BY GREG R. MAY, CEO, CAR DELIVERY NETWORK INC.
Trucking companies have many important attributes unique to the industry, an understanding
of which is useful in developing and
executing a turnaround strategy.
The concept of strategic value is
highly relevant in a turnaround of a
trucking company and may be derived
from a number of sources, including
relationships with customers, creditors,
shareholders, employees, unions,
or anyone else who has a material
interest in a company’s continued
viability. Capitalizing on a trucking
company’s strategic value is an
important step in a turnaround effort.
Those involved with a turnaround
effort involving a trucking
company should understand:
•;The role of trucking in
a supply chain
•;The specialized nature of trucking
•;The importance of identifying a
trucking company’s strategic value
•;Management of a fleet
•;The driver workforce
•;The impact of deregulation
•;The competitive environment
•;Volume and capacity utilization
Each of these can have material
implications to a trucking company’s
operations. Understanding the
importance of each of these issues
will improve one’s ability to manage
through a trucking turnaround.
Foundations of Strategic Value
Trucking plays an important role in
supply chains, in which goods move
from suppliers to customers. In a perfect
world, the supply of goods reaches
the customer just as they are needed
to fill demand. Logistics—managing
the flow of goods from origin to
destination—is key to optimizing the
performance of a supply chain.
In an efficient supply chain, a high
degree of coordination occurs
among multiple carriers in different
transportation modes, such as marine,
rail, air, and truck. Each service provider
in a supply chain becomes a partner
in a fully integrated set of processes to
deliver goods from point A to point B.
However, truckers have an important
advantage over their marine, rail, and
airborne counterparts—for the most
part, trucks are best positioned to move
freight “the last mile” to a customer.
Trucking is a diverse industry that reflects
the broad and all-encompassing nature
of the goods used in the economy.
Conveyances range from those as simple
as flat beds or freight boxes to more
specialized trailers designed for hauling
automobiles, heavy equipment, or
high-tech equipment. Carriers that have
specialized capabilities may be limited to
a niche in the freight industry, but they
also may have the opportunity to solidify
the relationship with their customers by
filling a special need in a supply chain.
Truckload, less-than-truckload (LTL),
tankers, refrigerated, automotive, and
flatbed are just a few of the many
specialized trucking segments. Because