wonder have brokers thought of this?

Real business math. If it cost an owner of a fleet of 100 trucks $1.40/mile to run his truck. $.20/mile for office overhead and he averages out on the year at $1.65/mile he will have made over $650k a year. So if he is hauling contract freight at $2.25/mile and takes a $1.20 load back he is ahead of the game.

 

Two reasons, A.) They will lose the customer, and B.) they KNOW someone will take it, and if there is no time crunch put on by the shipper, then it will sit there until someone does,

 

Your kidding right. As just like us most are out for the largest margin they can get

 

The issue is really, probably, as Bill and others have alluded to.

The freight is PROBABLY COMING FROM the shipper at a "reasonable rate" - and the broker will put it out there, as cheaply as he can get away with, and pocket the difference.

Less $$ to US, more $$ to HIM.


So when you say, "I need xx CPM to move the freight", and they tell you; "it's not there", then call you back an hour later - and suddenly IT IS THERE...

Do you HONESTLY THINK they called the shipper and got them to UP THE RATE - or they were a little more desparate to get the load MOVED, and GAVE UP some of the "excessive profit" they were attempting to screw the carrier out of - so they wouldn't compromise the relationship with the shipper by not moving the load?


A business decision by the mega, to re-positon units out of a slow market, isn't done to CORNER THE MARKET - it's a business decision. It's not a "conspiracy" to kill rates and CONQUER - but a way to get units out of a slow lane, and not DH out at a total expense.

Rick

 

Actually Rick I don't think the brokerage side of things is any less competetive than the trucking side. I really do believe that some brokerages bid on freight, and secure contracts on said freight, for very cheap unprofitable rates just to get the business. And likely they can more easily do this in areas that have a reputation of being cheap such as Florida. I understand what you're saying, sure there are plenty of brokers in FL with profitable rates out of there who simply take advantage of the market and get things moved very cheaply.. But those guys have always got to be looking over their shoulder and you just have to know the cheap rates they're paying in turn cause disgruntled attitudes and very poor service from owner-ops hauling it equalling ticked off shippers who know they are paying decent rates and getting screwed over. Double edged swords everywhere. And hey!! what's that "excessive profit" talk you know that's commie speak right?!!

 

Share The Wealth...

Actually, spoke with an old friend, small broker in AL. She tells me she bases her "advertised rates" on a 15% margin, and that she HAS called shippers back if capacity was low in the area, and gotten more $$ to get the load moved. She doesn't have any of her personal contracts that are less than $3PM dry box. I'm re-thinking my "reefer madness" and looking more at the dry market (thanks to this and our conversation). Same or better $$, more consistent/bigger lanes, way less investment/maintenance/risk doing dry than temp controlled.

She's an old, close friend - so I kinda trust her on that - but she's certainly not the "norm" for BFI Brokers. Starting to do some serious networking in prep for my "jumping off point". Calling a lot of folks I haven't talked to in years - "who do you know?", "can you hook me up with them?".

Basically "leveraging relationships" in order to build a contact/client book before I even roll the first mile...

Rick

 

If you think you are going to get the best paying freight right out of the gate, you are in for a big surprise. You have to prove yourself. If I was working with your broker friend for a few years with on time service and no problems. She would still give me better rates than you, even though you are friends.