Author: Logan

With the summer months approaching and some of the best prices on gas in years, the annual family trip is almost inevitable.  Fortunately, the Department of Transportation (DOT) realizes this as well and is enforcing laws that will ensure you and your family reach Grandma’s house safe and sound.  They are doing this by watching both the “Big trucks” on the road and the companies that run those trucks.  The DOT is enforcing a set of rules called the “Hours of Service.” They are requirements, which if followed, make the road safer for us all. They include how long a driver can drive, work in a day, and how much rest he or she must get.  A simple outline of the rules are as follows:

• Drivers may not drive over a maximum of 11 hours after 10 consecutive hours off duty.
• Driver may work (be on duty) for a total of 14 hours, but must then take a 10 consecutive hour break.
• A driver may not drive after 60 to 70 hours on duty in 7 to 8 consecutive days.  (A driver must have a 34 consecutive hour rest (restart) after the 7 to 8 consecutive day work week.)

There are a few exceptions, but as a general rule this is what most Over the Road carriers (OTR) abide by.

These rules are enforced in several ways; the most common enforcement are the DOT setting up random check points as well as the standard scale houses that are at fixed points along the highways.  The digital age is also dawning on the industry and is now allowing the carriers to self-monitor and regulate.  More and more trucks are now equipped with an Electronic On Board Recorder (EOBR).  This allows a carrier to see what the driver is doing in regards to speed, time at a location, on duty and off duty time, etc.  This data also helps the carrier discipline a driver that is not following the rules and reduce insurance rates when the drivers do behave.

In 2010, there were 1.1 fatal crashes per 100 million truck miles, down from 2.4 per 100 million miles in 2000 per the DOT and they are working to reduce that further.

It is for the greater good that these laws are enforced, but these laws do have an impact on the shipper and carriers.  For a shipper, they must be able to build the transit times into their production schedules and budgets.  For the carrier, they usually need more equipment and drivers to cover the same distance and volume of freight which they could with less effort prior to these newer rules. The laws are created to make the highways safer for everyone including the general public, the drivers, and carriers themselves.  I hope this will reinforce your level of comfort while you are traveling down this countries highway and byways this summer and into the future.

Have a great summer!

Rob Haynie, Carrier Sales Manager

Farlex Financial Dictionary defines Accessorial Charges as extra fees attached to transportation services for duties beyond simply shipping a good from point A to point B. Examples of services on which a company may attach accessorial charges include waiting time, storage, packing, extra fuel, and so forth. Accessorial charges are also called assessorial charges.

Like it or not, these charges have become very prevalent ever since the downturn in the economy.  Another way of putting it, our freight carriers need and want to be compensated for the work they do. The most common accessorial charges we see from LTL carriers are residential delivery, lift gate, limited access, inside delivery, HazMat, and overlength which are just a few of the charges you may see in the shipping public. Priority1 has some of these charges waived or reduced but, in order to make sure you are quoted the correct amount they need to be disclosed at time of quotation and declared on the bill of lading for the carrier.  This not only results in a correct quote but, will help avoid delays and re-delivery charges with the carriers when they are not aware of extra services required at delivery.

Priority1 gives our customers the added assurance of free freight bill audit to verify that these services were required and performed at time of pick-up and delivery.  No one likes surprise charges and we make sure that if they occur they are valid and necessary.

Lance Hines, Director of Sales and Business Development

 

In their book, The Go Giver, Bob Burg and John David Mann tell the story of Joe, who is seeking the key to success in sales. He is a real go-getter but seems to be getting further away from his goals the harder he works. He seeks out advice from a legendary consultant named Pindar, who takes Joe on a journey that will introduce him to other “Go-Givers” that will show him the Five Laws of Stratospheric Success.  The first stop on the journey is for Joe to meet a real estate giant, Ernesto.

Ernesto started out with a small hot dog stand that he turned into several fine restaurants and a large amount of real estate investments. He did this by taking a mindset of not just having a great product but making sure that his customers had a great experience as well. His success came from giving a value that was much greater than the payment he received. As Ernesto is telling Joe about his story, he reveals the first of the five laws:

“The Law of Value – Your true worth is determined by how much more you give in value than you take in payment.”

Now as you are reading this you may think to yourself, “What does a hot dog stand and real estate have to do with doing  LTL and Truckload business with Priority1?” It’s simple. We strive to provide a transportation service that is more valuable than any payment we receive. While the bottom line is important to every business owner, we want our true worth to be determined more on what we give to you than what you give to us.

So why do your LTL and Truckload business with us?

It comes down to this: You are not just another number in our system or another dot on our map. Our company culture has remained the same throughout our 20 years of doing business:  Make the people you deal with on a daily basis feel like they are the only one you are doing business with.  We want to offer you a transportation service that you don’t want to go anywhere else to find. At Priority1, we strive to make sure that we give you every opportunity to grow your business so that you can be successful. In order to do that, we have to focus on your needs and tailor our LTL and Truckload services to those needs. We want to know your business and how it functions so that we can provide you with the value that you need to be as successful as you can dream! By doing that, we are able to grow and be successful together.

With that being said, if you are already doing LTL and Transportation business with Priority1, thank you! We appreciate you and your business. If you are not doing your LTL and Truckload business with Priority1, what are you waiting for? I guarantee you that partnering with our company will be the most valuable decision you have ever made!

Jon Atchison, Manager of Agent Developemnt

“Cops”, a popular reality/documentary television show that aired for roughly 23 years, making it one of the longest running TV shows in the US.  The show was intriguing, at times quite humorous, and gave an insight into parts of society where few of us have experienced.  Many times, the events would reach a point that required backup support, not only for reinforcement to resolve the issue, but for witness and to account for the actions that lead up to the arrests if ever questioned in the future.

You are probably thinking to yourself,  how does this relate to freight?  Often times we place heightened faith and value into our own product knowledge, industry experience, and/or our customer’s knowledge and experiences.  Not to say those things aren’t needed or great assets, but to ensure the customer and carriers are clued in from a cost perspective on all aspects of each shipment handled via Priority1, it is essential that documentation is filled out correctly from the beginning and at delivery, as well as having proper backup readily available from the customer to dispute charges that are incorrectly assessed when the shipment has been completed.

The BOL is a legally binding document providing the driver and the carrier all the details needed to process the freight shipment and invoice it correctly.  If any information is excluded or incorrect on that document, there might be a challenge of proof once it becomes time for invoicing where there is a discrepancy.

The Delivery Receipt provides important information as to what actually occurred once the consignee received the freight from the carrier.  If the shipper and/or consignee are not properly educated on what to look for upon delivery, there might be complications due to items that the driver marks on the document or what the consignee failed to address on the document that could pose challenges once invoiced by the carrier as well.  It is the customer’s responsibility to audit the DR as closely as possible for infractions, as well as to inspect every shipment received.

Valid backup documentation is key to presenting “proof” in instances where the carrier is billing based on what a weight and inspection may have possibly revealed, a system error, etc.  Manufacturer spec sheets, pictures of the freight before and after, and packing lists are good examples of back up documents.  Unfortunately the times of presenting an argument without evidence have faded, with documented facts and paperwork being standardized across the board.

Documentation, audit, and presentation of correct data from the beginning does not eliminate the possibilities of encountering issues during or after the shipment, but they are crucial to limiting those issues and correcting issues where we have valid backup to prove our case.

John Redam, Vendor Relations Manager

 

In my time with Priority1 I have seen numerous changes in what is happening within the full truckload market. In the late 2000’s with the hope of coming out of a recession we did not see an uptick in truckload shippers but remained steady while everyone waited to see what was going to happen. So far in the 2010’s it has been a mix of increased shipments, rising fuel prices and capacity shortages due to a lack of drivers.

We are continuing to see some capacity issues but fuel has backed down from its peak. As the “baby boomer” generation is approaching retirement age, it has been a struggle in the transportation industry to replace the aging driver workforce. Truckload demand remains consistent, but the driver supply is weak.  As a result, rates per mile have remained consistent with reduced fuel prices.

As the industry works through the challenges of driver shortages there is a silver lining: In the past few months we have seen overall transportation capacity loosen up and rates dip slightly. In April 2015 we saw the national average of loads-to-truck ratio fall from 3.5 to 2.6 according to DAT 360.

As the truckload market stabilizes in 2015, one of the things that I have noticed is shippers are now more than ever open to shipping their full truckload shipments on rail; especially on long hauls. Rail continues to grow and is benefiting from the driver shortages as it offers an economical alternative to traditional over the road shipments. It is expected to continue to see a rise in rail shipments throughout the year and as we move into the near future.

The transportation industry continues to move through the changing economy and labor shortages within the industry. Today, it is as important as ever to be able to adapt to the rapid transportation changes. With 20 years in the industry, Priority1 has proven that it has the ability to see the transportation challenges coming and then adapt and meet all of our customer’s needs.

Jason Sheffler, Director of Truckload Operations

When Priority1 redesigned the company website and updated our logo, we wanted to make sure we had a way to reach our customers and the industry. One way in which we decided we could do that was through a company blog. The intent was that we could take different business leaders at Priority1, give them a topic, and have them provide some industry insight that may be helpful to a customer, vendor, or anyone out there looking for information on the topic. As we worked on defining the topics, we decided that we would dedicate this week’s post to our staff as well as provide some insight as to how Priority1 operates from a cultural perspective.

Priority1 has undergone major transitions over the past 6 years. Our staff has quadrupled, our facilities are under constant change and expansion, and our team continues to step up to every big challenge thrown their way. Our focus on winning and hitting our targets does not compromise our ethical approach to business. That said, while Priority1 has put a lot of work in to our long term goals, we have enjoyed a month of some very public acknowledgement regarding some of the things that the team has been working on for years.

In April, Priority1 was awarded the Better Business Bureau Torch Award. The Torch Award was designed to recognize businesses that go out of their way to promote ethical business practices with customers, vendors, and employees. Priorty1 was chosen because of our commitment to winning the right way. The evaluation process included a look at our vendor relationships, customer relationships, financial processes, HR processes, benefit packages, and a tough look at our core leadership values. After all was said and done, Priorty1 excelled in these categories and was awarded the BBB Torch Award for 2015 at the Governor’s Mansion.

Priority1 has had a tremendous amount of success over the past few years. A large part of that success comes from having an outstanding staff, but also from promoting a competitive and fun environment. We couldn’t have grown 600% in 5 years without an incredible team and fostering an environment for the team’s success. I could not be prouder of what we have accomplished as a team and I am even more excited to see how the next 10 years plays out.

Dan Berardi, General Manager and COO

In the early 1970s the US Department of Energy began to calculate the national average of diesel and track its fluctuation. This rate was set and updated on a weekly basis and was the beginning of the fuel surcharge.

So what is a fuel surcharge?

A fuel surcharge is a calculated rate for fuel based on the USDOE national average price for diesel in conjunction with a carrier’s fuel surcharge table. It wasn’t until the mid-1990s that the fuel surcharge became a feature in a carrier’s rules tariffs to provide a baseline to charge customers.

With the recent drop in fuel, many carriers have made the decision to update their fuel schedule to accommodate the current lower cost. This change was due to the base rates not factoring the fuel dropping to the record lows. (Logistic rates are currently calculated by a variation of rate bases which are based on a fuel level that was set years ago).

Carriers are virtually left with two options to overcome this:

One is updating their fuel schedule. This adjusts cost on a shipment-by-shipment basis.

The other option is to update the rate base, which has an effect on pricing as a whole instead of a shipment-by-shipment basis.

This raises the point; will current fuel levels ever be calculated in the base rate of our pricing instead of as a surcharge?

Good question.

I believe that may very well be a possibility with the advancement in technology and talk of dimensional pricing. Only time will tell.

Patrick Hart, Manager of Strategic Pricing

There was an English teacher of mine in high school that had a sign above the chalk board in his classroom that said:

What is popular is not always right and what is right is not always popular.

This quote was from the great Albert Einstein.  I know my English teacher would be disappointed that I didn’t remember his teachings of Beowulf so vividly, but that quote has stuck with me ever since.

People tend to talk a lot about ethics and “doing the right thing” but when the rubber meets the road the decision doesn’t always align with the words.  I read an article recently by Chris Bahn of the Arkansas Democrat Gazette entitled “Wal-Mart exec: Stores need polishing” about the newly hired Wal-Mart U.S. President and Chief Executive Officer, Greg Foran.  The article talked about his unannounced visits to Walmart stores and how he had found opportunities for the retailer to improve their store operations.  One particular quote in the article got my attention:  “We’ve got plenty of opportunity, but as I often say to my team, you get one point for talking about it, nine points for doing,” Foran said.  This quote rings true for ethics.  We can talk about doing the right thing all we want, but the moment of truth is when we have the opportunity to make it right and we execute.

Here at Priority1 we have developed Core Leadership Values with several of these values relating to ethics including:  Personal Courage, Respect, Integrity and Trust.  We pride ourselves in living out these values in our day-to-day operations.  Especially in our industry it is vital to ensure our customers know how we do business and our employees live out these values.

In its truest form, to me ethics is doing the right thing even when it’s not the most popular decision.  In business this can sometimes be challenging because each situation is different with a unique set of circumstances, but we must stay true to our moral compass when tackling these decisions.

Troy Lampley, Financial Assurance Manager

It’s been quite a journey from the first time the website redesign team met. We started on June 13th at 8 A.M. The plan was laid out and we wanted to completely overhaul our website; with new content, features, design, staff photographs, and social media integration. We wanted everyone to see who we are and create a modern online presence.

We will be adding a Track Shipment feature, a blog where news and communications will be distributed, and you will see the integration of Instagram postings to see our day-to-day activities, and Facebook and Twitter accounts to connect with you in a modern light.

We began with the redesigning of our company logo, which, let me tell you, was the most difficult part of the entire project. After our group of 8 unanimously agreed on a design, we began the process of working with our web designer, a man we selected from Liverpool, England, on forming the particulars of our new site: Layout, color scheme, arrangement, site map, functions, features, links, interface, acquisition of carrier logos and permission. . .need I continue? The necessities of a 21st century website are endless.

With the skeleton of our site in the works, we began interviewing local photographers to capture our corporate staff and location. Our goal was to create personal stock photographs to fill our website with. We selected an accomplished Little Rock native to shoot us in a natural fashion and he certainly got us down.

With staff, location, and management photos at our disposal, we began selecting photos to showcase our staff, management, and a collection of stock-style images from 250+ photos that we were provided. Our eyes began to tear up and burn after flipping through 18 pages of photos, but we found 29 photos, and man do they look good on the test site!

The last few weeks have been spent testing the ins-and-outs of every link, proofreading each page about 10,000 times, (no, that is not hyperbole), making adjustments to the site’s layout and other small features. We’re nearing the end of our project, just a few weeks until we go live on February 16^th, and we’re still tweaking certain dynamics.

It’s been a busy few months getting the new website up and running. It’s been difficult and aggravating at times as are all things, but it’s been fun and a rewarding experience. I’m glad to have been a part of the Priority1 INC. website redesign team. We hope you enjoy the new site as much as we do!

We would like to say thank you to the website redesign team and our corporate IT department who have devoted countless hours to the development of this project.

We would also like to extend a special thank you to our web designer Paul Maloney at paulmaloney.net and our local photographer Dero Sanford, thinkdero.com, for the work, effort, and insight that they have contributed to this project.

Logan Garrett, Research Analyst