The American commercial trucking industry serves as a key link between raw material suppliers, manufacturers, wholesalers, distributors, and retailers in most industries. According to the American Trucking Association, the industry includes dry van, flatbed, refrigerated and bulk/tank trucking over short-haul (up to 100 miles), medium-haul (100 to 250 miles), and long-haul (250 miles and up).
Timely Trucking will compete in the market for medium and long haul dry van trucking in the American Northwest. This market serves businesses ranging from the packaged goods/grocery industry to the clothing industry to high-tech equipment, as well as commercial relocations.
Customers which require frequent dry van shipping generally have the appropriate-sized loading dock for the standard 9' high, 8' 6" wide, 53' length dry van cargo area.
The market analysis table covers likely market segments within the five states which Timely Trucking will serve.
Raw Material Suppliers ship large quantities of materials to large manufacturers in the northwestern states. These materials generally do not require refrigeration or temperature control. Manufacturers maintain some on-site storage for these supplies and generally have some leeway as to when deliveries can be received, except when projections are mistaken and supplies drop low. Packaging supplies also must be shipped to manufacturers and are included in this group.
Manufacturers often outsource the distribution of their goods to businesses that specialize in serving one the type of retailer or business. Their packaged goods are often shipped to only one wholesaler/distributor, creating a regular business in shipping between the two locations.
Wholesalers/Distributors that serve large retailers assemble truckloads of goods from the many manufacturers they serve. While they often have their own trucks or distribution means, some of these firms do not either because they are smaller or because they attempt to limit their investment in assets. Others may require additional trucking support when they are operating at capacity but not prepared to expand their shipping capacity.
Timely Trucking will begin by focusing specifically on the segment of manufacturers in Washington and Oregon states, expanding after the first year to the entire intended five state region. By serving manufacturers, Timely Trucking can provide an affordable shipping solution for new and growing manufacturers over purchasing their own trucks.
Raw material suppliers sometimes require flatbed or bulk/tank trucking which will not be an initial service offered by Timely Trucking and wholesalers often have their own trucks. These segments are expected to yield some customers, but by focusing first on the middle of the supply chain with manufacturers, Timely Trucking will be introduced to suppliers and distributors who may require their services without having to engage in full marketing campaigns to these segments.
Hoovers reports that:
The industry includes carriers that use commercial motor vehicles and doesn't include couriers like UPS and FedEx or private carriers (companies that transport their own products and raw materials).
Hoover's writes that "demand is driven by consumer spending and manufacturing output. The profitability of individual companies depends on efficient operations. Large companies have advantages in account relationships, bulk fuel purchasing, fleet size, and access to drivers. Small operations can compete effectively by providing quick turnaround, serving a local market, or transporting unusually sized goods. Average annual revenue per employee is $135,000."
The industry is broken into "truckload (TL) shipments that dedicate trailers to a single shipper's cargo" and "less-than-truckload (LTL) shipments, which transport the consolidated cargo of several shippers on one truck, dropping off goods at multiple delivery points".
In addition to competing with other trucking companies, including national carriers, Timely Trucking will compete with rail and air cargo transportation. However, for the distances it intends to travel, and due to the few rail lines over the northwestern states, trucking is at an advantage.
Shippers choose between trucking companies based on: