Another Classic TQL comment

There is room in the industry for working with Brokers and working direct with Shippers as a carrier. Brokers have a place in many industries(Real Estate, Financial Markets, etc) and play an important role as well. Are some greedy and untrustworthy. FOR SURE! I worked as a broker before I started driving. Weather it is a direct shipper or a broker isn't the problem. Its dealing with shady people or people who are trying to take advantage of someone and the truckers who take the cheap freight and allow themselves to be taken advantage of. As with anything (Government for example) if you let someone take advantage of you they will. The people determine the market! The carriers have alot more power then some think. The smart people know it. Just have to stand up for what you believe to be right when it comes to rates and building a successful company!

 

Gearjamn, if you only want to make a living you should go flip burgers, at least you would have sick pay, insurance and unemployment when you are unwell. I don't mean to insult you, I actually compleatly agree with your thoughts on brokers but you only have half the puzzle pieced together.
I agree with RC and others about whether your negotiating with brokers or shippers it doesn't matter, if you can't negotiate well enough to run at a profit your not going to succeed no mater who you deal with.
You got to stop doing this for a living and start doing it to get rich! You may never get rich but at least you won't have to run in the red.
Try not posting your trucks in areas your looking to pick up loads, sounds counter productive I know but brokers look at how many empty trucks are in areas their shipping loads from, heck even the loadboards do that automatically. If I wanted to move something and saw your truck posted in my area I'd be calling you already armed with the knowledge you need to find a load, I know where and when and will pray on your need to move. If i had the same load but didn't see an endless supply of trucks being posted there and say for instance RC calls on the load I posted on the board (cause as a broker I usually have to post on the board to move the load, as a trucker I don't have to say I'm going to be there to get a load) he already has the upper hand, yes I know he's interested but have no clue how much of that % I'm going to have to give up as I don't know how far he's going to deadhead to my load (if any), I automatically am holding less cards than he is in thes poker game and now it's down to head to head negotiating. If I get the impression your in this for a living then that's all I'm going to give you cause I already know that's what your going to do it for!

As someone posted before it doesn't matter what trailer your pulling, if you can't negotiate well your going to have the same problem. Actually you'll have one more problem, I would go out on a limb and say its a lot harder to find a flatbed driver than it is a door slammer just by nature of the job.
I hauled reefer a very long time ago and was always in my Sunday clothes, never got wet and sure as hell never found myself climbing on top of it with a 100 lb tarp in the wind!
Theres a reason flat bedding usually tends to pay a little more on average.
As regards not being able to get direct customers vs brokers I'm baffled? I can't remember a month that went by we didn't pick up a new customer, what level of general liability and cargo insurance do you have?
I wish you well and hope you find yourself at a profit soon.

 

Freight broker here, also a former fleet owner. I would agree with what some have said previously, if you take a broker out of the mix, its not like you are going to uncover a magical world of shippers that open their check books to you blindly, paying whatever you want them to pay. Are there shippers out there that pay more to get their product delivered consistently? Sure, but its not like they just give their money away either. Any good shipper or manufacturer is going to try and minimize their transportation spend in order to improve their bottom line, whether they use a broker or carrier direct, most of the time it is a grind to get what you need and remain competitive. It is true as well that some brokers take a good paying rate from a customer and turn it into a poor rate to the carrier, but again its only poor for you as the carrier if you let it be. I'm not saying I haven't dealt off some cheap loads as a broker, but its not because I talked those carriers into taking them, I told them what I could pay on the load, if they asked for more I went back to my customer to see what they say and let the carrier know. If the carrier decides to take the load I have to assume they are good with it, its not my responsibility to make sure the carrier is turning a profit, they have to know that just as any other service provider does. I turn down some customers loads because I know it will not work with most carriers, I try to go after what I know will end up being good for everybody, but it probably doesn't always happen.

I don't think you give yourself enough credit as a small fleet owner and the leverage you do have to get a direct customer. I'm not trying to say this bad, but is not rocket science to find customers to deal with directly (no matter what type of trailer). It just takes phone call after phone call or going around to potential customers in your local area in order to get in touch with people that deal with the transportation end of the business. Try going for a drive and looking at what types of businesses are in your area, what type of products do they sell, how do they get there, do they control the shipping in/out, do they buy the products FOB, if so, who do they deal with to coordinate shipment? It doesn't come easy, and it definitely takes a lot of time but the opportunities are out there for direct work like you want. From you previous posts it sounds like you are well aware of most of this, but just trying to give you some advice or prospective things to try.

I'd suggest trying to find one customer that could possibly keep your trucks busy going one direction either out of their location or into it. If you can get them to pay you for round trip miles great. If not then possibly use a broker or 3PL to get your trucks back home or to where they need to be to service your customer.

If you absolutely don't have any luck with direct customers then i'd suggest following what Rolling Coal and others have suggested they do, as hard as it may be, sit your trucks until you find a rate that will make you money on that run. It may take a while to get the ball rolling on opportunities like that but if you can get one or two, i'm sure they'll start coming more easily after that. I speak from experience in trucking (small fleet owner) and other businesses that it is very unwise to continue to take on loads or business that does not pay your bills, in hopes that things will turn around. I made that mistake and chased both trucking business and other business blindly and in a matter of a couple years I created a financial situation that I will probably end up paying for, for a very long time. I finally had to cut my losses and move on to something else. I know its hard to let the bills pile up and possibly let employees go or not get paid, but the bottom line is, that you are in business for yourself (and your family if you have one) and to help provide for your way of life, not anybody else's. Its far better to let the bills pile up while your trucks are sitting (and sell out if you have to) than letting the bills pile up and hauling freight at a loss and making your financial situation twice or three times as bad or worse. I hope the best for you and hope that things will turn around in the near future.

 

Theres a big difference in getting your real estate brokers license and becoming a freight broker!
In either case I don't believe either is a necessity, especially in trucking. Any property Iv bought or rented I sidestepped the broker, if the seller wanted to pay them that's up to them but if you want to sell it and I want to buy it then we are going to negotiate, I'm not having someone getting stuck in the middle and with their hand out too, I'm more than able to do my own deal thanks. Otherwise I'll just pass.
Gearjamn is right about how brokers came into this industry, they bought the freight bills from the shipper up front and paid the trucker usually half up front and half on delivery extending credit to the shipper while taking the responsibility of organizing the truck.
Now they don't do anything any trucking company worth it's salt can't do! If they extend credit they impose it on the carrier, they carry insurance but so does the trucker. It's not like the days where you would stop at a truckstop half way across the country to use the phone and update the broker on the shipment.
In this day and age as truckers we have everything at our disposal that a broker has except we have one more very important thing, THE TRUCKS AND ABILITY TO ACTUALLY MOVE THE LOAD!
Do I deal with brokers? Of course! But I'm not their first call, I'm usually their call when all else fails because they will have to pay me what I want, not what I need!

 

I have to deal with brokers from time to time.
There are many times I just kinda chuckle at their low rates. I also counter with my rate.
I am high most of the times.
LAst week I sat in Denver from Monday untill Thurs. Then I scored a ld. Short haul, but I got my rate.
Then sat from Fri. midday until Today before I got ld. at my rate.
Weird thing is this is another short haul ld.and after talking with the broker a few mins, I threw my rate out.
To my surprise there was not well I don't have that much in it bit.
She paid what I asked for. I hung up thinking that was to easy. I just wonder how much she did have in for the ld.
Oh well, it more than covers my Dh. and my lded. miles and the company I leased to gets there cut.
Plus I also have a company ld. lined up after that. I will bounce 100 miles for it.
So I will sit or d.h. out from an area.
I have bills every month no matter if working or not.
Sometimes I sit to much, but I know what I need to run and make money.
Like I told a broker yesterday, I'm here to make money, Not travel around the U.S. to sight see

 

Thats a good question passingthru.
As NHS pointed out as an option in his very well explained post to Gearjamn, I built up a customer base close to home running local, regional and OTR. They pay top tier rates and I provide a top tier service and we are all very happy how it works out. I take their products where ever and use loadboards to get home. In the case of any of their shipments going to a bad area they pay me handsomely there and back and are happy to do so. Even hauling to areas like TX my rate there gets me there and back empty if I had to without running in the red. They know from years of experience that areas for example like CO, OR, FL are typically what we call $1pm states that usually want 48k LBS on the truck and tarp it too! We are not that type of company and are lucky enough to not be in a position where we have to take someone else's profit across the country at cost.

I have never just jumped in my truck and stayed out for weeks at a time following the busier lanes working the boards so I can't really speculate how long you should sit waiting for a decent paying load in that scenario. It's easier for me I think as I have a customer base at home that usually keep me busy enough but I get my quit times too. For me I sit as long as it takes. Yes there are monthly bills but if I don't move they are fixed expenses. If I move for what brokers would want to pay locally I'd be working at a profit but honestly not making real money. It's better to leave the truck in the yard and spend my time looking for more high end customers. That's harder to do away from home.
Im based in the Bay Area and my direct customer base spreads from Sacramento to San Diego which is quite a spread but they are high end commodity shippers. If I go to LA to pick up for them (350) miles and can't get in the region of $1000 (not including tarping) I go empty. It actually better to keep the truck empty and available to a local high paying load that day and deadheading than to commit the truck to loading a $500 load going to LA. No matter what way you look at it, half a day is gone going and getting loaded and unloaded. I'd sooner move something locally for $800 and dead head empty to the next high paying load than stay loaded all the time while only getting paid well half the time.
Some may disagree but Iv been doing this a long time and like to make money, I won't intentionally do it a less profitable way.

 

So I finally read the rest of the thread.

Gearjamn, probably much different circumstances but I've been where you're at with my business. It's bigger than just how you're covering your trucks, or even the rates you're getting. I guarantee you. The problem now is that you're too close to it to really be effective at solving it. If I can read the stress in the responses you've posted in this thread, you may as well have it on a billboard outside every broker's office that you call on.

Have you reached out to anyone posting on this thread or elsewhere on TTR? Not just on another thread, but one on one. Use the PM feature and ask for some time and a phone number. Someone who makes post that strike a chord with you when you read them. Maybe someone that seems to be running a similar business, equipment, or lanes that you do. Heck, even someone with a completely different business can bring up ideas you'd never think of. If they're like minded, it doesn't matter what sort of operation they run.

Not saying that my network of trucking industry contacts exactly rescued my business. I did that. What they did was serve as a sounding board and offer lots of ideas. Not everything all at once. Little bits here and there. I can't overstate the value of a strong peer network. I didn't do much of that until it was the last round and I was one punch away from having a truck sale and doing something easier. Some of us are hard headed enough that's what it takes.

The simple answer is what everyone else has been saying: you can't run at or below break-even and survive. You'd think brilliant! All I need to do is get better rates! or maybe better cargo! or maybe better customers! Before you know it, you're all over the place at once getting nowhere.

What you do know for certain, is that if you don't change something big, you're through. The safety net is long gone and you're in survival mode. So you've already expressed your challenges with negotiating rates. Get one of these self-proclaimed negotiating stars on the phone and don't just expect them to teach you the secret whisper that opens a broker's wallet. Listen to how they speak. How they sound. Lane strategies. Timing strategies. Everything. You want to learn what it is these guys do that makes a broker want to pay them more than you get. The best part: talk to three people and you'll hear three different voices doing it three different ways. Eventually you're gonna hear stuff that you're comfortable with, go do it, and see it work.

On the operations side, there's all sorts of ways to improve efficiency, pay and keep good drivers, service and fuel your equipment, and so on. I got lucky and stumbled on a few things. However I've picked up more over time from my peer network. Don't discount those things, even small stuff. A smooth operation takes away stress. Less of that you will display in front of your customers when you're pitching high rates.

 

agree with RF ,theres some really good people on here, I am grateful for the ones that have taken the time to help and answer my goofy ### questions whether it be on the forum, thru pm or phone.
the resources are here for you. I for one would like to hear that you were able to turn it around and are making some nice money.

 

I feel like you have a very short sighted view of the entire industry. You're certainly right that some brokers are making a killing off of backloads... But if you drive a reefer into CA right now you're going to get a pretty nice price coming back out again almost no matter where you unload.

The value in backloads during the CA growing season is created when someone, either you or the broker, finds someone east of CA who wants to ship stuff to CA and doesn't understand that they can get the freight hauled very cheaply. The broker did work to find a customer willing to pay over the market rate... I don't see why you're entitled to any of the money he created doing that work. You get the current market rate for having a truck at point X at time period Y.

EDIT: As for the negotiation stuff... You need to slow down and do some math. You need to figure out exactly how much it costs you to drive a mile (variable costs) and how much your daily burn rate is (fixed costs). Once you know these two numbers you can figure out exactly how much you need per mile. The only reason you should EVER be taking less than this is to get to somewhere you can 100% guaranteed take a juicy load for far more. Recently the AVERAGE price for hauling a reefer truckload of produce from CA to Boston was 8000. That's 2.68 per mile over a very long trip. You could also get 2.33 per mile to go to Chicago... another hub that should lead to a rapid turnaround on another decent load. Plan your routes to land in the prime markets for your truck type and refuse to drive anywhere else if it isn't for a premium that makes it possible for you to take a backhaul rate going back. If you're constantly getting caught in ###### places where you're at the mercy of some freight broker who knows you're stuck in BFE something is wrong... and that something isn't that the freight broker is screwing you. You're going out there in the first place for too little money.

 

What you don't seem to get is if you where trying to move a customers load direct for 2000 that would be your rate. But a broker can get it done for 1800 because he has more than just one truck. See we are usually the cheaper ones unless your posting on load boards ####### out the freight. Which some do. But to a shipper my 1800 is cheaper than your 2000 every time