FROM THE DESK OF THE PRESIDENT: RICHARD LICATA – Page 2
Safety by choice…. not by chance!
The best-laid plans go astray! We have put together a fantastic game plan going into 2021, but nobody could have anticipated all the challenges that we have faced. One thing I can say with certainty in 2021, it has been unpredictable thus far. We all knew the business would be plentiful, but we didn’t anticipate the labor shortage that would cripple the industry nationwide. Thank goodness we put in some of the programs in place that we did. I don’t know how we would survive had we not taken some of the actions we took. Some of the actions we put in place was to increase our local rates and we made the whole summer peak rates. This was done so that we could pay our helpers and front-line crews a minimum pay that can compete for labor with the Amazon’s and Costco’s of the world. Additionally, we established for the first time a Do Not Service List (DNSL), with the knowledge that 20% of the business causes 80% of the problems. Thus, eliminated moving customers to those hard to deliver locations that would cause our drivers to deadhead. In this manner, we were able to save our capacity and just service those shipments to and from our main routes. This has been particularly critical since other agents have their own hands full with labor shortages and therefore unwilling to lend any assistance when called upon. Additionally, non-conventional services have all but been eliminated this summer as they too don’t have the labor to perform these services. Most recently, we have paused all non-account resident-to-resident local moves for the balance of the summer. We went into this with much consternation as Reebie has never taken this drastic of a position to curb demand. However, with the current constraints against this business, this would be the only way to protect our accounts without jeopardizing the quality of the service we provide.
On the bright side, revenues have never been better. The pricing level for our interstate fleet is at its highest level – level 15. This level has an effective discount of less than 50%. In the past we’ve very rarely booked business at this high of a pricing level, but today it has been the standard pricing throughout the whole summer. I’m sure this makes our over-the-road fleet very happy as they retain most of that revenue. Our storage is busting at the seams and we are running low on storage vaults to house our customers’ storage. We are actively looking to purchase more vaults at every opportunity we can and rented containers in case we run out. A quick stroll into the warehouse and you get a tangible view at just how busy we are. There is barely a path to walk through. Our O&I business is very strong with Northwestern is utilizing any available body we can provide them. Finally, our consumer local and interstate is also above capacity as we are booked up until the last week of July. The only areas that continue to be sluggish, post pandemic, are the Account Domestic and International businesses. I would anticipate those to rebound towards the end of the year and into 2022.
In a year with many variables, one thing remained constant – our team’s hard work and dedication to our customers. Now more than ever, we are especially grateful for the teams we have in place at Reebie and our sister company, Jackson. You are the people behind our success.