Diesel’s Up, Down, and Sideways: Part 2

Riding It Out

In Part 1, we went through who feels it when diesel jumps around: the 3PL, the driver, the receiver, the end user. Short version: everybody.

So what do you do about it?

Honestly, there’s no single answer. Some people in this business want every detail signed and filed. Others still run on a phone call and a handshake. Both get freight moved. Getting through a rough fuel market usually has less to do with the paperwork than with how people think about it.

Focus on what you can control. The price at the pump isn’t on that list. Jim Horrigan, an expert partner at Bain & Company, told Sourcing Journal that the smart move is to stop waiting for prices to settle and focus on “the controllable expenses within freight.” What that looks like depends on your operation. For one shipper it’s timing. For another it’s lanes, or volume, or who they work with.

Expect the swing. Fuel that drops this month can climb again next month. The people who handle it best assume prices will move and leave themselves some room, whether that’s in a budget, a schedule, or a conversation they had early.

Talk sooner. Most fuel headaches start out as surprises. A heads-up that a load might run high, or that a pickup could move a day, goes a long way, whichever side of the deal you’re on.

Remember who’s absorbing it. Most trucking companies are small businesses. The Owner-Operator Independent Drivers Association points out that its members work load to load and “can’t simply raise their rates when fuel spikes.” When the people hauling your freight can’t stay in business, everyone has less capacity.

Play the long game. Fuel markets settle down eventually. Business relationships outlast any price spike, and the ones that held up when diesel was ugly tend to be the ones people count on when it isn’t.

Diesel’s going to keep doing what diesel does. How ready you are when it moves is the part you get to decide.