Follow us on Twitter!
Blog Header Logo
DG&A's Transportation Consulting Blog
Subscribe to this list via RSS Blog posts tagged in Yield Improvement

As we approach the end of February, most truckers would acknowledge that this is a good year for the North American motor carrier industry. Business volumes remain strong, in fact stronger than they have been during the first few months of prior years. Supply and demand remain in pretty good balance. Capacity is tight as experienced drivers remain in short supply. Low diesel fuel costs are keeping this operating expense in a more manageable range than it has been in some time. For Canadian manufacturers, the eighty cent dollar is helping drive exports to the United States. Many shippers are receptive to rate increases to ensure they retain their core carriers. There hasn’t been a better time in years to improve yields.

In the past, truckers would go to their low margin accounts during the good times and seek a significant rate increase or de-market some accounts in the hope that new, more profitable accounts would be added. As economic conditions worsened and revenues declined, these same truckers would often go back to the accounts they de-marketed and then try to re-secure them. This feast or famine approach to yield management did not appreciably improve the business on a long term basis. Some companies have learned from experience that there is a better way. During these fairly buoyant times, the opportunity exists to make some significant and sustainable improvements to the bottom line of your trucking business. Here’s how.

Get an Accurate Reading on the Margins on all of your Accounts

If you haven’t invested in a good cost accounting system, now is the time to do so. As a starting point for any yield management initiative, it is critical that you don’t guess at the margins of your accounts. A good costing system will supply you with high quality estimates of the margins of your clients. The system should supply you with a list of your accounts in descending order by contribution margin by lane. There is a need to fully understand what is driving these numbers.

Which specific costs are contributing to the low margins on some accounts? Does a particular account incur too much waiting time? Is the freight difficult to load? Does the driver have to incur too many out of route miles to pick up or deliver the freight? Are the costs in line but the rates are non-compensatory? Do the rates not sufficiently cover fuel or accessorial charges or freight density? What are the factors that are producing an inadequate return on the account? Where do the rates have to be to achieve a satisfactory yield on the account? This will serve as a partial roadmap as to where improvements are required.

...
Hits: 4547
0
Continue reading 0 Comments

Most Recent Posts

Search


Tag Cloud

Whole Foods Donald Trump Werner professional drivers Training drones Sales Management cheap oil Crisis management Online grocery shopping Coronavirus consumer centric IANA Politics Canadian truckers NMFC Transportation service NS marketing computer Sales Training Emergent Strategy economy CN Rail buying trucking companies Consulting employee termination LTL small business Success Digitization fuel surcharge Comey Outsourcing Sales Loblaw Sales CRM Canada U.S. trade China Muhammad Ali Climate Change the future of transportation Toronto freight transportation Carriers freight broker dynamic pricing Freight Shuttle System Freight contracts natural disasters Freight Rates Trump Rate per Mile network optimization e-commerce shipper-carrier contracts New York Times RFP Crude Oil by Rail CP Rail 2014 freight forecast University of Tennessee asset management Freight Management autonomous vehicles laptop MBA dimensional pricing Bobby Harris Leadership autos Fire Phone LCV's 2012 Transportation Business Strategies. Jugaad routing guide 3PL driver shortages dark stores freight transportation in 2011 Success failure entrepreneur Horizontal Supply Chain Collaboration economic forecasts for 2012 Freight Carriers Association of Canada Freight JB Hunt economic outlook Stephen Harper Trade Vision Software Advice TMS future of freight industry Canada $75000 bond LinkedIn transportation audit NCC Cleveland Cavaliers Transcom Fleet Leasing truck driver Freight Matching freight costs cars Finance and Transportation transportation news Toronto Maple Leafs Load broker driverless freight cost savings Spanx Yield Improvement 2014 freight volumes Management Electric Vehicles derailments technology Global Transportation Hub Infrastructure home delibery pipelines FCPC CITA Shipper Pulse Survey Schneider Logistics last mile delivery Trucking freight rate increases risk management selling trucking companies Transportation Buying Trends Survey recession 2015 Economic Forecast Transloading NAFTA Facebook Hockey freight forwarders MPG truck drivers David Tuttle Anti-Vax Microsoft computer protection FCA trade TMP Worldwide online shopping shipper-carrier roundtable CSX freight bid APL Rail FMCSA Global experience Business Development Celadon Truckload Canadian economy Value Proposition Justice USA Truck peak season Impeachment Conway Social Media in Transportation 360ideaspace TransForce CSA Swift US Manufacturing Blockchain freight RFP Tracy Matura supply chain management Covid-19 Surety bond General Motors US Election Map-21 customer engagement freight transportation conference freight agreements USMCA Ferromex intermodal UP Canada's global strategy coaching business security Doug Nix Accessorial Charges Dedicated Trucking FMS President Obama home delivery Masters in Logistics cyber security Freight Capacity Entrepreneur computer security Grocery Search engine optimization freight payment freight audit Uber Freight 2014 economic forecast transportation newspaper shipping 3PLTL Right Shoring Inbound Transportation energy efficiency Retail transportation carrier conference Scott Monty Geopolitics Digital Freight Networks Canada-U.S. trade agreement YRC Amazon CSA scores Business Transformation Strategy Habs BNSF BlueGrace Logistics CN Keystone Pipeline Training New Hires Montreal Canadiens Colilers International ProMiles digital freight matching Dan Goodwill Omni Channel US Economy FuelQuest business start-up Social Media Government Dedicated Contract Carriage Deferred Packaging Load Boards Business Strategy freight audit Leafs 2013 Economic Forecast Transplace Packaging Harper Davos speech Driver Shortage freight marketplace Tariffs hiring process Canadian Protests Career Advice ELD tanker cars driver solutions provider Failure Retail Freight Recession Wal-Mart ShipMax financial management freight payment Canadian Transportation & Logistics KCS Rotman School of Business driver pay Derek Singleton Otto shipper-carrier collaboration Job satisfaction US Auto Sales Distribution US Housing Market Driving for Profit truck capacity Regina mentoring EBOR robotics Transportation Trucker Protest automation broker security capacity shortage Transport Capital Partners (TCP) Education rail safety Doug Davis Life Lessons Business skills Broker Blogging Associates Warehousing broker bonds YRCW Twitter small parcel Reshoring bulk shipping shipping wine Shipper Hudsons Bay Company trucking company acquisitions Canadian freight market capacity shortages Railway Association of Canada Sales Strategy Adrian Gonzalez

Blog Archives

March
February
December
October
September
August
June
May
April
March
January