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How to Get Transportation Contracts
Transportation, trucking and logistics are some of the most in-demand services in the country and around the world. Nearly every type of business requires transportation services at one point or another in their business model, whether as part of supply chain, production or distribution of the products they sell.
Because trucking and logistics services are so in-demand, however, the result is that the competition for transportation contracts is strong. Competing with entrenched players in the transportation sector is no easy task.
That being said, there are techniques and resources that vendors can use to gain a foothold in the transportation and logistics industry or to expand their business with new clients and contracts in the private and public sectors.
In this article, we’ll review how providers of transportation, trucking and logistics services can get transportation contracts that will allow their businesses to thrive, even in the face of competition.
Finding good clients for your transportation business can be challenging, but by carefully selecting who you work with, you can maximize the stability of your business - and your profits as well.
Use load boards. While load boards are useful for when a transportation provider needs to drum up some revenue quickly, the temporary nature of load board jobs makes them unappealing for long-term stability.
Contact shippers. To grow your list of clients, get in touch with businesses that do a lot of shipping, and pitch your services. While cold calling is tough work at the best of times, if you put in the effort and can provide the service, you will get clients.
Look for public sector contracts. Working with state, local or federal government agencies is a great way to establish a reliable source of revenue for a transportation business. Government contracts are stable, well-defined in their scope, and typically pay well.
Treat your clients well. The golden rule of customer service is that the customer is always right, and the transportation industry is no exception. When you take on a client, treat them how you want to be treated and go the extra mile to keep their business if they are worth it. This isn’t only a good personal approach to your job: studies show that the cost of acquiring new business is much higher than retaining and up-selling existing customers.
Tips for Logistics and Trucking Contracts
When considering whether or not to take on a contract, transportation vendors should keep several things in mind. One of the most important is to figure out your costs.
For truckers, this means figuring out fuel costs, as well as the costs associated with deprecation of your vehicle, maintenance and repairs, and fluctuations in prices of everything from gas to licensing fees.
How to Calculate Fuel Costs
Below is a simple but ingenious method to calculate your fuel costs. This method is explained in more detail here.
To find out how many miles per gallon your transportation vehicle gets, fill up your gas tank and then drive for 100 kilometers. At that point, stop at a gas station and top up your tank so it is full again. Take note of how much gas you needed to refill the tank.
Since you drove 100 kilometers and then replaced the gas you used, you are able to easily calculate how many km’s per gallon your vehicle is getting. For example, if you had to add 20 liters of gas after 100 km, simply divide 100 (km) by the amount of gas used (20 liters). The answer is five, so you are getting five kilometers per liter of gas.
Having an accurate figure for fuel costs will help you price your loads in a way that allows you to cover your costs and make a reasonable profit as well.
Using a Bid Service to Find Government Transportation Contracts
Using a reputable bid service is a cost-efficient way to find transportation, trucking and logistics contracts that align well with the services you provide. Some bid services allow members to receive targeted lists of open contracts that meet their criteria, eliminating the hassle of searching through newspapers and government websites to find the latest contracts.
Bid services also provide access to closed bid and award information for the transportation industry, which can include valuable information about competitors, contract prices, contract renewal dates and more.
If you decide to become a member of a bid service, make sure that the company is reputable and experienced in the transportation sector. That way, you’ll be sure to get value for your investment.