Like many fleet owners, Rick Larkin wants and needs more drivers. With two pay raises so far in 2021, he is willing to put his money where his mouth is. But Larkin, president of truckload carrier BCB Transport LLC, is not so desperate that he will hire just anyone to fill the seats of his 300 power units.
BCB, based in Mansfield, Texas, about 30 miles from Dallas, will not hire any driver without at least 2½ years of commercial experience. No applicant can have worked at more than two driver jobs in any given year. What’s more, BCB will not hire anyone without prior dry van or reefer experience. Dry van comprises 85% of his fleet, with reefers accounting for the rest. It has 300 full-time drivers and 125 owner-operators who are largely exclusive to the company.
BCB is not self-insured and doesn’t operate a driving school. Not being self-insured may, in some respects, limit Larkin’s hiring flexibility. But the company’s minimum hiring requirements are based more on what Larkin will accept in terms of liability risk, especially since the buck stops at his desk.
The pickier hiring standards have been in place since the company was founded in 2011. Larkin remains steadfast about the policy even if other midsize truckers might adjust theirs in response to the tight driver market. “You should never change your minimum standards,” he told FreightWaves in a phone interview Thursday.
What is changing at BCB are wages. After the two wage hikes and other incentive increases thrown in, a driver with five years of experience at the carrier will make the equivalent of 65 cents a mile. A driver with eight to 10 years’ tenure will pull down about 69 cents a mile. New hires will receive 53 cents a mile. Every driver gets a $1,000 bonus each year regardless of tenure.
Larkin said the wage and incentive structure is currently at levels that will make it difficult for drivers to leave. Still, some do. BCB’s turnover rate stands at about 60%. Larkin said he began 2021 with a target of 30% turnover by year’s end. That is unlikely to happen, he said. A more realistic year-end goal is 48%-49%, he said. Under current conditions, a 60% turnover rate is a number Larkin said he could live with. At the end of 2020, the turnover rate was 92% for fleets generating $30 million or more in revenue, according to the American Trucking Associations (ATA).
The most common reason BCB drivers cite for leaving is an inability to be home nightly. That is not feasible given that BCB’s typical length of haul is 575 to 600 miles, Larkin said. The company will work with drivers to arrange more home time, but walking through the house door each evening is a requirement that BCB can’t meet, he said.
BCB generates about $125 million in annual revenue. About $95 million of that is direct freight from shippers, and the remaining $30 million is brokered out to other carriers.
Larkin estimated that he could bring on 35 more trucks — which would translate into 35 more full-time drivers — and still have enough overflow freight to broker out roughly $30 million.
He said he would like to see the traditional driver pay formula that is based on cents per mile phased out in favor of an hourly revenue model that would frame the wage as an annual dollar amount resembling a salary. He said it would be easier to attract younger people to the industry by advertising an annual salary of, say, $60,000 or $70,000 than one based on cents per mile that is perceived as unappealing.