Author Archives: JSY SOFTWARE

Surviving “The Week Of No Dispatchers”: A True Story

Renee’ Ferris is GM of a local P&D company in Chicago with about 50 drivers. A while back, she had the perfect storm:

  • Her AM dispatcher broke his leg in 3 places and was out of work for a week.
  • Her PM dispatcher went out of the country to visit relatives—the same week.
  • Her boss, the owner, went out of town for the same week.

Therefore, there was nobody in the office with dispatch skills, and they needed to route and manage almost 50 drivers and trucks in an intense, local LTL P&D environment. It could have been a disaster.

You can’t get a great P&D dispatcher from a temp agency. How did she manage? Was it a miracle?

How did the carrier survive that week?

How did the carrier survive that week?

I asked Ferris what got her through the week, and her first reply was, “JSY made it possible.” How come?

Ferris and her staff simply ran JSY’s OneTerminal TMS software, which walked them through every order from start to finish. There was no guessing which screen to use, and they didn’t get lost. She got the morning manifests done (with a little help at 5:00am from a seasoned driver). Then, she and the other three women in the office – a data entry person, a finance manager, and the HR manager – ran the trucking operation for that entire week. They could see everything they needed when drivers or customers called in.

“We’re a high-service, high-priced carrier, and believe me, it was a little unnerving to think about being without anyone who dispatches regularly. The software kept everything going and helped us keep our cool. We even maintained our usual profitability that week. It was a really amazing thing to be a part of,” said Ferris.

If you want to compare notes with Renee’ directly, you’re welcome to contact her at rferris@bhsystems.com. (She’ll probably tell you to just buy software from JSY.) It was an interesting week, that’s for sure, and a great story.

Would you like $1200 more each month or $3750 more?

As Steve Jobs famously said, “Think different.”

A local P&D company had $3750/month more in the bank after implementing new software that was just right for its operations.

The same company had cleared $1200/month more by buying a new power unit. Which is the more profitable purchase?

More money with a new truck or better technology?

More money with a new truck or better technology?

It’s relatively routine to increase a fleet:

  • You buy a new power unit. You can haul more freight than you could haul yesterday.
  • Assuming that you bill about $3K/week/driver, you should be able to bill an additional $12,375 this month, assuming that you can keep this truck as full as your other trucks.
  • If your operating ratio is 96%, you’ll have an extra $495 in your pocket this month.
  • If your operating ratio is 90%, you’ll have an extra $1237.50 in your pocket this month.

And a trucking company tripled that return with new software. Here’s how they did it:

  • ABC Cartage Company had two “billing girls,” Audrey and Gina, who were full-time. They did the rating and invoicing and A/R. Each billing girl cost $40,000/year plus benefits, so let’s say $10K/month total outlay.
  • ABC Cartage Company bought new software from JSY. It cost them $30K the first year and will cost them $15K in support the 2nd year. (Your costs may be different depending on the options you purchase.)
  • After ABC Cartage implemented JSY, they were able to get their rating and billing done in 20 hours a week, by one person. The work that had taken 80 hours went down to 20 – that’s a 75% time savings.Rating and Billing graphic 2
  • ABC was able to let one of the girls go (Gina was thrilled, since she wanted to start a family and go back to school after the baby was born), and Audrey was shifted into 50% rating/billing/AR and 50% sales support.
  • ABC’s costs went down by $60K per year.
  • ABC’s net savings after software purchase were $30K the first year and $45K the second year.
  • ABC saved $2500/mo. in the first year and $3750/mo. every year after that.
  • All that extra money flowed to the bottom line.
  • ABC earned more money on top of that savings, because Audrey helped the sales manager close some business that they hadn’t had the office muscle to follow up on before.

This is a hypothetical example, based on real-world stories from our customers. “Your results will vary,” as they say… but not by much.

So, where you will make your next investment?

Invisible Costs & Hidden Savings in the Trucking Office

Money in trashcanEveryone talks about reducing unnecessary spend in the supply chain. But almost nobody talks about the unnecessary spend in an individual trucking company’s office operations.

Which trucking office is most efficient—a firm that runs 50 trucks with 5 people in the office, 20 trucks with 8 people in the office, or 10 trucks with 5 people in the office? And why should you care?

You should care because there may be hidden savings in your operation that you may want to uncover. If you take advantage of them, that’s more money on your bottom line every week.

Trucking-company owners regularly complain to me about costs for insurance, maintenance, and so on. When I bring up office payroll, however, they often look at me funny. I get responses like these:

  • “We dispatch in Excel and bill in QuickBooks… Everyone does that, right?”
  • “The dispatcher writes everything down by hand in a book. Then he enters it into the computer. Then Tammy looks up the rate in our binder (or rating spreadsheet), calculates the rate, and tells Shari. Then Shari puts it into our accounting system. Easy enough.”

Here are the invisible costs. “Easy” is not the same as “streamlined.” Both owners above are wasting money on every order. They’re paying two or three people to enter information that could be entered once—if they had software that was a good fit with their operation. Multiplied by hundreds of orders a week, these trucking companies are paying duplicate office salaries—easily 6 figures in some offices—to have people do double-entry. It is an invisible cost because the people look busy and the work gets done.

VacuumInvisible costs suck money out every week. But are invisible costs necessary costs?

  • Are you paying 2 or 3 people to do the work of one, or 10 people to do the work of 8?
  • If one or more of those salaries flowed directly to your bottom line instead of going to your payroll account, and you still were giving great service, would that help your life?
  • If you saved that money every year for 10 years, would that be good? Could you retire early?

Office payroll is the #1 untapped opportunity  in trucking for cost savings. A business partner who can help you seize this opportunity is a valued partner indeed.

Technology and Embarrassment

EmbarrassedNobody likes to be embarrassed. I hear over and over that poor communication in business, just as in any relationship, creates the most embarrassment. It could be forgetting someone’s birthday or your anniversary. In fact, you might be feeling the heat of a prior embarrassing situation as you read this—the emotion is that powerful.

In trucking, embarrassment often comes up as the response to things like this:

  • “He only picked up 5 skids? Man, there were 7 to pick up. You did this last week too.”
  • “Where is the driver?” (even if he is already at the dock)
  • “Why can’t you tell me who signed for it and when?”
  • “When will you have a POD that I can see? The delivery was six days ago.”
  • “Why are we getting billed for detention when nobody gave us a heads-up?”

People sometimes think that new technology is all about new gizmos, bells and whistles they don’t need, and expensive toys they’ll never use. However, people sometimes don’t spend much timBad moralee thinking about the emotional climate at work, and the cost of that to you and your employees. When I ask gently, most people sure do have the embarrassment issues going on. What does embarrassment cost you and your team in terms of morale?  What does morale cost you in terms of your day-to-day ability to serve your customers?

It might be worth considering technology as an investment in your emotional well-being. Having better and faster answers to these questions can lessen your embarrassment and give your staff and customers new confidence. Enhanced tools, just the right ones for your business, might do wonders for your emotional climate.

As always, something to think about. Have a great week.

–Jonathan Miller

“I Just Want To Work a 12-Hour Day”

clock_07-00I hear this from busy trucking executives all the time. Sometimes it’s the owner/CEO who wants to work less. Sometimes it’s a spouse or family member in the company who wants a different proportion of work time to non-work time. Regardless, a trend seems to be developing: working all the time is not necessarily the life that people want, even for owners.

Where does the time-suck come from in trucking? There are several, but my customers and prospects in local P&D and related fields tell me of one particular demand that has mushroomed over the past few years. Customers want proof of delivery as close to real-time as possible. Customers will even sometimes leave carriers over this one issue.

We shouldn’t be surprised by this, really. Society in general has seen an acceleration of the speed at which people are able to retrieve information of all sorts (on smartphones, tablets, and so on). In the local P&D world, this acceleration takes the form of an expectation by shippers that the trucking carrier should also be able to provide “on-demand POD.”

When the customer calls, we generally want to avoid the following: Frustrated-caller-copy

  • “Dude, am I on hold again while you chase down that POD? That is so 20th-century. You are so lame. ”

So let’s assume you’ve said “okay” to this new demand. Who is going to do it? You? Everyone in the office?

One difficulty is this: Trucking companies are experts in hauling freight. You excel at getting the freight to its destination on time, accurately and damage-free, with special services as needed. You make appointments. Local P&D companies bring a liftgate or 2-man crew if needed, handle inside deliveries or tight urban dock locations, and so on. We might call this “core service.” Superior core service like this is a justifiable point of pride for many carriers. It can take 12 or 14 hours a day from many employees just to give great core service.

  • “So, Jonathan, are you telling me that this is not enough? I need to give my customer instant, on-demand POD too?”

No, I’m not telling you this…. your customers are. That is, they probably are, if you’re listening.

At some point we all have to ask:  What is best for my trucking company, right now? What is best for me, for my spouse, for my people, for my customers, for their customers?

Looking just at the POD requests, there are a number of ways to address the issue.

  1. Add 2-3 hours to each work day. (This gets tiresome pretty quickly.)
  2. Hire more people. (This gets expensive pretty quickly.)
  3. Ignore your customers.

Bury-your-Head-in-the-sand (We don’t recommend this.)

There are other choices too. One is to find technology that can do all this POD work for you, much more cheaply and reliably than a new hire. Depending on your situation, you may be able to satisfy most or all of your POD requests with a self-service web portal, where your customers log in and download whatever they need. In other situations, you may be able to satisfy several key accounts this way, providing some other communication mechanisms for other customers. In any case, given the trends, it’s worth devoting some serious time to thinking this through.

If you’d like to get down to that mythical 12-hour day, you can harness technology to get this done for you. Some effort is required to set it up. Of course, it also takes effort to do nothing and remain stuck in the same situation.

Finally: If POD isn’t the Great Time Suck for your business, what is?  For some carriers it’s billing.  Please leave comments below, or anywhere else you’ve seen this post, so that we can continue the conversation together. I look forward to hearing what you think.

–The Editors

3 Ways to Keep Customers from Leaving You

I hear it all the time:

“Jonathan, my biggest account just went somewhere else, and we had to lay off three drivers. It hurts.”Stanley

 

 

 

 

 

 

 

 

 

The Hidden Costs of Losing Customers

 

Losing customers is not only painful, it’s also a much bigger loss than just the revenue.

SCORE, a national nonprofit think-tank for entrepreneurial education, tells us (http://tinyurl.com/o975jxg) the following about losing customers:

  • It costs about 5 times as much to attract a new customer as it does to keep an existing one.
    • Jonathan’s suggestion:  Keep your current customers! It’s cheaper!
  • The lowest-ranking employee in a business can lose more customers than can be gained by the highest-ranking employee.
    • Jonathan’s suggestion:  When a customer leaves, find out why. Ask the hard questions.
  • If you make an effort to remedy customer’s complaints, 82 to 95 percent of them will stay with you.
    • Jonathan’s suggestion:  if someone takes the trouble to complain, take the trouble to listen and respond.  It takes time, but isn’t it worth it to keep that customer’s business? Of course it is – because more than 4 of 5 customers will stay if you try to help them. You might even get a grateful hug!

kiss in hall

What To Do Right Now

If you are losing customers, you must take action.  What to do? Here are some things you can do today:

 1.  Swarm your customers with thoughtful service.

Here are some examples:

  • If your customers want online POD, give them online POD.

Invest in a TMS that will give your customers this kind of self-service help.  (Hint:  your phones will be quieter, too.)

  • If your customers want you to call ahead for a delivery, or every delivery, or every pickup and every delivery, just do it. (You might need better systems in place so that you don’t keep forgetting to call ahead.)

You need a system in place where nothing falls through the cracks.

  • If you don’t have this, someone else will, and your customer will go there.

customer leaving at night

2.  Anticipate your customers’ needs.

 (Don’t wait for them to ask.)

proactive

Some suggestions:

  • Ask your top 10 customers what they dream of when they are shipping freight.
  • See what you can do to make their dreams happen.
  • If you can justify raising your rates as a result, so much the better – everybody wins.

And finally:

change ahead sign

3.  Adapt your systems

to your customers’ needs,

not the other way around.

 

You know the old joke:

        Everyone is all in favor of change,

        …. Until they have to change themselves.

  • If you are not set up to swarm your customers with thoughtfulness, another trucking company will be, and you will lose the business.
  • You may have to step out of your comfort zone to push through some needed changes with some of your stubborn employees.  (“We’ve always done it this way” ain’t good enough when the world outside your dock doors is changing all the time.)
http://www.dreamstime.com/-image20785598

Get out of your comfort zone!

If you’re losing customers, keep your head out of the sand!  If you are keeping your customers, let’s make sure you can maintain that momentum. Either way, contact me at jmiller@jsysoftware.com or 630-517-0705 for a free consultation. We’ll see what resources we can marshal in your favor.

Contact me today.

–Jonathan Miller

Editor, Local Trucking Blog

Mobile Fleet Devices in Local P&D: BYOD, COPE, or both?

There is a great article in FleetOwner about evaluating how to deploy mobile devices in a fleet. The basic choice is between these two options:

  • using drivers’ existing personal smartphones for business purposes or
  • having company-owned phones with selected personal features.

Read on for a great discussion about BYOD (“bring your own devices”) vs. COPE (“corporate-owned, personally-enabled”) smartphones. A lot of it depends on who your drivers are, since you can only demand so much from independents, while employee drivers have less choice. A good read for any fleet owner or fleet manager.

http://fleetowner.com/technology/smart-devices-and-fleet-desires?page=1

You’ll need to register for FleetOwner.com to read the entire article.

–Jonathan Miller

Local Hauls (<100 mi.) Exempt from 30-Minute Break Rule

This is good news for local trucking companies:

http://www.fmcsa.dot.gov/documents/hos/30-Minute-Guidance.pdf

Effective August 2, 2013, all drivers (CDL and non-CDL) that operate within 100 air miles of their normal work reporting location and satisfy the time limitations and recordkeeping requirements of 395.1(e)(1) will no longer be subject to the 30-minute break requirement.

  • Also, non-CDL drivers that operate within a 150 air-mile radius of the location where the driver reports for duty and satisfy the time limitations and recordkeeping requirements of 395.1(e)(2).

FMCSA will also be initiating a rulemaking to include text in the HOS regulations noting that the 30 minute break provisions do not apply to short haul drivers.

Jonathan Miller, Editor

Resisting Downward Pressure on Rates

How can you keep your local P&D rates up when everyone’s beating you down?  How can you compete when the national firms enter your last-mile market with tempting lowball prices?

There is one way to do it:  with unbeatable service.

resist downward pressure on rates local trucking

Keep Your Service Up!

There’s really no other way.

If you want to stay off the slippery slope, you need tools to give you consistently unbeatable service.  We’ve got the tools for you.  The ROI is totally a no-brainer.

For a personal consultation, contact Jonathan Miller at 630-517-0705 or jmiller@jsysoftware.com.

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