As in any business, being profitable is the name of the game. Auto transport is probably the toughest business in trucking and it requires expensive, specialized equipment with fewer shippers. A successful auto transport company must be more deliberate in their operations. Auto transport companies have the potential to make a lot more money than traditional trucking companies. However, the equipment is very costly and the risk is much higher. In the subsequent paragraphs, I’ll explain two core principles to focus on in order to reach and maintain profitability.
Utilize your trailer type to its potential
Utilize your trailer-type to its potential – If you operate a 9-10 car stinger, truckloads will be your best bet to get the most out of your equipment. New car logistics providers, rental car relocations and large used car buyers are wonderful resources for utilizing stingers to their potential. Stingers carry the most vehicles of any trailer type and are perfect for the big moves.
7-car trailers are very popular and can be used with a standard fifth wheel tractor. They are simple to use and can be quickly loaded. They are perfect for picking up LTL shipments of one or two cars until you have a full load. Personally Owned Vehicles (POVs) are a perfect fit for 7-car trailers. They are easier to maneuver in residential areas where most POVs are shipped from or delivered to.
Identify profitable routes and stick to them
Obtaining profitability in auto transport requires a disciplined approach to the areas of the country you’re going to service. One of the quickest ways to fail is to transport vehicles along random routes without an understanding of the average rates and demand for auto transport in that area. Your best bet is to use the “barbell” approach. Imagine the shape of a barbell – two circles, separated by a straight line. The circles are two hot areas for auto transport. For example, I’ll choose Atlanta and Washington D.C. to represent the circles in the barbell. These are two strong markets that move a lot of cars between them. It’s best to concentrate your assets into a lane similar to this and develop customer relationships in both areas. That will help in keeping your truck full no matter which way you are going in the barbell. You must stay focused on this route and stay away from any loads that take you outside of your barbell. Remember, provide service in your barbell – this is where profitability can be found.
Find a software provider and utilize them
Once, you choose the ideal software provider for your company there is no looking back. With the new technology that they bring to the table you get a competitive edge over your competition. You will have happier customers and hopefully be able to reduce any claims against you. Using a technology like GoPhore – Auto carrier software is extremely important to staying in this market.
In conclusion, the key isn’t what you say yes to, but rather what you say no to. The key is to stay focused on your barbell and utilizing your trailer type to its potential. That is the blueprint for success as an auto transporter.