Familiar Themes & Pricing Reset
Ryan McConnell, Vice President, Strategic Planning, and Jeff Schimmel, Vice President, Transportation Services, are key strategists in the effort to optimize sales and profitability for Atlas® Van Lines. In early September, Joe Stackhouse joined the team as the new President & COO.
Readers of this magazine, and anyone who follows the moving industry, will recognize familiar themes in the business of household goods transportation: stretched capacity, rising costs, and ever-more- demanding regulation.
“Over the recent years, our industry has been impossibly stretched,” says Ryan. “We’ve gone to the wall to meet market expectations while the costs of doing business have soared.”
As a result, the strategy team has introduced Tariff ATVL1000TR. It went into effect in May for non-contract business; it will take effect for contract business as early as May 2018.
“For most of my career I worked in the cable industry,” says Joe. “That industry has never shied away from raising rates. So I understand cost increases, the push-back they get in the marketplace, and the need for communication.”
Joe says the van lines and cable industries have similarities — dispatching trucks and providing service to people in their homes. And, like the cable industry, Atlas wants to make sure its people — van operators, agents, and employees — have the opportunity to make a good living.
Previous tariff models were designed to factor in changes in the cost of doing business. But they fell far short of reflecting actual cost increases for wages, insurance, corrugated cardboard, regulatory compliance, and third-party transit. The overall increase with the new pricing reset amounts to about ten percent across the board; more for lower weight classes, less for higher weights.
“A lot of thought has gone into our new pricing so it supports the professional service clients expect,” says Jeff. “We want to protect that capability for them on traditional household goods moves as well as on smaller, containerized shipments.”
Answering a Demographic Shift
The moving industry is undergoing a profound shift toward smaller shipments, reflecting the preferences of a younger demographic.
“While smaller shipments are certainly within our capabilities for Atlas quality service, they often require transit with common carriers,” says Jeff. “Our new containerization service provides a basis for determining fair rates when common carriers are needed.”
The announcement of new pricing for contract business comes on the heels of a summer that saw industry capacity inundated. It was made worse by the fact that two van lines folded their tents. The new pricing aims to counter this trend by supporting reinvestment in the fundaments of people and equipment.
“This is not just an Atlas problem—it affects every moving company,” says Ryan. “Those who fail to realize it are living on borrowed time.”
Fueling New Business
Besides pricing and capacity issues, the strategy team has brought advances in lead generation and regulatory compliance. A new search engine marketing (SEM) program is reinforcing sales with online advertising. Heightened education and training efforts support the goal of 100 percent compliance with the FMCSA December 18 deadline for electronic logging devices (ELDs).
“We have shown that the trucking industry has the capacity for smaller shipments of household goods. No matter who’s behind the wheel, the origin and destination service is Atlas.”
Jeff Schimmel Vice President, Transportation Services
“Our team is excited about the strategic path Atlas is on,” says Ryan. “We look forward to good things with the leadership as we work together to realize the promise Vision 2020 has for our future.”