The association says members should review costs in the face of fuel price increases
The Australian Livestock and Rural Transporters Association (ALRTA) urges all members to review their operating costs in the face of dramatic increases in fuel prices.
The association referenced the rising prices of fuel, tyres, parts, vehicles and labour over the last few months as reasons for operators to consider reducing their expenditure.
“Operating a transport business is difficult at the best of times, it’s a high capital, high cost, low margin game and we operate in a competitive environment,” ALRTA national president Scott McDonald says.
“Most transport businesses cannot afford to absorb these increases, so now is the time to put some effort into really understanding the full cost of providing your freight service.”
McDonald says calculating the impact of increased fuel prices “is the easy part” and that it’s important operators also factor in the current cost of replacing tyres and parts as well as performing essential maintenance.
“At some point, you are going to need to replace the truck and trailers, so you must make sure your margins can cover that too,” McDonald says.
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For businesses doing it tough currently, the ALRTA stresses the need to understand these rising costs is vital when it comes to adjusting freight rates.
The body says a common solution can be to discuss with customers the reason behind rates increasing, as it’s not beneficial for businesses to work harder for the same rate.
“We should approach this important issue as an industry, rate increases are easier to achieve when everyone understands the true cost of our service,” McDonald says.