TRUCKLOAD FREIGHT
transportationreport
How to beat the
truckload capacity crunch
FOR THE THOUSANDS OF COMPANIES THAT RELY ON THE NATION’S
trucking network to get their goods to market, perhaps no issue in the past
five years has triggered more angst than capacity.
Available truckload capacity is dearer than at any time since the middle of
the last decade, experts say. While the reasons for the shortfall are manifold—a weak economy that forced truckers to sideline rigs, a shortage of drivers, rising operating costs,
and a lack of adequate credit for carriers to replace aging equipment or expand their fleets—the fact
is, rig counts are down by as much as 15 to 20 percent from their 2006 peaks.
With capacity down and demand firming after a four-year freight recession, carriers can afford to be
more selective about the freight they’ll accept. They also have greater leverage when negotiating the
price of their service. For many shippers, this raises the twin problems of securing the capacity they
need and how much they’ll have to pay for it if they do.
Shippers who’ve adopted a tactical rather than strategic mindset are likely to encounter the most difficulty obtaining needed capacity, according to a recent study by C.H. Robinson Worldwide Inc., a
major 3PL that is also the nation’s largest freight broker. These shippers, according to Robinson, share
several traits that raise red flags for carriers: They switch back and forth between carriers in search of
the cheapest deal; they limit their talks with carriers to rate matters, and they ignore carrier complaints
about service issues like long loading and unloading times, and freight that’s difficult to handle.
These shippers also “time the market” in an effort to lock in rates at what they believe to be the
absolute bottom. This approach often backfires, according to Robinson. Not only do shippers get in at
the wrong time and end up paying more over the long run, but they alienate their carriers by failing
to care about the impact their decisions have on the trucker’s business, Robinson said.
Beating the capacity crunch won’t be easy. But it’s not an insurmountable problem, experts say. The
road to restoration begins with a change of attitude. What follows are some suggestions for achieving
the right mindset:
Be real, and be fair. Shippers need to frame capacity discussions in terms of what works well for both parties, as opposed to engaging in a zero-sum game where one benefits at the expense of the other. “Seeking
alignment between business goals and outcomes of both shippers and carriers can result in better rates and
Experts say there are ways to
ease the squeeze, but it will
require a change in mindset.
