul in, to the products or industry you're concentrating on, to the individual companies for whom you haul.
Here are the tough questions for which you'll need answers:
Is it possible your trucks are headed in the wrong direction? Your outbound loads need to be headed to destinations where reasonable paying returns are available, or your outbound revenue must pay for the complete round trip.
Have you become complacent and routine in the routes you run? You must invest the time necessary to keep tabs on your customers, their industry and other peripheral industries that may affect your company.
Is there an area or lane where growth is occurring that could fill the gaps within your current business? Keep your ear to the ground and know what's going on around you by tracking any lane your trucks might travel for those opportunities.
What is the prospect for growth in your lane or lanes in the near future? Know what emerging, relocating or expanding industries are developing along your service area lanes.
Are you able to maintain the needed cash flow while waiting for tonnage levels to increase? With increased costs and declining revenues, be sure to follow the money.
Are you aware of the financial health of the companies for whom you're hauling, as well as what the growth opportunities are for those companies? Look for trends that may indicate trouble, i.e., labor problems, foreign competition, new government regulations or declining market share.
As we emerge from this recession, many of the declining freight sectors will begin to reemerge. Be sure you keep tabs on these hauling opportunities and how they fit into your new plan.
As you evaluate your current business (and by the way, it's suggested you do this once a quarter), a picture of the state of your hauling business will begin to appear. If that picture is bleak, dark and foreboding, it's time to take action.
Lack of action will give you status quo; spinning your wheels will put you further into financial peril. But doing a precise evaluation of your current procedures and customers will help you find that glimmering ray of light, so you emerge from this great recession ready to take on the new economy.
Here's to good loads and safe roads in your future.
Contact Tim Brady at 731-749-8567 or at www.timothybrady.com