Jan Devecka has years of experience as a driver for various motor carrier companies. In December 2022, Jan made a 180-degree decision. He decided to go from a for-hire driver to an owner-operator by starting his own trucking company, JDD Rockway LLC. In January 2024, Jan decided to expand his operation to a fleet of four trucks. With this expansion, Jan was faced with a myriad of new business decisions. One is how to manage dispatching his fleet of trucks and drivers.
The post-pandemic freight market has presented challenges for many motor carriers. In the second half of 2023, numerous small to medium-sized and a few large national trucking companies shut down their operations, and some filed for bankruptcy. Notably, the third largest Less Than Truckload (LTL) carrier, Yellow Corp, filed for bankruptcy at the end of July 2023 (Reuters, 2023). JDD Rockway LLC was no exception to the challenging freight market environment. Towards the end of 2023, Jan noticed his financials dwindling faster than ever before. Something had to be done if JDD Rockway LLC was to continue its operation. At the same time, this downtrend in the freight market offered an opportunity to scale the business because the fixed costs associated with additional equipment were historically very low.
Thus, Jan constantly asked himself a series of questions. How can he scale his operation while facing declining revenue and increasing service costs? Should he introduce cost-cutting changes that could impact service levels, consequently risking losing more customers? Alternatively, should he continue absorbing financial losses, weather the storm, and maintain the same service levels? One specific operational change he is considering is bringing the dispatching aspect of the business in-house rather than relying on a third-party dispatcher. He believes this change can present a cost-cutting opportunity while increasing service levels for his existing customers.