Ahern Advisory Editorial - Driver Retention - Part II

I wrote an article on Driver Retention - The Unanswered Question. I received many telephone calls and emails from clients and readers. Many indicated that they thought the article was excellent and they passed it along to their staff.

Phoenix, AZ (prHWY.com) March 12, 2013 - Several weeks ago, I wrote an article on Driver Retention - The Unanswered Question. I received many telephone calls and emails from clients and readers. Many indicated that they thought the article was excellent and they passed it along to their staff. In some instances, some asked if I would write further articles for their consideration.

The more I thought about this request, the more I felt that it might be a good idea to review the driver situation in further detail, so that owners recognize that there are many ways available to solve this problem, if you become creative and are willing to change.

In my retention news article, I indicated that drivers do not leave companies, but drivers leave relationships for specific reasons. I noted that there will be an 80,000 driver shortage this year and it is contemplated that there will be over a 2 million driver shortage by 2018.

Obviously, these are depressing figures for our industry. However, if you don't want to become a statistic, if you don't want empty trucks sitting up against the fence, then you need to start thinking "outside of the box", and find ways to cultivate/keep good drivers.

The more I thought about this, the more excited I got, because I realized in the trucking industry, we unfortunately have the tendency to do what we always do.

* We place adds on the internet for drivers;
* We place adds in trade publications for drivers;
* We set up booths at truck stops to recruit drivers;
* We ask for referrals from our drivers;
* We provide bonuses to our drivers for referrals, but this all is generic recruiting.
* We don't think "outside the box".

I believe that knowledge is power and I continually state that if you want to reduce driver turnover;

* You need to plan your expenses to your profits; retention being a line item expense, and;
* You need a 1-year plan, a 3-year plan, and a 5-year plan to reduce driver turnover, and;

No matter how many times I say that , I am shocked when I speak to trucking company owners who indicate they are not where they need to be: they don't have a budget: they don't have a plan: and they keep complaining about the economy and driver issues. Complaining doesn't get more drivers in your trucks, complaining doesn't generate more revenue to reduce expenses; and complaining doesn't increase your "bottom line".


Therefore, let's start with the premise that the economy is in the toilet. Let's also recognize that 5 years after the start of the Great Recession, millions of middle class positions have been lost in developed countries all over the world, not just the United States.

What many of us don't recognize, it's not just the economy that has created the problems with the job market, it is that positions have been obliterated by technology. Each year computers and an array of machines and devices become more sophisticated and powerful, and capable of more efficiently doing tasks that humans have always done.

The point I am making is that the technology that is created by us is reducing our workforce. Thanks to technology, companies in Standard and Poors 500 Stock Index, reported 1/3 more profits in the past year, than they earned before the great recession, yet there were 500 million less jobs. Do you get the picture?

In the United States, 50% of the 7.5 million jobs lost during the Great Recession paid middle class wages ranging from $38K to $68K a year; many of these jobs are never going to return. So, the backbone of America, the middle class, as well as developed countries in Europe, North America and Asia are being replaced by technology. To me that spells opportunity, too.

* Locate drivers that have never been in our "space";
* Find people who genuinely want a new career and who are looking for job stability and benefits, and;
* Even though they have to go through a training period; even though they have to obtain experience, here is a way to cultivate, over time, a new market that historically is not being "tapped".

The irony of our situation is most jobs that were cut in the United States and Europe weren't moved, they vanished. These jobs are never going to come back. If you want to blame anybody, blame a clever software engineer working in Silicon Valley with a hi-tech hub around Heidelberg, Germany. My point; as we are replacing ourselves; as technology is becoming increasingly necessary in the trucking industry; the way in which you "harvest" and secure drivers has to change. The first step is to look for drivers in the non-standard markets. In order to do that;

1. You need a plan;
2. You need a plan to attract people that want to work;
3. You need to develop a plan where drivers want to work for your company;
4. You need to be able to demonstrate (as I stated in my first driver retention newsletter) that you care;
5. That you are looking for people who want a career and job stability, and;
6. You need to create the image of job stability, in a very difficult economic environment.

Trucking still has a stigma; but not the stigma it used to have. Technology can be a solution or a problem. It has played havoc in our industry, in reference to increasing cost, and putting many trucking companies out of business. But, technology can also work to our advantage. If you want to fill trucks; if you want to look for people that desire a stable work environment; then look outside your normal source. Some of the things that you can do to fill empty trucks; to attract 3rd parties;

* Look for fleet owners;
* Offer lease programs;
* Consider buying a small freight broker that utilizes small independent trucking companies to haul their goods and use that as a "spring board" to contact those carriers and ask them if they want job stability, by becoming part of your company;
* They can still operate as an independent, or;
* They can act as a fleet owner, but;
* You have "captured" capacity, and;
* You offer income stability; although this may not be Utopia, it is a way to stabilize and reduce costs and "address" capacity.

If you own a trucking or logistics company, you need to look at your business model; you need to continually change your business model; you need to adapt your business model to the way things are, not the way things used to be.

Many times you have heard me say, in the "old days" a handshake was good enough; if you buried your head in the sand and you worked hard, you got through your challenges. Unfortunately, today it's not that way. Trucking is complicated; it is much more difficult and you always have to focus in order to survive and prosper.

If I can impact anything to my readers, it's in order to grow and prosper in the trucking business, you need to constantly think and rethink your business model. You need to plan your expenses to your profits; and profits must be your first item of expense. Increasing your recruiting expenses doesn't spell long term success.

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Tag Words: trucking company

Categories: Transportation

Press Release Contact
Mr.Andre Ahern
CEO
2198 E Camelback Rd Suite 210
Phoenix, AZ
USA, 85016
PH: 602-242-1030
Claudia@ahern-ltd.com

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