Dollars & Sense
The Numbers Are In: August 2010 Another (Mostly) Great Month
Last week, Sylectus released their monthly analysis of the data they collect, which chronicles the ups and downs of the expediting industry. This monthâ€™s numbers cover August 2010, and as you might expect, things have lately been on an upward tilt across the board.
August was almost an across-the-board win, but rate per mile dropped several cents from its highest point in quite some time, which July 2010 saw.
Aside from that, however, August was quite a successful month, to go along with an equally successful rest of the summer. In August 2010, volumes were up as well as revenues, over August 2010. To go along with this increase in volume and revenue, there continues to be a tight capacity issue that Sylectus has been indicating could turn into a bona fide driver shortage in the near future. With respect to these capacity issues when considering volume and revenue, Sylectus says, â€œWith the increased business volumes and tight capacity, we are surprised to see the rate per mile take a decrease. It makes you wonder if there is unwarranted rate discounting happening.â€
Despite the fact that 2010 has been among the best years that Sylectus has tracked (if not the best year theyâ€™ve tracked), they still urge their clients to remain somewhat cautious and that they stay prepared in the somewhat inevitable event that the economy undergoes another downturn (we donâ€™t know when itâ€™ll happen, but we know it will--itâ€™s just a feature of how our economy works). They urge their clients to do the following:
Build strong business alliances. The survivors of the last recession relied on each other to help get through the tough times. There is strength in numbers (and diversity). It is never too late to diversify your relationships within the Sylectus Alliance. Stay on top of your cash flow. Be vigilant at collecting your money for the services you perform. Donâ€™t let customers get too far behind on payments. Build up your war chest. Invest in technology that can improve your productivity, improve your customer service, reduce your costs and â€œlock inâ€ your customers. Invest in your people. Do you have the right mix of energetic, creative, dedicated people who want to take your business higher? Get them trained for the job and support them. Prepare for CSA 2010. This single piece of legislation could cripple unprepared trucking companies. If your company is ready, you could see a significant increase in business (even in a down economy) as shippers gravitate towards the compliant carriers. Review your pricing strategy. Too many carriers are quick to drop their rates to non profitable levels. Right now, many carriers are getting a good rate for their services. Keep your costs in check. Buy the products and services you need to run your business. Now is not the time to be purchasing those sports tickets.
The lesson here, as I see it, is that you should enjoy the times weâ€™re in, and stay prepared for when things get rough. And keep your ear to the ground, because things can happen awfully quickly.