DRIVING THE NUMBERS:
A look at the trucking industry’s financial landscape
8
In recent years the insurance market for
trucking has experienced an exodus of
many primary insurers and reinsurers
from the marketplace which of course
corresponds with significant premium
increases. How has Bestway dealt with
this market disruption and what, if any,
advice do you have for smaller carriers
that have been particularly affected by
this development?
The key is to work with the right broker
who really knows the industry and the
marketplace.
How has Bestway dealt with the everincreasing
costs of healthcare for
employees? Are there specific changes
you have instituted that have helped
mitigate the annual increases?
We opened a clinic to provide many of
the basic services to employees that
otherwise would go through insurance.
Secondly, we adopted a semi self-insured
plan and that has been working well.
Like so many of the other segments in
the trucking industry, the landscape is
constantly changing due to merger and
acquisition activity. Do you see Bestway
becoming more active in that arena
and if yes, what are the key financial
indicators you look at before considering
a purchase? Historically what is the
primary driver behind pursuit of a
merger or acquisition (e.g. market share
growth in area the company is involved
in, expansion into new market segment,
customer base, etc.)?
We are open to the possibility of
acquisitions but I think the “fit” is the
most important driver. We have a very
small but talented management group
and operate in a specialized niche. We
see the need to diversify but want to
make sure that an acquisition does not
divert our attention away from our core
business.
What is the company driver vs owneroperator
ratio for Bestway and has that
ratio fluctuated much since you have
been at Bestway?
If yes, in what direction and what do
you attribute that to?
Since the company founding we have
always been 100% company driver and
that model works well for us.
As the driver shortage continues to
make headlines and companies strive to
adjust, what are the biggest challenges
Bestway faces when it comes to driver
recruitment and retention?
Does Bestway offer drivers healthcare
or retirement savings programs?
We do offer subsidized (not 100%
company provided) health insurance and
retirement savings but I think the biggest
challenge is increasing freight rates to
allow for increasing driver pay.
One possible solution to the driver
shortage is to recruit more female
drivers, has Bestway had any success
with recruiting drivers outside of the
traditional labor pool?
We don’t really target specific groups.
Our targeting is more geographically
based but are open to all.
What is your typical tractor life-cycle in
terms of years? Does Bestway follow
a strict schedule of how long, in terms
of years, it will hold onto a vehicle or
is it based on mileage? Does Bestway
purchase all its vehicles or does it also
lease and rent tractors or trailers?
I think years is really a substitute for the
true indicator which is miles. Our target
is to try and turn after 600,000 miles
but it is just that – a target – taking into
consideration profitability and revenue
outlook. We purchase all our own
equipment.
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