According to the US Federal Highway Administration, 12% of truck delays are caused by severe weather. Weather related events overall cost trucking companies up to $3.5bn a year, and there doesn’t appear to be an end to weather related losses in sight.
Growing your freight broker business can seem daunting. You probably landed your first few clients fairly easily: you had industry connections and were able to negotiate solid contracts. Those first big customers were enough to launch you on your own.
Now that you’re established and have your existing customers solidly managed, you probably want to keep growing your business. This is going to take a bit of ingenuity and creativity on your part, but fear not; we have some proven tactics that you can implement now to help grow your business.
As we all know, generating leads doesn’t just happen. There are a few things required to earn qualified, quality leads.
Know Your Value Proposition
Don’t just tell people what your business does. Tell people why your business is the best at brokering.
Why did your first few customers originally go with you? Probably because you offered something their existing primary freight broker couldn’t. This might have been because:
- You were the most reliable contact to reach by phone.
- Your customer service was exceptional.
- You knew the industry better than anyone else they were dealing with.
- You connected them with a reliable carrier who is always in their area.
You personally provided exceptional value and someone wanted to work with you regularly because of it.
What was that thing (or things) you did so incredibly well? Feel free to even ask your best clients what’s so great about you. In fact, ask them for an answer in an email or by messaging them on LinkedIn. If you have a personal reference or testimonial in writing from satisfied past or existing clients, you have a concrete reference.
Just how important are these testimonials that express your unique value proposition? Here’s some food for thought: according to one Hawkeye study, 71% of B2B buyers in the awareness stage and 77% in the evaluation stage cited them as the most influential types of content.
Tip: Make certain you know exactly what your value proposition is, because it’s going to matter in this next step.
Present Your Value on Your Company Website
Do you have a website?
If the answer is yes, skip these next two paragraphs.
If the answer is no, why? Every single business should have a website, even businesses in logistics. Buck Ballard of The Trucking Podcast puts owning your own website as a high priority in this day and age: “You got a business, you need some real estate.” Websites are the new business card.
It’s easier than ever to have your own website. Services such as GoDaddy and Wix have free website templates to plug your content into. Free websites will have some restrictions, but if a website is acting as a placeholder for your company info, then don’t worry about it. If those restrictions bother you, then there are plenty of web designers out there for hire that will design and maintain a website for a fee. If you don’t have a website, get that sorted out now.
A web presence needs to include your value proposition, contact information, and a lead capture form. Make certain your website is easily accessible: it’s on your LinkedIn Profile, it’s on Facebook, on your Twitter bio; everywhere.
First, you want your value proposition in front of people. Carriers and shippers will work with you because you provide something exceptional. Remember those written references from your best customers? Ask if it’s ok for you to include a quoted testimonial from it on your website.
Second, your contact information needs to be prominently displayed on the website. As mentioned earlier, websites have essentially replaced business cards. Whatever you would have included on a business card, make certain it’s on the website.
Finally, make certain you have a lead capture form to collect a name, company name, email, and phone number. If you want any other information, you can add more fields. Most website templates include contact forms which can work as lead captures for your small business. It serves the purpose, as you’ll receive notifications to your inbox when someone sends you a contact form with their information.
As business owner and CEO, Donald Miller is quick to point out in his book, Building a Story Brand, a person’s email is one of the most private things they could give you. It’s their direct line and they aren’t keen on handing it out for nothing. In order to make leads feel comfortable giving you their contact information, give them good reason with your value proposition on the company’s website.
This takes some leg work, but it’s worth it.
First form of outreach: ask for referrals from your existing clients.
Make it clear that you are expanding your business because your resources have grown, not because you’re going to negate on the excellent service you’re providing. If your client enjoys working with you, ask them to pass along your contact info to others in their network.
This is where the website and lead capture form will come into play. Your clients will forward your website to those in their network and that new potential business will fill out your contact form.
People are incredibly uncomfortable handing out the contact information of others—I won’t hand out any of my friend’s information. However, we’re all quick to send a friend a business’s website. A friend of mine has been seeing a chiropractor for 20 years, so when I said I was looking for one, she messaged me the business website. I checked out the therapies, called to make an appointment, and now I have a chiropractor I’m very happy with. Since she trusted this business, I was willing to trust them too.
Second form of outreach: you may need to cold call. (But do your research first.)
No one likes cold calling, which is why LDI helps you set up your cold call process. Our agents receive a 90-day onboarding guide which includes step-by-step and scenario-by-scenario call scripts to find new prospects. Whatever the situation, you will be coached and prepared with call templates and guidelines to steer the conversation towards securing new customers.
Need More Help?
Start with these three things to improve your lead generation:
Be able to sell yourself: knowing what value you offer to this industry will help you secure customers and partners whose values align with yours.
Display your value proposition clearly: a website that says who you are, what you do, why you’re the best at doing it, how long you’ve been doing it, and how others can contact you will make the right impression. A website says that you mean business and you’re here not only to stay, but to grow.
Reach out: Ask your clients and partners to pass along your contact information to others in the industry. You’re looking to grow your business and want your best customers to pair you up with other fantastic customers. Short of that, pick up the phone and start calling to find other amazing businesses to work with.
Ready to start putting these freight broker lead generation tactics to use? With the help LDI’s savvy, experienced team, our handy onboarding guide, and our industry-leading technology, your freight brokerage will be on its way to becoming a lead generation machine.
Demand for transportation is up, but the margins always seem to be shrinking. How is it possible to make a profit when margins are so thin?
No sweat. There are a few fast ways to increase your company margins during these changing times. We have a list of the 3 best practices to get more out of your small trucking company and even take advantage of the bright future ahead.
1. Leverage Industry Relationships
A surefire way to increase profit margins is to actively engage with those you do business with. Pick up the phone and start a Joint Business Planning discussion. Talk with your closest partners so you both come up with profit goals that align with each other. When one of you achieves, you both achieve.
SMB Business-to-business expert Francesca Nicasio reports that having a discussion with your partners can produce more cost effective outcomes than not. By inviting vendors to think of you as a partner, they’re more likely to help improve your workflow and suggest ways to streamline your business.
Joint Business Planning can benefit you and assure your partners you’re serious about the health of your business. A logistic broker who treats you like a partner is more likely to help increase your business and profit margins. A good broker will keep you updated in the industry, assist in lead generation, and offer their marketing resources to help you succeed. Companies who play the low-cost game and don’t offer these services are feeling the pressure in this market, so it’s important to form strategic partnerships that benefit each other.
Brian Abel, a financial advisor specializing in the trucking industry, recommends evaluating brokers carefully. He says one of the best indicators of a trustworthy firm is to be certain a broker is Transportation Intermediaries Association (TIA) certified. The certified TIA broker is bound to the TIA Code of Ethics to help maintain a community of trustworthy and transparent business partners of brokerages and 3PLs.
Now time to look inwards:
2. Maintain Retention and Reduce Attrition
One of the easiest ways to secure cash flow and predict profits is to work with the same customers over and over again. Your established book of business already has a few favored customers, so let them know you appreciate them. More often than not, regular communication will take this far. David Finkle, co-author of Scale: Seven Proven Principles to Grow Your Business and Get Your Life Back, says that a well-timed call, card, or visit lets the customer know you appreciate them actively purchasing from you.
On the flip side, if your customers aren’t benefiting you, perhaps it’s time to stop benefiting them. Finkle recommends that if your top customers’ margins are covering costs for your bottom customers, it’s better to cut ties and move on.
Don’t just take our word that these strategies are effective. Heartland Express (HTLD) refocused their business strategy for 2018 and experienced drastic results. They cut ties with less profitable lanes and focused solely on their most profitable customers. While HTLD experienced a significant drop in revenue year over year from 2017 to 2018, their operating ratio (OR) dropped by 9% and their adjusted OR dropped by nearly 11%. Because they pushed their OR down so far, HTLD actually increased their net income by over $11 million.
There’s a bright side to Heartland cutting ties with so many customers: their loss is smaller operations gain. Because of these cuts, HTLD haven’t been able to take full advantage of the strong demand for over the road truckers. That means the demand for freight is up and it’s yours for the taking.
Now to grab that low-hanging fruit:
3. Streamline Operations to Reduce Spending
Business optimization can produce game changing results, especially in industries with slim margins. If your office spends an exorbitant amount of time entering the same info into separate software systems, that’s money lost on finding and booking lanes.
Knowing how and where your time and resources are being spent can help optimize your business operations to make the most dollars per hour. The easiest way to do this? Princeton Consultants president and CEO Steve Sashihara says “use efficient technology.”
Transportation Management Software (TMS) is a huge asset for small trucking companies. The better the software, the better streamlined your operational process will be. A good TMS system will have invoicing and collections, dispatch services, legal and compliance, Bid, RFPs, pricing, and customer contracts all in one application. Make certain you choose a software that integrates with load boards, GPS integrated tracking, EDI capabilities, and analytic software to run reports. The fewer the clicks it takes to get between screens, the better.
Sashihara has seen enough good software systems streamline business operations to be a firm believer in investing in it. He specifically cites that the transportation industry has been able to transform struggling operations into profitable companies thanks to optimizing their fleet scheduling. By using real-time data plus historical knowledge, it’s easier for trucking companies to smartly predict price increases and act on them.
The Small Business Advantage
Heartland Express might have shrunk, but that doesn’t mean your small trucking company is going to. In fact, with increase in freight volumes and robust orders, margins are on the rise. Small trucking businesses are in the best position to take advantage of those margins. According to financial research specialist Mary Ellen Biery, “most general freight companies in the US are small businesses with less than 20 employees and […] their size might position them to adjust to market needs.” Hot spot markets and contract rates are expected to grow about 10 to 12 percent year over year. Those rising rates with the fairly stagnant growth of professional truck drivers means those already in the role are in position to benefit from this bright future.
Small trucking operations are in the best position to take advantage of this tight market. Since there is a lot more freight than capacity, act on these three things to make certain you get the best slice of the pie:
- Leverage Industry Relationships: work with partners who want to succeed with you.
- Maintain Retention and Reduce Attrition: work with customers who provide value to you and cut ties with those who cost you.
- Streamline Operations: make the most money per hour by investing in the right transportation management software that will reduce your workload and increase your bookings and invoicing.
If you’re ready to act on these three things and want to learn more about building a successful partnership, contact us at LDI to learn about our carrier program.
One of our business development specialists will be happy to hear about your existing business, your goals for growing, and have a conversation about how we can help you get there.
We’re already well into 2018, and a lot has happened in the logistics and transportation industry. The ELD mandate continues to be a controversial topic, we’re keeping an eye on the current capacity crisis, the industry is soaring to new technological heights with autonomous vehicles, and so much more.
Whether you’re a carrier, trucker, or freight broker, it’s crucial for everyone in the industry to stay up to date on the latest news and trends. As a truck driver or carrier, it’s important to know the latest regulations and news so you know how to keep doing your job efficiently (and legally). For freight brokers, knowing what’s going on in the industry can help you manage your loads, keep positive relationships with your carriers, and continue to provide the best support possible.
To help keep you consistently updated on the logistics and transportation industry, we’ve decided to look back on each quarter and roundup the best resources highlighting the quarter’s most important industry news, trends, and happenings. Below are the highlights we found for the first quarter of 2018.
Remember to check back at the end of June for our second quarterly update.
Want the latest industry news and updates sent right to your inbox? Subscribe to the monthly LDI Logistics & Transportation email roundup below!
1. After effects of Phase 2 of the ELD mandate
At the end of last year, phase two of the ELD mandate officially went into effect. From December 19th, 2017 and on, truckers are now required to log their hours electronically via an electronic logging device, or ELD. Now, we’re just a couple weeks away from another important date — April 1st — which is set to be the start of the enforcement and penalty phases.
With the looming deadline, it’s going to be important to keep an eye on those who have been avoiding complying to the mandate hitherto. A few FMCSA officials held a webinar on the ELD rule recently, and FreightWaves has the full recap you can read here. To summarize, the webinar discussed the rules and exceptions to the rule, including the agricultural exemption, uses of AOBRDs throughout the end of 2019, what happens when an ELD malfunctions, hours of service clarifications, and reminding all of the April 1st deadline.
Here are a few helpful resources to keep up to date on all information regarding the ELD mandate:
- The Federal Motor Carrier Safety Administration
- SupplyChainDive news
- Follow related hashtags on social media like #ELDmandate or #ELD
2. The truck driver shortage
For over the past ten years, the trucking industry has been dealing with the truck driver shortage. Many people believe this is due to age demographics or a difference in generational work ethic. Others claim it’s because the lifestyle of a trucker is often shown as less than ideal — whether it be the long hours, unfair wages, etc. And the recent ELD mandate is not helping the matter.
Whatever the reasons may be, we can all agree that the driver shortage is one of the most critical issues facing the industry. According to the American Truckers Association, “more than 70% of goods consumed in the U.S. are moved by truck, but the industry needs to hire almost 900,000 more drivers to meet rising demand.”
While the shortage has fluctuated over the years, it has yet to come close to a resolution. A recent analysis by DAT Solutions said at the beginning of this year, the available trucks versus the amount of loads was the lowest ratio since 2005. The Chief Economist of ATA said that, “even as the shortage numbers fluctuate, it remains a serious concern for our industry, for the supply chain and for the economy at large.”
So, what is the industry doing to reverse the shortage?
Many companies have to increase the wages of their current drivers to make up for lost hours on the road due to lack of drivers. And by attracting a younger generation of drivers, it might help replace the large number of drivers that are retiring every year.
It’s also been stated that the negative connotations associated with the “life of a trucker” has kept the job in the shadows – and simply increasing the wages and improving the benefits could solve a lot of the problem. In an article in the January 8th, 2018 issue of Transport Topics, Joe Chandler, President of SPI International Transportation, writes, “we have let real wages for drivers decline while paying more to our executives and more for our trucks.”
Plenty of blogs and news outlets consistently report on the ups and downs of the driver shortage. You can find some of them here:
Although the issue remains at a critical level, Supply Chain Dive has high hopes that the current capacity crisis will cause a growing need for drivers. Thus, pushing companies to improve their wages, benefits, etc. to attract more people. Joe Chandler believes since, “drivers are in high demand, [truck] driving should be a natural path forward for many of the nation’s underemployed workers.”
3. The Capacity Crisis
In our post about the crisis from last year, we discussed what it is, what’s causing it, and how businesses can handle the problem. To recap, a capacity crisis occurs when the industry has an abundance of loads, but is lacking the capacity (or trucks) to ship those loads.
Evidence of what’s causing the crisis points to fleet deterioration, loss of truckers with commercial drivers licenses, an increase in government regulations, etc. According to Supply Chain Dive, the ELD mandate and the driver shortage are primarily to blame.
Essentially, the reason there is a low truck supply is heavily due to the lack of drivers available to drive them. And the increased government regulations — such as the ELD mandate — are upsetting many of the already limited number of drivers in the industry. In a recent article by Forbes, it states that, “regulations such as these are…perceived by the drivers as an infringement on personal space [since] many consider their trucks to be a home away from home.”
Read more details on what’s causing the crisis, and how the industry is working to correct it, here:
4. Autonomous vehicles
Recently, there’s been a huge focus on the technology of self-driving, or autonomous, vehicles. It’s particularly popular in the transportation and logistics industries for a variety of reasons. Autonomous trucks can potentially lead to a more environmentally-friendly industry, save money on gas and other truck maintenance, and actually create more jobs — not fewer — for truckers.
Last year, Elon Musk unveiled Tesla’s first electric semi-truck, and Uber Freight recently announced it’s sending a driverless truck on a trip across Arizona. Other companies like Waymo, Starsky, and Embark aren’t far behind.
As technology continues to evolve at a rapid pace, it’s difficult to truly predict how autonomous trucks will impact the industry. We like to stay positive and hope the autonomous vehicle era will bring jobs, help the environment, and improve the way we transport goods. Unfortunately, not everyone agrees with that outlook.
Wired’s article, “What Does Tesla’s Automated Truck Mean for Truckers?” suggests that this new technology could actually worsen the driver shortage, and potentially worsen job conditions (i.e. force 24-hour shifts on employees because the driver would technically be ‘not driving’). It’s also important to mention that Uber is now under fire as one of their self-driving cars hit and killed a pedestrian, marking the first fatality due to an autonomous vehicle. Although this technology has been tested for some time, this is a brutal reminder that it’s still in its infancy.
Ultimately, there isn’t enough research being done yet on the effects of automation, so one prediction is as good as the next. Keep updated on the latest industry technology here:
5. Increasing sustainability within the industry
As previously mentioned, some pros of the autonomous technology would lower the industry’s carbon footprint, use less gas, etc. So, it makes sense that many within the transportation and logistic industries are aiming to implement more sustainable business practices.
The American Truckers Association is committed to establishing a bold sustainability program, and the American Transportation Research Institute shares best practices for sustainable trucking such as driving, vehicle, and public sector practices.
You can keep track of the companies who are making waves in sustainable trucking practices here:
6. President Trump’s New Tax Law
The ELD mandate is not the only way the government is impacting the industry. President Trump’s new tax law (and “trade war”) are more than likely to affect the industry.
The federal Tax Cuts and Jobs Act that was signed on December 22, 2017 will change how carriers account for buying and selling trucks. According to Transport Topics, “how the law will affect trucking businesses depends on business type.” If you’re a C Corporation, the federal tax bill lowers from 35% to 21%, but it’s important to keep in mind that C Corps have double taxation. S Corporations will choose between the lowest calculation of 50% of W-2 wages, 20% of taxable income, and 25% of W-2 wages plus 2.5% of all qualified property. Many businesses may look into restructuring their business, and sole-proprietorships may need to consider becoming an S Corporation.
Additionally, many are worried about the President’s proposed steel and aluminum tariffs will start a trade war.
Some helpful sources for staying on top of these new stories are:
Between government regulations and new technology, 2018 is bringing a lot of changes to the world of logistics and transportation. Whether you’re a truck driver, carrier, freight broker, etc., it’s important to be aware of what’s happening within the industry.
Know of any other important industry news or additional resources that we haven’t listed? Share in the comments – we’d love to check them out, too!
The idea of shipping dates back thousands of years – and today, container shipping is one of the leading means of transporting goods. In fact, it’s responsible for moving an estimated 95% of all manufactured goods around the world.
How did shipping become such an expansive industry?
In 1956, American truck driver Malcom McLean decided to stack 58 metal containers onto a ship going from New Jersey to Texas. The efficiency of transporting goods this way “completely revolutionized the industry,” according to a video from The Wall Street Journal. These containers both protected the cargo and made it drastically easier to unload the shipments. Standard containers allowed the cargo to move from ships onto trucks or trains without being repackaged — a system called “intermodalism,” which saves both time and money.
With the use of intermodalism and other advances such as industry globalization, container shipping continues to dominate the industry. Today, there are billions of tons of cargo being shipped around the world by container ships every year.
Without shipping, we would have far less food and produce in our grocery stores, cars to get us where we need to go, and access to the latest iPhone accessories. For such an wide-ranging industry, it’s surprising how little most people know about it. For example, did you know that over 10,000 shipping containers are lost at sea every year? Or that only 2% of seafarers are women?
Shipping is an expansive industry – and evolving every day – so we understand it might be difficult to always keep up with the latest news. That’s why we decided to share some of the most fascinating shipping facts and statistics we could find. Check out our collection in the infographic below. And if you’ve heard of other surprising facts, be sure to share them in the comments!