As we move further into the 21st century, businesses—yes, even those small motor carriers with fewer than 20 vehicles—are becoming more and more entrenched in the global market. The global supply chain has become increasingly local as raw materials are shipped around the globe only to find their way into finished products. Through all this movement, small motor carriers are finding that they have become an integral part of the overall global supply chain.
With goods traversing the globe daily, companies are being subjected to much closer scrutiny as to how they make their profit.
Last year, Rana Plaza, an eight-story commercial building that housed several garment factories, collapsed near Dhaka, Bangladesh, killing over 1,100 who became trapped inside. According to the New York Times, an initial investigation found that the Rana Plaza building violated codes, with the four upper floors having been constructed illegally without permits. This is an example of how not doing the right thing can reverberate across the globe.
Worldwide and national condemnation was swift as many U.S. retailers were suddenly faced with explaining to their customers why clothing sold in their stores was purchased from an obvious sweatshop-style manufacturer that had greater concern for profits than for the people they relied on to produce the clothing.
So, why should this be of concern to you, the micro- and small motor carrier? The tragic incident demonstrates how your company’s customers, whether they’re individuals or other businesses, are looking harder at the ethical practices of the businesses from which they purchase products and services.
You must consider all aspects of your operation, from where you get your repairs and maintenance completed, to who manufactures the products you haul, to how you market your services, and to how you, your employees and/or contractors do their jobs.
I recently spoke with the owner of a small carrier who contracts out to a larger carrier. He had been hauling under the other carrier’s authority for over a year when he noticed the freight he’d been hauling suddenly took a huge dip in the rate he was receiving from brokers. When he challenged the brokers as to why there was a decrease in rates, he was told that the carrier’s CSA scores on hours-of-service compliance had exceeded 90%, and the brokers felt they were taking too much of a risk using the carrier. This caused his micro-carrier’s revenue to be reduced through no fault of his own.
The lesson? You must not only evaluate your own company’s ethical policies, but those of others with whom you do business. Their ethics (or lack thereof) reflects on you and how your customers determine the value of your operation.
Contact Tim Brady at 731-749-8567 or at www.timothybrady.com
