Strategic Perks: Understanding and Navigating Today’s Truck Driver Shortage (Part 5 of 5)

This article concludes our series about understanding and navigating today’s truck driver shortage. In the first two articles, we considered the many factors that are contributing to today’s truck driver shortage. We then shifted to looking at strategies to navigate this capacity shortfall, including business relationships and driver pay and perks.

A third capacity management strategy advocated by the experts is to use a mix of contracts and spot market rates.

Given the current volatility in supply chains, trying to forecast contract volumes and rates over longer periods of time is a risky proposition. Plus, a mixed approach makes it easier to manage a large number of carriers.

“I wouldn’t put everything on spot, and I wouldn’t put everything on contract,” suggests Kenny Lund, executive vice president at Allen Lund Company, LLC. “You can’t put all your eggs in one basket with the carriers because there are too many to have to deal with.” He suggests establishing strategic relationships with reputable brokers, just like they do with asset-based carriers.

Working with a broker helps shippers gain access to the many small trucking lines and independent drivers in the industry. The broker can also provide transportation management services well beyond load matching.

Gail Rutkowski, executive director for the National Shippers Strategic Transportation Council, agrees that relying on reliable brokers can give shippers access to carriers and capacity that would otherwise be invisible.

“Brokers play well in the small carrier market between one and 20 units that you don’t have time to pursue,” Rutkowski notes. “Call your first or second asset-based carrier. If they can’t handle your load, throw it over to a broker and let them make the calls to move your freight.”

With more carriers establishing brokerage divisions, shippers can gain access to both purchase options under a single roof. Existing relationships can be expanded to provide greater access to
capacity.

“Working with transportation providers that offer a hybrid solution puts assets behind your shipments but also give you flexibility,” explains Ryan Carter, president of Scotlynn USA Division Inc. and Scotlynn Transport LLC. “When production ramps up or shifts to another location, you can bring in extra trucks as needed.”

The capacity shortage is a real phenomenon and overcoming the problem will take time, effort, and investment.

“If shippers want drivers to move the freight, they need to start by treating drivers as professionals,” Rutkowski cautions.

Building upon this foundation, shippers must take multiple steps to ensure that their product makes it swiftly to the final destination.

Increasing driver pay, improving work-life balance, adding new equipment, mixing contract and spot rates, and reducing dwell times are appropriate tactics to address the capacity conundrum that isn’t going away anytime soon.

Source: Blue Book Services, Inc.