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| I like putting pencil to paper when calculating changes to my business plan. Somehow writing everything down in longhand makes the figures stay in my mind better which helps out a great deal when a decision needs to be made on the "fly". |
As we enter into the New Year, the final ELD mandate is on track to be fully implemented by December 2017. Fuel prices are on the decline and expected to stay low for the near future. A major political disruption in the Middle East seems to be the only force that could change the current fuel pricing structure. In 2015, many in our industry referred to this last year as “The Year of the Driver.” Part of this was due to the ongoing driver shortage/driver churn which is a subject all in its own for another blog. Driver pay became an important factor in retention as well as recruitment. Also, how drivers are being paid became an important issue as well. For example: paid detention time, fuel bonus and other performance based pay systems. I myself became more involved in driver training last year as a means to assist companies on improving their return on investment in new technologies. What many carriers are learning is that ongoing driver training is more important than ever to extract the maximum benefit from today’s technologically advanced semi trucks. The days of simply handing a driver the set of keys to a new truck and saying “goodbye” are coming to an end. There is much more to consider today if you want to get the highest return on investment.
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| Keeping the pencil sharp for 2016 |
Looking forward into this New Year has made me reflect on the past year and calculate figures for the next twelve months ahead. Today I sat with paper and pencil and put numbers to paper. Many people today like to put this on a spreadsheet however for me I tend to remember the figures if I actually write them down instead of type them into a form. This afternoon, I worked on fuel mileage numbers in order to take a look at our changing fuel prices and how they will affect my business going forward into the coming months. For a large portion of the trucking industry, fuel surcharge had quietly become a profit center for many carriers. With the national diesel fuel price index being today at 2.235 and dropping changes the balance point between fuel efficiency and productivity. One change you won’t see is the importance of maximum profitability. On my next blog, I will share the results of my figures and discuss just how these fuel price changes can affect our bottom line.
This year should be an interesting year as carriers begin to implement electronic logging devices for the upcoming mandate. I wonder how long it will be until a “time surcharge” gets put into effect. This is much like how a “fuel surcharge” became implemented when fuel prices escalated for everyone years ago. Another option may be that shippers and consignees will find new and innovative ways to load/unload our trailers in an efficient manner. This could be a bumpy ride for all involved as we navigate through these changes of which is one of the largest since deregulation of the industry. Speaking of bumpy rides, with fuel prices being at record lows could this be a good time to push for a fuel tax increase? Many of us as drivers understand the condition of our nation’s infrastructure and how we desperately need repair, replacement and other improvements. This would be a great way to fund our highways and is an easy cost for us to recover through fuel surcharge. The alternative would be to add more toll roads which are much harder to pass along to customers.
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Finally, parking is still in the headlines. Parking is finally beginning to have a value as many locations are charging for a portion or all of their parking spots. Having a value attached to a parking spot could go a long way towards ending the parking shortage which has plagued us for years.
I would like to wish all of you a Happy New Year and let’s make 2016 the best year we have ever had.