I’ve heard the odd person allude to a possible double dip in the economy but for the most part (as mentioned before) it looks like the worst is behind us. In discussions with our carrier customers, most have followed a cost cutting protocol, regardless of the size, scope and nature of their business. Still, if we look at Ontario vs. Western Canada, it appears carriers can raise rates in the west, while the shippers still carry the big stick here. Available capacity seems to be the predominant trump card.
You’ve probably all heard something along the lines of “Quality, service and price…pick two”. In this new, post-recession economy, smart operators are forced to follow that guideline. Where shippers are under pressure to maintain or lower their transportation spend, carriers have had to modify their thinking accordingly. Where a partial load west used to move Friday for a Monday delivery, now it might wait to get topped up Monday for a Thursday delivery. This brings us to another saying “Better to beg for forgiveness than ask for permission”.
Even though driver demand here has never been higher, the carriers can’t increase their wages. This will discourage new drivers to enter the industry and as the aging driving force retires, this lack of drivers to move the freight will either push more freight to rail or decrease capacity (as it has in the west) and then maybe rates can rise… and the cycle continues. Interesting how supply and demand eventually gets things sorted out. Hopefully it will again and everyone can breathe a little easier.
What are the biggest lessons you’ve learned since the recession? My top 5 follows and you can probably add the statement “like never before” to each one:
Lee’s Quote for the day
“By the time everything all comes together, it’s time to retire!”