After wild peak seasons in 2020 and 2021 that simply didn’t go according to tradition or plan, even the most experienced ISPs have questions about recruiting for the peak season. Though sentiments surrounding volume during peak have had a decidedly negative tone this year, not just for FedEx Ground but across transportation and logistics, Christmas isn’t canceled and last-mile delivery associated with eCommerce is a big part of it. FXG contractors are gearing up for the rush, and these are some of the most poignant questions they’ve asked Beans Recruiting this holiday season.
1. How Do I Hire Faster to Cover Peak Volume?
Just like peak volume creates bottlenecks in transportation and logistics, it also creates bottlenecks in the hiring process. First Advantage gets slammed this time of year. Their service isn’t an automated software program with infinite capacity; it’s a process run by people. They can only do so much. Same with local drug test centers. Both background checks and drug tests will experience delays due to this.
If you’re seeing either background or drug tests take longer than usual, give First Advantage or your local drug test center a call to see if you can move the process along. However, inundating these services with tickets or demands to expedite your drivers will most certainly result in further backups for everyone. Reach out when necessary, and send First Advantage an email for non-urgent issues.
The thing we can’t stress enough about peak season hiring: don’t under-prepare and don’t wait until the last minute. Failure to serve your CSAs during peak has led to contract cancellations as volume softens up, and we expect to see more of the same this year as the economy has begun to dip. Don’t find yourself a victim of these cuts simply because you under-hired.
2. Is AVP a Practical Strategy to Overcome Peak Volume?
AVP is a great strategy to help address variability in the market, including peak season. The problem? Peak season isn’t an ideal time to implement an AVP strategy. It takes time to get into place; your company as a whole really has to buy into the strategy, and accommodating each AVP driver’s individual needs and capabilities can get complicated.
We suggest starting an AVP program in January so you’ve got time to get it up and running smoothly before the next peak season hits. There are countless benefits including a set per-stop pay rate, fewer surprise expenses related to truck maintenance and repair, less need for hard-to-come-by rentals, and a ton of flexibility.
3. What Should I Do with FXG Drivers Hired During Peak Season Once Volume Recedes?
Hiring new drivers for peak season is a necessity, but what do you do with them once the peak has passed? We usually advise one (or more) of these three strategies.
Hire Seasonal Workers
When you hire drivers for peak season and you make sure those drivers know that they’re being hired on a seasonal basis, it can eliminate a lot of issues. Simply be upfront with candidates about the nature and length of the job.
Now that the labor market is softening a little, you can employ another strategy to hang onto the rockstar drivers you hire during peak. When onboarding new hires, make sure they know that a stellar performance during peak could come with a full-time job offer. This gives the good drivers that sign on seasonally the opportunity to stick around while freeing you up to legally and ethically cut from your workforce the drivers that didn’t meet standards.
Use Performance Evaluations to Make Cuts
Attrition happens. It’s the nature of the FXG beast, with an average 76% attrition rate annually. Some of those seasonal drivers will just float away after peak season, but what should you do with the remaining extraneous drivers? We suggest laying out performance metrics at the beginning of the year and sharing those metrics with your driver pool so they clearly understand expectations. Once volume softens, you can evaluate those metrics and make performance-based cuts. This allows you to move forward into the new year with your best team.
A great way to ensure that your drivers are striving to meet those expectations, whether they’re with you for a few years or a few months, is to offer performance bonuses of some kind.
Shift to a 4-day Work Week
A 4-day work week can help you cut costs and create a culture that is more conducive to handling next year’s peak season.
Benefits of a 4-day week for FXG ISPs include:
- Better truck utilization
- Better driver attendance
- Drivers are more likely to work overtime when necessary since they’re still working a 5-day week
- Reduces the risk of burn-out
- Decreases the risk of injury, especially during peak, since drivers still have ample days to rest
- Drivers love it!
4. How Do I Get My Current Drivers to Step Up Their Game During Peak?
Ideally, ISPs keep hiring to the bare minimum for peak season. Hiring is expensive, it takes a long time, and it’s a potential safety hazard to put new drivers in trucks during icy winter conditions. When experience is key, your current drivers are your most valuable resource. You can avoid hiring a ton of new drivers if you can get your current drivers to perform even better.
Money is a great motivator, especially during the holidays when nearly everyone incurs extra expenses. We suggest offering aggressive stop-based pay to help motivate your current drivers to push a little harder to help cover the holiday rush. As much as drivers appreciate coffee and donut deliveries to show your appreciation, more earning power speaks louder. When the drivers you have perform better, you save money on rentals and hiring, making the potential pay raise for your drivers pay off for the business in the end.
You can also offer performance-based bonuses to your BCs when they must get in a truck to cover peak volume.
A retention bonus can help you keep those seasoned employees around during the holidays when the temptation of tons of seasonal job openings try to draw them away. Include safety, service, and attendance metrics in the requirements for a retention bonus that runs from October to the new year and offer enough to make it worth sticking around. 3 working days’ salary is usually enough to get drivers excited about a bonus.
5. What Will Peak Season Look Like This Year?
The truth? We don’t know. We don’t have hard and fast numbers that are going to tell us exactly how much peak will peak (or not peak), and the last few years has left even the most qualified analysts nervous to make assumptions.
Leadership at Beans can only offer up the anecdotal evidence we’re seeing, vague as those signals are right now. We’re hearing that volume may be relatively flat in lower-income markets more affected by inflation and the sputtering economy, but that more affluent areas will experience higher peak volumes.
With companies pushing harder earlier to get rid of excess inventory, we don’t expect to see quite the Black Friday/Cyber Monday spike in volume that we normally would. Those sales began in October and may very well lead to less of a rush now that it’s truly the Christmas shopping season. That certainly should change how ISPs are planning for 2022’s peak volumes just as it’s changing how the rest of the supply chain is strategizing.
In Conclusion
Peak season comes and goes each year, and it can make or break FXG businesses if they don’t take it seriously. Plan for it and don’t take it lightly. If you listen to the subject matter experts from Beans Recruiting and never stop recruiting, rolling with the punches this peak season will be doable. Post-peak as volumes dip, it’s the perfect time to revisit your labor strategy and maybe even experiment a little.
Happy holidays, and may the hiring be ever in your favor. You can reach out to the Beans Recruiting team anytime by email at fxgrecruiting@beans.ai to learn how you can get more drivers through the hiring process faster.