By Amy Toner, NATSO Vice President Publishing and Digital Content
Truckstop and travel plaza operators, industry suppliers and business experts gathered in Savannah, Ga., Jan. 21-24 to discuss the state of the industry, learn how to prepare for the future, and find the products and services that can improve sales and operations.
The session kicked off with the Great Ideas! Session for Independent Operators where truckstop and travel plaza attendees shared their challenges and brainstormed with each other for solutions. Attendees shared thoughts on everything from top SKUs in their grab-and-go food areas—hard boiled eggs for one operator—and ways to engage the community, such as offering ‘We pump Wednesdays’ where one location offers full service on the fuel islands so customers can go inside and shop.
The Change Ahead
Don Quinn, president of Sapp Bros. and NATSO’s 2017 chairman, welcomed attendees during the show’s first keynote address. Quinn said the truckstop and travel plaza industry is experiencing a period of drastic and rapid change and called on NATSO members to seek out the opportunities that exist within that change. Shifts in consumer behavior coupled with a growing number of competitors are driving the need for truckstop and travel plaza operators to explore and adopt new service offerings in order to stay competitive. “We may not always like change, but I am certain we will like irrelevance even less. The ability to evolve and change will strengthen our businesses and contribute to our long-term success,” Quinn said.
Several speakers discussed potential disruptors to the industry, which range from growth in e-commerce to autonomous trucks. During a presentation given during the board meeting, Ken Cassar, an analyst with Slice Intelligence, told operators that e-commerce is growing six times faster than brick and mortar, accounting for almost 10 percent of consumer spending. Digital usage is increasingly a part of truck driver’s work life, and professional drivers are active users of the internet. Cassar said they shop two times a week online, with 71% using a laptop, 71% using a smartphone and 17% using a tablet.
Not only is growth in e-commerce changing how people shop, it is changing how shippers source and store goods, which is affecting the length of haul. Today the average length of haul is 533 miles, which is down 33% since 2000, said Bob Costello, senior vice president and chief economist at the American Trucking Associations. “Since 2000 we started buying online. Bricks and mortars have had to adjust to that,” he said, adding that online sales have increased nearly 500% since 1995. “They have built more distribution centers around the country. They’ve gone from a handful to dozens but they’ve gotten closer to the source.”
During his keynote address, Costello also addressed autonomous trucks, saying the technology is moving much faster than anyone anticipated.
Trends in the Trucking Industry
Costello told attendees he is optimistic for the year ahead for trucking, saying 2017 will be a better year than 2016. “Statistically we’re due for a recession, but what you really need in a recession is something to get out of whack,” Costello said. “What out there today is overheated? Nothing that throws up alarms.”
Costello said the job market is solid and the unemployment rate is 4.7%, which will ultimately lead to increased wages and give consumers more money to spend. “We’re a society of consumers. The more money coming in, the more we’re going to have going out,” he said, adding that the additional spending results in goods in trailers.
New home construction is also strong, which adds to freight levels. Last year just under 1.2 million new homes were built, and that is projected to increase to more than 1.2 million this year. Manufacturing is also moving in the right direction and could go from no growth to a little bit of growth.
Costello said he expects fleets to take a productivity hit once the electronic logging mandate takes effect. However, if productivity goes down, fleets will need more trucks to haul the same amount of freight.
The Risk of Tolls and Rest Area Commercialization
David Fialkov, NATSO’s vice president of government affairs, told attendees that he expects to see increased interest in tolling and rest area commercialization as lawmakers seek to boost infrastructure funding levels. President Donald Trump advocates a $1 trillion infrastructure investment over the course of a decade paid for primarily through private investment and tax credits. Such funding schemes could lead to tolling and rest area commercialization, both of which NATSO strongly opposes. NATSO has long supported an increase in the motor fuels tax. “Adding tolls to existing interstates is an inefficient means of collecting revenue. It results in traffic diversion, where vehicles – especially trucking fleets – will avoid toll roads and instead travel on secondary roads that are not equipped to handle interstate-level traffic volume,” he said.
Additional speakers addressed specific strategies business owners can take to move operations to the next level, beverage trends, how to create a capital and infrastructure investment plan, and ways to hire and retain top talent. The show also included several networking events where attendees could share ideas in informal settings while forming and strengthening relationships.
To take advantage of these types of learning opportunities next year, plan now to attend The NATSO Show 2018, Feb. 9–13, in Nashville, Tenn.