Considering fleet ownership

If you are a manufacturer with steady and high-volume shipments and are analyzing your carrier service levels and costs, you might be surprised at the potentially lower performance results for-hire carriers generate.

We know the recent disruption in trucking services – described as a ‘capacity crunch’ – has caused rate volatility, while an increase in freight volume is bringing a decline in service levels. At the same time, the industry faces a greater challenge, with the implementation of mandatory electronic log devices in the US limiting the hours a driver can legally run.

How do you avoid all these trucking services pitfalls? Some would have you believe there’s only one way: adjust to the reality of having to pay more for freight movement, accept slower delivery times, and hope the carrier isn’t farming out your shipment to a less-than-desirable trucking partner.

That’s a worst-case scenario, of course, but even if you have a strong partnership with an efficient, reliable trucking company, there’s a reason to explore your options. Do you have a good handle on the movement of your goods, the management of costs, and the service levels being provided to your customers?

I’m here to tell you that to gain that “good handle”, on things you might need to explore the concept of fleet ownership. “Wait, what?” you say. “Own my own trucks? Are you crazy?”

Well, no one would dispute that with truck fleet ownership comes great responsibility. There are compliance requirements, and truck ownership may bring you fiscal and legal exposure. Units need to be sourced and decisions must be made about engine types, capacity needs and the technology tools you’ll use to monitor both mechanical fitness and operator behavior.

But you don’t need to panic. The power unit buy is a standard practice for most for-hire and private truck fleet owners. Once the costs are established, it’s quite a straightforward investment, with the specifics about truck types and performance data tried and tested.

Just don’t forget that part of the market value proposition is the drivers.

Buying and maintaining trucks is the easier aspect of fleet ownership. To hire, screen, train and monitor drivers, you need to invest a significant amount of time into the assessing applicants – on an ongoing basis.

That’s because every time you put someone behind the wheel in a truck that bears your company name, you’re putting your company name and reputation at stake.

So, the most important goal is getting good drivers. Trucks don’t drive themselves – yet! Did you know that most incidents involving trucks are not mechanical, but are caused by driver behavior, including speeding, distracted driving, fatigue and impairment?

To reduce risk, look for safety-conscious, experienced and professional drivers. Or, get someone else to hire them.

A good hiring agency will screen drivers through extensive license validation, driving history reports, employment reference and verification, skills and experience screening, communication and work performance evaluation, road testing and detailed background checks.

It can also navigate staffing-related government laws and regulations for you.

For example, new regulations that went into effect on Sept 1st in Canada, will potentially affect 904,000 workers in federally regulated sectors, including trucking, bringing changes that mandate personal leaves and longer bereavement periods and vacations.

As Inside Logistics reported, employers have asked Ottawa to make exemptions or delays to these major potential changes to the Canada Labour Code. Hundreds of thousands of employees and bosses are unsure whether they are fully covered – and might still be wondering beyond the federal election on Oct 21st.

An established leader in the driver placement service industry will keep a close eye on such pressing regulatory and HR issues, in addition to providing appropriate testing and training. Such a firm also has expertise on fleet compliance processes and driver retention.

In the end, outsourcing fleet driver services can let you focus on your business goals of freight movement, expanding markets, and core product and service innovation. While it may not be for all firms, every firm should at least consider it.