Thriving in a Freight Recession | Ep 45

Bryan: 00:00:00

Everyone wants to know what the future of the freight market holds.

We've been in a freight recession for the past couple of years and people always want to know who has the crystal ball and what's it going to look like in the future. On today's episode, we're going to go over the most recent election, how that impacts our industry and how that impacts a driver shortage.

All right, man. The elections coming, gone. Trump's been elected to office, the 47th President of the United States.

With our industry and what that looks like, we've been stinking lean and grinding it out over the past several years, especially from a margin perspective, from a volume perspective as well as a new client acquisition perspective. Right. Inflation's been at an all time high, consumer confidence at an all time low, and people are not buying additional items they don't need.

Their dollar is stretched further than it's ever been stretched before and we feel the impact of that.

I love industry because of the fact that we get a front row seat to how many shipments are out there and what the economy is doing on a weekly and monthly basis. Do you have any thoughts like what are you hearing out there as far as when is the freight recession going to be over?

Justin: 00:01:21

Yeah, I'm day to day, Brian. I am day to day.

Bryan: 00:01:25

Everyone wants to know. Everyone wants to know.

Justin: 00:01:27

I don't have the crystal ball, but what I do know is thank God for our clients, thank God for our carriers, thank God for our employees, thank God for you, our families and the support. Because the last two and a half years. Yeah, we started during COVID or Covid. The last two and a half years were very difficult.

I think we saw a lot of collateral damage from post Covid and companies went out of business, carriers shutting down, consumers not spending. And to your point, a lot of things you just mentioned. But with the recent election, there is a lot of optimism around the future of our industry.

And I think that's why you and I are called psychotic.

But I think that's why we're, we're just like obsessed with the industry and you know, have stuck with it for so long is because the volatility and the chaos and it's something new every day. I mean, we're constantly learning. But I personally, I'm very optimistic. I know we've discussed this here and there.

There's a lot of factors that come into play. I think there's still going to be some aftermath and more businesses closing down. Specifically like carriers, brokers.

Bryan: 00:02:31

Yeah.

Justin: 00:02:32

If you made it through and you grew you know, luckily we were able to grow the last few years. But if you grew, like, give yourself a pat on the back.

Bryan: 00:02:39

Impressive.

Justin: 00:02:39

Yeah. But looking forward, I think there's a lot of questions on what will it look like.

I do think Trump's presidency will help inject some growth into our industry. I'm not a data analyst. I don't, you know, dive. I know a decent amount replay of articles and forecasts.

A lot of specialists or, you know, people who do forecasts and study the market are looking for more of a Q2, Q3, you know, swing. But, you know, what are your thoughts there? What do you have any insight or.

Bryan: 00:03:09

Yeah, I mean, anything that I, that I read and listen to within our industry, I think it's about the same. It's going to demand will meet supply sometime in Q2, Q3.

And again, nobody does have that crystal ball, and I wish we did because I think it would make probably alleviate a lot of stress. Right. But I think with that, we have to think of a couple things.

You have a Republican president in office, there's going to be less regulations, people are going to have more consumer confidence than the previous four years.

And I think that that goes a lot to our industry because when drivers wheels are turning, it means that everybody's making more money out there, whether that's a carrier, a broker. That's where we love to live, is in a tight market. But again, it's all cyclical.

One thing that not a lot of people are talking about is I know there's been a huge push for mass deportation of illegal immigrants with that.

And whatever happens in January when he takes over the seat or what have you, I do think there's going to be a pretty big impact on the number of drivers that are out there. And I think driver capacity is going to get a lot less. And what does that mean for us?

Well, there's going to be less drivers on the road and we're going to have more of a middle ground where the number of shipments are going to equal the number of drivers or the number of carriers out there.

So I do think usually January, February are a little bit slower times in our industry, but I do think there's going to be a little bit of a ripple effect from that alone. Yeah.

Justin: 00:04:35

I also think from the brokerage side is how can we educate or provide those insights to our clients to be more of a strategic partner.

And like there's still some unknown, we have an idea of what it will look like, you know, coming this year, but getting in front of our clients, answering any questions that they have.

Bryan: 00:04:54

Yeah.

Justin: 00:04:54

Providing snippets or articles, educating them on what to expect.

Because there's going to, you know, tender rejections are going to increase, capacity is going to shrink, drivers are going to leave the industry, and that's where that swing is going to happen.

But supply is going to be increasing from the shipper standpoint, so it's that leverage is moving from the shipper's side over to the carrier side, where rates are going to increase, capacity is lowering. And educating your clients and saying, hey, here's what to expect. Here's what we're looking to do.

And some of those annual RFPs or contracts that they have, they're going to fizzle out because carriers are going to push back and say, we need rate adjustments here.

Bryan: 00:05:33

Yeah, I think. I mean, with that.

mmitted to this price back in: 2024

And I think it's having those strategic conversations as opposed to slamming your hand down on the desk and saying, hey, I need a couple thousand dollars more for the same exact shipment. Those are the conversations that need to be had versus something that is transactional.

Justin: 00:06:44

Yeah, for sure.

And also thinking of some of Trump's initiatives, bringing a lot of those international jobs back into the United States, where those were previously being imported in from other countries. Now we're going to be producing, and there's going to be more jobs there. There's going to be more product that's needing to move domestically.

So there are going to be some continued disruptions in the industry. My advice, if you're selling in this market right now, is don't show up late to the party.

Bryan: 00:07:11

Right.

Justin: 00:07:11

And what I mean by that is be very intentional with who you're targeting.

Bryan: 00:07:15

Yeah.

Justin: 00:07:15

You know, don't start those conversations when things tighten up and, you know, everything's going haywire. Start those conversations now and be very, very targeted with who you're having those conversations with.

Bryan: 00:07:25

Yeah.

Justin: 00:07:25

Because it's going to get disrupted. Carriers are going to fail. They're going to be evaluating, they're going to be kicking carriers out of their network.

The ones that have been having conversations with them are going to be sitting at the dinner table, and you're going to be sitting at the Door still. So that's my advice. Start those conversations now and be consistent with them.

Bryan: 00:07:42

Yeah, I've heard a couple different recruiters out there that have talked about, okay, what kind of hires do you need to make now to prepare for a potential upswing?

Do we need to hire kind of a mass hire, 10, 20, 30 people at a time to bring in so that we can prepare for a little bit of an upswing when that happens? Q2, Q3. Or is it more of a strategic approach where you want to bring in the right type of person?

So things are looking for the better in our industry, which is great just because we mentioned that the last two and a half years, it's been a little. It's been super lean. Right. And there's been this dark cloud over our side of it for a little while now.

And I'm glad to see that some of the positivity is moving forward at the same time.

yourself for the back half of: 2025

Justin: 00:08:32

It's easy to look like a superstar when things are easy. There's plenty of capacity out there. Anyone a monkey could go get a truck right now for a shipper.

But when things get difficult and tighten up, that's where the real rock star is going to shine. Invest in the relationships that you have from a shipper side, but also from a carrier side.

Those carriers are gonna be pretty limited when things do tighten up, and they're gonna wanna work with the partners that they enjoy working with that take care of them. And when things are soft, we might pay some of our carriers a little bit more higher rates than what the market's showing.

But when it gets difficult, we're gonna want them to work with us as well, be flexible on rates so we can be consistent with our clients.

Bryan: 00:09:13

Yeah, I mean, you want to have control of the inventory, and in this scenario, the inventory are trucks and truck drivers. So, you know, I've been through a lot of different cycles and it's got it so interesting to see this being the longest. I mean, this was tough.

God, there was like a lull in: 2013

I don't want any ill will towards anybody. But when a newer broker posts a load and nobody calls in now, they're just dumbfounded and they're like, well, what do I do? Now. Well, you better get.

Wait, I have to dial out. Dial? Yeah, you got to start dialing the phone and create a relationship.

But, yeah, I think with the election and what this looks like, I think it's something for our industry that people are looking forward to. At the same time, I encourage those leaders out there to be strategic with the decisions you're making over the next three to six months.

Justin: 00:10:11

know initiatives moving into: 2025

We'd love to hear your thoughts, and we'll continue to, you know, release these types of episodes as we see changes in our industry.