How to negotiate pricing with truckload carrier.....broker perspective

so my driver was just offered 1.19 for a load from Medley Fl to Berwick PA... i thought it was a insult and turned the load down. The broker is saying that it's a good rate considering that it's coming out of FL... what is a good resource from pricing loads based on a particular region? He also said that because he paid him 2.16 on the inbound, that should compensate for the shortage on the outbound. Im new to this and want some advice from those of you who have been at this a while. Thanks for your input

 

He should have never come to FL for $2.16. You just can't average that and make a profit with a van. $3 inbound and $1.19 outbound averages about $2.10 for all miles, saying the inbound is the same distance or more as the outbound. $1.19 isn't the worst price for Miami outbound on a van, I've seen much lower. The trick on coming to FL is averaging out just like any other deadend state like say WY or the northeast. These are lessons you learn.

 

Thank you fortycalglock. I have a lot of learning to do in a short amount of time. ... I just signed up for a truck rate site, so that I can better price the loads.

 

On sites like that, remember they are only as good as the data inputted and who inputted it. Personally I could care less what the going rate is, I know what I need to go to places to maintain my average. That is based on experience. Use that site as a reference guide, but don't take it as gospel.

 

i agree with forty

you go into florida for at least $3 (miami area) maybe tampa at $2.50 because you know you are going to have to deadhead out of the state, so include that mileage in your initial rate, or dont take the load

though $1.19 is justifiable to get to savannah or atlanta (same or next day delivery)

and when you do mileage, never do broker mileage (they cant add for nuttin) you go by actual mileage (google miles) door to door (unless you get free fuel from post office to receiver)

 

Exactly, if you get $2.50 Chicago-miami and grab $1.10 to GA/SC, that can be averaged out. If you get 2.50 from Atlanta, the numbers just don't work. I look at it this way. With my experience I can go work for a few carriers pulling a box making $80,000 a year as a company driver. I need to make that and work way LESS, or make way more and work the same amount to justify all the financial risk I take on as an O/O. Running for 1.50 average for all miles means I'm making less than I would working for Walmart.

 

fortycalglock and ezx1100 have some great advice for you. The only thing I will add is find a good broker that will help you. When I started brokering I wanted to start with what I new running produce. While driving I ran produce from CA to Boston, MA all the time. When I started as a broker I wanted to work with some of the same companies I did as a driver. However, my first call was to a fish company in Boston because I new they had lanes out of Boston to the mid-west. There pay sucks but it gets you out of Boston another crappy area to get out of. So once I secured them worked on the produce companies in CA. Now when I have loads going to Boston I tell the carriers who call here is the rate to Boston and if you need a back-haul out of Boston this is what I've got. Now I can pay them an average that makes us both money. A lot of brokers don't think about that and could care less if the driver is stuck or has to dead head 300 miles out of an area.

The truck rate sites are a good tool to help you if you use them right. If you use a pipe wrench to pound a nail in you will probably get the nail in eventually, but it will be bent and take more time. If you use a hammer it will go in straight and quickly. Rate sites are the same way. If you just quote the broker the rate on the rate site you may get the load eventually, but you won't get paid what should. If your bottom line to break even and how much profit you want to make you will get the load quicker and both of us will make money. I keep ITS and DAT open all the time and if a carrier calls in and quotes me a price like $2182.00 I know he got it from RateMate and has no idea what he is doing. So usually I will get him to do the load for $2000.00 when I would have paid $2300 for it.