The number one challenge in 2017 when bringing more HGV vehicles into a transport fleet
Entrepreneurship is risky, but without risks are there are no rewards. Even experienced entrepreneurs find times of change and expansion daunting.
It is an exciting time of growth and opportunity for the haulage industry. If you are looking to maximise on this and expand operations in this sector there are some common pitfalls. Growth in any sector has similar challenges. Examples include, not having the finance for growth, or adapting processes to suit the changing business.
As well as the challenges facing all growing businesses, there are some niche to this sector. Human resource problems that are unparalleled in any other industry. For any of the 44,565 freight companies or freelancers, operating in the UK, who look to expand this is 2017’s biggest challenge.
Shortage of drivers in the industry.
As outlines staffing issues are the number one challenge for freight sector entrepreneurs. And the number one challenge to be encountered is the shortage of HGV drivers in the lorry trade. This has made headline news nationally and the story has spread beyond just industry press.
The UK is reliant on the road trade haulage industry. In 2016 goods listed by HGVs increased by 15% to 1.89 billion tonnes. But the Road Haulage Association suggested that by the end of the year, there will be a deficit of 100,000 drivers, needed to fulfil demand, of companies trying to operate in this sphere.
Further to this little is being done to resolve this challenge. With the UK government hoping that the rules of supply and demand will push up the wages of the profession and encourage more into this industry. When looking to employee a first full time employee, do not underestimate the importance of choosing the right person. It can be a deciding factor on the future success of a business.
More potential employees are aspiring to be freelancers.
However it is not just shortage that is causing staffing difficulties. Other market conditions make it harder to jump from self-employment to an enterprise in the haulage industry. It is necessary to gain a loyal employee but also to keep profit margins wide, but it can be hard to offer wages higher than the industry standard.
With an average wage of £26,000 many truck drivers are becoming increasing dissatisfied and are aspiring to become owner drivers too. Many owner drivers in this sector, looking to expand their business find this can be a major obstacle. Familiar with the benefits of working for themselves, they can start to understand why self-employment is appealing.
However not all workers in this sector want to be responsible for truck maintenance and organising their own truck fleet insurance. They would prefer the security of a regular income than the ups and downs of a less predictable income.
Being an attractive proposition to potential employees.
It can be hard to compete again some of the larger well established haulage companies and their packages that include security. Although it is not unheard of that staff move from a bigger competitor to a smaller family run business. It is important that entrepreneurs are able to offer something that their larger rivals can’t. For example a more hands on role in staffs personal development, or more autonomy over working hours. Sometimes staff becomes dissatisfied by the impersonal nature of a larger enterprise.
One way that companies can do this is by offering training and development to its drivers. This is something that increasingly being offered to cover the cost of training as a driver. This is a great way of getting raw talent at an affordable price. However it may be more important to have someone with experience to support your goals.
This can be particularly appealing to younger employees who would struggle to get the finance for their own vehicle and get truck fleet insurance under their own name. Often companies with larger fleets will find it easier to secure better value HGV fleet insurance for lorry drivers under 25. To find out more information go to http://www.truckinsurancecomparison.co.uk/ and gain a better understanding.
Is is possible to overcome these HR challenges and grow a HGV fleet?
Some of Britain’s fastest growing businesses are fleet based businesses. For example Mick George whose services include haulage have seen a 55% increase in profit in the last three years. They started in 1978 with a single tipper truck and now have a fleet of over 300 vehicles. And the UK haulage business Panther have just made it onto the list of Europe’s fastest growing firms .
Many businesses, even small ones are able to secure the talent they need to help their aspirations to thrive. But entrepreneurs need to always tackle growth with a detailed plan, and not overlook challenges like staffing issues, HGV insurance costs and vehicle maintenance in the excitement of taking on a new contract.
There are certainly advantages to a slow and steady approach, and often the fable is right and companies with this culture win the race.
