Owner Operators and direct loads for growth

Most shippers deal with brokers because they usually need larger numbers of trucks, and it's easier to work through a broker than to book the trucks, check the history/safety of the carrier, get rate confirmations signed, and other things done by having a broker do it, than hiring the staff to do it. With the number of loads some places send out each day, they would need several people to handle everything.

 

Honestly? A lot of truckers (independents) just don't have the sales and business skills or the image required to be dealing directly with shipper's transportation heads and come out successful. Sure in a trucker's home town, he may have enough respect and personal history to make some things happen with a local business, either inbound or outbound, but outside of that, if you're in a market where you're a complete unknown, you are at a severe disadvantage. Plus, who has the time when they're away from home in a "foreign market" to knock on doors, set appointments, etc? Although it doesn't hurt to get your business card on as many desks as possible and can get the phone answered and give immediate yes/no answers but that's often hard to do without making it seem you won't be able to cover the next load either.

 

I agree with Lilbit, fleet size is a huge factor. Also, shipper relations are no longer based on a handshake and words. With the technology and persistent broker calling, it's easier for shippers to shop around. A good broker friend of mine asks a simple question. "Why does a shipper need you?". Well, bottom line is they are looking to save a dollar. You may spend a good deal of time trying to establish a lane with a shipper and the next week someone may cut the rate $25.00 and you lose it. I feel it's more about cost than quality. Going direct also does not guarantee payment. Over the years we have had our fair share of shippers going bankrupt and reopening. Lastly, shipments have become less consistent as they were in the past. That makes it tough on a small operation to plan out their week. If a load gets moved from Friday to next Weds, you might not be around, leaving the shipper to contact the next in line. Hope that helps some.

 

Also, some businesses who have a semi-personal relationship with a small carrier expect the rate to hold constant, even if fuel jump 40 cents in 10 days, and when you try and put in a higher rate than usual, they take it personally or that you're trying some sort of bait and switch tactic. Dealing with brokers, you can accept what they're offering or refuse, and nobody gets hurt.

 

I am at a TA as we spaeak watching the homeless people..I can see it now...


Billy Bob Johnson Trucking Owner walking into a ''professional'' atmosphere armed with his yellow sweat pants with a brown streak running down his crack,flip flops,1987 zz-top hat on and his 1978 tank top on.Armed with his ''green'' safety book having a meeting with a guy that has a degee in a business suit wanting to move 10 loads a week...

 

What's the going rate for a truck and 53 ft van? it?

 

HUGE variable on where its origin and destination are.

$5.00 a mile to $1.50.

 

$1.50 a mile? You are very optimistic. I got a rate of $1.06 out of Dallas today. 47K lbs with two stops. The guy gave me the rate with no hesitation in his voice. I hung up on him, but still, he actually gave me that rate.

 

I've had some opportunities for direct freight that payed above average and passed it up. Here's why.

When I deliver a load, I am looking for the best load available to me out of that area, don't care where it's going. When I am in that position I can consider 100% of the loads available.

Now, if I have a contract to haul one load a week from Peoria, IL to Columbus, OH I don't have that luxury. I get to Columbus, OH and I have to be concerned with getting my truck back to Peoria, IL. Even if I have a few days extra built in, this is going to cut my options down from considering 100% of loads available to considering 10% of loads available.

So even if that direct customer is paying me $0.50/mile above "standard" rates, I am going to miss out on many good loads. Besides which, you would be surprised how often you can blow standard rates away working load boards effectively. Not to mention I can always choose not to haul. That comes in handy if I need to make repairs or even if I just want some time off. When I'm done hauling a load I have no further obligations.

yes it's true, 99% of load board loads probably pay less than contract freight. The key is to find that 1% that pays better, and find it every time.