Why pull cheap freight.

My thoughts on "cheap freight" is that it exisits because the larger carriers can haul it for those low rates and this brings down the rates for everyone else. The real problem lies in what keeps cheap freight cheap! How can larger carriers continue to haul cheap and stay in business? Its because their business model considers freight as a secondary means of income. The real money is in financing and lease agreements on trucks and equipment.

If I can make a ton of money on you taking over all the risk and maintenace on my used tractors and pay me for the opportunity I can also lower my freight rates and lowball the competition right out of business. Its a simple business model. Some people call it the razor/ razor blade model. I sell you give you the razor for a low rate or almost no profit and sell you over priced razor blades for ever. Freight is the razor in the equation and the lease agreement is the razor blades.
Its the gift that keeps on giving. The lease agreement makes it almost impossible for you to be successful so in the end I even get the truck back and do it all over again.

You cant just scream dont haul cheap freight you also have to scream dont sign terrible leases! The free market is more complicated than just a low freight rate. Youll have to change alot more than the "back haul" mindset.

 

I DO NOT haul cheap freight.I am the deadhead kid.People that know me say i am nuts.Ok,i guess i am nuts.I have been known to roll 500 miles leaving cheap break even crap behind.Not worth my time for a couple extra bucks and at least 24 hours of my time..

 

There is no such thing as cheap freight just a bunch of dumb @$$es hauling freight cheap

 

That is all BS because i know 3 different trucking companies including the one I'm about to leave that don't have a lease purchase program, have great equipment, and pay good money that haul "cheap freight" They get a pretty good rate going up to the Northeast and get crumbs coming back down... All 3 have in between 100-300 trucks.

Does it sucks yeah it does but the fact of the matter is it's been that way for some time, everyone knows where the cheap lanes and i just don't understand why won't nobody just won't haul it and shut up, it's not going to change no time soon, Jesus...

When freight headed to the Northeast is going below $2 to 2.50 a mile, then I'll maybe fuss and complain, but complaining about Florida, Texas, and Freight coming out of the Northeast is nothing new....

 

There are a lot more than 3 trucking companies that make the market. And the companies that make money in ways other than hauling freight are the ones that have the market power to move rates. They can haul large amounts of freight and in a free market that kind of action will move rates. They make money in financing and can haul for almost no profit or small profit. Rates come down across the board. If these carriers became more dependent on a spot market freight rate to satisfy the shareholders they would have the market power to move rates up.

The point is you will not change rates by guilting O/Os on a truck forum into not hauling cheap freight. There is more at work here then just O/Os. Same thing happened to the American farmer when large corporations moved in and began mass producing food. Walmart does it to small time retail store owners. There are plenty of retail store owners who cried "dont buy cheap groceries" in an attempt to slow the bleeding when a large retailer move in and takes all the busness because they can sell cheaper. The small guy get squeezed and you either sell cheap or go out of business or sell cheap until you go out of business. Welcome to the free market!

 

cheap freight will never go away as long as the CDL mills are running,there will always fly by night and seat of the pants folks that will pull it.can't change it.don't like it don't take it.

 

So they have 100-300 trucks and more that likely they have twice as many trailers at lease 10 office employees one or more terminals chances are the have had drivers wreck some destroying equipment. Have you ever heard of Overhead Large Companies dont haul cheap freight 90% of the cheap freight goes on load boards

 

Spot market load boards is the swap meet for selling trucking capacity. But week after week drivers are coming on here complaining about how you are trying to sell your Tommy Bahama silk shirt at Nordstrom retail rates at the swap meet. Really?!?

You want consistent better rates then stop trying to sell your services in a market that is designed for discounting.

 

You guys are so narrow minded it's insane. Why would a shipper pay MORE to one of you guys just because you're the poor O/O with the Pete 379 and all the chrome? I ship my product every day using outside trucking companies, explain again to me why I should pay more to you guys, lol.

And someone define "cheap freight" for me. Never heard a definition, other than you guys all crying about it.

Maybe "cheap freight" is there, and will always be in the equation of trucking? Learn to deal.