The spot freight market is improving, as noted in the last post–in a 12-month period, the freight you find on your load board has improved by 54%. That’s a move in the right direction. But we still can’t jump to the top in one single leap; we must take it one step at a time. Here are the additional steps needed to continue improving your current hauling situation:

1. Develop that special niche—become the expert in the hauling niche you select. You need to be the “go to” company for anyone who wants the best and most cost-effective means to haul within your niche. A niche can be a product, a lane or a region. Study the trends of the market you serve carefully; then adjust to them as necessary.
2. Constantly be mining for new brokers and customers—with the current economic environment, a lot of trucking companies are still falling by the wayside. This presents an opening for your company to develop new hauling accounts.
3. Constantly be adding value—remember, as you’re out doing that mining for new customers, so is your competition. Your best protection from rate-gouging, bottom-feeding trucking companies, (and even from the other value-driven transportation haulers) is to constantly add value to the hauling services you provide your current customers. There will always be some trucking company willing to cut rates to the quick to steal your best shippers. The only way to stem this effort is by creating value in your services which exceeds your price.
4. Know your Break-Even Point—don’t ever agree to haul for less than what it costs you to operate. Once you start down the “But it creates cash flow,” spiral, it’s nearly impossible to reverse it. Pushing a boulder down hill is easy. Trying to get it back to the top is very difficult. The same is true with hauling rates.
5. Education and knowledge—when times are difficult and tonnage is slow, that’s the best time to catch up with new and innovative ways to do business. Anyone who thinks he’s learned it all will find himself scratching his head as the rest of the trucking world passes him in the hammer lane, blowing off his doors. Success comes from knowledge; knowledge comes from education.

In trucking, we know when times get tough, the tough get going. This is true no matter if it concerns the weather, the economic environment, politics or just the nature of competition within the industry.  We will always have the challenges of government regulation, attacks from organizations which don’t have a clue as to what trucking involves, trucking companies who don’t know what it costs to do business, or companies who will cut rates to steal business. For the foreseeable future, fuel prices will continue their upward trend and other trucking-related costs will follow. The trucking business isn’t for the faint of heart. It’s a very high-cost, low-profit margin business, but like any other dysfunctional relationship, it is addictive. Once the diesel has gotten into your blood, there is no cure. Keep in mind, like any other addictive dysfunctional relationship, to be successful in trucking requires a ‘tough love’ approach:

- Bottom-line boundaries which aren’t crossed,
- Knowing what’s fair and equitable in your hauling rates,
- Treating employees, drivers and customers with the same level of respect,
- Making sure your customers are not over-paying,
- Making sure you’re not underpaying your drivers or employees,
- And all while ensuring you’re making a decent salary for your efforts and your company is earning the needed profit for growth.

In short, trucking will always be filled with challenges. Trucking will always be needed to get the vital goods to the American public. Trucking is a noble industry worth our efforts. It’s not time to toss in the towel and give it all up. Grab them boot straps, look very closely at your trucking operation, and apply the tough-love steps where required.

Good loads and good roads, everyone.

Timothy Brady © 2010
www.timothybrady.com