The performance of public trucking industry in Tanzania: a case study of regional transport companies

Abstract

Transportation plays a significant role in economic develop wont or Tanzania. All other sectors of the economy particularly the agricultural sector which is the backbone of our economy depend, to a large extent on the efficient functioning of this sector for their growth and development. However, over the last few years transport services and especially trucking services have so much deteriorated that they have acted as a hindrance towards the development of productive sectors. The main objective of this study has been to evaluate the performance of Regional Transport Companies with the aim of pinpointing sources of and factors which has led to poor performance in public trucking firms. Our study adopted both descriptive and regression analysis in evaluating the performance of Regional Transport Companies. It has been established that labour productivity in Regional Transport Companies exhibited a declining trend. The regression results indicated that low capacity utilization, low vehicle availability and utilization era a major cause behind a decline in labour productivity and that although the size of the labour force and that of fleet size has been growing at a tremendous rate there has been a less than proportionate increase in the growth in output and in some cases output has declined. As far as the financial performance of Regional transport Companies is concerned, an analysis of four financial ratios namely profit rate, current ratio, operating ratio and return on capital (investment) was rnade. The results indicated that the financial performance is less satisfactory since in most cases the level of performance declined and that standard targets set were not achieved.