Auto transporters rely heavily on load boards to keep track of their shipments. The correct load board may assist in guaranteeing that trucks are transported at maximum speed and efficiency by connecting carriers and shippers to simplify transportation. Load boards have a massive role to play in the trucking sector.
Unfortunately, fuel prices are getting ridiculously high and what seemed a profitable business is under massive threat. With fuel prices going high, there are increased expenses for fleets. It is not business as usual, since loads are so low on load boards despite everything going on. You would expect that since gas prices have risen significantly over the last couple of months, trucking companies would limit their activities and have massive loads on the load boards. However, that has not been the case. At least not yet!
Loads remain low on the load boards even with the increase in gas prices. Does it mean it is business as usual in the trucking industry? Or could it be that the rise is not too huge to stop transportation? Here is why loads remain low:
Load boards allow 24/7 access
The increase in price means that the cost of moving products from one location to another is significantly more expensive than it was. It means you can’t have trucks moving around empty since that will only make more losses: You are better off preceding instead. Luckily, one of the reasons why loads are so low is because load boards have 24/7 access. It guarantees drivers that they will not have to deal with idle time if they move from point A to B. The load boards allow shippers to book loads anytime, anywhere, even on weekends or at midnight.
Shippers can guarantee that no time is lost, and carriers may better manage their workflow by allowing the former and the latter to arrange loads at the drop of a hat. Knowing how to maximize your routes caters to the extra price paid for gas. While the trucking companies might not be making as much money as they were accustomed to, they can still make profits thanks to loading boards. As long as they can ensure they do not have idle time, they will remain in business, and that is one of the main reasons load boards don’t have loads lying around without transportation.
Arguably, the immediate effect of high gasoline prices falls on the drivers since they pay more at the pump and consequently, it becomes expensive to move products around. What you might not realize is that gasoline prices affect every sector. It has implications for the economy, politics, the environment, globalization, and technological development. These effects result in higher costs for products. Consumers will have less money to spend on purchasing items such as television sets, clothes, kitchen appliances, and other things that should be transported by truck.
Since people are not buying as much as they would if the gas prices were standard, you end up with loads being so low on the load boards. Spending too much on gasoline only limits the amount people can spend on merchandise.
Consumer spending tends to decline when gas costs increase. Consumers would have to pay an extra $23 billion a year to keep up with their previous spending habits if gas and oil prices rise by 10%.
Fuel price increases have become a severe issue for firms that depend primarily on the commodity. For example, airlines usually spend around one-third of their costs on fuel, which implies that any increase in pricing has a noticeable effect. Because of this, several foreign airlines are already adding fuel surcharges to the cost of a flight. When gasoline prices increase, they drag everything else along with them. It becomes challenging for entrepreneurs to purchase the products and move them from one location to another.
Bidding war amongst drivers
Truckers must market and sell their goods and services to potential clients like any other company owner. On the other hand, truckers need clients who have freight at the correct place, at the right time. Unlike other companies, this is a must for truckers.
It is challenging to put together a network of shippers that can deliver cargo at the proper time and location. Developing a network of shippers and channels is difficult for many truckers due to a lack of available time and resources. Truck drivers need to make the most out of every route with gasoline prices increasing.
This is why truckers must use a range of sources to obtain cargo. Truckers often use one of the four strategies below to locate the shipment. Truckers may maximize their negotiating power by using various strategies, including bidding directly from the shippers, through freight brokers, load boards, and load matching apps.
With load boards, searching thousands of cargos in real-time is possible for truckers. Spot market loads make up the vast majority of the loads listed. These loads come and go regularly. Truckers directly contact freight brokers when drivers want to learn more about cargo and negotiate a price. The exchange of authority and insurance information occurs before both parties sign a rate confirmation. The flexibility of bidding for the job brings competition amongst the drivers, which might not be healthy.
Unfortunately, as gas prices increase, one of the reasons why loads are so low on load boards is because of the bidding war that is going on between the drivers. Considering there are so many truck drivers out there, who are bidding for the same business, you don’t expect them to bid the price up; instead, they bid the rate down. Whoever has the best rate gets the work.
So while gasoline prices keep on rising by the day, drivers want to stay in business. It is only a matter of who charges better and the quality of service they can provide. The focus is on minimizing idle time so that if you are paying a considerable amount for gas, you can compensate for the merchandise you transport.
Access to instant booking, bidding, and load requests
Another possible reason why loads are so low on the load boards could be the fluidity this industry has embraced over the last couple of years. Most load boards are intuitive, making arranging a load a straightforward task. One of the reasons for this is that they are connected to a complete auto-transport system.
As a result, carriers and shippers may optimize processes by using a single source of truth and having access to all the tools they need to operate their company and move items. The guarantee that drivers get knowing that they will get someone who wants their products moved from one place to another keeps them in the business even if the gasoline prices are not favorable. It is one of the reasons why there have not been loads piling up at load boards yet.
There is no deadheading
Deadheading is mainly used when empty trucks return home after dropping off freight. Unless there is a return load, it is essentially lost gasoline, vehicle wear and tear, and a missed chance for the driver to make money. Why would you drive an empty truck? After you have scheduled your outbound journey with load boards, you may look for nearby loads for your return trip.
Drivers who can avoid deadheading can remain in business regardless of the increasing gasoline prices. Considering that the truck industry has been growing over the last couple of years, it is a sector that has employed many people. You should not expect that this population will sit around just because gasoline prices are gradually increasing. As long as they can find a way around the situation, they will keep on delivering the available products to their destination. Luckily, load boards are in place to ensure there is no deadheading and that the driver can maximize their trip as much as possible.
While there is no definite answer as to why loads are so low on the load boards even as the gas prices continue to increase, it could be due to several factors. It could be a lack of spending power among entrepreneurs or drivers getting creative and trying to make the most out of the current situation. Likewise, the bidding war among the drivers is another issue that could be keeping the load boards low on loads. Every driver wants to get the job to avoid moving around with an empty truck, which can prove pretty costly when the bidding contest comes in. You find shippers transporting all sorts of goods to cater for the extra amount they pay on fuel.
However, while the focus is on bidding for shipments, drivers still keep in mind that they should make a profit. Carriers also need to calculate their costs and see what they can afford.