Your first interview with the fleet recruiter usually sees him peppering you with questions. But how about asking a few of your own? Ask the right questions up front and you could ensure that the long-term outcome is good for both of you.
We were surprised when we surveyed a number of drivers and owner-operators to find that they ask mostly about operational matters, like who pays for the baseplate, tolls, insurance etc. Or about dispatch procedures and layovers. Few, it seems, are asking questions about the actual business relationship.
It's a little different for company drivers, as they have employment and labour law on their side, but drivers can still try to discover more about their prospective employer than simply 'When do I get home?'
Stephen Evans, director of safety and risk management for H&R Transport in Lethbridge, Alta., suggests drivers often don't see their careers in terms of being employed by a particular company, but as a member of the industry at large.
"This outlook may prompt drivers to view the term of employment from a 'good while it lasts' perspective," Evans says. "It's almost as if they're not too concerned with the long-term outcome. When the grass starts to look a little greener over there, they'll move on."
Larry Lee, manager of the international division of SLH Transport in Kingston, Ont., says he's never been asked if the company is profitable, never been asked to produce income statements for currently contracted owner-operators, and never been asked what kind of a safety record the company has.
Dollars & Sense
The carrier takes steps to ensure that you'll live up to your obligations, and owner-operators should be doing the same. If the carrier promises 12,000 miles per month and you consistently only get 8000, your business is going to suffer. If the carrier has a track record of not maintaining its equipment, the DOT may target you as that carrier's representative. If the carrier is struggling financially, you may not know about the problems until your cheque bounces or you find the bailiffs have locked the gate, with your truck on the inside.
Lee says he's surprised that he's never been asked about the financial performance of SLH. "That kind of request may not be that well received by some companies, but if they're uncomfortable with the request, maybe there's a reason," he advises.
Asking for a credit reference shouldn't be an unreasonable request. You can get a reference from a fleet's major suppliers, or informally talk to the company's present owner-operators.
You can also apply to get a Dun and Bradstreet credit rating on the carrier for a small fee. That company's CreditCheck service provides a snapshot of the essential facts needed to evaluate the creditworthiness of a company. It contains a detailed business summary of important information and an overview of all available public record information such as suits, liens and judgments (www.dnb.ca).
Take the real-life example of Jessie. He leased his truck to a small carrier who couldn't control his receivables and didn't have the money in the bank to pay Jessie on time. Sure, the money was out there, but it made Jessie late with the payables on his own ledger. He had to get out, and when he did, the carrier refused to pay, challenging Jessie to take him to court.
"My lawyer told me that it could take several years to get to court, and even if the company was still in business, we'd probably only see pennies on the dollar," he told us. "Probably just enough to cover the legal fees." Jessie could have done a credit check on the carrier before he started, which may have indicated the carrier was having problems. "If I had seen problems then, I never would have hired on," he says.
Until recently, safety ratings haven't been much of an issue but they'll reveal a lot about a carrier. The enforcement community is placing a far greater emphasis on a carrier's on-road performance than in the past. This can affect your business relationship in two key ways.
First, shippers are now beginning to look at those ratings, and some are refusing to do business with lacklustre carriers.
Second, poor performance ratings indicate a carrier isn't doing the best job of managing its fleet. Whether it's a rash of hours-of-service violations or equipment failures, it means the DOT is watching, and they'll be watching you too. You might also end up paying higher insurance premiums.
In Canada, it's difficult to gather accurate information on a carrier because not all provinces maintain carrier profiles, or safety ratings. Ontario does, and the record is called the Commercial Vehicle Operator's Registration. Every trucking outfit in that province will have a CVOR. Get the carrier's CVOR number and check them out by contacting the Ontario Ministry of Transportation. This information is public and may be obtained for a fee of $5 per transaction.
Quebec is currently in the process of establishing a carrier safety rating system, but it may take a while for all the information to percolate to the surface. Alberta has its PIC program, or Partners in Compliance, which should tell you something about a carrier, but by all means, don't stop there. You can also do a search on the U.S. DOT carrier safety database, called 'SAFERSYS', on the Internet. Records can be obtained by searching the carrier name, ICC number or DOT number, but the records may not be current (www.safersys.org).
The Short Strokes
In terms of the questions that owner-operators don't ask during the interview, Lee says he's most surprised by the apparent lack of interest in what the carrier offers in terms of business advantages.
"If a carrier can offer a better price on shop rates or fuel than the owner-operator can find elsewhere, then we've effectively lowered his cost of doing business," Lee says. "There might not be a big difference in mileage rates across the board, but one carrier can still come out ahead of the others in an apples-to-apples cost/rate comparison."
Few guys dig that deep, but you'd do well to find out what advantages the carrier might offer, and more importantly, who pays for them. There's a big difference between 'We supply...' and 'You pay for...'.
H&R's Evans suggests that owner-operators need to ask many more pointed questions about the arrangement, like insurance matters. "We had a lease-op here who recently had a minor accident," he says. "He thought he'd be covered under the terms of the insurance, but in fact it became a Worker's Comp issue. That can get quite complicated."
The underlying theme here is to clarify everything at the beginning of the relationship rather than arguing about them at the end. It costs the owner-operator a fortune to switch companies, and the carrier pays thousands as well. High recruiting costs hurt their bottom line, which makes them less competitive. That often means less money available to pay the contractors. In the end, it'll pay everybody to enter a relationship from an informed position.