Rates of Return Increasing in Trucking Industry

According to Transport Capital Partners’ fourth-quarter industry survey, more carriers are getting adequate rates of return. However, tight credit and static accessorials are continuing issues of concern.

With rate increases being nonexistent right now in the trucking industry, some carriers may have hoped to raise income through renegotiating accessorials. The bad news from the survey is that 42% of carriers surveyed this quarter indicated they do not expect to be able to renegotiate. This is down slightly from the past two quarters.

From 2011-2013, the number of carriers able to raise fuel surcharges has dropped from 30% to 11%. Pessimism about accessorials is greater among smaller carriers than the larger carriers (50% vs. 38%).

In spite of the lack of rate increases and static accessorials, slightly more than half (54%) of carriers indicated they are getting an adequate rate of return. This is the highest level yet for this survey.

Even though these numbers are trending positive, they are not entirely encouraging. Forty-three percent of carriers still believe they are not getting an adequate return. The crux of the issue is how carriers define “an adequate rate of return”. What is “adequate” for one carrier may be “inadequate” for another.

According to Richard Mikes, a TCP partner,

For the industry to thrive, and not just survive, a large percentage of carriers must be making adequate rates of return to afford the investment in equipment and support services required by modern supply chains.

Credit availability is not improving for carriers, either. Approximately 75% expect credit availability to remain the same this year as last year.

Steven Dutro, another TCP partner, says,

Credit availability and carrier profitability go hand–in-hand, both are essential to replace aging fleet assets and to grow capacity. Carriers with stronger profitability and cash flows will find credit available and affordable and will be better positioned to gain market share.

A very necessary way for carriers to increase their profitability is to be able to collect the money that is owed them. And, with 35% of freight brokers closed down due to the FMCSA’s $75,000 bond requirement, that may be difficult to do.

That is where we come in.

If you are a carrier who has done business with one of the now-closed brokerages, we want to hear from you. We can help.

At Powers & Stinson, we pride ourselves on our Customer Service. We have a “Reputation of Respect”. We recognize that in this era of outsourcing, companies are very careful as to whom they allow to handle their collections.

As a professional Transportation Debt Collections Agency, Powers & Stinson saves these companies the initial capital outlay of having to employ and maintain additional staff.

We also free these companies’ employees from the additional burden and awkwardness of collecting from their clients.

Our firm features an in-house transportation attorney and a nationwide network of transportation attorneys. Together we can assist in collecting your debts in all 50 states and Canada. Our goal is to keep cash in your pocket and your drivers on the road.

When it comes to any freight debt, no matter the circumstance, we will collect it for you.Transportation laws and liabilities are unique, and you deserve a firm that has extensive knowledge and expertise in the transportation industry.

Let us deal with the headache of collecting unpaid invoices for you. Our firm handles collections for carriers, brokers and factoring companies with a proven track record of success.

Let us turn your losses into gains.

Our in-house counsel practices in more areas than just transportation law and litigation. He can also assist in Transportation Contract Drafting, General Contract Drafting and Factoring Laws.

Don’t hesitate to contact us to set up an appointment to get you justice today.

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