The trucking industry plays an integral role in the U.S. economy. Just how big is trucking to America? 10.4 billion tons, or over 70 percent of all freight tonnage moved in the U.S., goes on trucks.
Without trucks, America's economy would come to a screeching halt. The increased reliance on trucks has made it more difficult than ever for managers.
As the owner of a trucking company, you are no stranger to the demands and struggles of back-office management. But making a few common mistakes could be having a big impact on your efficiency, longevity, and bottom line.
Easing these tasks doesn't have to be complicated. By making a few simple changes, you can get you and your trucks back on track.
Here are five common truck management issues and how to fix them. Read on to learn more.
1. Not Embracing Technology
Technology is moving at a lightning fast speed. Smartphones, smart houses, and smart cars are becoming more commonplace every day. Welcome to the future.
There's no denying the impact technological innovation has had on society. By embracing new technology, you can positively impact just about every part of your management.
New technology can help you optimize route efficiency, pricing, freight loads, and even operator abilities. Automation will also be playing a bigger role in the future, with estimates showing robots could overtake 1.7 million truckers within the next decade.
It's easy to see why management is slow to embrace technology - it's intimidating. If you're looking to implement new technology into your trucking company, first address key performance indicators.
Evaluate whether the new technology will move your trucking company closer to its goals. If the answer is yes, it's time to embrace innovation.
2. Bad Fuel Policy
The retail price of gas has more than doubled since 1995. Implementing a firm fuel policy is more important than ever if you're looking to keep your expenses down.
Fortunately, trucking management teams have plenty of tools at their disposal to enforce fuel policies. These tools can help management evaluate fuel purchases, get alerts, and enforce their policies in the moment.
But what do these tools look like? First, exception reporting helps managers access fleet fueling information in real time. The reports get transferred through your company's management tool and showcase whether or not the report met your policy guidelines.
Purchase alerts instantaneously alert the team when a driver inputs an invoice that doesn't meet company policy. This is a great way to make sure drivers stick to policy parameters. It's an especially useful tool for managers who try to oversee hundreds or thousands of fuel transactions every week.
A solid fuel policy will include limits on purchases, location, and established fuel grades. Adding a strict fuel policy could save you big money on your monthly expenses.
3. Poor Bookkeeping
Bookkeeping is one of the most stressful and important aspects of management. This is especially true for trucking management. You have to handle invoices, payments, and operating expenses for entire fleets on a daily basis.
Many truckers use cash-based accounting systems, which allows them to get cash at the moment they are paid out. It might seem convenient, but it's easy to lose track of financial records without daily bookkeeping.
Thanks to modern advances, however, bookkeeping doesn't have to be complicated. Technology is already transforming the way we handle freight payments.
Digital bookkeeping is helping managers approve invoices, process payments, and access important financial documents all at the click of a button. Digital invoicing can help your bookkeeping become more efficient and reliable to your team. By going digital, you can get rid of the headaches that stem from complicated bookkeeping efforts.
4. Employee Retention
Turnover is a huge problem in the trucking industry. In fact, the turnover rate for large truckload carrier fleets was over 80 percent at the end of 2016.
Those alarming numbers suggest that personnel issues may be an industry-wide issue for the foreseeable future. While there are a number of factors that weigh into employee retention, it's also important to look into the aspects that you as a manager can control.
One way to help with employee retention is to focus on employee engagement. Employee engagement occurs when workers are invested in the company and are willing to work to move the company forward. It's also a huge indicator of employee retention.
But how do you keep your workforce engaged? It all starts at the beginning. Drivers need to have the right expectations when they go into the job. Their engagement will be hindered if there is a gap between their expectations and the reality of the job.
In addition, you should focus on making their daily duties easy to perform. Try to streamline your processes to make them both transparent and user-friendly.
There are no easy fixes to employee retention. But you can help your chances by creating simple systems, setting the right expectations, and being transparent in your management.
5. Financial Issues
Financial issues can impact even the savviest of managers. Where do you begin to get your company back on track?
While financial issues will differ on a case by case basis, there's one thing that all managers can do to get their finances under control: perform a cost-benefits analysis.
Doing a cost-benefit analysis is a great way to determine what systems, technologies, and changes can be beneficial to your company. You should do a cost-benefit analysis prior to implementing any company-wide rollouts.
The cost-benefit analysis will let you break down the exact costs incurred from a company change. You should look at the change from a macro perspective, taking into account the impact on installation, maintenance, drivers, and the fleet. This tool will help you determine the return on investment you will get from any changes to your business.
Your Trucking Business
Management isn't easy. But you can simplify your life by making a few simple managerial changes. These small changes can have a big impact on efficiency, profits, and employee retention.
Are you looking to revamp your management style? We can help. We are developing a full-scale platform for the commercial trucking industry for bidding, freight matching and networking. Contact us today to learn more.