The popular phrase “knowledge is power” rings true right now for many owner-operators struggling to make ends meet.
We all know that giant shippers like automakers are cutting production because GM’s staggering losses dependably make the front page. That information is in your face. But what about that “other” freight – the computer stands, copy paper, tennis shoes, widgets made by companies whose bottom lines aren’t worthy of major news? An old trucking friend from New Jersey used to call this “soup to nuts freight” and what is happening to it is the kind of news that you need to know to keep your business paying the bills. So where do you find out what’s up?
In these days, when nearly everything we do is monitored, you can bet that somebody somewhere is watching that freight. The best place to find it is that old “information highway,” online. If you are not computer savvy, it’s time to get comfy with using the Internet and making Google your friend.
Much of trucking’s bread is buttered by smaller but successful retail businesses. When one of these files for bankruptcy, most people think “shoot, that was my favorite place to go” or “oh no, my sister works there.” Truckers and those of us who work in the industry – including trucking journalists – react in a different way. We temper that news with calculated load loss.
For example, Mervyn’s, the California department store chain, is the latest in a series of retailers to enter bankruptcy. They’ll be open for a while, but their future is shaky. That wasn’t big news to most, but if you are hauling retail goods to Mervyn’s it is.
The upshot is nobody is going to spoonfeed you the state of the freight. You are on your own when it comes to assessing the health of your shippers. It’s not hard. Not only can you observe them when you pick up or deliver, but you can hit the Internet and punch in a few key words. It didn’t take me three minutes to find that Pep Boys auto parts are closing 31 stores. Foot Locker is closing 140 more stores. Linens ’n Things, which filed Chapter 11 in May, recently announced it will close 120 stores. Pier 1 imports will close 25 more stores; the company closed 79 in 2007. Google up “businesses closing” and you find stuff like Rite Aid drugstore chain is closing 28 stores, Sprint Nextel Corp is closing 125 stores. Movie Gallery, a video rental chain, is closing 400 stores.
Have restaurant supplies been your bag? You need to be watching restaurant closings. My favorite place, Lone Star Steakhouse, recently announced 27 closures. This week, I found that national restaurant chains Bennigan’s and Steak & Ale have closed their doors and filed for Chapter 7 bankruptcy protection, closing more than 300 locations and laying off thousands of employees. It is one of the U.S.’s largest restaurant bankruptcy filings, so it did make the Wall Street Journal. The Journal reports that the chains will liquidate and are not likely to reopen.
One area that sees loads of goods trucked in and out every day is our country’s shopping centers. I did a quick search for shopping center closures and ouch, there’s Bloomberg News reporting the average vacancy rate at neighborhood and community malls rose to 8.2 percent, up from 7.3 percent in 2007 and the highest level since 1995. And at regional and super-regional malls, vacancies increased more than 6 percent. It’s doesn’t take much of a Google search to find that Disney Stores are scaling back, closing 98; PacSun – that’s Pacific Sunwear of California – is closing 154 stores, and Ann Taylor, luxury clothing, is closing 117 stores. Wilson’s Leather is closing 100 mall stores and Friedman’s Jewelry is liquidating and will close 120. Zales, the famous diamond store, will close 105 full-size and mall kiosks. Sharper Image is closing 90 stores. Dell Computer will close 140 stores, including some mall kiosks. Bloomberg quotes one economist as saying retail space is being “abandoned” at the highest level in 28 years.
Missing those construction loads? If you’re a flatbedder and have made a living hauling construction supplies for the past years, you’re no doubt jonesing for the good old days. But you still need to rely on new customers for a while. Home Depot closed five stores in May. I recently found that 84 Lumber, based in PA, will close 12 stores. And if you hauled the stuff that furnished new homes and buildings, that’s not recovering quickly either. Ethan Allen home furnishings are closing 12 retail centers. I just learned Levitz is filing for bankruptcy.
OK, so now the third quarter news is happening and not all of the info that affects your business will end up on the evening news.
Use the Internet to watch your customers’ health and keep your truck moving freight that pays.