Fuel Bonus - Want Opinions

It is human nature to bite the hand that feeds... For employees to find little grievances about the boss. You can buy them all cars.. In 3 months theyll be griping behind your back again.

The goal is cost cutting right? Atleast the thread opened with cost cutting them somehow went to pay raising. You dont cut costs by raising pay. Raising wages as your revenue shrinks is how you capsize the whole ship.

If you implement fuel miser programs and start clipping guys wings during a period of paycheck shrinkage and increased pressure on drivers, youll end up with more grumbling and maybe a little mutiny. They always think the grass is greener and you might lose a few drivers. Chances are they wont be the ones you wanted to lose. Your laggards are still there, youve had an ace or two leave.. And now the real risk.. That the ace does find a better job, stays in touch with some of your guys and helps the other company poach out of your flock. You know theyll offer him recruiter incentives to bring over more aces.

When times are tough is when tough decisions must be made. You know your laggers. Privately coach them on their unique issues. If their truck is falling out of profitability because of their tickets or lead foot or missed loads.. Fix them. If they wont be fixed, let them go and sell their truck to ease budget issues and pay down debts. It is normal for a company to contract during economic contraction in order to survive. The rest of the crowd will get in line real dang fast. The message will be loud and clear. Your job is to generate a profit so the business can continue to exist. If you dont, your job goes away.

If you dont have another driver in need i say sell the truck because truck prices are still fairly high given these low rates, but theyre gonna drop as the rate bust deepens and drags on. more carriers go nipples up and youll be able to buy up better equipment down the road for less. Sell high buy low maintain cash flow. Hanging onto parked trucks as truck prices fall.. only to sell later when you cant put a good driver in them is just losing equity. If theyre not collectible classics, dont collect em. If you let go of the worst driver then look over your fleet to let go of the worst truck, your company should get a little healthier.

 

Why should your profit come from the drivers pocket? Raise your rates so the shippers and receivers pay.
Are the drivers. the revenue generators, involved in the process of any changes.
Or are they just numbers?
Everybody wants to be a tycoon.

Where did the money for these cars come from?

 

If rates fall far enough there is no profit. A company running at break even or a loss eventually folds and leaves everyone jobless. The driver showed up with empty pockets the day he needed a job. Payroll is direct deposit, not direct withdrawal. If the employer bounced checks would the driver not leave? If one trouble driver cant be profitable like all the others, and cant be fixed over time, end the relationship. That is a necessity for the business cycle to continue and everyones kids to get new shoes.

Raise rates when everyone else is lowering them and watch your dedicated accounts evaporate, making the situation worse.

From the company that gave the driver a job. Did the driver put up $100k to get a truck and trailer? Does he lose $30k if he doesnt check the oil?

The owner has a lot more at risk than the driver so dont give me that snivelling socialist crap. The driver can wreck the truck and the company still has to make the payment.

In capitalism your rewards are proportional to your risks. Low risk, low return. The reward/fee for bearing financial risk is collecting interest. The higher the risk the higher must be the interest.

Eroding that basic tenet is why our entire country is getting socialistic. Theres some reality for you.

 

The way I see it your ideals amount toward Communism and without drivers there is no revenue.
The driver did not put the company in the position it's in Capitalism did.
I do agree on 1 thing tho ,If the way you're doing business is not working then change the way you are doing business
Did you inherit the company or something? How did the company start?

 

Why make everything so complicated? It’s simple, minor glitch in Trucking right now. Increasing Profitability should always be a goal.The key here is to keep your Drivers. Let them know your not going to cut them loose. It’s a hard thing to do, explaining profit concerns, and implementing cost cutting, without raising concern about future of the Company, and Drivers financial concerns. Cutting Drivers, no way!!! Next month, it could all change.Being prepared to take advantage of rate increases is key, long term.What ever Midwest Trucker does, better to make gradual, not drastic changes. He’s obviously been doing something right, As a Driver myself, I can only hope, if I ever need a job,I’d find an employer that is reasonable. I won’t work for Cut throats.

 

The communist way would be to shoot the lagging driver. The socialist way is to make every other driver take a pay cut to keep the lagger on. The capitalist way is to give the lagger his walking paper so the company can survive and maintain the same level of pay and benefits for the others who produce.

If there are no laggers and there isnt enough revenue to pay everyone at the current rate, the business has made some errors and it will feel some pain in a downturn. Percent of linehaul pay format doesnt really have the company issue that CPM pay format does. If youre on % you know its the market overall who cut your pay, if youre on CPM you think its the company. Get a DAT account and try to run your own truck then and youll see for yourself.

By @Midwest Trucker accepting tremendous personal risk to create the company, i assume. A hired driver doesnt start anything. The risky part has been done long before he shows up with his hat in hand looking for a job at an established company.

I mentioned cuts because MWT was addressing concerns about how to keep paying what he has with the contracting rates. Thats the sort of questions one asks when an iceberg is ahead and now is the time to look at some hard contingency plans for if the iceberg is bigger than it currently looks. Thats all. If this is a blip in the radar no big deal. If winter comes in with a fury and the stock market noses over at the same time we may be in for a bumpy ride. Food for thought is all.

 

Really it is not. Psychology tells us that people are hard wired to self select into groups, and think US vs THEM. A leader's job is to define US as the company, and THEM, as everyone else. If you've ever worked at a company with a healthy productive, energetic company culture, there's no #####ing about "them" within the company, because the company is US.

No, the goal is NOT cutting costs. The accountants dream is cutting costs. I love telling them they should just stop making deliveries, and that makes the costs as low as it can go...

No, the goal is to increase profit, and if it takes more money to the drivers to make more money for the company, that is called a win-win. There are so many opportunities to make more money if everyone pulls in the same direction, but the FIRST thing you have to do is stop thinking like a book keeper.

Minor quibble. Yes, the goal is to keep GOOD drivers. The goal of a good metric system (Management Information System in business speak) is to identify the good drivers AND the bad drivers. Bad drivers need to get coached, trained, supported, and brought up to standard..... but if they don't make it, it's time to set them free to be all they can be, somewhere else.

 

I feel youre kinda in conflict with yourself there accidental trucker. The rates are what they are. If youre hauling dryvan and the load to truck ratio decides $1.90 a mile is all they got in it then oh well. No wizzbang negotiation tactics are gonna change that. So revenue is capped. Making more profit on same revenue is now limited to cutting costs. So you want drivers to save fuel. Great i am all for it. Save fuel by paying them more? By slowing their trucks? Maybe itll work, maybe itll make morale worse.

Ive been part of a big corp during boom and bust. 150yr old company that had lots of boombusts actually. Booms everyone gets a job and lots of OT. During a bust they use the rule book to selectively eliminate the turds and survive the down turn. Trucking aint no different. Hell most manufacturers are now staffed by a few hundred temps through the boom so they just let them go and cut back to the core personnel in lean times.

Your last paragragh is pretty much the same thing im saying. Times are getting tough.. Fix the squeeky wheels or turn em loose.

 

I don't agree. Yes, if you see your business as a trapped price taker, then, yes, the only way you can compete is on cost. But these aren't the times of ICC set rates and "level playing fields".

But we all know that even in dry van, there's crappy paying freight, decent paying freight, and premium loads. A good management information system allows you to increase your revenue rather than throwing your hands up and saying " those are the rates". There is ALWAYS better freight, better routes, better truck utilization, better schedules, etc, etc, etc. There are ALWAYS ways to work on the revenue side.

As far as cutting the turds, that should happen ALWAYS, not just during bad times. There is NO law that says you have to expand during good times and contract during bad times! Yes, it's what people do, because it's what "everybody does". But what if you don't? What if you don't chase the easy money during an expansion, but rather continue to focus on getting better, finding the best freight, the best customers, the best drivers, the best maintenance programs, the best operational model? Almost all management gets lazy during the good times, because it is easy, and then the employees get to bear the brunt of the downturn when it happens.

What if management WASN'T lazy during the good times and positioned the company so everyone could just keep working and even keep making an profit during the downturns?

 

You hit the nail. Most problems I see are caused by Managements lack of discipline. When things get tight, it’s Service that sells, same as when it’s busy. The ability to cover loads, even when underbid, usually results in Customer coming back. Many Companies focus on maintaining profit increases, especially if they’re Publicly held. Privately held Companies, are a better bet during tough times. It can mean the difference in Stability, for a Driver. All depends on Who is in Charge.My Wife always points out the fact, that a Company’s Employees attitudes are an extension of Management. It starts at the Top. It’s so true, seen it a lot. Good Management, makes for more Productive Workers. Bad Management, just the opposite,