Un-Fuzzy Trucking Math: Saving Money Through Better Onboarding
If trucking owners and executives had to sum up the transportation industry’s challenges in a single word, that word would be “drivers.”
To be clear, it’s not that drivers are the problem. Rather, the problem is a shortage of drivers—specifically, ones who stay on the job. Driver turnover has reached crisis levels in the industry, with companies reporting rates at or above 100%.
“Despite unemployment rates of less than 5% nationwide, the transportation industry continues to struggle to find enough qualified drivers,” said Deborah Lockridge, Editor-in-Chief of Heavy Duty Trucking Magazine, during a webinar we hosted with HDT earlier this year. “And the problem is only getting worse: according to some estimates, fleets will need to hire 96,000 new drivers every year for the next 10 years.”
In a previous article, we explored this phenomenon in detail, looking at how 100% turnover is even possible (spoiler: it means you’re losing drivers faster than you can hire them), and how you can calculate your company’s rate.
In this post, I’d like to share some more trucking math. The unfuzzy kind – we’re talking dollars here.
We’ve got a great ROI story to share from one of our trucking clients. They were able to shave off one day of training per driver using Compligo. This client hires on average about 250 drivers per year, so it really started to add up. They regained 250 driver days. That means 250 days trucks were on the road instead of sitting idle.
Industry averages show that an idle truck can cost an organization anywhere between $500 and $1,000 per day. That’s a lot of money sitting there in the yard.
Let’s get into the math:
We’ll start with the low end of an idle truck, using the $500 figure. If we multiply that $500 by the 250 driver days our client saves from the idle time, that puts $125,000 in savings back in our client’s pocket per year. Quite a hefty ROI on the software they purchased.
Try plugging in your own numbers:
A = Number of drivers you hire in a year
B = Cost per day of an idle truck in your fleet
A x B = Your savings by eliminating one day from your driver onboarding
Pencil that out to get a sense of how much money you’re losing by spending too much time using inefficient onboarding processes.
Once the shock has worn off of how high that number is, give us a call. We can get you started down the road to efficiency.