Moving Words – Tough Times

Timothy Brady

“Tough times call for tougher decisions.” –  Prabhas

As we start working our way out of the pandemic hole that’s been dug, we need to apply tough love to our operations, our people and our customers. Chances that we will return to what we saw as normal before COVID-19 are very unlikely. So we need to reevaluate what we’ve done to survive since March of 2020, and determine if those changes will work for us into the post-pandemic future.

In moving we know when times get tough, the tough get going. This is true no matter if it concerns the weather, the economic environment, politics or just the nature of competition within the industry. We’ll always have the challenges of government regulation, attacks from organizations which don’t have a clue as to what trucking involves, moving companies who don’t know what it costs to do business (read that Internet movers), or companies who will cut rates to steal business. For the foreseeable future, fuel prices will continue their upward trend and other trucking-related costs will follow. The moving business isn’t for the faint of heart. It’s a very high-cost, low-profit margin business. Remember, like any other addictive dysfunctional relationship, to be successful in trucking, it requires a ‘tough love’ approach:

1. Bottom-line boundaries which aren’t crossed
2. Knowing what’s fair and equitable in your hauling rates
3. Treating employees, drivers and customers with the same level of respect
4. Making sure your customers are not over-paying
5. Making sure you’re not underpaying your drivers or employees
6. And all while ensuring you and your management team are making decent salaries for your efforts and your company is earning the needed profit for growth.

The shutdowns, mandates and quarantining over the past nine months have caused many businesses to close their doors, some temporarily and others permanently. From adversity emerges opportunities: when the economy begins to improve, there’ll be a hauling capacity problem within all segments of the trucking industry, and moving won’t be an exception. The trick will be determining where these shortages of hauling capabilities will emerge. With all the remote working arrangements wherein employees are working from home, will this continue as a trend, emptying out the office space in metropolitan centers? Will companies start reducing the square footage of their office space in exchange for home offices? How many formerly commuting employees will want to relocate and move closer to family? These questions will require answers to determine a new strategy for the developing changes that are coming for the moving industry. Here are some ideas that may help you take advantage of these new opportunities:

1. Develop that special niche—become the expert in the hauling niche you select. You need to be the “go to” company for anyone who wants the best and most cost-effective means to haul within your niche. A niche can be a product, a lane or a region. Study the trends of the market you serve carefully; then adjust to them as necessary.
2. Constantly be mining for customers both corporate and individuals—with the current regulatory challenge and loss of capacity, a lot of moving companies are either falling by the wayside or lack the necessary vans to haul the available freight. This presents an opening for your company to develop new accounts.
3. Constantly be adding value—remember, as you’re out mining for new customers, so is your competition. Your best protection from rate-gouging, bottom-feeding movers, (and even from the other value-driven transportation haulers) is to constantly add value to the hauling services you provide your current customers. There will always be some mover willing to cut rates to the quick to steal your best shippers. The only way to stem this effort is by creating value in your services which exceeds your price.
4. Know your Break-Even Point—don’t ever agree to haul for less than what it costs you to operate. Once you start down the “But it creates cash flow,” spiral, it’s nearly impossible to reverse it. Pushing a boulder downhill is easy. Trying to get it back to the top is very difficult. The same is true with hauling rates.
5. Education and knowledge—when times are difficult and tonnage is slow, that’s the best time to catch up with new and innovative ways to do business. Anyone who thinks he’s learned it all will find himself scratching his head as the rest of the moving world passes him in the hammer lane, blowing off his doors. Success comes from knowledge; knowledge comes from education.

We’ve been through tough times before and we’ll go through them again. It’s just a part of being in business. To survive the tough times is to use them as a learning opportunity, so we know how to handle the next one. Here’s to a prosperous and successful 2021 everyone! May we take the hard lessons learned during this pandemic and apply them to our future success.

“Tough times don’t last, tough people do, remember?” – Gregory Peck