Over the past several years, most “C” level executives have been focusing their attention on earnings per share as well as managing corporate risk from all possible contingencies. Today, those same corporate executives are looking at all possibilities to greatly reduce expenses as a way to improve profitability and for some companies, to guarantee survival. For many companies 2009 has been the year of “decision paralysis.” For those companies to survive in 2010, long term cost cutting initiatives must be implemented. Many “C” level executives are now hearing from their financial institutions that leaner and greener Supply Chains are essential to obtaining financing in the future.

One of the major areas for enhancing a company’s bottom line is Supply Chain Management profit improvement initiatives. Not only is this an area for tremendous potential cost cutting, it also presents a great opportunity for companies to reduce risk which is critical in today’s business environment. There needs to be a plan of action for the entire Supply Chain’s improvement in terms of cost reduction and process improvements. One of the key areas in this process is to identify strategic sourcing and business partners so the company can achieve its desired results.

The first step is to understand how the company’s current Supply Chain stacks up against the competition. This means understanding every facet of the operation including the company’s current product sourcing outlets, its transportation, warehousing and distribution network, as well as inventory control and customer service operations and expectations. Every company operates its Supply Chain somewhat differently and in many cases without a great deal of up-front analysis as to what is the best Supply Chain environment for the company. The way to start is to identify what’s best for the company’s customers! “World Class” Supply Chains are built from the back end, (the customer), to the front end, (the supplier) and throughout the Supply Chain process are constant checks and balances that focus on customer satisfaction, corporate controls and profitability.

The goal is to cut costs out of the Supply Chain, not on a one time basis, but continually. At the same time companies must keep focused on what their customer expects and must make sure it meets and ultimately exceeds their customers’ expectations year after year. Knowing how a company’s direct competitor’s Supply Chain functions is also critical.

Companies have to start identifying all of the costs associated with the Supply Chain by category. Identify all possible strategic sources of product supply and ascertain which option leads to the best sourcing partners with the lowest landed product costs. Once this information is identified, companies must place the Supply Chain logistics pipeline in place that assures prompt and efficient delivery of the goods to its customers again, at the lowest landed costs. But remember, cutting costs out of the Supply Chain without creating greater customer satisfaction is a recipe for disaster.

Take the time to analyze the basic operation as follows:

• Ascertain the true and actual costs for every category of the Supply Chain spend.

• Identify what the corporate wide spend currently is for each of these categories. Are there any opportunities to improve pricing leverage with any of the company’s suppliers?

• What are the top selling products? Will they be the same in the future? If not, what are the characteristic differences between the current top selling items and those of the future? How does the difference in product characteristics affect the cost of the product through every facet of the Supply Chain?

• Which suppliers represent the “BEST” overall “Partner” for the company and more importantly, the effect they will have on the ultimate customer?

This costing analysis is critical and will go a long way towards identifying ALL of the associated costs related to the complete Supply Chain. Unfortunately, it is a step that many companies overlook.

TRANSDIGEST-Volume XIV, Issue No. 140, October 2009

There are many in the world of transportation and logistics that are grateful that 2009 is finally coming to an end. Many shippers and carriers have endured a very tough year with the recession of 2008/2009 still wreaking havoc on their businesses as this year comes to a close. As many experts have stated, this economy is the worst since the Great Depression and there are few that would argue with that commentary.

For many companies however the tremendous downturn in business has created an environment where corporate management has “taken the bull by the horns” and made decisions to look at cost cutting as the key to survival. Many companies seized the financial crisis as an opportunity to take excess costs out of their businesses to create a leaner operating environment. Some companies used their excess operating resources to seek mergers and acquisitions to position them for tremendous growth in the future. On the other hand, we have witnessed many other companies where there was a total paralysis of decision making on the part of both middle management as well as top management to make tough decisions to change the status quo. Many of these companies are still reeling financially from the negative impact of doing nothing and hoping that business will improve in 2010 and all will be well. We just hope it’s not too late for these companies.

2009 was also a year in which every aspect of the supply chain should have come under scrutiny to make sure all of the pieces were working harmoniously and to the advantage of all of the stakeholders including the internal and external customer base. In addition, all aspects of the supply chain should have been reviewed to ensure that costs were consistent with current metrics based on the services rendered and current market conditions. What better way to ensure a company’s financial future than to focus on what the customer wants and making sure a company delivers that product or service on a consistent basis! All successful companies consistently monitor the value they present to the customer. After all, without the customer there is no business.

2009 brought with it some major reductions in freight costs for shippers. The major ocean carriers reduced their rates several times in the second half of the year. They had to because the volume of cargo moving to the US was down considerably. These same ocean carriers have literally parked hundreds of ocean-going vessels because there just was not enough cargo to make it worthwhile to move those ships. In the LTL arena we saw a 90/90 deal come in the fourth quarter of 2009. That is 90% freight rate discounts for the final 90 day period of 2009. What does that tell you about carrier over capacity? The push for all freight carriers in 2009 was for market share with very little regard for profit. With limited freight available to all freight carriers the best way to secure additional revenue was to offer extremely competitive rates to lure shippers away from the competition.

By some estimates the major parcel carriers UPS and FedEx lost close to a million packages a day, again just due to the downturn in the economy. So the only way for these carriers to gain business was to “steal” it away from the competition. They targeted accounts they wanted to gain and went after them very aggressively on pricing and also attempted to offer “bundling” solutions which involved not only the parcel business they were attempting to obtain, but also to gain traffic for their nationwide LTL operations. For some shippers this exercise resulted in considerable cost savings. Other companies were not as fortunate. Many signed on thinking the bundling had to be the best deal they could get when in reality the offerings were not as aggressive as they should have been. Unfortunately, most shippers are not in a position to measure the cost savings opportunities because they had no benchmarks to match the offerings to. That is why the use of consultants to analyze contractual price offerings from all carriers is growing in popularity.

On the other side of the coin, many companies refused to even discuss rate negotiations with their freight carriers for fear the carrier would not look on the shipper in a favorable manner and would only come back to increase their rates when the economy turns around. This fear resulted in a great deal of the decision paralysis we mentioned earlier. The real issue is the fact that many shippers do not understand freight carrier pricing levels and cannot assess whether they are getting a good deal or a raw deal. There is a tremendous need for the shipping public to get deeper into discussions with their freight carriers on a “longevity solution” to their business relationships.

When we speak of longevity solutions we are talking about building strategic partnerships between shippers and freight carriers which benefit both parties for the long term. Shippers and carriers alike should always approach their relationship with the future in mind. Unfortunately for too many shippers and freight carriers this is not the case. Many are looking for the short term financial rewards they can reap without any regard to the future business relationship. This short sighted approach ends up costing the carrier and the shipper dearly when they are forced to make changes because of poor service or rates that ultimately are not competitive.

Enough about 2009! Let’s take a look at what we can expect in 2010.

All shippers will see freight rate increases primarily in January of 2010. Many carriers have already announced the specific dates for these increases. For years now the freight carriers in the trucking and parcel industry have raised their rates approximately 5- 6% each year. Just imagine the compounding effect of those rate increases over the years. And while the overall impact of these rate increases as reported by the freight carriers is 5-6%, many of the rates are increased at a much higher level. Many shippers however remain unaware that there are solutions to just accepting these increase as offered. Again, the real issue is the lack of knowledge on the part of the shipper to carrier rate structures and cost efficiencies that can be negotiated to reduce or eliminate these general rate increases.

Freight carriers need to operate at a profit to maintain the service levels they provide and to obviously invest in new equipment and technologies. However, shippers on the other hand need to better understand these rate increases and how they impact their business. Remember no two carriers have the same base rate levels so deciding which carrier to use based on the carriers’ discount offering means nothing. Shippers should ask their freight carriers to provide an impact analysis of any freight rate increase the carrier is proposing. Remember however in some cases these are across the board increases and if the shipper does not balk, the increase will be swift and automatic.

Along with rate increases in 2010 there is a good possibility that we will witness some additional carrier bankruptcies as well as a handful of mergers and acquisitions. The more the freight carrier supply shrinks the higher the cost of doing business with the carriers that remain. This was a fear expressed in the early 1980’s when deregulation first came into existence but may now finally become a reality. Many shippers have walked away from carriers that appear to be in financial trouble. While many agree with this concept the reality is that the carrier’s financial condition should be monitored even in good times. By diverting freight from carriers that appear to be in financial trouble, shippers just speed up the bankruptcy process. How many shippers really know the current financial condition of the carriers they are using?

2010 will also be the year when companies will have to make decisions to operate leaner, meaner and greener! Yes, green is in and it is here to stay. Shippers will see many more demands from their customers to PROVE they are reducing their overall carbon footprint. The major retailers are already aggressively adopting scoring methods to measure the impact of these reductions and if the suppliers cannot meet the standards they will be dropped as a supplier. Just go to the Wal-Mart website to see what demands they are placing on their suppliers. Consolidating the number of freight carriers utilized to make the carrier loads more efficient will certainly be considered a green initiative. It could also spell lower freight costs by providing fewer carriers with more business, certainly a benefit to shipper, carrier and customer. A winning combination if ever we heard one!

As we enter 2010 we want to thank each and every one of you for allowing us to present our monthly newsletter these past few years. We thank you for your comments and your criticisms as both will help us to make this publication more valuable in the future. Next month we have a real treat in store for you. We will be providing a special supplement to Logistics Strategies written by Jack Mitchell, president of Parcel Appraisal and Negotiations Consulting Group and ICC’s Strategic Business Partner. Jack will be providing a comprehensive analysis and breakdown of both the UPS and FedEx general rate increases which will become effective on January 4, 2010. You won’t want to miss this in depth analysis because you will finally have a complete understanding of what the actual numbers will mean to your business.

Wishing you and your family all the best in 2010!

Much has been written about the state of our economy as we end 2009 and look ahead to 2010. 2009 will go down as the year of survival for many companies who have fought the good fight but for others it has been the year of decision paralysis; we hope it is not too late for those companies to survive. 2010 will be an interesting year because our Washington leaders have told us that the recession is “officially” over, however everything we see leads us to believe otherwise.

In fighting the good fight in 2009, many companies have strengthened their relationships with their core suppliers. This will go a long way towards ensuring these companies economic viability well into the future. A good part of this strengthening has been cost reduction and service improvement initiatives. Cost reductions are critical for all businesses, however companies must make sure they never sacrifice service for costs.

In the selection process for transportation service providers there is much more to the relationship than just moving freight from point A to point B and while cost is obviously one of the key factors in the relationship, it is not the most important one. Now the real task is to convince corporate management that this is the case. Here are a few examples to prove that perceived cost is not the most critical element in a supplier/customer relationship:

· A furniture manufacturer negotiated extremely low LTL rates and decided to ship a bulk of its furniture via LTL carriers. While the rate per one hundred pounds was favorable to the manufacturer the product itself was not conducive to the LTL shipping environment. The manufacturer experienced considerable product damage and many unhappy customers. The real question the manufacturer should have asked is what was the true and total cost, not what it appeared to be.

· A distributor negotiated extremely favorable Truckload rates involving stop offs in transit to deliver its products to their customers. Part of the negotiation was to include delivery appointments to be made by the carrier in advance of delivery to the customer. Unfortunately, the carrier did not totally fulfill its obligations and in many instances just showed up at the customers’ door with the product without making the delivery appointment. Many of the customers could not accept the freight without the appointment being made and refused the shipments. Those shipments would have to be placed in storage and the distributor would now have a customer service nightmare on their hands. To make things more complicated, on a shipment with three stops, if the first customer refused the shipment, the remaining customers’ deliveries on that same truck would obviously be late. Now there are three unhappy customers. Again, what was the true cost to serve?

· A shipper needed to send a machine back the manufacturer for repair. It decided to utilize the LTL carrier that had the lowest rate. The actual value of the machine was in excess of $1 million. The machine was damaged in transit and the shipper filed a claim in the amount of $165,000. The claim was declined by the carrier because it’s liability for “Used” equipment was only ten cents per pound. The shipper was paid $1800 for the claim and had to absorb the balance of the loss.

Over and over again we see companies basing decisions on what appears to be an attractive discount pricing program. The reality is there is much more to the selection process for transportation service providers and it is incumbent on the shipping community to fully understand what the true cost to serve actually is.

Well it’s that time of year again when the transportation industry announces their General Rate Increases for the upcoming year. The major parcel carriers, UPS and FedEx, have announced increases to become effective on January 4, 2010. Here is a brief overview of the projected increases. In our December 2009 issue of “Logistics Strategies, ” Jack Mitchell, President of Parcel Appraisal and Negotiations Consulting Group, will provide us with an in-depth analysis of each carrier’s General Rate Increase. You won’t want to miss next month’s issue of “Logistics Strategies.”

UPS General Rate Increases:

UPS’ small package Daily and Retail rates will change as follows:

UPS Ground Service will increase 4.9%.

UPS Air and International Services will increase a net 4.9% through a combination of a 6.9% increase in the base rates and a 2% reduction in the fuel surcharge.

UPS will also re-align their fuel surcharge calculations to provide for a more stable surcharge structure when fuel prices fluctuate.

FEDEX General Rate Increases:

FedEx Express package and freight rates will increase 5.9%, however the rate increase will be partially offset by adjusting the fuel surcharge calculation.

FedEx will also change the following rate categories:

· FedEx Express US Import Rates

· FedEx Express US Rates to Puerto Rico

· FedEx International Premium Rates

· FedEx International Priority and International Economy Rates

As always these rate increases will require a comprehensive analysis by each shipper to ascertain the impact to the individual shipper. It is also critical to point out that the major motor carriers, including UPS Freight and FedEx Freight, will also increase their rates in January, 2010. We will provide more details as they become available.

One of the nation’s most visionary leaders, Warren Buffet, of Berkshire Hathaway is planning a $26.3 billion buyout of the BNSF Railway. Some analysts see this move as an “all in wager” on the American economy by bringing the nation’s second largest railroad under his control. Many experts believe this move will allow the BNSF Railway to reshape its network and make the other major railroads envious of its leadership. Investors believe the BNSF will be challenged to generate larger than normal profits for the privately held Berkshire Hathaway organization. You can be sure if Buffet is involved, small profits will be a thing of the past.

Many industry leaders believe BNSF will change the face of shipping for the future by taking more aggressive actions to move freight off the highways and onto the rails, strike longer contract deals with major shippers and ocean carriers and convince new shippers to open up plants and distribution centers along the BNFS tracks.

Buffet stated in a recent Journal of Commerce article, “Our country’s future prosperity depends on its having an efficient and well maintained rail system. Conversely, America must grow and prosper for railroads to do well.” This purchase is Berkshire’s largest ever investment.

In today’s world of transportation contracts and pricing agreements all freight carriers including parcel, trucking, international ocean and domestic air carriers have varying provisions regarding the length of the contract term, rates, charges, liability and penalties. It is incumbent on the shipper to have a thorough knowledge of these contract terms preferably BEFORE they sign on the dotted line. Here are some examples you should be aware of:

· Most parcel carriers will issue contract agreements for a two or three year period. During the term of the agreement the parcel carrier agrees to maintain the provisions as it relates to discounts and incentives. However, the parcel carriers are free to increase the base rates each year as part of their general rate increases. What most shippers do not know is that while the contract agreement is for a 104 or 156 week period, the contract can be voided in 30 days by either party giving written notice to the other party. This provision is critical for a shipper to know since their volume might increase during the contract term and the incentive revenue bands may no longer provide the pricing incentives the shipper deserves based on its shipping characteristics. By the same token, if their volume decreases it will also want to “Re-Negotiate” the agreement to lower the tiered incentive levels. The important issue here is knowing you have an option.

· Most motor carrier pricing agreements will base their rates on the carriers “list” rate and then discounts are deducted to reduce the net rate. Shippers should be aware that rates vary greatly from carrier to carrier. Therefore, no two carriers can be measured from a pricing standpoint based on the discount they have published. Most shippers do not know they can have all of their LTL carriers publish a standard base rate and then have them discount from that base rate. This would allow a shipper to clearly discern which carrier has the lowest net rate based on the discount percentage published. To give an example of this, we recently completed a negotiation for a shipper that had a 79% discount with its primary LTL carrier. We negotiated a new contract for our client using a different base rate scale and the same carrier has now offered a 55% discount. The net result is that the new rates are 43% lower than the carrier’s prior net rates. Before signing what looks like a good deal make sure the net rates are appropriate and do not be fooled by the discount game.

· Most ocean contracts provide pricing based on the number of TEU’s (Transportation Equivalent Units) the shipper agrees to tender to the steamship company. What most shippers do not know is that if the shipper does not fulfill that commitment it can be charged a “penalty” fee for each unit it is short within the contract period. This is important because many shippers will embellish the number of containers it actually ships to obtain a lower rate form the carrier but, as you can see, this can come back to bite the shipper, you know where, if it does not meet its commitment.

· Most domestic air freight forwarders have provisions which drastically reduce their limits of liability in cases of loss or damage. In most cases these domestic air forwarders will limit their liability to $0.50 per pound if the freight is lost or damaged in transit. The sad fact is that most shippers do not know this until there is a claim and they find out they are left holding the bag. These liability provisions, by the way, are usually clearly spelled out on the back of the forwarder’s air waybill which the shipper fills out, but very rarely reads. It is also important to point out that by signing the air waybill the shipper is agreeing to ALL the contract terms and conditions.

The list of these contract and pricing agreement terms and conditions goes on and on. The clear message here is “Caveat Emptor” … Let the buyer beware!

According to a recent survey conducted by the Supply Chain Leadership Forum, a majority of Supply Chain Executives are of the opinion that the economy will “officially turn around” in either the second quarter of 2010 or the fourth quarter of 2009. Approximately 41 percent of respondents voted for second quarter 2010 recovery while 30% opted for the last quarter of 2009. Bruce Tompkins, Executive Director of the Supply Chain Consortium stated the recovery depends on the industry in question. For example, he stated that the food and beverage industry is already seeing signs of a recovery while the high tech and retail sector will have to wait for a while to see any signs of improvement. If you listen to the “official” word out of Washington, the Federal Reserve Chairman has already declared an end of the recession. The reality is most everyone agrees the end of the recession is in sight. So what did we learn from this recession?

The savviest companies used this economic downturn to position their companies ahead of their competition. “The smartest companies shifted to recovery mode before their rivals by developing and implementing a strategic plan that anticipates the end of the recession and positions them for future growth,” Tompkins says. “But even companies that were not significantly impacted by the downturn are pursuing aggressive supply chain improvements to strengthen their competitive positions.” The companies that were and probably still are in a holding pattern will fall farther behind their competition as we come out of this recession. The paralysis that has plagued many companies during this economic crisis must come to an end. Let’s hope it’s not too late for those companies to compete as we move onto firmer economic ground. 2009 has been pegged as the year of survival. What has your company done to jump ahead of the competition! We would like to know.

On another note, The Business Optimism Index, Grant Thornton’s quarterly confidence measure of U.S. business leaders increased again to 60.9 in August, 2009 compared to 54.5 in May. 58% of these respondents believe the recession will be over by the first half of 2010. The Business Optimization Index takes into account three measures.

1. The U.S. Economy: Business leaders’ perceptions of whether the U.S. economy will improve, remain the same or deteriorate in the next six months.

2. Business Growth: Business leaders’ perception about the growth of their own business over the next six months.

3. Hiring Expectations: Whether business leaders expect the number of people their companies employ to increase, remain the same or decrease in the next six months.

The Westchester Business League will hold a seminar and panel discussions on Tuesday, October 27, 2009 at Pace University in Westchester County, New York from 8:00 AM to 11:30 AM. There will be time to network and time to learn what your company can do to take advantage of the current economic environment to benefit your business.

Tony Nuzio, President of ICC Logistics Services, Inc. will be a presenter during the conference and will speak on the subject of “Improving your Supply Chain’s Bottom Line”. For more information, please contact Pat Kober at 516-822-1183, ext. 314, or you can register on line at the Westchester Business League’s website at www.westchesterbl.org. We look forward to seeing you there.

Many companies are taking advantage of the current economic conditions to ensure they not only survive 2009, but prosper mightily in 2010 and beyond. How are they doing this? Well, there are a number of areas they are looking at including maintaining a lean workforce for the foreseeable future. There are no major signs on the employment front indicating corporations are going to increase headcount in the near future. Companies have also been aggressively reducing operating expenses to keep those expenses at the barest minimum. Unfortunately many companies do not have a handle on all of their expenses so cutting them to the bone is a major challenge. This is especially true in the area of the company’s Supply Chain expenses where very few companies have a complete handle on their total costs. And, some companies are even aggressively looking at mergers and acquisitions as a way to grow their businesses and put them in a much stronger competitive position when this current recession ends. On the other hand, there are thousands of companies who believe in the status quo and will just ride out the storm and hope everything will be just fine.

Wherever a company falls in the above descriptions, there is a concept that many corporations overlook that can have a profound impact on the company’s Supply Chain operations and ultimately its bottom line. That concept is utilizing Centralized Procurement systems to manage a company’s risk as well as obtaining for those companies the lowest Supply Chain costs possible. Centralized Procurement involves the most effective utilization of the buying power of the entire corporation to yield these benefits. Sounds pretty simple doesn’t it but you would be amazed at how many companies do not know what their current risks are or what their total Supply Chain costs are. If they do not know their risk how can they manage it? If they do not know their total Supply Chain costs how can they possibly implement processes and procedures to control those expenses?

The first step in the Centralized Procurement process is to identify whether the corporation has the necessary skill sets to thoroughly understand a company’s risk due to lack of knowledge in many areas. If the company does not have the in-house expertise to solve these major issues it is incumbent on them to seek outside help from knowledgeable consultants that have the expertise and staff levels to solve these problems with little involvement from their in-house staff. One of the major areas where companies are vulnerable is the area of computer security. If you read the trade journals and listen to the news you know that corporate executives including the CEO will not only receive stiff fines for violations of security measures, they can also serve jail time for not complying with the latest security mandates. With these stiff penalties what CEO does not want to pull out all the stops to ensure he does not trade in his pinstriped suit for an orange suit with numbers on it?

In the Supply Chain area let’s explore some examples of companies that would like to get their arms around their costs so they can control them, but just do not have a clue on how to go about it. In a recent consulting assignment we were contracted to analyze a company’s transportation expenses to determine what potential savings might be available if their current transportation contracts were re-negotiated by our team of Supply Chain Contract Negotiators. During the initial phase of our assignment it was determined that the company did not know who was routing and bearing the expense of their inbound supplier shipments. Nor did they know what their total inbound freight cost liability was. Sounds impossible but we see this all the time. The result of our study indicated that the company was certainly paying for the inbound freight costs either through a freight bill issued by the freight carrier, as an added charge on the merchandise invoice, which by the way also included an arbitrary shipping and handling cost, or the freight costs were “buried” in the product cost. In each case the company bore the expense but did not control it and had no idea what the total liability should be.

In another case we recently re-negotiated our client’s parcel carrier contract and found out that for the past 10 years several of their shipping facilities were not included in the contract and therefore never received any discounts or pricing incentives from the carrier for shipments made from those facilities. In another case a client refused to audit its parcel carrier’s invoice claiming it was receiving huge incentives based on the company’s multi million dollar annual spend with the parcel carrier. We convinced them to perform an audit even though the company had given up their right to file claims for recoveries of late delivered shipments. The initial audit which covered a 60-day period resulted in refunds from the parcel carrier in excess of $40,000. What company can afford to leave these dollars on the table in today’s economic environment?

These are but a few examples where Centralized Procurement initiatives would have paid off greatly. In each of these cases there was no central control over the costs, how they were allocated and reported. Therefore, how could they possibly be controlled? Very often in today’s corporate environment there are many independent empires where the right hand does not know what the left hand is doing. Someone at the “C” level has to take ownership over these situations before it’s too late. Many companies will not survive 2009 unless they get their arms around these uncontrolled and spiraling costs. The “C” level executive has a fiduciary responsibility to make sure the company is as profitable as it can be. How can this be done if the middle management team does not know some of the most fundamental terms of sale and or purchase terms of its raw materials and finished goods? Why would any corporate executive refuse to audit the invoices it receives from ANY carrier? This is however very prevalent in the area of parcel carrier invoice auditing.

This is a real call to action for all “C” level executives. Now is the time to act. Make sure everyone in your organization understands their job to the fullest and knows what the company’s risks are. Ask questions, probe, set up teams to look under every stone to make sure your company knows what its true costs of operations are. Make sure those costs are the lowest costs based on the services offered. Make sure your company is not exposed to lawsuits, fines and most importantly that the CEO won’t be spending time in jail because he or she failed to understand what the law provides. Ignorance is no excuse! Bring in those outside consultants to help you get where you need to go immediately and without hesitation. Stand strong when employees put up roadblocks for their own personal benefit. What are they hiding from? You need to know or you may be the one to take the fall.

A recent study conducted by the Virginia Tech Transport Institute on behalf of the Federal Motor Carrier Safety Administration has found that truckers that text while driving are about 23 times more likely to have a crash, or at least a close encounter, than drivers who are watching the road.

The study took place between 2005 and 2007 and monitored 203 drivers operating 55 trucks. The data covered over three million miles of actual driving time. The study indicated that the risk of crashes or near crash events were 5.9 times higher for truck drivers that were dialing cell phones as compared to a non- distracted driver. When those drivers were using or reaching for an electronic device the risk of a crash was 6.7 times higher. When those drivers were texting the risk of crash increased to 23.2 times higher than the non-distracted driver.

Another study conducted in June by Car and Driver Magazine indicated that texting while driving was more dangerous than driving while intoxicated.

Currently 14 states and the District of Columbia have laws that ban texting while driving. Look for additional states to follow. There is a Senate bill that would force states to enact these laws to ban texting or risk the loss of a big chunk of their highway appropriations funding.

Technology is a wonderful thing but as a society we are getting to the point where we are so involved in this technology we are losing sight of all logic. For those of us who fall into this category, lets use our heads while we are driving to drastically reduce the risk that we will endanger ourselves, our family and those innocent folks driving in the vehicle next to us.