rookie O/O question

Don't most customers usually pay good, and the brokers usually hijack the rate? Just curious, I've only been a company man, trying to learn the ins and outs of running my own.

 

Yes and no. You really have to see the transaction from a different perspective. Direct customers usually run on a contract rate. You get an ok rate in exchange for a commitment. When you book from a broker, it's spot market and the price depends on where it starts/ends, how bad it needs to move right now, and how many vacant trucks are in the area.

Often the broker will have the contract and it becomes a shell game when they need a load covered fast. That is, some of the profits planned into their contract rate may have to go out to cover a dropped load, for example due to the first carrier they booked having a breakdown.

So yes, they do jack the rates. They have to get paid. On the other hand, it also pays to be the carrier scooping up those "need to cover right now" loads at a rate the direct shipper might never agree to, unless it was a last minute order on their part. In that case the broker wins too, since they usually have exceptions baked into their contract with the shipper. In either case, you, the carrier, have to be in the right place at the right time and known to be available to get that order.

 

You did ok with that. If I remember right it's a first try. The 2.50 load would have been great if it went back to your area but,oh well, you'll learn with time. Next time use simple math and just know the rate needs to be more than double the miles involved. Denver to Portland is 1258 miles. I round that to 1300 and so the $ should be more than $2600 to catch my attention. That could help with missing the load while you are using the calculator. I did not say that you should not negotiate that number,just use it for a baseline for your quick decision thinking. I have had the person on the phone to do the calculation for me and then when he says $2.06 per mile I would ask him for $3000 and see what happens. If they don't bite but offers $2800 then you just have to decide if you want to sit another day or not. I would be on to the confirmation personally.
Btw,don't be quick to write off CHR. When you get a good record established they can be pretty handy. I actually get better loads from them than many others and when they put in my T number it's easy to see that I'm not cheap but never a service failure of any kind. Bargaining power when the agent has a load that needs to move right away.

Another way to look at the situation could make Denver not so bad after all. You said $2.70 going so lets say that was from Portland. That's $3396. If you get $2800 back to Portland we add them for a total of $6196. The miles 1258x2=2516. Works out to $2.46 all miles. Do it every week and laugh all the way to the bank.

 

If you REALLY want to experience a fun 2 weeks.

Do what I call a "dead hole tour".

The requirements are:

1. rates you can live with
2. big dead heads you can live with
3. must go to a dead hole.

You'd be surprised where you end up at. I am talking like Denver (not really a dead hole to me.) Kalispell and Billings MT,

Arroyo Seco, NM, Dickinson ND. Places like that. Sucks up commodities, but ships little out.

 

Never say never!!! Sometimes the choices are not so wonderful. Sitting and waiting for a miracle costs money. Deadhead costs money.
Just pretend for a moment that my example actually did happen as opposed to never going to happen. You never know what develops from humble beginnings. Look at the numbers again and figure the actual revenue based on say fifty weeks of the year. NOW,do you sit around in Denver enjoying the view when the rates are a little down one week. Or grab the $1.95 per mile and get back to Portland asap.
I had that very issue today in DFW. Seems as if everyone in Texas took a week off for a one day holiday. Very few outbound loads and practically nothing in my direction. My usual victims had nothing so with a truck unloading in the morning I had a decision to make. Grab what I could get or deadhead home because he definitely will not be still sitting there come Monday to see what might happen. He will be back on this end loaded or not. So,bottles of water it is. $950.00 on 477 miles,130 of it deadhead back towards home. You can do the math because I don't really care how much per mile. I made a loaded round out of a potential deadhead home for a little less than normal rate at at time when sailboat gas isn't paying much at all.

 

Well done. $950$ is better than 0$"going that way anyway" some people work 2 weeks for that kinda $

 

With a dryvan?

 

coyote always treated me right