Owner Operators - The Grapevine
Planning Saves Money
Did you know that the trucking industry provides for 1 out of every 14 jobs in California? In 2006, the average load nationwide weighed just above 12,000 lbs and only traveled just under 600 miles. The average truck in California paid an average of $9,007 in taxes and fees, which is the sixth highest in the nation. Did you know that truckers paid 48% of the total tax revenue collected in California? Once again, that is why it is so important to start thinking about how you are going to improve your revenue this year and cut your costs by 5%.
We know that in the early months of the year, the available freight is down. So, what do you do?
Do some checking with your shippers, brokers or the trucking company you are currently leased to. Find out what their projections are for the year and what their solutions are to keep you on if the freight remains low. Look into other traffic lanes. For instance, you may like the LA to OAK traffic lane, but now you may have to check to see about running from LA to SEA, or in the other direction to LV or PHX. Be sure to take into consideration the weather season you are in.
What about trucking rates? Can you still depend on fuel surcharges? From reports within the shipping and logistics community, shippers are expecting higher costs. They know that shipping rates have remained low compared to their other costs. They are moving away from truckload shipping. In fact, truckload percentages have dropped almost 5% in the last three years. Shippers and logistics companies are doing everything in their power to roll the fuel surcharge into the base hauling rate, so knowing your costs and your break-even point once again becomes even more crucial.
Finally, what can you do to stand out in the crowd of competitors? After all, why should anyone pick you to haul their freight? What makes you better than the rest? Don't forget with shippers, logistic companies and other trucking companies doing everything they can to keep hauling rates down, today's truckers are going to have to be more inventive and creative to remain competitive.
One suggestion to set yourself apart is to have everyone in management take an applicable official US DOT training course at the NTA online Institute at www.ntassoc.com. One, the courses can be done 24/7, 365 days a years and, two, you can boast that all your management team has been trained and holds certificates from the US DOT through the Transportation Safety Institute.
This fact holds true for the owner-operator as well. If I was a safety manager for a trucking company and needed to put on an owner-operator, there is no doubt in my mind that I would pick the owner-operator with documented training over any other owner-operator.
Simply put, hauling freight the same way you always have, while expecting better results than last year will put you in the poor house. Start looking at what your customers want, not just at what you think they need. Look at what your shippers' needs are and what they want. Shippers need trucking companies to be in compliance with a satisfactory rating. They need on-time pick-up and delivery. They may even want greater control over increasing costs.
In 2007, you will have to be more flexible and have a quicker response. Your goals should be working directly with the shipper to develop a better load planning strategy so that you don't run out of hours. Have a preplanned load already set up for the backhaul.
In short, always think of working with, and not against, your shippers, receivers and other trucking companies.
New Fuel Savings Program through NTA Website
Small trucking companies can make sure the rubber meets the road while saving money and reducing pollution with a new loan program that will help pay for fuel-saving technologies. The Environmental Protection Agency (EPA) is partnering with the Small Business Administration (SBA) to make loans available to purchase Smartway Upgrade Kits.
This program helps small truckers finance these kits which include idle-reduction devices, low rolling resistance tires, aerodynamic equipment, and exhaust after-treatment devices. The kits can improve truck fuel efficiency by 15% and save more than $8,000 in fuel costs annually, while significantly reducing emissions of soot and nitrogen oxides. This program coupled with our no transaction fee Fuel Card Rebate program will really increase your bottom line.
Small truckers can now borrow from $5,000 to $25,000, with no collateral, and an easy online or telephone application, and flexible load terms.
Information is available at www.ntassoc.com. Simply click on "Industry Links" and scroll down to the Fuel saving Technology Link. Don't forget to check out the Fuel Saving Calculator as well.
FMCSA Proposes New Entry Standards
The Federal Motor Carrier Safety Administration (FMCSA) has proposed new rules to toughen the entry into the trucking business. Under the proposed new rules, would-be carriers would have to comply with eleven (11) rules that the agency believes are essential elements of safety management. If an applicant did not comply with any of the 11 rules he would fail his audit.
FMCSA Proposes New Rules on Medical Card
The Federal Motor Carrier safety Administration (FMCSA) has issued a long-awaited proposal to merge information currently on the medical certificate with the commercial driver's license (CDL).
When the proposal is finalized and after a prescribed phase-in period, CDL drivers would no longer be required to carry the medical examiner's certificate. Their certification status would be verified electronically. Motor carriers would no longer be required to maintain the original or a copy of the medical certificate in each driver's qualification file.
For non-CDL drivers, the requirements would not change and drivers would continue to provide the carrier with a copy for their driver files.
We will try to keep our readers updated on all these proposed rules in the future.