More Owner Operators The Answer?

I fear that the little guy, the single O/O will be under cut and eventually put out of business by the mega carriers. Its the same principle as mom and pop stores verus Walmart. Economies of scale at work, I'm I wrong?

I hope so.

 

They have been talking about Owner Operators going to be a thing of the past since the first owner operator. I collect old trucking literature and magazines, I have one from 1953 or 1954 and it has an article that says "Owner Operators are on their way out" and almost 60 years later were still here.

 

I don't operate in your market but I think the same principals apply.

If you are going to try compete on straight forward general freight movement you can not compete.The reason been that the deciding factor for the customer on this is price.If you cant win in that department then you will battle for business.

The bigger carriers are the same where ever you go. They lack flexibility.They cant implement changes instantly.There are companies and industries that need these characteristics from a transporter. There are also industries that need the transporter to be more then just a steering wheel holder.The driver is the obvious choice for been an extension of their business.They may require you to have some knowledge about the cargo you transport.To interact with their customers.Here is where the O/O has an advantage.

Much like your Walmart vs mom & pop stores analogies. You cant compete on movement of consumer goods or general freight between major centers.
People however don't commission art work or buy gourmet cuisine at Walmart.So there will always be restaurants and galleries. O/O's will always have a place if they are willing to find a niche and learn specific value adding skills.These cant be reproduced by mega carriers and will always be in demand.Probably more so on dedicated accounts or specialist freight.

 

What recent woes? Swift, I know, doesn't compete on price alone. You'll always have rate cutters. How are you going to get more owner-operators? Big shippers need carriers with big surge capacity; owner-operators can't provide 500 extra trucks to Wal Mart during the holidays. Mega carriers can. Too, owner-operators often serve different markets than the mega carriers.

If you're ever in Portland, OR, visit the main library. They have a complete set of 1930's "Transport Topics." It's not microfilm. It's real, musty-smelling magazines. Good stuff! If you can ever find the July 12, 1937 issue of "Life" magazine--great article, with lots of photos, of truckers.

 

The mega carriers are all working on a non-asset based business model. In other words they want to use O/O's or lease operators because they simply make more money that way.