Leading your trucking company through tough times

These are tough times. In a recent issue (February 22, 2016) of the Journal of Commerce, the headline was “Is the US in a Freight Recession?” If a freight recession is defined as two or more consecutive quarters of year/year declines in freight volumes, parts of the US and Canadian transportation economy are certainly there. While we aren’t back into the Great Recession of 2007-2008, there has been a pronounced slowdown in business activity. Trucking industry executives confide that business volumes have tapered off.

This is when leaders are put to the test. Here are some thoughts on how to lead an organization through tough times.

1. Be visible and communicative

Don’t hide in your office all day in closed door meetings.  This is sure to unnerve your employees. Be visible and try to maintain a “business as usual” demeanor. Employees pick up on every change in behavior by its leadership team.

2. Promote a positive work environment

Employees read the same magazines as you do and notice if there are fewer shipments on the dock or less loads to move. They worry if their jobs are secure. Maintain the employee lunches, bar-b-ques and pizza days. Don’t mope around all day with a “woe is me” attitude. Be engaged and positive.

3. If you need to cut staff, be decisive

Explore all options before cutting staff, especially long service employees who have been productive and loyal to the organization. Explore reduced hours before staff reductions. This will allow you to retain these good employees until conditions improve. If staff cuts have to be made, be decisive, get them done and move on. Don’t engage in a drip, drip, drip process spread out in waves over various weeks and months. This is a sure way to distract your people from securing freight or moving freight and get them thinking about looking elsewhere for employment.

4. Be thoughtful about where to cut costs

Some companies will seek to eliminate costs that are deemed to be discretionary or of a lower priority. These may include sales staffing, sales or other forms of training, advertising and marketing costs. Remember that many of these activities take time to produce benefits. Cutting sales people and spreading the workload over fewer account managers or cutting back on training will have long term consequences. Reduced sales coverage or less well trained staff will ultimately lead to lower revenue. Cutting back on service will ultimately lead to unhappy customers. It is important to remember that it is costly and difficult to replace established, loyal customers.

5. Identify and execute the key elements of your Business Plan

Identify the key elements of your Business Plan and execute the plan in a focused and diligent way. Don’t take your “foot off the pedal” since this will surely result in lower revenue or higher costs.

Freight recessions, if they truly exist, do not correlate directly with economic recessions. The Cass Freight Shipment Index has declined year/year in the United States for two consecutive quarters nine times since 1991, a period in which the U.S. saw only three recessions. The bottom line is that ebbs and flows in freight volumes are common over time. There are indications on both sides of the border that business levels are now on the rise. The American Trucking Associations reported that truck tonnage increased by 7.2 percent year/year in February.

Trucking company leaders need to “keep their cool” during slower periods, maintain their focus and the morale of their team. Crisis management can be learned and is a skill set of successful business leaders.


Dan Goodwill

Dan Goodwill, President, Dan Goodwill & Associates Inc. has over 30 years of experience in the logistics and transportation industries in both Canada and the United States. Dan has held executive level positions in the industry including President of Yellow Transportation’s Canada division, President of Clarke Logistics (Canada’s largest Intermodal Marketing Company), General Manager of the Railfast division of TNT and Vice President, Sales & Marketing, TNT Overland Express.

Goodwill is currently a consultant to manufacturers and distributors, helping them improve their transportation processes and save millions of dollars in freight spend. Mr. Goodwill also provides consulting services to transportation and logistics organizations to help them improve their profitability.

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