7 Challenges of getting business back on track

Challenges of getting business back on track

1)    Trust & Confidence  

The corona virus global pandemic has us in an uncharted territory with no end in sight, and that is creating perhaps one of the most stressful workforce situations in Indian history for employers and employees, “In just a matter of days, we've gone from employers struggling to find and keep employees, to deserted offices and dire job loss forecasts. In this scenario everyone has lost trust Employee & Employer both, so we need to build that trust first, employees are worried about security of their jobs. Employer don’t believe in efficiency of employee we have to accept it and start living with it a big paradigm is going to happen. "

"Culture is what holds an organization together, so it's never been more critical to lean hard into culture during these tough times to build a sense of community and support among the workforce. "If employers can help fill the void employees are feeling, that can empower them to overcome the many obstacles on the road ahead.

"There are strategies employers can deploy to relieve at least some of the stress and help employees not only perform, but come up with innovations to steer through this crisis. We have to adapt “WORK FROM HOME CULTURE “employees need more support once that gap is bridged company will rise,

2)    Driver Shortage : MAIN PROBLEM

Before lock down we had 650 Drivers on every 1000 Trucks and now we have 300 Driver on every 1000 Trucks and Post Lock down this ratio will decline to 150 to 200 Driver on every 1000 Trucks. They all are scared of COVID 19 virus. Nobody wants to risk their life and be on Trucks. They are ready to work as peons in office and earn less but don’t want to be on wheels and risk their life. COVID 19 has brought a big revolution in Trucking Industry.

Their demands have changed. Now they all want to be back home on the same day, they want proper Rest & Sanitation facility if they are going for long route. No driver wants to sleep in a Truck or at the Dhaba or on a Petrol Pump. They need proper Clean Rooms or Clean Lodges to sleep. They also want Insurance & Mediclaim against COVID 19 and

we as Transporter have to adapt to this new change and accept their demands and support them and take care of them. And this is the only way to bring them back on wheels there will a very big behavioral change amongst Transporters & Drivers

We also need Government support to resolve this issue. During the COVID 19 virus pandemic, our truck drivers risked their lives and Delivered Groceries, Medicines, Daily essentials and also medicines to the hospitals where corona patients were being treated.

3)    Labour Shortage

80 % labour have already migrated to their respective villages and most of them are from UP & BIHAR and I really doubt they will come back as their state government has already created employment for them UP government has already created employment for 50 lakh people and that is a huge number and plus they have also signing MOU with mobile manufacturing companies and many other brands which will create employment for more 10 lakh people so there is very less chance they will return . we all have to adopt automation – LESS MAN FORCE MORE WORK

4)    Lack of Automation

In Transport industry Loading, Unloading and Stacking everything is done manually but now we all have to adopt automation Robotics and autonomous machinery – LESS MANFORCE MORE WORK – Adopting new and innovative technology solutions has become imperative for logistics companies. Given that labour is scarce,technology advancements can increase productivity by minimizing time, cost and errors. Replace man work with machines we will have to invest but there are ways to recover it. Collaboration is the solution to it.

5)    Fix Operational Cost (FOC)

We all have fix cost like EMI, Godown Rent, Labours Salary, Employees Salary, and all this takes upto 85% of COST. because of Corona business has reached to 20-30% We all really need to bring it down and it’s the only way to survive now. To reduce (FOC) we need to collaborate with other 4 transporters who doesn’t have service on same routes and share godown space, man force so that Godown Rent, Labours Salary, Employees Salary can be bring down to 20-30 % or they can also give each other franchise of their company and help each other to grow 

6)    Impact of Economy

Political instability, decline in manufacturing, No labour, sector performance. adversely impacts demands for products and services, which also impacts on Transport as only 50% industries are functioning with 30% Capacity so automatically freight & demand both will get affected so only 15% Trucks demand will be there, it will have big impact on freight rate and it will drastically go down transporters will ply their trucks on cost to cost as there will be a huge competition amongst each other and availability of trucks. Conversely, State government investments and infrastructure projects for migrate labours will kill existing SME.

7)    Financial Crisis

The wheels have stopped and so there is no revenue generation, no financial inflows as payments from parties are restrained and existing finance with the small operators as well as that of big operators is depleting fast.    i) Establishment Cost (Electricity Bill, Water Bill, Rent, Property Tax, Interest on Loan etc), Salaries, Maintenance expenses still stand and is payable. No relaxation or reprieve as on date. ii) EMIs, Permit fees, Fitness (validity extended till June 30); Third Party insurance (extended till April 21) and Motor Vehicle Tax / Passenger Tax / Goods /Token taxes (no deferment as yet), are to be paid in immediately in advance (upfront) once the present deferment period is over. iii) Working capital is required to meet the running cost, is a big challenge. Whatever credit was available to the transporter is in circulation and is currently stalled as parties are not making the payments iv) The transporters especially the small operators do not have enough resources to sustain their families, due to stranding of vehicles, they won’t be able to pay for the statutory and regulatory compliance's even few months after the normalcy is restored. They need to earn first to be able to pay up.     Amid the prevailing uncertainty, the next two quarters would be extremely critical and nightmarish for the road transport sector as poor consumption will lead to weak demand and hence less transportation activity. It will take about six or more months to revive production and consumption in the country and to get transportation activity to reach an average level.    

ONLY WAY TO SURVIVE THIS CORONA HEAT IS COLABORATION

WE ALL TRANSPORTERS SHOULD COLLABORATE WITH EACHOTHER SHARE SPACE AND MANFORCE, REDUCE OVERHEADS, HELP EACHOTHER TO CARRY LOADS, TEAM UP AND SHOOT CONTRACTS WITH MNC, CREATE ONE POINT SOLUTION

IT TIME TO SURVIVE HOLD HAND AND GROW TOGETHER

Regards

Chirag Katira,

Director

Shree Nasik Goods Transport Co Pvt Ltd

[SNGT GROUP OF COMPANIES]