Date: Mon, 14 Aug 2000
From: "Archie C. White, III" <ArchieW@acwhite.com>
Subject: RE: AMS-Forum COD HHG's - I hope I'm wrong...
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Ed raises some good thoughts about COD business. COD business has changed over the years. So often now it is just a bidding war to see who can give the highest discount, shave the weight, grossly underestimate the packing, conveniently forget about long carries, stairs, piano carries etc, all the while the salesperson keeping their fingers crossed that a miracle will happen and things will go fine. On top of the maximum discounts, we also tend to give them the least flexible (for us) schedule. One day load, then a real short delivery spread on a job that is already way underpriced. Best price, best schedule, on jobs with less profit potential. Formula for disaster, that we repeat month after month.
As Ed and Chris have said, many are reducing or getting out of the COD market. I know some that already have. We struggle with it, and do our share of fussin and cussin. Unfortunately, Atlanta is a great COD town, and its not our customers fault we are idiots, we have seen the enemy and he is us. (I stole that line from Pogo, the old comic strip)
SO I think the new Tariff 2000 has the potential to make it harder for us to cheat ourselves. Every shipment will have hauling accessorials built in, so the drivers wont be cheated out of their long carries. The packing will be by the cwt. so we don't have to worry about packing 125 boxes when the salesman estimates 40. Balloon contract packers will pack less, since they get the same $$$ and there is no incentive to use dishpacks for lamp shades anymore. We just have to figure out a tolerance for shaved weights, and watch drivers going back to the good ole days of leaving one tractor wheel off the scales when they get their light weight.
Anybody that's ever gotten involved in a COD binding estimate dispute and spend hours trying to tell their accounting department the final version of the amended, adjusted, agreed bound price will appreciate some attempt to at least make it simpler.
Remember, for just a few weeks of the year, the good ole COD customer will gladly pay 5-10-15% more than national account or military, and its the only line of business we can truly adjust our pricing on, even for just a few weeks of the year. And when (not if) you screw up a job, you might make one customer mad, but you don't lose the account. There is a lot of pressure in account business, when you give them a 62% discount year round and are still liable to lose the account if you screw up.
I say, lets hurry up and start using the Tariff 2000, at least before next summer.
Blind note to Ed......when you downsize those COD salesmen, send em to me!
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