We live in an ever-changing world. Trucking companies come and go. They are being bought, sold, merged, downsized and resized every day. Under new management, a company may flourish or deteriorate. In this era of driver shortages, carriers are being very deliberate about how they allocate their capacity. As they focus on yield management, this precious capacity is being supplied to the carriers' most profitable customers.

In addition, trucking companies are constantly adding and losing business. A trucking firm may add a new account tomorrow at a higher margin than they are receiving from your business. This may cause them to make their capacity more readily available to another client. The bottom line is that it is always prudent to prepare for a “rainy day.” In other words, there is value in having backup carriers for most of your business.

This means that it is critical during the rounds of bidding, to smooth out the variances in rates between your “low bidders” and the others who were on the short list. By doing this, it reduces the cost differential in making a switch for any of a variety of reasons (e.g. poor service, carrier goes out of business, de-markets certain lanes etc.).

It should also be kept in mind that a carrier will not be too motivated to serve your company if they are a backup carrier in name but receive no freight. To achieve success with freight bids, carefully determine your primary and secondary carriers. This should include both asset and non-asset based providers.  While the temptation is there to give all your freight to the low bidder, to maximize savings, this can be a risky strategy. Where possible, select primary and secondary carriers. Give your backup carriers a reasonable volume of freight so as to keep the primary carriers “honest” and to keep all of your transportation providers engaged in serving your company.

The objective of a freight bid project is to secure a range of carriers and logistics service providers that are best able to supply a shipper with the service (e.g. transit times, customer service, shipment tracking information), capacity (e.g. drivers, tractors, trailers, straight trucks) and pricing to ensure the company has a competitive advantage in the market. It takes time to do this right.

If your company has conducted a professional bidding exercise, you should be able to rank your service providers on a set of variables at the end of the first round of bidding. If the bidding process has been conducted effectively, there will likely be some significant cost savings, particularly for companies that have not gone to the market for several years.

There is a temptation on the part of some shippers to “take the money and run.” This could be a big mistake.

There are thousands of freight carriers, load brokers and logistics service providers throughout North America. One of the important elements of an effective freight bid is to seek out those carriers that can provide the best combination of service, capacity and rates to meet the unique needs of your business.

Over the years, we have observed some companies that do freight RFP exercises but limit the carriers they contact to the same group of companies year after year. My colleagues and I will hear comments like “we used that carrier in 2002 but their service was poor” or “most carriers in that lane have the same rates” or “we know the carriers that can handle our freight effectively.” It is our view that conducting an RFP is a great time to learn more about the various players in the industry.

Times change and so do carriers. New management will strengthen some carriers while weakening others. The quality level can vary significantly from carrier to carrier.  There can be a wide disparity between carriers in their ability to serve certain geographic areas.  

In an RFP, the carriers are being asked to bid on specific types of freight moving on specific traffic lanes. The rates they quote are based on the freight descriptions that you provide. It is essential that all aspects of the freight be documented in sufficient detail so as to ensure the quotes received are an exact match for the freight being shipped. These are some of the areas that require their input.

a) What do typical shipments look like (e.g. pallets, pieces, a combo, drums, totes etc.)?

b) What are the precise dimensions and weights of the freight?

c) How is the freight loaded and unloaded (e.g. crane, fork lift, lumper service, side loading, apartment deliveries etc.)?

Over the past eleven years, my colleagues and I have worked on a variety of successful freight RFP or freight bid projects. During that time, we have observed a number of factors that are the keys to success. This is the first in a series of blogs that will provide tips on how to run a successful freight bid.

1. Obtain Buy-in and Participation from the Operating Divisions

In some multi-plant or multi-division companies, the RFP project is approved by the head office CFO or President. While the divisions may pay the carrier freight invoices, their participation in the RFP may be limited to reviewing the proposed carrier list or bid documents or simply being made aware that the project will be undertaken. This is not adequate.

Since the division managers are directly involved with shipping and receiving goods on a daily basis, they often have information that head office personnel don’t have. It is essential that these people be engaged at the beginning, at key milestones throughout the project and at the end to ensure a successful project. The division freight personnel should be asked to not just read status requests or respond to written requests for information; rather they should also be engaged in conference calls on specific topics (e.g. freight loading and unloading requirements, documentation of local cartage runs, pick-up and delivery requirements in specific branches etc.) so the bid documents completely and accurately reflect the shipping characteristics of your firm.

In a recent Stifel report, it was noted that the “mother” of all capacity shortages is expected to hit the United States in 2017 as a series of government regulations reduce the supply of fleet equipment by five to fifteen percent. Despite the efforts of carriers to raise pay, upgrade facilities and improve the lifestyle of drivers, annual turnover stubbornly remains at close to one hundred percent in many fleets. On the rail side, a huge upswing in the movement of energy products by this mode has had a deleterious effect on intermodal capacity and service. Wise shippers realize that trying to secure carriers on the spot market is a risky endeavor since this leaves them open to capacity shortages and rate volatility.

What can your company do to protect itself if there are capacity shortfalls?

Is your company ready for even tighter freight capacity? Will the integrity of your company’s supply chain be maintained in this ever-changing environment? What can your company do to protect itself if there are capacity shortfalls?

1. Bring your top performing carriers under contract

An important first step is to view your major carriers as business partners. As such, it makes good sense to negotiate formal multi-year contracts with capacity commitments and service guarantees. As you engage in these types of discussions, find out how your business fits within the parameters of their operation. Does your freight move on their primary traffic lanes? Do they have head haul or back haul in the reverse direction? Are you a valued customer?

This past year was a tumultuous and transformative year in Freight Transportation. What is in store for us in 2015? Here are some trends to watch.

1. Dimensional LTL Pricing

The National Motor Freight Classification (NMFC) system, developed during the Great Depression by the National Motor Freight Traffic Association, classifies goods based on four elements—density, stowability, handling, and liability—that reflect a shipment's "transportability." However, the ratings from the system are not derived from the dimensions of the actual shipment but from average shipment characteristics. The classification methodology was not designed to accommodate the changes in modern-day production methods, where goods tend to be lighter and generally cube out in a trailer before they weigh out. For nearly eight decades, less-than-truckload (LTL) carriers have been using this system to allocate their trailer space.

Change will come to the LTL freight industry in 2015, driven by so-called dimensionializing, or dimensioning, machines that precisely calculate the amount of space a shipment will occupy in a trailer. The machines measure a shipment's dimensions—arrived at by multiplying length, width, and height—and provide proof of their calculations. A high-end "static" machine designed to measure stationary objects sells in the low to mid-$80,000s. The payoff can be rapid—30 to 60 days, depending on how a carrier uses the machine and how it calculates return on investment (ROI). Carriers like UPS Freight and FedEx Freight, LTL units of highly visible companies that have used dimensioners in their parcel operations for decades, are going that way. Old Dominion Freight Line Inc., that has used dimensioning equipment since 2009, YRC Worldwide Inc., and many of the other leading players in the LTL sector will likely follow the leaders.

2. Low Energy Prices will continue for much of 2015

As the year draws to a close, it is time to reflect on the major news stories in the world of freight transportation. These are the ones that struck me as being the most impactful.

1. The Economy – Two Steps Forward/One Step Back

US GDP grew by over 3 percent in 2014, its best showing in several years. A rise in employment levels, coupled with an increase in consumer spending, helped lift the American freight market. The long, slow post Great Recession recovery finally kicked into a higher gear, driving an upswing in freight activity.

However, November data highlighted a slowdown in the pace of recovery across the U.S. manufacturing sector. At 54.7, down from 55.9 in October, the seasonally adjusted Markit Flash U.S. Manufacturing Purchasing Managers’ Index™ (PMI™) indicated the weakest overall improvement in business conditions since the snow-related setback in January. Although the latest reading remained well above the neutral 50.0 threshold, the index has now dropped for three months in a row. Weaker rates of output and new business growth were the main negative influences on the headline PMI figure in November.

2. America - the Super Energy Power

At the 2013 Summit, Jacquie Meyers, President of Meyers Transportation Services, made shipper-carrier collaboration a “hot topic” with an impassioned plea to both sides to take a more enlightened approach to working together. Her argument was that this is the best way to reduce freight costs. Since this plea resonated so well with the attendees, Jackie was invited to come back and participate in a panel discussion on this topic with another carrier and two prominent shippers.

This year Jacquie was joined by Elias Demangos, President & CEO, Fortigo Transportation Management Group, Anna Petrova, Associate Director, Supply Chain, Ferrero Canada Ltd., and Susan Promane, Director, Supply Chain, Whirlpool Canada. To lead off the track, Jacquie was asked to provide a definition of a successful shipper-carrier partnership. She expressed the view that true shipper-carrier collaboration is the opposite of a poorly-run freight RFQ that goes to 105 transport companies with the lowest price carriers being awarded the freight. Jacquie stated that a true shipper-carrier partnership is based on honest communication, trust, commitment and investment. A 2, 3 or 5 year commitment allows her company to invest in equipment and develop special customer service solutions. While there is room for “good” RFQ’s, working together will achieve greater efficiencies and cost savings.

The two shippers on the panel presented their views on what it takes to make this happen. Anna Petrova suggested that they key is “alignment on strategy. The carriers we hire are an extension of our brand.” Since retail customers can “fire us” or “punish us” for poor performance (e.g. poor case fill rate, poor on-time service), the shipper and carrier must perform in these areas. On-time service is a carrier KPI and it is up to her carriers to provide the service.

Susan Promane reinforced this point by highlighting the importance of “execution.” She stated that very few carriers operate as true partners. Susan mentioned that she shares her annual goals with her carriers and monitors their performance on a monthly and annual basis. While she agrees with the concept of a multi-year commitment, to her that means 2 years since the world changes too much in that time frame to lock in for a longer period.

Anna suggested that there is value in “formalizing SLAs” (service level agreements) so as to clarify expectations with respect to trailer drops, dedicated CSRs, service reports etc. Providing a carrier partner, particularly a new partner, with this information helps build trust and creates accountability. When a carrier meets their service expectations, they aren’t just talking the talk; they are “walking the talk.” Susan also emphasized the importance of tracking safety, EDI compliance and billing accuracy.

Over the past few weeks, there are a couple of items that have come to my attention that inspired me to write this blog. First, I had the pleasure of sitting in on the annual Masters of Logistics webcast, sponsored by Logistics Management. This is the 23rd year that these high quality researchers have surveyed a large sample of shippers and carriers to get a “read” on the current state of the industry. As always, the study produced a number of interesting findings. The one that caught my eye is the disconnect between shippers and carriers. The researchers labelled it a “tug of war.”

The results highlight that shippers and carriers, at this point in time, have conflicting business objectives. On one side we find freight carries looking to recover from the economic downturn and offset the rising costs of driver wages, higher fleet costs and regulatory changes. With capacity tight and drivers in short supply, trucking companies are seeking to maximize profitability.

At the other end, shippers are trying to reduce their costs while managing increasing demand uncertainty from all customer levels. “In fact, many shippers are asking for cost reductions at the same time that they’re asking for improvements in service,” says Karl Manrodt, one of the lead researchers. How do you reconcile these opposing views?

Some companies are coming up with white papers to educate the shipping public on the challenges that carriers are facing. Within the past few weeks I received two good ones, “Industry Challenges” from JB Hunt and “Truckload Capacity in 2014, What’s Causing the Capacity Crunch and What Can Shippers Do About It?” from DAT Solutions. These are useful, well written documents. They do help create an understanding of the issues being faced by shippers and carriers. They also contain some helpful tips on how to obtain additional capacity and secure competitive rates. Unfortunately, written documents have limited value.

The key to bridging the gap between shippers and carriers is face to face communication. As I think back over the years, the current “tug of war” brings back memories of 1999. Some of you may remember the concerns over Y2K and the worries that the year 2000 would bring a meltdown in computer systems throughout the world. As President of a large freight broker at the time, I remember the conversations I had with our top 10 carrier partners. While addressing the Y2K issue, we had an opportunity to discuss various aspects of our business relationship. This was very productive and is clearly what is required now.

A few weeks ago, I gave a presentation to a group of transportation professionals at a Best Practices in Cross-Border Freight Transportation conference in Buffalo, NY, sponsored by SMC3. I made the point that changes in just one variable, Currency Exchange, could make or break a company. As I look back over my lifetime (I am an old guy), Canada – U.S. exchange rates have varied from a Canadian dollar being worth $0.61 US to $1.10 US. As evidenced by the past few days, these currency fluctuations can occur quickly and without warning.

Furthermore, these types of variances can have huge impacts on shippers and carriers. If you look at some of Canada’s core industries (e.g. newsprint, minerals), the effects can be devastating in terms of market competitiveness, north-south freight flows, freight rates, empty miles, - - - even business survival.  Currency exchange fluctuations are just one of a number of variables that can change quickly and without much warning. There are a host of others.

Think about the winter we came through in the first quarter of this year. Is this the result of climate change? Will this be, as some suspect, the new normal? Have you made plans in the event that the next winter is as bad as the last one? We are still dealing with rail congestion as a result of the harsh winter and we are about to enter the fourth quarter. In addition to winter storms, we are seeing an upswing in other types of weather issues (e.g. tornados) in America and other countries.

Think about the Middle East that is a powder keg today. What if war breaks out in a variety of locales? What if ISIS tries to attack America? What if some sources of energy supplies are cut off and diesel fuel prices spike? What happens if the economy spikes? Think about the driver shortages today, the challenges in attracting drivers into the industry and the potential impacts on the supply of truck and rail equipment if the demand for transportation services is not met with an increase in supply. What would significant increases in freight rates do to your business?

Think about the possibility of an economic slowdown in Asia, Europe, Russia and/or South America, countries that are still dealing with the aftermath of the last recession. What would happen to our economy if some of these economies falter? We are living in a turbulent and fragile world.

As I look at the LTL freight transportation today, it is hard to believe that just a few years ago, this was one of the most battered sectors of the freight industry. The LTL freight industry took a tremendous pounding during the Great Recession as business volumes contracted by about twenty-five percent. As operating margins shrunk, LTL carriers closed or consolidated terminals and cut staff in an effort to right size ether businesses. Shippers took advantage of the situation by conducting multiple freight bids to leverage their volumes to extract rate concessions.

Seven years later, the industry has changed dramatically and the pendulum has swung back in the carriers’ favour. As volumes return to pre-recession levels, LTL carriers are finding their networks full of freight. As the North American economy improves, manufacturing is on the rise. The near shoring movement is also bringing some manufacturing jobs back to America. In addition, the driver shortage is making it difficult to find drivers, particularly for long haul truckload routes. A clogged intermodal system is limiting the opportunities to divert over the road truckload freight to the rail system. The net result is that some of this freight is being diverted to large LTL shipments so it can move with an LTL carrier. In other words, this is creating traffic for an already full LTL system.

Unlike the truckload sector where even the largest players control only a small (single digit) percent of the total truckload sector, the LTL industry is highly concentrated among a core group of companies. The top 9 LTL carriers in the United States (e.g. FedEx Freight, Con-way, YRC, UPS Freight, Old Dominion, Estes, USF Holland, Reddaway and New Penn, ABF, R & L Carriers and Saia) control almost seventy percent of the LTL market. In Canada, the major players, TransForce (e.g. TST Overland, Canadian Freightways, Kingsway, QuikX, Quiktrax, Clarke Transport and Vitran), the Day and Ross Group and Manitoulin would also control a major share of the LTL market. With limited capacity and pricing discipline, this gives this group of companies considerable pricing power. With high quality costing models, these companies can now seek meaningful rate increases or de-market poor paying accounts. In other words, the “fun” is back in this business.

To further improve yields, FedEx Freight and UPS Freight are introducing density based or dimensional or cube-based pricing. I wrote about the potential of this trend years ago(http://www.dantranscon.com/images/downloads/mtr%20sep_oct%202009.pdf) and it is finally starting to take hold. Just as airlines charge for “bums in seats” and adjust their plane sizes to each route and the potential passenger traffic, LTL freight carriers are going to become much more diligent about charging shippers for the cubic space occupied on their trailers. Shippers with poor packaging, who don’t nest their products effectively or don’t design their products well or load them smartly, will face a nasty surprise. With so much industry consolidation, it won’t take long before dimensional pricing becomes more standard across the industry.

Another reason why LTL carriers are having more “fun” is in their attitudes toward logistics service providers. A few years ago, 3PLs were viewed as the enemy. They were seen as trying to poach LTL customers and replace their carriers by taking control of the direct customer interface. Times have changed. LTL carriers are increasingly viewing 3PLs as business partners. They are forming alliances with companies that have common objectives and customer profiles so they can collectively bring value to the customer. The large LTL carriers are going a step further by creating their own internal logistics or at least freight brokerage arms.

Freight rate increases are coming this year. The economy is on the upswing. Truck capacity is tightening as driver shortages, government regulations, cost overruns from a very challenging winter and carrier financial prudence all push freight rates in one direction - - - higher What can shippers do to mitigate the impact? A lot. Here is my list.

1. Capture your Freight Costs

Take a look at your freight costs and compare them to prior years. Look for opportunities to fix negative trends (e.g. lack of discipline in moving less than optimum size shipments, too much expedited or air freight etc.) that may have arisen.

2. Benchmark your Freight Costs

Obtain rate quotes from carriers that serve your traffic lanes. Compare their rates to yours. If your company ships high volumes, consider obtaining a benchmark freight rate service on at least your major lanes of traffic. The study will at least tell you if your company is paying market rates or higher and identify carriers that provide the same service at lower rates. There are also companies that provide an ongoing fee-based benchmarking service.

As the year 2013 winds down, it is time to reflect on the major transportation trends of the past year.  While I saw and read about a wide range of developments, these are the ones that resonated most with me.

1.Technology Comes to Freight Transportation

Last year I predicted that we would see a flurry of new technologies come to freight transportation.  They did and I wrote about some of these new companies on several occasions during the year.  Technology was successfully applied to the freight brokerage business, freight portals, LTL density calculations and to other segments of the industry.  Buytruckload.com, PostBidShip, Freightopolis, QuoteMyTruckload,  and Freightsnap were featured in various blogs during the year.  They are changing the way business is done in freight transportation.  Watch for more of these companies to surface in 2014.

2013 has been called the Year of the Network by numerous supply chain and transportation industry thought leaders.  Companies that built a successful supply chain trading partner network focused on three elements:

Connectivity— unite disparate systems and trading partners

If your trucking company hasn’t been purchased or doesn’t get purchased by TransForce, will it be in business in five years?  That is the question that came up in a recent discussion with a long time industry colleague.  The response I received was that he didn’t think his company would survive.  I was a bit surprised by the response and asked him for an explanation.  This led to an interesting discussion on what it is going to take to make it in the trucking industry in 2014 and beyond.

We both agreed that while the trucking industry has changed in some ways over the past decade (e.g. more use of technology, better cost controls after the Great Recession, LNG vehicles, greater use of 3PLs as customers), the industry is not that much different from ten years ago.  The slow economic turnaround since 2008 has created a challenging environment and there is little reason to expect a major improvement in the short term.  Rate increases are hard to come by, even with a tight driver situation.  Even more of a concern is the lack of innovation in the industry and the threat that such changes could wreak on so many complacent companies.

The warning signs are there.  As a Canadian, you don’t have to look much further than Nortel and Blackberry to see what can happen to industry leaders that were not able to keep up with changing consumer needs and quality competitors.  At the same time, one can observe what companies such as Amazon and Apple have been able to do to change the paradigm of some long established industries. 

Some of the large trucking industry players are making investments in technology and people.  They are integrating back offices and focusing on achieving economies of scale.  They are thoughtfully expanding their service portfolios and geographic footprints. 

Some of the small players are offering solutions that are very tailored to certain industry verticals and geographic areas.  Companies that are focused on same day delivery, refrigerated intermodal service, pooled LTL service, energy distribution and other emerging capabilities are creating a space for themselves in the industry.

At the end of each year, I like to take stock of the major freight transportation stories of the past twelve months and look ahead to the trends that will drive the industry in the coming year.  The two blogs that I write are prepared from my perspective as a consultant to shippers and carriers.

This year I would like to hear from you.  Those of you who follow this blog observe trends in your segment of the industry.  Please take a minute to share them with me.  Please post them on this blog or send a private e mail to dan@dantranscon.com. 

Please feel free to select any major trend or trends that are having or will have a major impact on our industry, whether regulatory, economic, technological, demographic, consumer behavior, environmental, modal shifts or business strategy.

To broaden the range of inputs and perspectives, I will also post this request on Facebook, LinkedIn and Twitter.  In the coming weeks I will be preparing my two lists.  The lists will include a blend of my observations and yours.  Look for these two blogs in mid-December.  Thank you to those of you who take the time to share your observations with me.

Last week the Council of Supply Chain Management Professionals released its 24th annual State of Logistics Report. Last year, business logistics costs were once again 8.5 percent of U.S. Gross Domestic Product (GDP), the same level they hit in 2011, the new report says. That means freight logistics was growing at about the same rate as the GDP. Inventory carrying costs and transportation costs rose "quite modestly" in 2012, said the report's author Rosalyn Wilson. Year-over-year, inventory carrying costs (interest, taxes/obsolescence/depreciation/insurance, and warehousing) increased 4% y/y as inventory levels climbed to a new peak. Meanwhile, transportation costs were up 3% y/y predominantly from an increase of 2.9% in overall truck transportation costs.

This "new normal" is characterized by slow growth (GDP growth of 2.5% to 4.0%), higher unemployment, slower job creation (which will primarily be filled by part-time workers due to higher healthcare costs), increased productivity of the current workforce from investment in machinery/technology (and not human capital), and a less reliable or predictable freight service (as volumes rise but capacity does not increase fast enough to meet demand). Wilson noted that slow growth and lackluster job creation has caused the global economy to wallow in mixed levels of recovery. "This month will mark the fourth year of recovery after the Great Recession, and you're probably thinking that here has not been much to celebrate," said Wilson. "Is it time to ask, 'Is this the new normal?'"

For logisticians, the "new normal" means less predictable and less reliable freight services as volumes rise but capacity does not. In areas such as ocean transport, Wilson said, this can mean slower transit times. "I do believe the economy and logistics sector will slowly regain sustainable momentum, but that we'll still experience unevenness in growth rates," Wilson predicted.

For cutting-edge logistics managers, however, the current environment also means great opportunities to secure increasingly tight capacity in an era of shrewd rate bargaining. This is partly because the trucking industry, in particular, is facing a lid on capacity because of higher qualifications for drivers while top carriers are becoming increasingly selective in their choice of customers and in the allocation of their assets.

"Truck capacity is still walking a fine line—few shortages, but industry-high utilization rates," Wilson explained. Truckload capacity continues to remain stagnant (with the majority of new equipment orders for replacement or dedicated fleets and the copious amount of truckload capacity sapping regulations coming down the pipeline) and the assumption that freight demand will continue to modestly increase (as the economy continues to muddle along at low single digit GDP growth in combination with population growth), a less predictable and less reliable freight market is developing (as described in the "new normal").

In last week’s blog, I shared some ideas from the recent SCL – CITA annual conference on how to improve shipper- carrier collaboration.  Various suggestions were proposed by a panel consisting of two leading shippers and two major Canadian carriers.  Some other thoughts were expressed during other tracks that day.

The panelists presented some suggestions that came out of a joint meeting between the Ontario Trucking Association and the Canadian Industrial Transportation Association.  Here is more of what they had to say.

Removing Waste from the Shipper and Carrier’s Operation

During the panel discussion it was suggested that it is through trust, communication and dialogue, rather than through an RFP, that opportunities to remove waste from a shipper’s operation can be identified, discussed and solved.  The RFP process is typically too rigid to allow for a meaningful exchange of ideas and for the development of action plans. 

Since the focus in an RFP is typically on rates and service, it doesn’t create a forum for dedicated problem resolution.  Moreover, by not creating project teams, action plans and time lines to remove waste, the inefficiencies typically doesn’t get extracted.  The shipper continues to perform the same functions, in the same way, with its existing and/or new carriers.  Drivers continue to be pick up half full loads since opportunities to consolidate freight or change pick-up dates are missed. As one trucking executive mentioned, the savings generated from these types of initiatives can be much larger than the two percent saved as a result of the freight bid.

For the past week I have been reading with great interest the postings on the LinkedIn Sales Management Group.  As of the date of this blog posting, there have been over 40 responses to the question, “What advice would you give a new salesperson”?  The tips offered were so good that I thought I would share a “reader’s digest” version with the followers of this blog. 

As I read these suggestions on a daily basis, I see two sets of users for these tips.  First, new sales reps should study this list and make sure they take action on every item.  Second, sales managers should take this checklist and cross reference it with their current (and future reps) to ensure they maintain a winning team.  Here are my 21 favourite tips for the new rep.

1. Achieve mastery of the services that you sell.
2. Achieve mastery in sales skills.
3. Seek out the top performers on your sales team and learn from them as to how they dress, their work ethic and their communication skills.
4. Understand how your services compare with those of your competitors.  
5. Be a great listener so you understand the needs of your prospects.  There is a good reason why we have two ears and one mouth.  Focus on understanding the needs of your customers so you can solve their problems. 
6. Get to know your prospects before you turn them into customers.
7. People buy from people, specifically people they like and trust.
8. Prospect, prospect, prospect.
9. Learn as much as possible about your customers.  The more due diligence you do up front, the easier it will be to close the sale at the end.
10. Be persistent and consistent.  Success comes from a strong work ethic.
11. Be passionate about your company and its services.
12. Try to sell solutions rather than products or services.  Learn your company’s value proposition and where it fits best.  Sell the value of your solution, not price.
13. Learn early on to distinguish buyers from non-buyers (i.e. lack of mutual fit/interest/resources, etc.).  This will go a long way towards increasing your income and your employer’s income while reducing customer acquisition costs.
14. View yourself as a profit centre.  To be successful, time management is critical.  Spend your time, energy and resources on the most viable opportunities in your sales pipeline.
15. Be ethical in all of your business.  Remember, you are selling your (and your company’s) credibility and integrity.  If you lose your integrity, you have nothing to sell.
16. Invest in yourself.  Continually upgrade your product and business knowledge and your sales skills.
17. At the end of the day, when all of the other sales reps have left the office, make one more call to a new prospect.
18. Acquire a CRM tool and use it faithfully every day.
19. If you are having difficulty in one or more areas of your sales pipeline, this is telling you that you have a weakness in specific areas (e.g. prospecting, obtaining appointments, asking for the sale). Take action to turn these weaknesses into strengths.
20. While the sales job can seem very lonely at times, don’t forget sales is a team sport.  Work closely with your manager and the rest of your team (e.g. drivers, dispatchers) to achieve your goals.
21. Always ask for the sale.  If you don’t ask, you may not get. 

I am sure there are many more tips that can be added to the list.  What advice would you give to new freight transportation sales rep?  I would love to hear from you.

This year’s Surface Transportation Summit will take place on October 16, 2013 at the Mississauga Convention Centre.   Please block out this date in your calendar.  We have some great speakers lined up for this year’s event.

The economic forecast for this year and for the balance of the decade is rather glum.  Many economists have projected a two percent growth in GDP will become the norm for the next several years.  This scenario is supported by the fact that 24 million Americans are out of work and millions more are underemployed or have given up looking for a job, corporations are reluctant to invest in their businesses until there is a more visible sign that a sustainable recovery is under way and the US government seems incapable of reaching far-ranging agreements on the financial management of the country.  Real gross domestic product -- the output of goods and services produced by labour and property located in the United States -- decreased at an annual rate of 0.1 percent in the fourth quarter of 2012, certainly not a number that would instill confidence that America is turning the corner. Looking at the past several years, it is easy to support the thesis that we should expect to see more of the same in the future.

But America doesn’t seem to be buying into the low growth scenario.  Here is why.

• The stock market, a leading indicator of economic activity, has almost doubled since March 2009.  Investors poured $11 billion into U.S. equities in the first two weeks of 2013, the biggest gain since 2000.  The market is telling us that there are better days ahead.

• Over the next 5 to 7 years, America is expected to achieve energy independence and will no longer be dependent on foreign energy sources.

• A strong housing market gained momentum in November, 2012 and is expected to continue through 2013, especially with low mortgage rates, which will keep affordability high, according to the BBVA Compass. The Housing Market Index rose to 46 compared to 41 October, which is the highest level since 2006. The jump is a result of homebuilder’s confidence in the housing market.  New home sales and construction are expected to continue on a strong trend throughout the remainder of the year.

• A healthier economy and more model introductions should push U.S. auto sales above the 15 million mark this year, predicts the Polk research firm.  Auto sales should continue to lead the country's economic recovery, rising nearly 7 per cent over 2012 to 15.3 million new vehicle registrations.

• Another tech boom is under way with consumers migrating to tablets, smartphones and social media.  America is strong in these areas and Apple, a key player, has recently signaled that it plans to perform some if its manufacturing in the United States.

• The United States may be in the early stages of recapturing a significant piece of the manufacturing production that fled to Asia over the previous couple of decades.  This is being driven by three factors.  Wage rates in the U.S. are depressed, while labour costs in China are rising.   The surge in oil prices is making it more expensive to move goods across oceans and the shale gas boom in the U.S. has dramatically lowered the cost of powering a plant.   U.S. productivity rates are among the best in the world.  According to the Boston Consulting Group, the U.S. economy is poised to add between 2.5 million and 5 million jobs over the next decade as result of increased factory production (700,000 to 1.3 million actual factory workers and the rest from supporting services).

• U.S. employers added 157,000 jobs in January 2013.

Jeffrey Saut, the chief investment strategist at Raymond James, has suggested that if we look at the combined impact of all of these developments, we may be witnessing the early signs of a new long-term bull market.  Time will tell.  Low interest rates will not last forever.

One thing has been strangely missing during the first five weeks of 2013.  While President Obama has been pushing hard for immigration reform and new gun laws, two very important initiatives, he has said very little about any legislation aimed directly at economic growth.  Perhaps we will hear some of his plans during this week’s State of the Union report.  Certainly the President’s leadership in areas such as infrastructure development, education and training (retraining), debt reduction and a sound budget would go a long way towards powering America in this direction.  This was one of the key elements of his election campaign.  Now is the time for the President to step up and lead his country and the free world to a strong and sustained economic recovery.  Based on the trends above, he has the option of being a leader or a follower.  Let’s see which path he chooses to take.