Welcome! As most of our loyal readers know, we have been posting on two blogs for the last few months. Well the time has come to finally shut the door and turn off the lights here! This has been a good location for us and we will miss it dearly. Change is a good thing and we hope you will visit our new blog address which is on our website. Please click the link below and join us at our new home!!
Showing posts with label 90 days to 75%. Show all posts
Showing posts with label 90 days to 75%. Show all posts
Sunday, December 16, 2012
Friday, November 30, 2012
The Ugly Truth About Empty Trucks
What exactly does an empty truck cost a trucking company? "Not that Much" said one brave soul. "A whole lot!" replied another. "I don't know!" he said quietly to himself, and he was right.
Let's jump right in and figure it out, because the water is warm and getting hot. The purpose of this blog is not to cause grown men to cry, nor put the fear of God or additional pressure on already nervous Driver Recruiters, but quite the opposite. Where are your resources going? Are you giving your recruiting departments enough resources?
Now, you may not want to know what that an empty truck costs you and I don't blame you... You may purposely avoid driving around the side of the building where all the empty trucks are parked when you arrive in the morning. I don't blame you for that either... Now, settle into your favorite bar stool, grab yourself a pencil and cocktail napkin, turn the napkin over onto its back, and lets do some accountin'...
Feel free to insert your own costs here, if you don't know these off the top of your head, these are good averages to use. (These descriptions and amounts all meet again in a column near the bottom, I felt some explanation was needed as to just how I arrived at my numbers.)
Tractor Payment - $2075.00 - Just an average payment amount based on a new truck with 5 year straight financing.
Trailer Payment $300 - $600 (Oh wait, multiply that $300 trailer payment number by two! Remember the person(salesmen, operations manager, VP of this and that, CFO) who convinced you that you need to be at a 2 to 1 trailer to tractor ratio? (Yes, Sir, you now have two trailers for every tractor. You did that so you could do some fancy dropping and hooking and increase your revenue, yes, Sir.)
Actual Depreciation - $1541.00 5 Year to $7500 (I don't care about how you speed up or slow down depreciation for taxes, doesn't matter here, stop thinking it's a good thing, and stop thinking about it entirely for this exercise, please.)
Overhead - $900 Includes (Non-driving Employees, Office Staff, Mechanics, Phones, company cars and so on. I'm going to peg this at $.09 per mile as a good average, basically all admin costs divided by number of trucks by 10,000 miles per month. Again, please feel free to use what number you feel is a realistic representation of your company.
Profit per truck - How much do you make per truck per month? I don't know how much you make, but the 5 - 25 - 100 empty trucks on your lot play a major role in your overall profitability - Please feel free to insert your profit per truck number here. I left it at ZERO
To Summarize -
Tractor Payment $2,075
Trailer Payment $600
Depreciation $1,541
Overhead $900
Profit $0
Cost per Empty Truck per Month $5,116
The trucking business makes for a good mistress but she's a mean wife. She's very cyclical as we all know and full of mood swings. "And Boy, I Say Boy", she's been in a mood for the last year or two. The carriers who understand the cost of an empty truck and address it head on are sure to weather the storm. Stay strong, our time to shine is coming again...
COPYRIGHT 2012 Michael H. Komadina
Thursday, September 20, 2012
Cortes on Recruiting and Retention II
Return to 18 Wheels of Justice Home
Continued from Part I - Senor Cortes on Recruiting and Retention
Cortes may not have been the most qualified to lead the expedition. Though he was experienced and renowned for his courage, another reason for his appointment was his promise to help finance the expedition. Cortes emptied his personal wealth and poured it into the trip. He mortgaged his lands. He called on friends to both help prepare for the trip and to join his small army.
The first land Cortes and his crew of 508 men spotted was the coast of Yucatan, at one time the central nervous system of the Mayan empire. Cortes had ordered his scouts to the coast a month ahead of time to travel to the borders of the Aztec Empire to see what sort of trouble they might face when they approached to pillage the Aztec gold. They set up camp on the beach and prepared for the perilous journey ahead into the heart of the Aztec's and waited for the scouts to return to the coast with their report.
As Cortes' men waited for the scouts and prepared horses, guns and provisions for the nearly 200 mile inland journey, some curious local tribesmen had visited the encampment. The subject of Montezuma, gold and armies were the main topic of discussion. The locals told them of Montezuma's city of gold, the homes were decorated with and the streets were paved with gold. They were amazed with the white, bearded man's peculiar interest in gold. They also told them of Montezuma's fearless army, some 10,000-20,000 men strong by the locals count.
Within a few days the scouts returned, and they met with Cortes in the conquistadors large tent. Some of the Cortes' men, eager to learn what they were facing, hid behind the tent and listened carefully to the discussion. The scouting report was worse than any had imagined, Montezuma's army numbered well over 100,000 men, armed with spears, bows and arrows. Although the expedition was well armed with guns and a large cannon, victory with 500 men vs. 100,000 well trained warriors, seemed an impossible feat. Cortes took all of this in, swore his scouts to secrecy, and retired to his tent for the evening.
Cortes, meanwhile, weighed his options. He faced imprisonment or death for defying the governor, Velasquez, if he returned to Cuba. Cortes knew the want of gold and riches was not a big enough motivator for his men to face such a daunting task. They were Soldiers of Fortune, not the soldiers one needed in such a battle. All the gold in the world is worth nothing to a dead man. The best soldiers are the soldiers who are fighting for God, Country and for the safety of their homes and family.
Cortes decided to take a walk on the outskirts of the encampment and try and get a feel on his men and their morale. The men who had been eavesdropping on the scouts and Cortes, had of course spread the word quickly about the 100,000 plus warriors. Panic ensued within the men and everyone felt Cortes had surely lost his mind if he wanted to proceed, and there was no amount of gold worth marching into a certain slaughter. They knew his situation at home in Cuba, but they were merely following Cortes' orders when they set sail from Cuba, and felt any of the consequences of joining Cortes would be dismissed. The majority of them came to the conclusion, that life was good enough in Cuba, and it was time to return to their families and plantations.
Cortes knew his only option was to move forward with the expedition, he knew Velasquez's anger at his disobedience would be cooled off by returning with ship loads of gold, of which the Cuban Governor would get his fair share, of course.
Hernando Cortes had heard all of this mutinous planning discussed at length by his men well into the late evening. They had finally decided to seize all the ships at first light and sail back to Cuba, with or without Cortes. Cortes, in a bold stroke of genius, sent his personal entourage of 50 loyal soldiers to the ships in the darkness.
He ordered his men to set all 11 ships on fire and send them out to sea.
They followed Cortes' orders, set the ships on fire, pushed them out to sea, and watched them burn and eventually sink, in a glorious sight in the darkness.
The next morning, Cortes and his army of 508 men marched toward Montezuma.
How does this relate to the trucking industry's seemingly never ending battle with recruiting and retention? Join us here on Monday, September 24th to explore more on this fascinating subject.
Negotiating with Freight Brokers. Gain much needed additional revenue by learning superior negotiating skills - Order Today!
Continued from Part I - Senor Cortes on Recruiting and Retention
Cortes may not have been the most qualified to lead the expedition. Though he was experienced and renowned for his courage, another reason for his appointment was his promise to help finance the expedition. Cortes emptied his personal wealth and poured it into the trip. He mortgaged his lands. He called on friends to both help prepare for the trip and to join his small army.
The first land Cortes and his crew of 508 men spotted was the coast of Yucatan, at one time the central nervous system of the Mayan empire. Cortes had ordered his scouts to the coast a month ahead of time to travel to the borders of the Aztec Empire to see what sort of trouble they might face when they approached to pillage the Aztec gold. They set up camp on the beach and prepared for the perilous journey ahead into the heart of the Aztec's and waited for the scouts to return to the coast with their report.
As Cortes' men waited for the scouts and prepared horses, guns and provisions for the nearly 200 mile inland journey, some curious local tribesmen had visited the encampment. The subject of Montezuma, gold and armies were the main topic of discussion. The locals told them of Montezuma's city of gold, the homes were decorated with and the streets were paved with gold. They were amazed with the white, bearded man's peculiar interest in gold. They also told them of Montezuma's fearless army, some 10,000-20,000 men strong by the locals count.
Within a few days the scouts returned, and they met with Cortes in the conquistadors large tent. Some of the Cortes' men, eager to learn what they were facing, hid behind the tent and listened carefully to the discussion. The scouting report was worse than any had imagined, Montezuma's army numbered well over 100,000 men, armed with spears, bows and arrows. Although the expedition was well armed with guns and a large cannon, victory with 500 men vs. 100,000 well trained warriors, seemed an impossible feat. Cortes took all of this in, swore his scouts to secrecy, and retired to his tent for the evening.
Cortes, meanwhile, weighed his options. He faced imprisonment or death for defying the governor, Velasquez, if he returned to Cuba. Cortes knew the want of gold and riches was not a big enough motivator for his men to face such a daunting task. They were Soldiers of Fortune, not the soldiers one needed in such a battle. All the gold in the world is worth nothing to a dead man. The best soldiers are the soldiers who are fighting for God, Country and for the safety of their homes and family.
Cortes decided to take a walk on the outskirts of the encampment and try and get a feel on his men and their morale. The men who had been eavesdropping on the scouts and Cortes, had of course spread the word quickly about the 100,000 plus warriors. Panic ensued within the men and everyone felt Cortes had surely lost his mind if he wanted to proceed, and there was no amount of gold worth marching into a certain slaughter. They knew his situation at home in Cuba, but they were merely following Cortes' orders when they set sail from Cuba, and felt any of the consequences of joining Cortes would be dismissed. The majority of them came to the conclusion, that life was good enough in Cuba, and it was time to return to their families and plantations.
Cortes knew his only option was to move forward with the expedition, he knew Velasquez's anger at his disobedience would be cooled off by returning with ship loads of gold, of which the Cuban Governor would get his fair share, of course.
Hernando Cortes had heard all of this mutinous planning discussed at length by his men well into the late evening. They had finally decided to seize all the ships at first light and sail back to Cuba, with or without Cortes. Cortes, in a bold stroke of genius, sent his personal entourage of 50 loyal soldiers to the ships in the darkness.
He ordered his men to set all 11 ships on fire and send them out to sea.
They followed Cortes' orders, set the ships on fire, pushed them out to sea, and watched them burn and eventually sink, in a glorious sight in the darkness.
The next morning, Cortes and his army of 508 men marched toward Montezuma.
How does this relate to the trucking industry's seemingly never ending battle with recruiting and retention? Join us here on Monday, September 24th to explore more on this fascinating subject.
Negotiating with Freight Brokers. Gain much needed additional revenue by learning superior negotiating skills - Order Today!
18 Wheels of Justice Series available at: 18 Wheels of Justice
EMAIL - Negotiator@18wheelsofjustice.com
Tuesday, August 28, 2012
If You're Gonna be Dumb, You Gotta be Tough
Return to 18 Wheels of Justice Home
To help satisfy the ever increasing curiosity of my readers and growing fan base(yes fan base, I receive lots of emails from readers wanting to know more about me, so I consider these emails fan mail). I often get asked questions encouraging me to share about myself. To save time, instead of answering each email individually, I have broken them down into the three most popular questions I receive from fans and will post them here.
1. Who do you think you are?
2. I've been doing this for 20 years, if this worked, I would have heard it about it by now. What rock did you crawl out from under?
3. How are you even qualified to make such a statement?
Now, before I continue, I would like to tell everyone the title of my new book. I would also like to preface this by saying that my new book outlines my new program to reduce driver turnover(increase retention-this explanation provided for my fans) in the over the road trucking industry. As we all know, driver turnover has reached an alarming and critical level in our industry. The title of my book is "90 Days to 75% Retention".
I do occasional consulting projects for trucking companies for a variety of reasons related to trucking and transportation. In meetings to discuss my consulting services, I'm often asked about the title of my new book. More often than not, it is met with laughter. And not polite laughter, but real, hearty laughter. When people glance at me after the laughter erupts, and realize I'm not laughing(I never laugh about retention), the polite ones usually stop, and present sympathetic looks akin to glances the dumb kid in class gets when he gives the wrong answer in a classroom. ("He just doesn't understand, this is an unsolvable problem. We must live in and accept our problem, we must tell him to accept the status quo, and be energized by our problem, not to keep seeking a solution.")
Has turnover become so accepted in our industry, that a 25% turnover rate is thought to be so unattainable that it prompts laughter? It's that outrageous? The ones who laugh the loudest are usually the ones who haven't done much self-examination recently and have the highest turnover, and have trouble grasping the concept that 25% turnover is achievable. It takes me back to the days of my youth, when my one of my brothers(for the sake of family harmony, I won't identify which brother) and I were given a BB gun from my grandfather. We charged outside, BB gun in hand, and held a heated debate about who was going to shoot it first. It was finally concluded that I would be the first to shoot it and my brother in all his wisdom, would hold an empty aluminum soda can in his out stretched arm as the target. So it was decided. I walked off 10 paces in the backyard and turned around to see my brother holding the can in his hand, I aimed and shot quickly. I missed the can completely and the BB struck my brother in the chest. He looked down at his chest, looked back up at me and proclaimed in a taunting voice, "You missed, moron!"... My grandfather, heard the commotion, came outside took the BB gun back as we explained what happened. He turned to my brother and said, "Well, If your gonna dumb, son, then you gotta be tough".
The retention problem is large and It's not going away.
Our retention issue is a cancer that has been growing since the early 1990's. Twenty years of a growing tumor on our industry, never in remission, but only a few short periods of slowed growth with a slowing economy, followed by rapid growth in turnover fueled by an expanding economy.
All of this is yesterday's news, as they say and I don't expect anyone to be surprised at any of these comments.
Have trucking companies just given up and accepted their turnover rate as the status quo?
I don't believe so. Trucking Executives are some of the best executives in our country, never to be ones to give up, quit, or not to find a better way.
This retention issue is one that has never been faced before in history. There has been no training available, not a clear successful plan to follow. It is massive and growing. Whenever there is no history of success to follow, innovation must prevail!
Innovation and new approaches are always laughed at, criticized and scorned at the beginning. But, it must be said to the detractors, that in the history of the world, there has never been a statue in a town square built in honor of a critic!
There is not an industry in the history of the United States, dare I say the world, that has experienced this! I defy anyone, a college professor, a Harvard MBA, anyone to find an industry who has experienced such a shortage of employees during a poor economy that keeps getting worse.
Trucking companies are willing to pay just about anything to get a driver in a seat. Find any industry in the United States! Any industry in the world! Not just this century, any century! Why? because the trucking industry is unique and so is our problem.
1. Trucks have wheels - carriers aren't defined and limited by a physical location, and neither are drivers. This creates a large pool of potential drivers and a large pool of potential employers, ready to transact at a moments notice. This is why broad economic theory is effective in this situation.
2. The CDL is unique in the amount of time it takes to be licensed and the amount of experience needed before a solo driver is deemed safe.
We must employ not one concept, not two concepts, not one economic theory or practice, but many applied together in a unique manner aimed at the trucking Industry. We must call on the genius of Henry Ford and Keynes! We must apply a personal approach unique to an employee who is always working but never at a physical workplace! We go home and he is still in his truck, driving, sleeping, loading, unloading. When he does arrive at the terminal, it's usually off hours and we are at home. If we are there, he is in a hurry to go home to his family anyway, and doesn't want to enjoy a hot dog with us at the driver appreciation BBQ.
To help satisfy the ever increasing curiosity of my readers and growing fan base(yes fan base, I receive lots of emails from readers wanting to know more about me, so I consider these emails fan mail). I often get asked questions encouraging me to share about myself. To save time, instead of answering each email individually, I have broken them down into the three most popular questions I receive from fans and will post them here.
1. Who do you think you are?
2. I've been doing this for 20 years, if this worked, I would have heard it about it by now. What rock did you crawl out from under?
3. How are you even qualified to make such a statement?
Now, before I continue, I would like to tell everyone the title of my new book. I would also like to preface this by saying that my new book outlines my new program to reduce driver turnover(increase retention-this explanation provided for my fans) in the over the road trucking industry. As we all know, driver turnover has reached an alarming and critical level in our industry. The title of my book is "90 Days to 75% Retention".
I do occasional consulting projects for trucking companies for a variety of reasons related to trucking and transportation. In meetings to discuss my consulting services, I'm often asked about the title of my new book. More often than not, it is met with laughter. And not polite laughter, but real, hearty laughter. When people glance at me after the laughter erupts, and realize I'm not laughing(I never laugh about retention), the polite ones usually stop, and present sympathetic looks akin to glances the dumb kid in class gets when he gives the wrong answer in a classroom. ("He just doesn't understand, this is an unsolvable problem. We must live in and accept our problem, we must tell him to accept the status quo, and be energized by our problem, not to keep seeking a solution.")
Has turnover become so accepted in our industry, that a 25% turnover rate is thought to be so unattainable that it prompts laughter? It's that outrageous? The ones who laugh the loudest are usually the ones who haven't done much self-examination recently and have the highest turnover, and have trouble grasping the concept that 25% turnover is achievable. It takes me back to the days of my youth, when my one of my brothers(for the sake of family harmony, I won't identify which brother) and I were given a BB gun from my grandfather. We charged outside, BB gun in hand, and held a heated debate about who was going to shoot it first. It was finally concluded that I would be the first to shoot it and my brother in all his wisdom, would hold an empty aluminum soda can in his out stretched arm as the target. So it was decided. I walked off 10 paces in the backyard and turned around to see my brother holding the can in his hand, I aimed and shot quickly. I missed the can completely and the BB struck my brother in the chest. He looked down at his chest, looked back up at me and proclaimed in a taunting voice, "You missed, moron!"... My grandfather, heard the commotion, came outside took the BB gun back as we explained what happened. He turned to my brother and said, "Well, If your gonna dumb, son, then you gotta be tough".
The retention problem is large and It's not going away.
Our retention issue is a cancer that has been growing since the early 1990's. Twenty years of a growing tumor on our industry, never in remission, but only a few short periods of slowed growth with a slowing economy, followed by rapid growth in turnover fueled by an expanding economy.
All of this is yesterday's news, as they say and I don't expect anyone to be surprised at any of these comments.
Have trucking companies just given up and accepted their turnover rate as the status quo?
I don't believe so. Trucking Executives are some of the best executives in our country, never to be ones to give up, quit, or not to find a better way.
This retention issue is one that has never been faced before in history. There has been no training available, not a clear successful plan to follow. It is massive and growing. Whenever there is no history of success to follow, innovation must prevail!
Innovation and new approaches are always laughed at, criticized and scorned at the beginning. But, it must be said to the detractors, that in the history of the world, there has never been a statue in a town square built in honor of a critic!
There is not an industry in the history of the United States, dare I say the world, that has experienced this! I defy anyone, a college professor, a Harvard MBA, anyone to find an industry who has experienced such a shortage of employees during a poor economy that keeps getting worse.
Trucking companies are willing to pay just about anything to get a driver in a seat. Find any industry in the United States! Any industry in the world! Not just this century, any century! Why? because the trucking industry is unique and so is our problem.
1. Trucks have wheels - carriers aren't defined and limited by a physical location, and neither are drivers. This creates a large pool of potential drivers and a large pool of potential employers, ready to transact at a moments notice. This is why broad economic theory is effective in this situation.
2. The CDL is unique in the amount of time it takes to be licensed and the amount of experience needed before a solo driver is deemed safe.
We must employ not one concept, not two concepts, not one economic theory or practice, but many applied together in a unique manner aimed at the trucking Industry. We must call on the genius of Henry Ford and Keynes! We must apply a personal approach unique to an employee who is always working but never at a physical workplace! We go home and he is still in his truck, driving, sleeping, loading, unloading. When he does arrive at the terminal, it's usually off hours and we are at home. If we are there, he is in a hurry to go home to his family anyway, and doesn't want to enjoy a hot dog with us at the driver appreciation BBQ.
So what exactly am I suggesting here? That you read and study the economic policy of Keynes? That you study Henry Ford's trial and error approach to retention? That you spend the next twenty years trying different things to keep drivers from leaving your company until you figure out the best path to successful retention for your company? I have done all of this already for you in a simple, fast moving process that will walk with you to successful retention in 90 Days.
Please join our Discussion Groups on LinkedIN. Both "Negotiating with Freight Brokers" and "90 Days to 75% Retention".
18 Wheels of Justice Series available at: http://www.18wheelsofjustice.com/
EMAIL - Negotiator@18wheelsofjustice.com
Friday, August 17, 2012
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