Truck News


Efficiency gains must come from partnerships

It goes without saying that all businesses - regardless of their size or the nature of the industry itself - need to be as efficient, productive and service-oriented as they can be to survive in today...

It goes without saying that all businesses – regardless of their size or the nature of the industry itself – need to be as efficient, productive and service-oriented as they can be to survive in today’s competitive marketplaces. It is also true, though often overlooked, that the performance of suppliers of goods and services to those companies can and do have a major impact on the efficiency and productivity of their customers. It follows then that maximizing efficiency, improving productivity and meeting or exceeding ever-increasing service and quality demands from customers cannot be achieved without co-operation from and a true partnership between the suppliers of products and services and the buyers of the products and services.

Nowhere is this perhaps more evident than in the relationships between shippers, receivers (and their third-party service providers) and their motor carriers. In the end, shippers establish what level of service they require. A carrier that cannot or will not meet those demands is likely to hear from the disgruntled shipper and perhaps even lose the business.

Carriers want and need shippers to succeed. If companies are not manufacturing, selling or buying things, there is no reason for carriers to exist. But, carriers can also help shippers meet their business goals. There’s a lot riding on the trucking industry. The interdependence between all parties involved in the transportation and distribution of final products and/or business inputs is a fact of life. The inter-relationship between those parties is an essential component of each other’s business success. So, you’d think that everyone would realize that it is in the parties’ mutual interest to work together. But, do they? This is after all, the transportation business.

How is the relationship between carriers and their customers? Are all the parties working together all the time to improve and optimize their mutual business performance? While it would be a mistake to over-generalize – as with most things there are those that do an exceptional job and those that have a ways to go – the feeling amongst many carriers is that there needs to be better communication between carriers and their customers/consignees. The carriers are concerned about delays in loading/unloading at shipping docks. They are concerned that drivers are being de-motivated by the less-than-considerate treatment they sometimes endure at certain shipping/receiving docks. They wonder sometimes if the shipper realizes that what they do or don’t do can have as much impact on the efficiency and productivity of the distribution system as what the carriers do or don’t do.

Many carriers feel they could enhance their service offerings if they were afforded the opportunity to get to know the shipper and his/her business better. And, they think it would help if more shippers and receivers took the time to understand the carrier’s business too.

Is it really true anymore that carriers are a dime a dozen, that if this carrier doesn’t take the freight, someone else will? Is freight transportation really just a commodity? Maybe in some people’s minds. But, the glut of capacity that was a feature of the trucking industry in recent times appears to have dissipated. Who has the equipment, who has the drivers to service your business? Can you really afford to lose your primary carriers?

The carriers certainly don’t feel that what they provide is a commodity. They want to be a business partner to their shippers, not just another supplier. They want to maximize their profit, too. Like all businesses they have bosses, shareholders and lenders to satisfy. They want – no they need – to be able to pay their drivers a decent wage. They need to be able to re-equip their fleets. They need to cover the increased cost of fuel and insurance. They need to play by the rules and regulations as established by government. Before the shippers reading this say “Yeah, don’t we all?” stop and think about it. How can improving communication aimed at boosting efficiency, productivity and service do anything but help?

As with most relationships, this is not a one-way street. While a more open, communicative and co-operative approach from some shippers, receivers and consignees would be appreciated and would contribute to a mutual advantage it is also evident that more carriers need to demonstrate their willingness to work together with their shippers. It is not enough anymore to complain to other carriers, the associations or whomever about low rates, increases in fuel and insurance costs, or about the treatment you are receiving at such and such distribution centre. You need to take action. You need to know your costs. You need to look for ways to reduce costs and if that means convincing the people you haul goods to or from that there is a better way, then you need to tell them. As we head into 2003 we need to recognize that without co-operation amongst all the parties in the distribution chain, further efficiency gains will be harder to come by. There’s surely little if anything left to squeeze out of carriers. Here’s to working together.

David Bradley is president of the Ontario Trucking Association and chief executive officer of the Canadian Trucking Alliance.

Truck News

Truck News

Truck News is Canada's leading trucking newspaper - news and information for trucking companies, owner/operators, truck drivers and logistics professionals working in the Canadian trucking industry.
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