The freight transportation market is in a state of disarray. Many economists are predicting that the 2^nd Quarter of 2020 will be the worst in US history, and the transportation industry reacts with a quarter lag to these economic conditions. There will be as many as 600,000 trucks taken out of the market in the 2^nd quarter. We are hearing various stories of how this is particularly affecting small fleets and owner operators, that are reducing operations down to 1 truck, or shutting down completely.

With all this said, it is key to remain positive. While there are no predictions on how the market will react once this time is over; but there are predictions that there will be at least 250,000 trucks put back in the market. The deficit of trucks will mean that we will have the tightest truck market on record.

So, what can carrier companies do to get through this time? Many experts in the industry are stressing that it’s time to go back to basics and focus on some key areas that will get them through.

Build and Maintain your Relationships

We all know in this industry, there are times when you need brokers and shippers, and times when they need you. Now is the time when you are needed, but don’t forget, the market will eventually flip. When that time comes, make sure you are a preferred carrier by keeping those relationships strong now. Key ways to achieve this are to answer their calls, be smart with rates, and work with them to provide the essential services!

Pay Down Debt

If you can do so, now is a great time to pay down debt. In addition, many in the industry are warning carrier companies to not take out too many loans; just because the loan rates are good, doesn’t mean you need to extend yourself. If you can get by without the loan and cut your expenses, do it. The only type of loan that experts in the industry are encouraging carrier companies to apply for is the Paycheck Protection Program, which can be a forgivable loan that small businesses to pay their employees during the COVID-19 crisis. For more information on the program and how to apply, check out the Treasury’s Fact Sheet.

Save Cash

Related to paying down debt, is the industry’s suggestion that now is the time to save cash. This is hard right now. But, perhaps this time can teach us that even if we can’t save cash right now, it’s an important reminder to do so when times are better. Having cash saved will put you in the best position to continue operations.

Know Your Numbers

Many small carrier companies and owner operators find it difficult to keep track of their numbers and business expenses. The more you know, the better position you will be in, and you will be able to pinpoint exactly where you can save cash. Check out the OOIDA’s Cost of Operation Spreadsheet. It’s a great place to start to build your budget!

Watch For Opportunities and Be Flexible

There will be many opportunities for new shipment types, new lanes, and new partnerships. Keep your eye out for those in the coming months and remember to be flexible! Try to avoid statements that contain “I don’t” (i.e., “I don’t run that lane”, “I don’t haul that product”, etc.). You may need to adjust your operations in order to be successful.

One final thought, positivity is key right now. We must get past the fear, on to learning, and then into growth. So, remember, breathe, and focus on what you can control!