Landstar and rates for independent carriers

Simply supply and demand. Don't under estimate the power of brokers to under cut each other on rates. Landstar agents compete against each other all the time. I see countless repeat load postings from multiple agents who's rates vary as much as .30 cents a mile! I have also experienced loads that had their rates padded up to get responses only to tell me the customer will only pay less. In fact in the last 2 years I have had more loads cancel then my last 10 years with Landstar. Some agents will admit they simply were out bid on the rate. These days, with technology of web based load boards the shippers know they can shop around rates and they know in weak areas they can pretty much move freight a lot cheaper by simply posting loads on multiple load boards. Even Landstar is nothing more then a logistics company working with multiple smaller logistic providers who share loads. Its certainly not benefiting owner operators in the rates. It may very well offer you more freight but at what costs? Its no secret that with so many out of work that many people saw becoming a broker or agent as a way to make money. To me load boards are limiting rate increases in some areas. It really does not matter if you lease to Landstar or have your own authority or lease to someone else. Your basically all compete for the same loads on a broader scale then ever before. The reality for the owner operator to survive is find niche lanes that pay well and reduce costs wherever possible to deal with the rates.

 

I'm about to leave Landstar. Their rates do suck. I've learned enough to move forward.

 

Landstar has a large collection of agents who are independent of each other and all compete with each other as well as having to compete with non-LS brokers. LS simply takes a flat rate cut of every load, regardless of whether the agent or driver are making a profit.

Sometimes it is the cheaper agent who is lying to you and some times it's the other one playing bait and switch with you. And don't forget the shipper. They play brokers off against each other also.

 

Is Mercer any different than LS, structurally? I don't see them post loads on public loadboards as much.

 

Mercer is pathetically cheap. Like really cheap and sometimes agents are double brokering causing many problems when last minute changes need to be made on the load details. Speaking of Landstar, I had an issue yesterday of the agent calling me every name in the book and threatening me because I refused to give them free access to my equipment and they had an absentee receiver. I'm at the point now where I'm pretty much done with both of them. I can't keep rolling the dice hoping to get a decent agent anymore and losing my daily revenue goals. I'm currently deadheading 850 miles to keep my schedule for the next run. I see some cold calling for direct customers in my near future.

 

One of the things you'll see a lot is heavily asset based brokerages struggling to pay market rate prices with high spot rates. This is because the brokerage side of the business often exists to allow them to broker out additional freight they've gotten from customers through their asset backed contract side of the business..

In other words they are getting the loads for the long term contract rates that they set with the customer in more normal times. Those rates might have been pretty good in 2017, and they might have been really happy to get them after 2015-2016, but today they simply aren't sufficient. They will be sufficient again at some point in the future, but until then they will probably lose a lot of money keeping their customers happy.

It is important to note that these same types of brokerages MINT money during down periods. Show me a Landstar/Mercer agent who lost 30k last quarter and I'll show you someone who had 25% gross margins in 2015-2016. Also LS and Mercer agents who just broker won't be affected at all... It's the big agents with significant national contracts who will be feeling the burn.

 

Hi, boredsocial.
Can you PM me? I would like to ask some questions, if that is o.k.
Thanks.

 

@UltraZero - we self-identified brokers don't have the ability to PM folks on these forums. Just an FYI.

 

Mercer agents are hit or miss. If you work with a hand holder at Mercer Kentucky, you'll get a better idea of the pay to Mercer trucks- which can be very good.

If you are dealing with one of Mercer's agents directly, like CNC, you might get quoted $2.00 less per mile than if you dealt with a Mercer handler.

I had a Mercer agent put "Call xxx-xxx-xxxx (agent office) for dispatch because she didn't want me to see the rates that Mercer Kentucky sees.

Either way, their rates are in the toilet right now around here. Better to surf the load boards and check Mercer agent freight when it goes back up. And check through their corporate office.

 

Thanks, PPDCT.
Is there no way to get in touch other than this forum thread?