Why is Trucking System Dropping the Competitive Rates?

Posted by Nikita on October 30th, 2019

The inventory growth has shown a massive increase, but the demand has become soften. Like this, there are hundreds of reasons as for why the Trukkin system is going down with the rates. First of all, the growth of inventory has drastically impacted the tariff market and as a result of which the shipping demand has reduced. As it is a known fact that unless there is no demand, the supply term cannot be executed. Seeing the revenue report and the surveys of trucking providers, it is evident that the competitive rates are going down, and at the same time, the industry is suffering from unavoidable and deep down losses too.

But the other side of the story is unless the Middle East trucking is unable to serve the customer’s demand, there will be no increased in rates. The nature of a normal customer says, give me good services, and I am ready to pay any amount you have charged. On the contrary, if the services are not apt, then it is quite sure that the customer will refuse to pay the bill too.

Another responsible nature for a low shipping rate is the timing. Like any other company, even the truck rental providers have peak time, which is the end of every year. It clearly indicates that the early phase of the year possesses a down market. It is nothing but the weakest time of the year, which makes the providers serve the customers at the lowest possible rates.

The next concern which can be made liable for the dripping rate trucking services for rent is the cold calls. Cold calls are done, but the asset carriers and freight rental providers to lure the customers with low and negligible rates. Doing this, the quality freight rental providers and their businesses are drastically being affected. The problem was at peaks a few years back, and the companies have suffered losses like never before.

The intermediaries are also accountable for the declined rates. You must be thinking how right. So, here is an example of a better assessment. If you are a freight rental provider and have entered a deal via an intermediary, then it is quite sure after the deduction of the commission, you will be given just peanuts. While on the contrary, if you offer the same business to the customer directly, then the chances of profit ratio will be high. Now, it must be clear as to why the middlemen are causing the dropping of freight charges.

As per the current survey, it is expected that the truck rates are going to step down if proper measures are not taken by them. Although the government of the Middle East has come up with suitable regulations, but it is still in the hands of the trucking system, whether they want to gain profits or make losses. It is suggested to open for trucking companies in Dubai, and the best solution provider is none other than Trukkin.