February can be a slow month for truck drivers. Combine that with the market being sleepy in general right now and you have a scenario that could rattle your confidence. But there is reason for optimism.
There is a rhythm to the trucking market. A cycle. And maintaining profitability is an exercise in timing those cycles correctly. DAT research tells us these cycles typically last between 18 and 24 months (although it’s reasonable to expect a bit of a bump in the market, starting down south, when produce season begins).
Be ready when the market bounces back
In times like these, when the market is down, you can use the extra time to build your business for the long haul. Specifically, you can fortify our business to the point that it can sustain you through both up and down cycles.
Staying profitable in a down market is not a fantasy. But to do so, this is a great time to leverage business relationships, shore up your costs and fine-tune your strategies.
3 steps for profitability in a down market
- ‘I Was Told There’d Be No Math’: Here’s a scenario you may have faced: You pick up a high-paying load in, say, L.A. and haul it to Denver. But you can’t find a load to carry out of Denver and you end up deadheading hundreds of miles for your next load. Why did this happen? Because Denver is what we can call “a consumer market,” meaning lots of loads come into the city to be consumed but not a whole lot of goods head outbound. Bottom line: if you had the power to find two loads that cumulatively pay more than one high-paying load, you’d do it. And thanks to DAT One, you can see that data right now and make a better-informed financial decision for your business.
- What’s a Cup of Coffee Worth? While trucking is an industry with lots of unique quirks and nuances, there is one way in which it is identical to every other business on earth: It’s a people business. Relationships with the people you encounter day to day form the bedrock of success in trucking too. While the market is hibernating, it’s a good idea to shore up those long-term business relationships you’ll rely on when the market bounces back. If you can help a broker out of a bind in a tough situation, he or she will remember that when times are good. It’s not all about short-term gains.
- Fuel Economy: Given that diesel fuel is typically the primary expense for a trucking business, it’s imperative to gain control over your fuel expenses with a few creative strategies. At no cost to you, DAT offers a brief guide to reducing fuel costs, and many of the suggestions it contains can be implemented today. Take advantage of the down market by equipping your vehicle with these cost-cutting techniques.
Load Board Hacks: Here are a couple of tips and tricks to help you when searching the DAT One load board.
- Knowledge is Power. Let’s return to our hypothetical L.A. to Denver route. Chances are you won’t be the only truck leaving Denver empty-handed, and all of the trucks that delivered goods in Denver have now become your competition for the next load. On the DAT One load board dashboard, you can view the number of inbound loads versus outbound for each market and plan ahead accordingly.
- The Lay of the Land. Be sure to check the load-to-truck ratio. When researching a market, you’d ideally like to see a high number of loads and a low number of trucks because that means you have leverage. Check the Market Conditions map in DAT One to see where your truck is in high demand, and where there’s a lot of competition for freight.
- Time is money. Making business decisions means assessing all the relevant information, and nowhere is that more important for carriers than when it comes to deciding on what loads to haul. With the new Profit Estimator from DAT One, you can quickly see how the numbers add up for each load and choose the one that best fits your business goals. It’s fast and simple. You just enter your business costs and goals into the Profit Estimator one time. After that, DAT One automatically shows you a breakdown of your potential profits based on the broker’s offer rate on any load. Easy as that. Now you can plan with confidence and zero in on the best loads for your business.
As you can see, staying profitable during a down market is more than just possible, especially when you’re guided by DAT One and the rich data it delivers. These useful insights might even make you feel a bit more empowered and invigorated. Perfect! When it comes to your business, the effort is directly connected to the result.