Volume 49, Issue 1- January 2014
News Analysis: Transportation
Owning vs. Leasing: Alternatives
For some business owners, those concerns can be avoided by outsourcing the transportation of their product through a trucking or logistics company.
“If you’re a glass service company working with construction companies and that’s what you want to focus on, you can say ‘look, I don’t want to mess with maintaining trucks and having to service them, I want someone to take that on, I always need to be supported while my drivers are on the road,’ you could turn to [a truck leasing company] for services like that,” says Randolph P. Ryerson, director of corporate communications for Penske Corp., the Reading, Pa.-based company that provides truck rentals and leasing as well as logistics. Alternatively, Ryerson adds, “If you’re running a business and it’s hard to recruit safe drivers, or you don’t want to own trucks at all and you would rather outsource that transportation part and focus on your core business … you could contract with a logistics company to bring the glass to your jobsite or into a plant.”
Ryerson adds that outsourcing transportation needs can mean removing the headaches of regular maintenance and inspections among other things. “You could lease from us long-term for glass shipments and we would provide the truck and the maintenance services, fuel, 24-hour road assistance, etc.,” he says. Companies such as Penske also can provide your glass shop’s branding on their trucks, making their fleet appear to be your own.
Ryerson points out, though, that the trucking industry is facing its own problems these days. “There’s a huge issue in the trucking industry with a shortage of drivers,” he explains.
Whether your solution involves your own fleet of trucks and employee-drivers or an outsourced option, Ryerson suggests not making price the final factor in the decision.
“In the glass business you probably want to know that [your driver] has good practices and good handling with what I’d call a ‘high touch’ product where special handling is required,” he says.
This, in fact, is the reason Michael Frett, sales director for MyGlassTruck.com in Glassboro, N.J., feels it is very hard for a glazier to outsource glass deliveries. “This outsource company would have to invest in lot of additional equipment and training. They would need racking systems for both inside of their facilities and their trucks. I imagine they also would need to train their workforce in the proper technique of handling the glass,” Frett says. “[Moving glass] is very different from hauling crates filled with product.”
Leasing is another alternative. “For the big glass distributors, leasing is the way to go,” Frett suggests. “The costs on the curtainside trucks or trailers, for example, are much higher than your standard van with a small glass rack. Big glass distributors can lease a vehicle with a big rack for five to six years and then turn it in when it is done and have it depreciate slowly instead of buying it outright. They can even have the option of switching a glass body over to another truck in the future, if the body is still good, and put it on a new lease. The cost of our big glass trucks and racks can be higher than your normal van or pickup, and then can be even higher if you put a forklift or boom crane on it, which is why I think leasing would be better. Another plus for leasing is that you can get a maintenance package and every 90 days or so you can send your truck in and get it cleaned up and checked out to make sure it is working properly.”
Still, Frett adds, “Smaller [companies] can own their trucks outright and run them until the trucks are dead. Both the racks and the trucks are fairly inexpensive compared to the bigger units and the truck doesn’t have to undergo as much maintenance.”
Whichever way you go, it could pay in the long run to examine
every possible option for moving your product.