While there has never been a better time to start your own trucking business there also has never been a more regulated and potentially hazardous time to do it either.
Technology makes it possible to gain access to information. tools and resources to help you start, build and grow your business that was unimaginable just a few years ago. Those same technologies make it easier than ever for DOT and other regulatory compliance agencies to enforce their rules and regulations on far greater numbers of motor carriers than ever too.
All trucking companies large and small need to be aware of what they need to know and then have effective management control systems in place that protect their business, their people, themselves and the public all at the same time. Those who are oblivious and otherwise cant or won’t get their act together – well let’s just say that sooner than they may expect DOT will be at their door and when they leave it will be a very painful and unpleasant learning experience.
Some will be shut down.
Others will survive – but the fines and the additional costs they will incur will make it difficult to truly be profitable for years. There are also other factors they will suffer from related to failing a New Entrant Audit or a Compliance Review. These things include loss of certain customers who will not allow them to haul their freight, increased insurance rates, and far greater exposure to potential litigation – even if the accident (crash) is not the fault of the motor carrier at all. A bad safety and compliance record will make such a company far more difficult to defend and a far more desirable target for opportunistic litigators when the opportunity presents itself.
So What Should You Do?
The first thing I recommend you do is to get some education on precisely what the DOT requirements are and take immediate steps to ensure you are fully in compliance. The risks of fines and possible loss of authority along with all the other negative repercussion make this a huge priority. Avoiding the problems to begin with is far better and far less expensive than having to try to fix problems after the fact.
Beyond that, the regulations are the MINIMUM requirements.
There are a number of things you can do and practices you can immediately implement that will not only help protect you and your company – but that will also dramatically improve overall productivity and profitability. Not to mention you will sleep better at night and have far less stress during the day when you know you are running a tight ship and that everything is being handled better than good.
Your insurance company will love you for it too – and more importantly, they will very likely offer you substantially better rates. Even as a single owner operator operating a single unit the savings can be dramatic – but for a fleet – the number of dollars in savings increase dramatically. This money saved, every dollar of it – all goes right to bottom line profit. The amounts can be huge – thousands and even tens of thousands of dollars per year.
Other Benefits Of Great Management Control Systems
When you follow best practices you will also enjoy less driver turnover and all the benefits that come with that. Think about how long it takes from the day you lose a driver and a truck becomes empty. How long does it take to find, recruit, screen, in-process, onboard and complete the hiring process all the way to the day you can dispatch that new driver on his or her first run? What are your actual numbers (be honest with yourself) 30, 45, 60 or more days?
Now add up what that empty truck would have generated in revenue during all those days it sat idle and empty. Next, calculate the net profit you lost. Multiply that times the average number of trucks you usually have empty (or the exact number you have empty now) and look at the number.
That’s all lost profit, that once missed is gone and is gone forever. This is not theory – it is REAL MONEY!
Imagine if you were to withdraw that amount in cash and set it in the middle of your conference room table to get the point across to your executive team and front-line managers. Imagine what that would look like – though in reality you probably don’t want to literally do that for safety reasons. The point is these are not just numbers on a report or sheet of paper. It is your profit – real hard earned dollars and cents that can all be retained and used to improve and grow your business instead of just letting them be wasted.
Implement better systems and you can keep and use all that money as you see fit.
Your accident rates will decline. A new driver is always an unknown quantity to a certain extent even with excellent screening and in-processing practices. By reducing that unknown you reduce your risk. That makes your insurance company happier and as a result, they will be more likely to reduce your rates and make you happier too.
There will be fewer customer service problems and headaches for your dispatchers, customer service people and even your shop personnel along with the rest of your staff. Even the greatest drivers and hardest workers have to learn the ropes and that takes time and effort. They will also make mistakes as they learn – that’s the nature of the business and of life in general. Yet the drivers who are already with you have already learned all these things – they know the ropes – and they need less supervision. They perform better and more efficiently, so their productivity is higher and so is your profit. Keep your drivers happy and with you by understanding them and their needs and then taking excellent care of them so they don’t leave. There are ways to do this – if you take the time and effort to learn them and then train your entire staff to do the things they need to be doing. More money and fewer problems is your reward.
I can go on and on about all the benefits of running your company better – but I think you get the idea. There is one other major benefit I will mention though and that is satisfaction. Call it what you will – but when you run a highly productive and efficient operation that is profitable and consistently so in all areas life is just better. Fewer headaches, less stress, less worry, more confidence and all that makes going in your front door every morning something to look forward to instead of something to dread.
If you are interested in learning more about how you can start improving your trucking business visit us at www.ldsewell.com and send me a message requesting a Free Consultation.
I will also be conducting a live workshop in Richmond VA during the last week of June 2018 which would be an excellent opportunity for you to get a ton of information in just a couple of days – along with 30 days of included follow up support. Let me know if you are interested in attending and I will email you a registration link as soon as we post it.