Question: How will any potential increase in gas taxes be reflected in your fuel surcharge as a shipper? The fuel surcharge in UltraShipTMS is automatically updated based on the published national average. How can transportation managers act to mitigate the cost increase likely to materialize?
Whether you agree or disagree with the idea of raising taxes to fund upgrades to America’s crumbling infrastructure, everyone in the transportation industry can agree the work needs to be done to improve roads, bridges, tunnels, ports, etc. Given the growing need to act, it is near certain that some kind of legislative action is in the offing. There are two prime ways the government can act to increase funding for our nation’s infrastructure – increase the fuel tax or increase tolls on roadways. Both ways will cost carriers and their shipper-customers more money to move freight.
The trucking industry is actually more supportive of increasing the fuel tax (which isn’t indexed against inflation and was last raised back in 1993) which they perceive as more equitable than the other proposal which calls for increased tolls on roadways. Tolls would be, in the trucking industry’s opinion, disproportionately shouldered by trucking fleets, and driver operators adding even more to the cost of moving freight than a modest increase in the national fuel average.
Regardless of how the cost of fuel is derived, how will the impact of increased fuel costs be mitigated by trucking companies and the shippers that rely on them to move their freight around the country?
The answer to so many challenges in transportation logistics comes via technology solutions like Transportation Management Solutions (TMS) and associated tools like automated scheduling, route optimization, and freight payment software. These tools, used together, dramatically improve the relationships between shippers and their carrier partners. For a shipper locked in brutal competition for dwindling capacity, these tools can help foster strong and equitable relationships which make the shipper a more attractive customer to carriers.
For example, a shipper with a strong TMS solution enjoys improved flexibility supporting the decision to ship outside of typical daytime hours. Carriers and the drivers they employ are facing more stringent hours of service regulations making time on the road even tighter. Shipping at night when traffic congestion is lowest can result in shorter travel times and more freight moved in less time. Not all shippers can or will take this step to sustain operations beyond their established hours. But those that are willing can do so more easily with the planning capabilities in a strong TMS.
Another excellent strategy involves leveraging advanced scheduling features in TMS to expedite loading and unloading. If a carrier knows your organization employs a robust and easy to use scheduling tool they will be more inclined to do business with you. Lots of time is wasted waiting at pickup and delivery locations. Prove through the use of powerful technology, that you will get the carrier in and out of your facility with speed, precision and efficiency and you’ll find yourself with higher volume of tender acceptance!
Among the most powerful incentives for a carrier to do business with a shipper is speedy payment processing. Trucking companies are bound to feel the pinch whether government decides to enact a new fuel tax or levy more tolls to pay for infrastructure upgrades. Fuel and tolls are out of pocket costs trucking firms must carry on behalf of their customers. Strong, efficient, effective freight payment technologies help to dramatically reduce the time it takes a shipper to pay carriers, shortening the time the carriers’ money is tied up. With their margins sure to be squeezed by the impending rise in operating costs, carriers will be very grateful to work with shippers that are tuned into mitigating this pain.
The industry sits on pins and needles while our government debates how to fund the sorely needed repairs to our roads and infrastructure. Now is the time to put tools and practices in place to position yourself as an attractive customer to carriers. Get started today with UltraShipTMS.