The transportation industry is essential to the global economy, but it also faces significant challenges. From increased competition to changing regulations, transportation businesses have an array of exposures that can lead to costly losses if not addressed in a timely manner.
Transportation companies must be proactive in identifying potential exposures and creating risk management solutions that help protect their bottom line. By understanding the current industry challenges and how to meet them, transportation businesses can ensure they remain profitable in an ever-changing environment.
This article will discuss three of the most common transportation industry challenges (per the American Transportation Research Institute’s recent report) and how businesses can create effective risk solutions to address them.
1. The Economy
With growing inflation, supply chain shortages, high diesel prices and continued wage pressures, the economy is a top concern among transportation leaders. When times get tight, transportation companies must have a solid understanding of their costs and optimize their operations for maximum efficiency. Risk solutions such as transportation-specific programs that help reduce claims frequency, ultimately help transportation companies minimize their exposure to economic downturns.
2. Driver shortage
There are a number of underlying factors contributing to the driver shortage, including a retiring driver workforce, the challenging lifestyle, and regulatory pressures leading some drivers to leave the industry. Stakeholders believe there are multiple ways to reduce the shortage including:
- Lowering the legal driving age to 18
- Improving the driving lifestyle, by expanding truck parking and reducing detention at customer facilities
- Recruiting more women to the profession
3. Driver retention
While the average annual starting bonuses were up 26% over the past four years, according to ATRI’s Operational Costs of Trucking research, retention bonuses were up 57% over the same time period, showing the industry’s increased focus on retaining their best drivers.
Other strategies could include:
- Research and prioritize retention strategies, based on driver feedback and driver tenure data.
- Evaluate the impact of truck driver benefits, including health insurance and retirement benefits, on driver retention.
- Quantify the relationship between safety technology deployment (e.g. cameras, speed limiters, active braking systems) and driver satisfaction and retention.
At Kapnick, we understand the transportation industry and take a comprehensive approach to addressing your unique challenge. As experts in both business insurance and employee benefits, we can ensure our transportation clients’ worries are addressed, whether that involves risk management or employee retention strategies. Contact us today at 888.263.4656 or [email protected] to learn more about how we can find the best solutions for your transportation business.