Last two weeks

[OntarioVanMan]

The new Toyota plant is huge down here near Tupelo MS...great for Ms and TN.....
same for I think its a Honda plant over in Greenfield Ind...almost done.....

[ericmoss37]

Thanks for the advice. I really do enjoy reading my copy of Expedite Now when it comes in. I am going to hang in there I am rather new to expediting. I got my three trucks at the begining of this year so I don't really have the option to park them more then a month or two. Selling them at this point is not a option either. I have to protect my FedEx Ground business. I have four routes over there so taking a loss on trucks is out of the question. I do have a advantage because my trucks are climate control and they have lift gates plus they are class 8's so they can handle more weight. The drivers do need to get Hazmats.

[highway star]

But Lawrence, if you were to buy a Camry you'd be supporting fellow Kentuckians working just 50 miles down the road from you. I delivered in Georgetown yesterday to the recently opened powertrain building. You are buying American when you buy Toyota, Honda or Nissan, especially when you look at the foreign content of Big 3 cars.

[Jack_Berry]

But Lawrence, if you were to buy a Camry you'd be supporting fellow Kentuckians working just 50 miles down the road from you. I delivered in Georgetown yesterday to the recently opened powertrain building. You are buying American when you buy Toyota, Honda or Nissan, especially when you look at the foreign content of Big 3 cars.

funny how when folks look at foreign cars they forget that many are mfg'ed in the us of a and that the plants employ people living in the us of a at pay rates higher than walmat greeters. yes the big money may go overseas but at least it is not going into a multi million golden parachute for an executive who cannot manage his company.

[BillChaffey]

It's kind of hard to blame the Big Three Auto manufactures, they have only known for 35 years the Oil producing Countries have had our Country by the throat. For all those years they bribed Congress so as not to improve on mileage, Cars & Trucks just kept getting bigger. Now there just asking for some of the bribe money back.

[ATeam]

Thanks for the advice. I really do enjoy reading my copy of Expedite Now when it comes in. I am going to hang in there I am rather new to expediting. I got my three trucks at the begining of this year so I don't really have the option to park them more then a month or two. Selling them at this point is not a option either. I have to protect my FedEx Ground business. I have four routes over there so taking a loss on trucks is out of the question. I do have a advantage because my trucks are climate control and they have lift gates plus they are class 8's so they can handle more weight. The drivers do need to get Hazmats.

Thank you for the kind words about Expedite NOW.

I woke up this morning thinking about what you wrote and offer the following, not to be harsh, but to present more to think about. It is offered it not with you specifically in mind but also others who, like you, may be experiencing a significant decline in freight.

When you say you don't have the option of taking a loss on your trucks, are you sure about that?

Now that you are in the game, you are not alone in determining the outcome. You may not want to take a loss, but if freight declines in price and/or volume for a significant period of time you may end up taking a loss whether you want to or not.

It is incorrect to say that taking a loss is not an option. Taking a loss is always an option.

The difference may only be that if you choose to take it early, the loss will be less than if other people force the choice on you later. Those people may include drivers who leave the trucks in search of better paying jobs, the finance people who decide to repo the trucks, shippers paying lower rates (an option they have when too many trucks are chasing too little freight) and truck buyers who will pay less for an older truck than newer.

You mentioned another business you also have and feel the need to protect. I do not know the relationship you have between the two businesses, but an expediting business is best run as a stand-alone entity. Blending the needs of an expedite business with another business muddles the way you run both. Expediting is a truly unique endeavor. Better business decisions are made when the business is clearly seen.

If an expedite business cannot stand successful on its own, I don't know how another business that you own will change that. Nor do I know how an unsuccessful expediting business will protect another business.

Large carriers that have non-performing subsidiaries tend to jettison them as a stop-loss measure. Such decisions are made by groups of managers who do not let emotion or desire rule the day. Smaller operators are more subject to the need to be right, which can cloud one's thinking about taking a business loss.

Ask yourself, "What am I trying to be right about?"

Are you trying to be right about being a winning expediter, or trying to be right about preserving your capital and living to fight another day?

Are you trying to be right about about looking successful in the eyes of your friends and family that see your trucks and envy what you have, or are you trying to be right about what those trucks are doing to your balance sheet?

Are you trying to be right about being catered to by your truck dealer and other vendors, and being a big shot in their eyes, or are you trying to be right about balancing your equipment with your freight levels and driver retention ability?

Are you trying to be right about feeling important because you have drivers under you, or are you trying to be right about having the assets to keep yourself out from under your creditors?

I am not telling you to get out of the business. I am only suggesting that there may be more thinking to do before saying taking a loss is not an option. If your business is in a losing position, a loss absolutely will be taken. The only question is how much will the loss be and when will it be taken?

If you find yourself looking more at hope than at your numbers, the hope you maintain should be examined. These are not hopeful times.

Yesterday, General Motors said it did not have enough cash to see it through the year. General Motors! Unemployment is at a 14 year high and expected to go higher. Retail chains are going bankrupt and/or closing stores by the hundreds.

These developments are different than failed financial companies morphing into larger companies or people's home values going down. The strength or weakness of consumer spending (jobs), automotive companies and retail translates directly into freight or the lack of it.

This is not the end of the world. It is a severe recession. The good news is recessions eventually give way to the next phase in the business cycle that is expansion. But the recession will get worse before it gets better.

A positive mental attitude can make big differences when applied to things you control. It is meaningless when applied to the economy. Just as the rain does not care if you get wet, the economy does not care what you hope. It makes no difference to the economy if you succeed or fail or how you feel about either.

In a recession, hope is the mechanism that transfers money from the losers to the winners. Somebody is going to profit from the trucks you own. Whether it is you or someone else depends on the level of hope maintained and by whom.

If you are running a business on the hope that things will get better, your money will flow into other people's pockets. If you are running a business with good decisions and strong numbers, money will flow into your pockets because other people are vesting their hope in you.

People shy away from expediters that run on hope alone. But if you have a healthy balance sheet, banks will lend you money, carriers will give you freight, and drivers will sign on with you and tend to stay.

If hope for a better day is driving your business, remember that he who has the most hope loses. Put in another way, it is better to be profitable than hopeful. Put in yet another way, hope is for suckers.

In this economic environment, the option of taking a loss is very much on the table. If you are in a marginal or losing position now, hope will not change that. The need to protect a different business will not change that. And given the present economic outlook, a shift to better conditions is not likely to change that.

If you can take an objective look at your business and see a loss coming, the faster you abandon your hope, the less the loss will be.

Taking a loss is not a shameful thing. It is often the smart move and one people will respect and understand.

[ericmoss37]

Phil I appreciate you point of view on the business. My trucks are older used trucks that are financed for 32 months. I have three 22ft straight trucks. 2001 Kenworth T-800 with Cat C-10. 2002 Freightliner Century with same thing lift gate and Refer. This truck also has a Cat C-10 They have Warranty coverage for another 150K miles. I have the option to extend the coverage to a million miles. My last truck is a 2003 Century with lift gate only, but it has my favorite engine the Cummins ISX. All three trucks are 1500 a month for 32 months. I have lots of cash on hand and I am just worried more about the drivers. I do have a plan B and that plan is to run solo's and pick up 1000 plus mile profitable broker loads on Fridays that deliver on Mondays. It's hard to run them with a team after Panther's 15% and given that the drivers have to split the 40% paid to the truck. I can offer brokers a more competitive rate with a single driver in the truck. Brokers tend to laugh when you tell them how much you need with a team in the truck. My solo drivers are doing better then the teams so that might be the way to go until business picks up.

[ATeam]

10-4

As I said, the above was not offered specifically with you in mind, but with others too. Best of luck to you, and all of us in dealing with whatever lies ahead.

[davekc]

Phil wrote
You mentioned another business you also have and feel the need to protect. I do not know the relationship you have between the two businesses, but an expediting business is best run as a stand-alone entity. Blending the needs of an expedite business with another business muddles the way you run both. Expediting is a truly unique endeavor. Better business decisions are made when the business is clearly seen.
================================================
Is this just your opinion, or is there something specific you can point to that states that?

[Falligator]

I haven't had hardly any loads for Ford, Chrysler or GM. Mainly other freight. However, I must admit that things have gotten really.....really bad in just the past 3 weeks. This is supposed to be the time when freight is picking up not slowing down. Since living in Florida, I've seen freight drop drastically. I was getting loads out of Tampa, Orlando, etc. In recent weeks....I have been having to DH out of the area. Which is suprising because there are not even any loads going to Naples or anywhere else in the state for that matter. I am hoping that the new president elect will keep his word and bring change to this country. However, the fact is that something has to be done sooner rather than later.

[ericmoss37]

I can see why it would be better to run it stand alone. You can see your cashflows and you can have seperate business credit. What I was refering to is my loans are rather new and I don't have enought cash on hand to take a 50% loss on each truck. I know that the trucks I bought just a few months back are worth about half of what I bought them for. That means I would have to make up the difference of three trucks with my cash on hand and that puts the other business at risk. Thats what I was refering to. Taking a 50% loss would take up just about all my free cash that I have in my accounts.

I am doing good over at FedEx Ground and it has not slowed down a bit. We actually have delivery volume growth over last year. The contractors have a chance to hire temp drivers at Christmas and make a killing by beating company thresholds for stops. I think that money should carry me if I need to park my expeditors for a few months. I should at the very least free up all my credit cards and free and clear of bad debt. I have a plan and I love working on getting the drivers freight. I scored a $5500 dollar backhaul refer run from Cali with one stop off in Atlanta before heading to Philly. If your willing to work the loads are up for grabs.

[ATeam]

I am doing good over at FedEx Ground and it has not slowed down a bit. We actually have delivery volume growth over last year.

It is very interesting and encouraging to hear that your FedEx Ground business is showing growth. To what do you attribute the increase?

[moose]

FedEx ground have the largest account for Del. small packages, mainly letters that must be sign for.
in that category you can fined items like :
homes foreclosure notice,
auctions opportunity ,
credit decline notice,
late payments requests,and inquiries,
account termination statements,
employment termination .
union buy outs,
unemployment claims ,
food stamps,
unpaid bills,
stimulate pay ,
and lots of election junk mail ...

all have being on the raised this last quarter .





Moose.

[ericmoss37]

Well we seem to get growth every year and I am not sure how in this enviornment, but I am going to say exceptional service. We are winning lots of new accounts as shippers buy into the independent contractor model. We are also gaining accounts that DHL once held. DHL is on the verge of going out of business and we stand to gain more accounts. They are also starting to take care of route owners by paying bonus to off set employment and property taxes. I found away though the interstate commerce expemption to avoid taxes on my FedEx trucks. The real test will be after Christmas when business slows. Christmas time is a time to take advantage what is offered. The company does not hire drivers so it's up to the contractors to cover routes because the year round truck can only fit about half of the daily package volume. So I hire 7 to 10 extra drivers to cover my four routes. It's important that you time it right because I hired people to early last year and business did not pick up until December and it was a disapointment. This year I think it's only going to be about two or three weeks where I make the big money.

I ended up getting into expediting because of lack of oppertunity to grow my business at FedEx Ground. Routes become available every few years and FedEx has no system to fairly award the routes. The managers pretty much decide who they want to give it to and they don't announce they are doing it. They have increased the pay every year for the last few years due to lawsuits that challenged single route drivers as being employees. The FedEx business provides good week to week cashflow that helps with the 15 day wait at Panther. It also helps with slow months or a month when a truck is down for a long period of time. I feel like I am in a better position than a fleet owner that is just in expediting. The margin is expediting is better when the drivers get decent milage, but FedEx Ground is more consistant and only varies by $500 dollars between a slow and busy week. With DHL going out in the next few months things will only get better with more oppertunities to get more routes and trucks.

[moose]

First time Am hearing about DHL going out ,
guess i was living under a rock ... (a big one am a Moose...)
Think it will bring up a new opportunity for CV as well ?
how 'bout St.trucks ?



Moose,