Rate slashing scourge hits Western Australia

The WA Road Transport Association calls for the trucking industry to resist the lure of cutting rates

Rate slashing scourge hits Western Australia
King says cutting rates risks the business

Western Australian operators are feeling the economic pinch with more being driven to the brink due to rate cuts, WA Road Transport Association (WARTA) says.

WARTA Chief Executive Ian King says the number of operators slashing rates in order to stay alive keeps increasing.

He has also seen invoices being dragged out for at least 60 days, placing further pressure on the industry.

Checking fuel costs with suppliers, seeking financial advice and acquiring IT or telematics equipment that could help boost business are just some of the measures operators could undertake to keep their business on track, he says.

The association’s door is always open to those who need advice, he adds.

"Cutting rates is a quick path to being forced out of your business," King says.

"There are business tools that help you establish rates with a nominated return.

"It sounds easy but being fully aware of how you will manage the business for both you and your customers is a cost that will be able to be fully passed on because many of your customers will not have the knowledge you will have and how the chain of responsibility is something that you can maximise based upon your knowledge."

Implementing compliance and enforcement should not be seen as "all gloom and doom" but an opportunity that could help improve bottom line, he adds.

"The major concerns highlighted by operators were that they faced a limited ability to effectively negotiate with principal contractors often resulting in payment rates that were insufficient to maintain a viable business."

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