Truck News

Blog

It’s a good time to be small


The trucking industry is booming, and small carriers are potentially the biggest benefactors. Looking to the U.S., small fleets are growing while larger fleets are not. Speaking at Newcom’s Surface Transportation Summit Oct. 10, Stifel Financial Corp.’s David Ross pointed out that small fleets are increasing revenue, while larger fleets are seeing a decline.

“Large fleets have been shrinking for some time, partially because they got too big and most of them didn’t make any money,” he said, noting how many turned to asset-light options like brokering trucks and warehousing.

In September, I attended the FTR Transportation Conference in Indianapolis, Ind., and there was discussion there as well about the improved outlook for small carriers. Finding and keeping drivers is the name of the game, and in a strong market, small fleets have certain advantages on this front. They can offer more perks to drivers, create family environments, and focus exclusively on driver-friendly freight and not have to chase skids from major retailers.

“Retailers that allow their operations to hold drivers for six to 16 hours are abusive in today’s environment and it happens every day in retail,” said Jeff Tucker, CEO of freight broker Tucker Company.

There were also accounts of shippers – desperate for capacity – going out in pursuit of small fleets that can serve as “one lane wonders.”

“If you have some dedicated runs like we do, and if you can match them with a niche carrier where that lane becomes meaningful to them, it’s a great opportunity,” said John Janson, director of global logistics for Sanmar. “Last year we added three different sets of one lane wonders where my transportation team has put their sales hats on and they’re out finding these carriers.”

Large shippers seeking out small carriers…how times have changed. Back at the Surface Transportation Summit, I moderated a panel discussion on success strategies for small carriers. The panel consisted of: Leanne Quail, Paul Quail Transport; Brian Taylor, Liberty Linehaul; and Doug Sutherland, Sutco Transportation Specialists. All said they are enjoying improving rates and more demand than they can keep up with. The key, they agreed, is not to lose sight of your core customers.

“There’s a lot of people asking for us to do business now, and I think you don’t want to chase that,” said Sutherland, whose company is focused on the forestry sector.

He said small fleets are at an advantage in prosperous times, because they can be more agile decision makers and can offer a driver-friendly workplace easier when every employee is known by management on a first-name basis.

Taylor said Liberty Linehaul has been approached of late by large Fortune 500 shippers, looking for capacity, and asking how they can become a good customer. This is something only the mega-carriers had experienced in the past.

Another thing small fleets have going for them is that technology is offering them the ability to cost-effectively offer services to customers that previously only the large carriers could provide, including real-time visibility of freight. Only a few years ago I wondered if the small carriers could survive without the IT resources enjoyed by the big guys. However, I now see technology as the great equalizer, and not a competitive disadvantage, thanks to the arrival of well-designed, simple apps and other tools that are now more cost-effective than ever to deploy.

I think everyone would agree it’s a good time to be a trucking company – and the buoyant moods I observed among carriers at both the conferences I recently attended would support that. It could be that it’s an even better time to be small.


James Menzies

James Menzies

James Menzies is editor of Truck News magazine. He has been covering the Canadian trucking industry for more than 15 years and holds a CDL. Reach him at james@newcom.ca or follow him on Twitter at @JamesMenzies.
All posts by

Print this page


Have your say:

Your email address will not be published. Required fields are marked *

*