THOSE WHO ASK, GET
In most rate negotiations, especially spot rate negotiations, we more times than not leave money on the table. Imagine this, what would happen if on every load you booked this year you asked for an additional $28? You’re probably asking, “Why $28?” My answer would be, “Why not?” Most customers/brokers are so accustomed to hearing the same old, “Can I get an extra $50, or $100” question that they say no without even thinking about it. However, when they hear a request for an un-round, seemingly strange dollar amount request, it catches their attention. It makes them think that $28 must actually be going towards something vs. the extra $100 most carrier’s often ask for without any clear reason. I strongly believe that if you start asking for an extra $28 per load above what your bottom-line number is, you’ll likely get it more times than not! I had a client implement this strategy and he saw an increase in revenue of 3% for doing nothing special outside of simply asking the right question!
BURNING THE MIDNIGHT OIL WILL BURN YOU OUT
Everyone involved in the trucking industry knows that the inbound phone calls from drivers, their mechanical breakdowns, the load events, and the revolving customer updates never just stop at the end of the workday. Whether you’re a new or established business, the constant burden of being on call wears you down. This isn’t what you signed up for!
You likely decided to start your own business with the vision of gaining professional and monetary freedom; not to become a slave to your own business. Unfortunately, the negative impact of your business is also negatively affecting you as an individual. I would assume with confidence that those late night driver calls are being answered less and less. Ultimately, causing driver turnover due to them feeling unsupported and underappreciated. But wait, it doesn’t stop there. Not only are you attempting to manage your driver support needs, but you’re also scrambling to handle your customer update emails over the weekend. Miss these customer updates and your service levels decrease, relationships are tarnished, and your business opportunities quickly diminish.
Let’s face it, your core competency is not taking after-hours calls (nor should it be). The greatest impact you have on your business is not created by you getting minimal sleep, being overworked, and resenting your business. Your business needs you at the office with a clear mind, positive attitude, and an excitement about growing your business. You need to prioritize your time and energy on the things you do best!
Staffing a full-time employee to handle all after-hours and weekend call support is a possible solution to this ongoing pain point. Although if you do the math, having a person dedicated specifically to after-hours can be expensive. And if you come up with the brilliant idea of assigning a current day-time employee to cover the night shift, I can assure you that when they receive an inbound driver call at 2:00 AM they’ll be in a deep sleep counting sheep.
But ok, hang-in there and take a deep breath, there is an alternative solution for you. Have you ever considered partnering with a third-party support team that is solely focused on managing all of your after-hours support needs? I would personally recommend Twylite Logistical Support, who is a leader in providing high-quality support around-the-clock. Third party support companies like Twylite are able to provide 24/7 After-Hours Call Support at an effective price point by leveraging the economies of scale they create through their client network. Most providers interface directly with your standard operating procedures and create a seamless transition between your regular daytime operation and after-hours needs.
Your drivers and customers will not notice a negative difference at all. In fact, they’re highly likely to take notice to the uptick in your businesses overall attention to quality support.
REMEMBER THE BIRTHDAYS
Within our program we talk all of the time about the “Driver Experience”. I can tell you with 100% certainty that there is a direct correlation between the “driver experience” and the driver retention rates within a company. Companies that firmly focus on creating a high-level driver experience for their drivers rarely have issues with retention. You NEED your drivers to love working for your company. If they do, then they will stay forever. Not only will they stay, but they will recruit other drivers for you! Now you’re not only saving money on retention efforts, but you’re also saving money on recruiting. Ultimately, it boils down to doing the little things. A practice I love to implement is to have a calendar, or a rolodex ,or something of that nature where you can keep all of your driver’s birthdays, their kids names, their hobbies, anything pertinent to that driver. On their birthday you call to wish them a happy birthday, ask them about their kids by name, ask them about their favorite sports team, etc. The key is to make that driver feel special and connected to the company they are working for. They need to know that their company cares about them. Do the little things and your drivers will stay with you for the long haul!
STOP COMING STRAIGHT HOME
You would think this strategy would be obvious, but I’m constantly amazed at how many companies still want to use the old school mentality of the “headhaul” and the “backhaul”. For the sake of this example, we’ll use a dry van carrier who runs dedicated freight from Minnesota to the East Coast, but doesn’t have dedicated freight out of the East Coast so they utilize brokers to get home. The strategy the client was using was to just “backhaul” direct from the east coast to Minnesota because they needed to get their equipment in position for their dedicated Minnesota loads. I can fully understand wanting to have equipment in position to service the customer, but what if we could still have that equipment in position but for 20% more revenue? You would do it in a heartbeat, right? Well here’s how we did it. This client was taking direct “backhauls” home from the East Coast for $1,250 ,shipping Monday and delivering on Wednesday. Remember they needed their equipment in position by Wednesday for their dedicated headhaul. Instead of coming straight back, we tried a different strategy. I asked, “Why don’t we take a one-day load from the East Coast to IL/IN to deliver Tuesday, then a one-day load from IL/IN to MN to deliver Wednesday?” That way our equipment is still in position when it’s needed. The client made some calls on the load boards and booked a load from PA to IL for $750 and a load from IL to MN for $750. Total revenue on the loads were $1500 vs. the $1250 they were previously taking on the direct backhaul. That’s an increase in revenue of 20%!
SET THE EXPECTATION
I learned a long time ago that an unmet expectation is never a good thing. There are a lot of companies out there that choose to make wild, outlandish promises about pay, home time, or anything they can say in order to lure people in. Most of the time, these promises are never met. By setting unrealistic expectations with your customers, employees or drivers, you create a “gap” between what the expectation is and what the reality is. Anytime the reality falls below the expectation you’ll have issues. If you’re consistently having driver turnover during their first 3 months on the job, then you likely have an “expectation” problem. You will need to correct the expectations that you’re presenting to your driver prospects. TELL THE TRUTH! If your company runs certain lanes, then market those lanes to prospects, not some fairytale that might possibly happen within the next 2 years. Tell them EXACTLY what they can expect for pay. Don’t give them the compensation numbers of your top performing driver cause more than likely this prospect will not live up to that level. The goal is to set reasonable, obtainable expectations with your drivers and prospects. You NEED to set expectations that allow your company to meet and/or exceed those expectations on a consistent basis. If you do this, then your driver turnover percentage will decrease significantly because the drivers feel that they are getting exactly what they were promised or even more.
ALL DRIVERS AREN’T CREATED EQUAL
Every single driver you have is different, so every driver cannot be treated exactly the same. Now don’t get me wrong, they all should be treated with the same level of respect and professionalism, but there also is an art to getting the most out of each driver you have. I always make the comparison to a coach of a professional sports team. It is the duty of the coach to get the full potential out of every player on his team. To do that, they cannot treat every player the same. Some players might need a finesse approach that calls for positive reinforcement and “stroking”. Some players may need a harsher, stern approach to get them motivated. The point is, you need to have a firm understanding of what motivates each of your drivers. The better you understand the underlying needs of each driver, the more production you’ll be able to get out of them. If you can get each player to get as close to their full potential as possible, then you’ll have a championship team!
It’s an undeniable fact that technology will continue to play an increasing role within the transportation industry. If you haven’t already started utilizing technology then now is the time. Because, you better believe that your competitors are! Transportation Management Systems (TMS), routing systems, GPS tracking, Electronic Onboard Recorders (EOBR), and in cab cameras are just a few of the pieces of technology that can be used to increase service levels while decreasing costs and office headcount. Here’s a great example of how utilizing technology can easily reduce your operating costs; say company driver “Dave” runs a specific lane that he has been running for years. He’s set in the route he takes and the fuel stops he uses. Let’s say for example the route Dave takes is 1150 miles and the average fuel price is $2.60/gallon. The company decided to employ a routing software that ended up shaving 55 out of route miles off each load and also identified a fuel stop where Dave could save $.15/gallon. The annualized cost savings on the out of route miles and fuel alone would be $7,803! This is a great example of how the utilization of technology can increase your bottom-line.
“Those who don’t measure, don’t want to be held accountable”. I can’t stress enough how important it is to measure, benchmark, and create scorecards for every area of your business to ensure that you reach your strategic objectives. Measure customer and driver satisfaction, turnover, revenue, loads, employee performance, etc. Here’s a practical example of how to track driver performance; measure how many miles each driver is turning each month. How much revenue are they creating? Did they have any safety violations? You can then leverage that data to make sure the drivers are meeting the goals you set for them. If they are falling short, then you can put an action plan in place to help improve the driver’s performance.