The challenges operators face

The challenges operators face

A recent round-table discussion with transport operators, hosted by Standard Bank, has highlighted that tough economic conditions continue to take their toll on the transport industry. Some operators are battling to grow, due to high costs and shrinking operating margins.

Rising costs resulting from fuel and maintenance were noted as the biggest issues currently keeping transport operators awake at night.

“These two issues are really creating pressure and have led to some operators believing that the industry is becoming saturated – since it is very difficult to drive growth in the current tough economic conditions,” says Toni Fritz, head of vehicle and asset finance – business at Standard Bank.

Fritz says the industry can learn a lot from well-established operators that have invested a lot of time and resources in implementing strategies and policies to lower costs. Some of these include pre-buying fuel to get discounts, route and payload optimisation and regular maintenance.

It was also noted that the industry is constantly burdened by road accidents. “Transporters agree the industry needs to work together to identify solutions for dealing with this problem,” Fritz says.

 “One of the solutions identified was the self-regulatory Road Traffic Management System (RTMS), but the costs, time and infrastructure requirements often discourage transporters from participating,” says Fritz, adding that, from a long-term point of view, RTMS will eventually pay for itself – the challenge is getting transporters to this point.

Attracting good drivers is also seen as a problem. Fritz says that transport companies should consider creating their own pool of skilled drivers, and paying well to attract better drivers.

“It was evident from the discussion that things are not going to get easier. Therefore, transport operators need to start working together to develop long-term strategies to manage rising costs and road carnage and to retain skilled drivers,” concludes Fritz.

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