This appeared some 40 years ago in a certain well-known men's magazine:
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
CSSHEGEWISCH Retail businesses "fire" customers all the time but in a different way. I still take photos with a Canon A-1 film camera. Walgreen's, Wal-Mart and others have phased out their film developing and photofinishing service (the demand has shrunk) so I'm no longer a customer for their photo services. Fortunately, I've found a specialized shop that takes my business. The other stores couldn't make enough money from film photofinishing so they dropped it. Some residual business was lost but not enough to hurt the bottom line.
Retail businesses "fire" customers all the time but in a different way. I still take photos with a Canon A-1 film camera. Walgreen's, Wal-Mart and others have phased out their film developing and photofinishing service (the demand has shrunk) so I'm no longer a customer for their photo services. Fortunately, I've found a specialized shop that takes my business.
The other stores couldn't make enough money from film photofinishing so they dropped it. Some residual business was lost but not enough to hurt the bottom line.
Murphy Siding Anybody seen anything about what CSX is planning to do to grow their business? Or is the plan to keep shrinking it like what Sears is doing?
Anybody seen anything about what CSX is planning to do to grow their business? Or is the plan to keep shrinking it like what Sears is doing?
Thanks to Chris / CopCarSS for my avatar.
Murphy Siding Euclid I have never worked in retail sales if that is what you mean by "Business world." Maybe your definition is too narrow. Every company does not handle it the same. If they did, nobody would be complaining about how CSX is managed. Of your three choices, I can't imagine why anyone would "live with it" since that means losing money. "Get the heck away from it" is pure Soup Nazi thinking. By "Improve it," I assume you mean figure out a way to fix the problem without losing the customer, and continue to make money on the customer's trade. That is what the smart companies do. Those are the "progressive" companies. Perhaps it is all just buzzwords to you. There's no way you will ever understand it so I won't even try.
Euclid I have never worked in retail sales if that is what you mean by "Business world." Maybe your definition is too narrow. Every company does not handle it the same. If they did, nobody would be complaining about how CSX is managed. Of your three choices, I can't imagine why anyone would "live with it" since that means losing money. "Get the heck away from it" is pure Soup Nazi thinking. By "Improve it," I assume you mean figure out a way to fix the problem without losing the customer, and continue to make money on the customer's trade. That is what the smart companies do. Those are the "progressive" companies. Perhaps it is all just buzzwords to you.
There's no way you will ever understand it so I won't even try.
So it is okay to fire customers as long as you are not CSX?
Murphy Siding charlie hebdo Murphy Siding Euclid I have never worked in retail sales if that is what you mean by "Business world." Maybe your definition is too narrow. Every company does not handle it the same. If they did, nobody would be complaining about how CSX is managed. Of your three choices, I can't imagine why anyone would "live with it" since that means losing money. "Get the heck away from it" is pure Soup Nazi thinking. By "Improve it," I assume you mean figure out a way to fix the problem without losing the customer, and continue to make money on the customer's trade. That is what the smart companies do. Those are the "progressive" companies. Perhaps it is all just buzzwords to you. There's no way you will ever understand it so I won't even try. I guess you don't subscribe to the policy of: "Give the lady what she wants!" Yes, but...
charlie hebdo Murphy Siding Euclid I have never worked in retail sales if that is what you mean by "Business world." Maybe your definition is too narrow. Every company does not handle it the same. If they did, nobody would be complaining about how CSX is managed. Of your three choices, I can't imagine why anyone would "live with it" since that means losing money. "Get the heck away from it" is pure Soup Nazi thinking. By "Improve it," I assume you mean figure out a way to fix the problem without losing the customer, and continue to make money on the customer's trade. That is what the smart companies do. Those are the "progressive" companies. Perhaps it is all just buzzwords to you. There's no way you will ever understand it so I won't even try. I guess you don't subscribe to the policy of: "Give the lady what she wants!"
I guess you don't subscribe to the policy of: "Give the lady what she wants!"
Yes, but...
Pinning down Jello!
Never too old to have a happy childhood!
Some interesting ideas come to mind on this notion, I think what is important to remember here is that CSX, like all companies, is run by people just like you and I. Not every company handles pieces of business the same, its not an algorythm or equation that determines always whether or not you service a customer. Lets take for example the Steamship carriers, they are doing some particularly strange thigns now and they will give price business at a loss in order to 1.) perserve a relationship, 2.) build/bolster a reputation 3.) protect/expand marketshare (sometimes that looks better on a balance sheet) and 4.) External factors, mostly governmental, dictate it.
Back to the case of CSX, this effort is by and large an internal effort with external consequences. I've heard mixed reactions, obviously the folks-who-observe trains are quite upset, the people in the field that are losing jobs or work are upset, but some people have told me that the RR was simply too 'fat'. And with the associated health problems of that, CSX may actually be more so on a diet than anything more, shedding the unnecessary weight by giving up some things considered luxury, excess or even joyful on their part.
However, whatever the effort may be, my opinion is the largest issue being timing. CSX has been an an extremely agreessive timeline, where I've heard horror stories of customers given literally just a few days to come up with alternaitve supply chain solution. What should have been done over the course of years was literally done in just a few months. The language of business is spoken in numbers, and switching over to that language completely may have caught a few folks off guard.... some more tact and class would likely have been welcomed. But the past is just that, so hopefully CSX is off to a better footing and we'll put the dark days behind us.
You won't even try? No soup for you!
EuclidI have never worked in retail sales if that is what you mean by "Business world." Maybe your definition is too narrow. Every company does not handle it the same. If they did, nobody would be complaining about how CSX is managed. Of your three choices, I can't imagine why anyone would "live with it" since that means losing money. "Get the heck away from it" is pure Soup Nazi thinking. By "Improve it," I assume you mean figure out a way to fix the problem without losing the customer, and continue to make money on the customer's trade. That is what the smart companies do. Those are the "progressive" companies. Perhaps it is all just buzzwords to you.
Murphy Siding Euclid “Firing customers” is an old fashioned idea. It reminds me of the “Soup Nazi.” It comes from the business mindset that mistakenly believes that the customers need the business. The most progressive companies realize that their greatest cost is in obtaining customers, so they have figured out how to avoid the need to fire them and still make money off of their business. It's obvious that you don't now, nor have you ever worked in the business world. Progressive companies.... buzzwords.... blah, blah, blah….whatever. Every company handles it the same. If you have a customer that needs to change, like every other road bump in life, you have 3 basic options: 1)Live with it. 2) Improve it. 3) Get the heck away from it. Read the post from Bob Withorn above. He gets it. You don't.
Euclid “Firing customers” is an old fashioned idea. It reminds me of the “Soup Nazi.” It comes from the business mindset that mistakenly believes that the customers need the business. The most progressive companies realize that their greatest cost is in obtaining customers, so they have figured out how to avoid the need to fire them and still make money off of their business.
It's obvious that you don't now, nor have you ever worked in the business world. Progressive companies.... buzzwords.... blah, blah, blah….whatever. Every company handles it the same. If you have a customer that needs to change, like every other road bump in life, you have 3 basic options: 1)Live with it. 2) Improve it. 3) Get the heck away from it. Read the post from Bob Withorn above. He gets it. You don't.
I have never worked in retail sales if that is what you mean by "Business world." Maybe your definition is too narrow. Every company does not handle it the same. If they did, nobody would be complaining about how CSX is managed.
Of your three choices, I can't imagine why anyone would "live with it" since that means losing money. "Get the heck away from it" is pure Soup Nazi thinking. By "Improve it," I assume you mean figure out a way to fix the problem without losing the customer, and continue to make money on the customer's trade. That is what the smart companies do. Those are the "progressive" companies. Perhaps it is all just buzzwords to you.
Euclid“Firing customers” is an old fashioned idea. It reminds me of the “Soup Nazi.” It comes from the business mindset that mistakenly believes that the customers need the business. The most progressive companies realize that their greatest cost is in obtaining customers, so they have figured out how to avoid the need to fire them and still make money off of their business.
Murphy Siding Euclid Murphy Siding In our business we've fired customers before. That's essentially what CSX is doing- firing customers. Sometimes it has to be done. But before we get to that point, we try to change things to make that customer worth keeping. The easiest thing to do is raise prices to a level that makes the business worth keeping or drives the customer off to my competitors- which is not all bad. The most common justification for firing a customer would be that there are other customers out there to take his place that are better. We would never wholesale fire the lower echelons of customers without their replacements in hand or almost in hand. Because of economy of scale, it would seem that firing a whole bunch of customers at once would lower the efficiency, and therefore profit, of your company. Does CSX have new business in the hopper to compensate, or is this move just to make the books look good for next quarter reports? Why did you have to fire those customers? What were they purchasing? Why couldn't you make them worth keeping? Why is CSX firing customers? 1) If you have ever worked in the business world, you'll understand.2)Irrelevant3)See highlight in red above. 4)Ask them
Euclid Murphy Siding In our business we've fired customers before. That's essentially what CSX is doing- firing customers. Sometimes it has to be done. But before we get to that point, we try to change things to make that customer worth keeping. The easiest thing to do is raise prices to a level that makes the business worth keeping or drives the customer off to my competitors- which is not all bad. The most common justification for firing a customer would be that there are other customers out there to take his place that are better. We would never wholesale fire the lower echelons of customers without their replacements in hand or almost in hand. Because of economy of scale, it would seem that firing a whole bunch of customers at once would lower the efficiency, and therefore profit, of your company. Does CSX have new business in the hopper to compensate, or is this move just to make the books look good for next quarter reports? Why did you have to fire those customers? What were they purchasing? Why couldn't you make them worth keeping? Why is CSX firing customers?
Murphy Siding In our business we've fired customers before. That's essentially what CSX is doing- firing customers. Sometimes it has to be done. But before we get to that point, we try to change things to make that customer worth keeping. The easiest thing to do is raise prices to a level that makes the business worth keeping or drives the customer off to my competitors- which is not all bad. The most common justification for firing a customer would be that there are other customers out there to take his place that are better. We would never wholesale fire the lower echelons of customers without their replacements in hand or almost in hand. Because of economy of scale, it would seem that firing a whole bunch of customers at once would lower the efficiency, and therefore profit, of your company. Does CSX have new business in the hopper to compensate, or is this move just to make the books look good for next quarter reports?
In our business we've fired customers before. That's essentially what CSX is doing- firing customers. Sometimes it has to be done. But before we get to that point, we try to change things to make that customer worth keeping. The easiest thing to do is raise prices to a level that makes the business worth keeping or drives the customer off to my competitors- which is not all bad. The most common justification for firing a customer would be that there are other customers out there to take his place that are better. We would never wholesale fire the lower echelons of customers without their replacements in hand or almost in hand. Because of economy of scale, it would seem that firing a whole bunch of customers at once would lower the efficiency, and therefore profit, of your company. Does CSX have new business in the hopper to compensate, or is this move just to make the books look good for next quarter reports?
Why did you have to fire those customers? What were they purchasing? Why couldn't you make them worth keeping?
Why is CSX firing customers?
1) If you have ever worked in the business world, you'll understand.2)Irrelevant3)See highlight in red above. 4)Ask them
“Firing customers” is an old fashioned idea. It reminds me of the “Soup Nazi.” It comes from the business mindset that mistakenly believes that the customers need the business.
The most progressive companies realize that their greatest cost is in obtaining customers, so they have figured out how to avoid the need to fire them and still make money off of their business.
It used to be said the railroads thought along the lines, "If it didn't fit in a box car, it didn't belong on the railroad." Now I guess if it only fits in a box car it doesn't belong on the railroads.
It's fun to listen to current and former railroad management types talk the industry into oblivion. Eventually there won't be any business left because they'll have convinced themselves no business is worth persuing.
Jeff
The way I see it is if things were 'this way or that way' or 'black and white' we wouldn't have jobs! Like most things, we live in the gray area, not two situations are the same and everything has layers of complexity. I'm just glad we have computer technology these days, it would be impossible to juggle all the balls in the air at once.
Also to note -- I don't work for the aftermentioned RR reporting mark in my user handle, I simply like that locomotive painted the old Bangor & Aroostook (a road I grew up with). Just wanted to clarify that point in case anyone were to try to draw connections with that particular outfit (who is very impressive by the way)
I'm glad CMQ_9017 is on the forum because he's knowledeble. I'm not going to exactly agree with him all the time. But so what? I'm not always right and the discussions are interesting.
I said CSX has no "Common Carrier" obligation to supply the boxcars. He seems to agree with that. I did not say that CSX has no "Common Carrier" status. And he seems to agree with that.
CMQ_9017 disagrees with the CSX business decision. OK. It's fine to disagree and explain why. My opinion is that they have the right to manage their own business. They're not always going to be correct, nobody can always be correct. Government involvement won't help, because they're going to get it wrong too.
I learn new things everyday... so hardly an expert I'd say just always trying to improve and find a better way to do business.
RRs are still common carriers, absolutely. There are STB rulings you can look up where RRs file to get out of the CC obligations. The move by CSX to put their cars into certain lanes is to maximize the utility of the asset for CSX, something they paid for and they really have a right to do. Now think about that for a minute, the Class Is know that they all must work together to ensure fluidity in the entire network... can you imagine if every since railcar had a return empty to the host RR. Yes, some cars are put into service in particular lanes for a variety of reasons (designed for purpose, under lease/contract for service, can't be cross-functionally moved) but a good chunk of cars can move load-to-load without issue and should. TTX also a big part of that (RR owned) and ensures fluidity, each RR is expect to carry their own weight. From a business perspective I get what CSX is doing, but from an industry perspective they aren't making many friends. I have opinions either way on this topic, I can see parts of both sides. I tend to weigh against CSX and their percision railroading but I do think some of the concepts if properly applied can work out pretty well. We are also in the era where you have take or pay agreements build into many clauses, where shippers can't simply sit around and hold onto equipment forever. I also have seen examples where some RRs are slow on turning over equipment, or keep it captive. While certainly they pay car hire for it, it can serve their benefit as they don't have to buy rail cars when they just hold a few hostage... so it like most things it gets complicated. You can't judge one instance against another, most cases are completely unique.
CMQ_9017 EBIDTA, the measure of cash flow before required costs (aka costs you have no choice in making), is the standard measure of corporate health these days. And the common carrier obligation, as far as I understand it (I don't make the rules, I play by them) is that basically a RR is required to give service if it is with a reasonable request (emphasis on what one considers to be reasonable). So that means there are complexities and it must be judged on a case-by-case basis. Similar to business law, you must have a meeting of the minds to establish the framework of a contract. Deregulation did not remove common carrier obligation, just gave more freedom to publish rates. More on the CC obligations: https://www.nap.edu/read/22093/chapter/13 Most contracts outline the terms of doing business, how are payments processed, what are the average transits, whats the equipment pool, how is it handled... ect ect. Also what is important is what kind of move it is, where are transfers of liability/risk, ect. Shippers depending on their level of control they wish to exercise can either let the primary RR (the one they are located on) to establish the routing or they may seek/ask for particular routings. Pricing mix and strategy can come into play, if you wish to bulk up volume as a RR you can attempt to pull in some at or near-cost business that subsidizes other more lucrative business, thus on a train basis you are a net-net positive (so lets say some railcar traffic ends up just covering costs of operating while other different types on the same train might pull in a bigger penny, but be smaller in volume). But now we're falling down a rabbit hole and I don't want to reveal too much about pricing strategy of RRs... also its a headache like most things.
EBIDTA, the measure of cash flow before required costs (aka costs you have no choice in making), is the standard measure of corporate health these days. And the common carrier obligation, as far as I understand it (I don't make the rules, I play by them) is that basically a RR is required to give service if it is with a reasonable request (emphasis on what one considers to be reasonable). So that means there are complexities and it must be judged on a case-by-case basis. Similar to business law, you must have a meeting of the minds to establish the framework of a contract. Deregulation did not remove common carrier obligation, just gave more freedom to publish rates.
More on the CC obligations: https://www.nap.edu/read/22093/chapter/13
Most contracts outline the terms of doing business, how are payments processed, what are the average transits, whats the equipment pool, how is it handled... ect ect. Also what is important is what kind of move it is, where are transfers of liability/risk, ect. Shippers depending on their level of control they wish to exercise can either let the primary RR (the one they are located on) to establish the routing or they may seek/ask for particular routings. Pricing mix and strategy can come into play, if you wish to bulk up volume as a RR you can attempt to pull in some at or near-cost business that subsidizes other more lucrative business, thus on a train basis you are a net-net positive (so lets say some railcar traffic ends up just covering costs of operating while other different types on the same train might pull in a bigger penny, but be smaller in volume).
But now we're falling down a rabbit hole and I don't want to reveal too much about pricing strategy of RRs... also its a headache like most things.
A very informative post! You are obviously an expert on these concerns, so what about this statement in the post before yours? "Does CSX have a "Common Carrier" obligation to supply boxcars for any service? No they don't. Boxcar movements were deregulated, along with intermodal, on March 23, 1981. That deregulation fully includes the right to withdraw provision of railroad owned boxcar service. Railroads are, generally, allowed to operate as a business and no longer required to offer money loosing services." True, partially, or non-applicable? Are railroads still "common carriers" under the current laws?
I seem to have kicked over a hornet nest here. Oh well, if you don't ever get people upset you're not doing anything.
I'll try to answer some things.
If CSX has a contract to supply boxcars, is it obligated to do so? Yes. Never welch on a deal. But no one in their right mind signs a perpetual contract. I'm confident that if CSX was moving the freight on a contract they complied with the contract. Otherwise, they'll end up in court. If the contract expired, or there was no contract, CSX is free to chart their own path.
Does CSX have a "Common Carrier" obligation to supply boxcars for any service? No they don't. Boxcar movements were deregulated, along with intermodal, on March 23, 1981. That deregulation fully includes the right to withdraw provision of railroad owned boxcar service. Railroads are, generally, allowed to operate as a business and no longer required to offer money loosing services. That has worked out for the good.
Is CSX "Ignoring" its customers? I don't think so. They needed a kick in the pants, and they sure got one. Were mistakes made? Oh sure. Progress is made by trial and error. If you don't try things and make some mistakes doing so you're not going to progress.
Does some boxcar business today produce a positive cash flow? For sure. That's why it's still there. If it produced a negative cash flow alarm bells would go off and the situation corrected one way or the other. Cash flow does not equal profit, but once you've already got the asset (boxcar) you're going to flog it for all the cash you can get. You've already made the investment so there's nothing to do but make the best of it, even if it was a mistake.
Did loose car, boxcar service ever work in 180 years? It did when there were very poor alternatives such as a team and wagon. Does it work now? Only for niche services. It cannot be made in to a reliable competitive service that meets today's logistics needs for the vast majority of freight.
SD70Dude"Sure would be easy to run this railroad if it weren't for all those darn customers!"
SD70Dude zugmann greyhounds They don't owe anyone a boxcar Not even cusotmers they have contracts with? I just think of the often used quote: "A hell of a way to run a railroad." "Sure would be easy to run this railroad if it weren't for all those darn customers!"
zugmann greyhounds They don't owe anyone a boxcar Not even cusotmers they have contracts with? I just think of the often used quote: "A hell of a way to run a railroad."
greyhounds They don't owe anyone a boxcar
Not even cusotmers they have contracts with?
I just think of the often used quote:
"A hell of a way to run a railroad."
"Sure would be easy to run this railroad if it weren't for all those darn customers!"
Bummer!
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