TANK truck carriers require extensive cooperation from shippers in order to meet the demands for today's operations, said Cliff Harvison, National Tank Truck Carriers president. He addressed the carrier/shipper relationship at the National Petrochemical and Refiners Association March 24-26 in San Antonio, Texas.
He pointed out that shippers are requiring carriers to comply with many demands that are costly and inefficient. This includes the implementation of e-commerce programs that have little consistency between the various shippers. “Shippers have to make up their minds on e-commerce,” he said.
Harvison provided recommendations to improve the carrier/shipper relationship. For example, mandated delivery times are unfair and unsafe when they force drivers to make up time from unpreventable delays.
“If you have a two-truck loading rack, don't order six trucks to load at 8 am,” he added, noting hours-of-service regulations that are in effect when drivers are waiting, as well as when they are on the road.
He urged shippers to make drivers feel welcome and provide reasonable accommodations for them while they are waiting.
A financial situation that must be worked out between shipper and carrier is the insurance crisis pummeling transportation companies. A 130% increase in insurance rates for hazardous materials carriers is not unusual today, Harvison said. Shippers must be prepared to pay surcharges to offset the climbing costs. In addition, while some shippers are including hold-harmless clauses in their contracts, carriers' insurance companies will not honor the agreement. This excludes carriers from being able to compete for the shipper's business.
Another competition-related problem arises when carriers expend resources to qualify with ISO quality certification, adopt management systems such as Six Sigma, and become a member of Responsible Care. After absorbing the costs of meeting shipper demands, carriers often find that competitors that have not adopted the standards receive the shipper business because of a lower bid. The inconsistency must be reduced, Harvison said.
Harvison also addressed a problem related to shipper management and its knowledge of hazmat transportation. He pointed out that department heads often lack the authority to make decisions critical to the carrier operations. Managers typically are rotated through various departments as part of their upward movement within the company. Often, they don't acquire enough expertise in distribution and transportation to work efficiently with carriers. To ease that situation, carriers should have access to both marketing and logistics departments.