With the freight market highly competitive and operating costs skyrocketing, carriers are focusing on ways to grow their business profitably. So, with peak shipping season winding down, it’s the perfect time to reevaluate all areas of your business and position your company for success in 2023.
Having a positive and more profitable 2023 can be helped by doing a few things now – whether it’s through creating ways to drive more revenue or finding more efficiency in the day-to-day. Here are four areas we recommend carriers focus on to bolster your bottom line in the new year.
Finding success from RFPs is easier said than done, and most carriers have already learned the hard way that RFPs can be both an opportunity and, on occasion, a big waste of time and money. On the one hand, RFPs are a fast way to start working with a company that leads to consistent new business. At the same time, there’s always some risk with any RFP. Participating in any bid takes time, with no guarantee of being awarded any new freight. But, if you’re going to put effort into one, you need to do it right.
Keep in mind winning a bid is never all about just rates. In fact, the less you make your responses about rates, the better. You want to give potential customers as many other reasons as possible to select you as a partner. When you know the shipper and are confident the opportunity is good for your business, you can go all in with your pricing. At the same time, make sure you look for any red flags that signal that an RFP and company won’t be good for you. It’ll save a lot of time you could spend pursuing more valuable prospects.
Many carriers have a potential business right in front of them and don’t know it. Trying to develop deep relationships with companies you are already working with is often worthwhile because you never know the opportunities that may exist. It sounds obvious to do so, but many carriers do not make a basic effort to explore the potential of many relationships they already have. By the way, even if the relationship started through a third party, there is still an excellent chance to take it further. It’s always a mistake not to try. For this to work, you have to have proven yourself, of course. This means providing good service and communicating with the customer from the start are both important. For example, providing accurate and timely progress updates as loads are moving is a big positive in the shipper’s eyes—customers notice these things.
And remember, you’ll probably have to ask and make it known that you’d like to handle more of a company’s freight. It’s not personal, but don’t assume they’ll ask you first. And by the way, familiarity with customers makes servicing them easier and more efficient for your company, too.
The truth is not all freight is good for you. So, smart carriers looking to grow will always take the time to determine the right types of customers that work well for their company. An important step in being able to do this is knowing what your company is good at and which type of customers you want to grow with. Of course, the hard part is that you need to find them. A common mistake is for carriers to think they can be good with all kinds of customers and freight.
Having experience with specific industries and consignee locations with certain requirements (e.g., food and beverage companies or large retailers) is effective for identifying customers who’ll recognize the added value of your capabilities. More good news is that working with the right types of customers enables you to remain more efficient in your operations.
It’s also an oversight to assume that companies you feel are a good fit know about you—even if you have worked together before. Employee turnover is common (which creates new opportunities sometimes), so it’s essential to be constantly performing sales and marketing outreach with the targets you identify. There’s a bonus here, too. Companies are interested in carriers who understand their business and will often pay a little more when that’s the case.
Whether through a broker or cold call, every carrier/ shipper relationship has to start somewhere. The good news is many shippers find it more effective to use freight marketplaces. For them, dealing with time-consuming tasks like vetting carriers for safety and compliance are headaches they do not want.
Freight marketplaces are an instant way to begin relationships with companies with the types of freight that are right for you and play to your strengths and needs, such as finding backhauls. Better yet, as you find shippers in these marketplaces, you’ll have the opportunity to build those relationships further, as we’ve already discussed. And remember, in addition to offering well-paying spot loads and backhauls, quality marketplaces can also provide contract opportunities. In other words, it’s wise to go where the shippers are to find new ways to grow.
Let’s be honest, this year has been challenging for trucking companies. Many of the reasons this has happened are out of your control. But you still need to be proactive and take those challenges on. Implementing any of these four ideas will give you a great start to a more profitable 2023.