WTF?

Guess that's why it is "first star" they couldn't make it to five stars, so they settled for one.

 

wow you are defensive and a bit smarmy.

So breaking this down.

You are paid $1600 a week by your customer in a retainer. No problem with that. That is between your customer and you.

What I read originally was the customer pays you $1500 for the load and you pay $700 to the truck and pocket $800 as your percentage/cut.

There is a big difference between the two.

 

Actually I said I pay 1,000 on a load I get paid 1500 on. The customer gives me the produce season rate to help me stay in business during the off season. She does this because I am one of her primary brokers, and she really doesn't want me out prospecting for new customers. Please explain to me why I'm morally obligated to give away the extra money my customer is paying me. I really want to hear this. Tell me why I should pay 1300 instead of 1000. Or is 1300 not enough? Should I be grateful to make 10% and do it for 1350? Bear in mind I have 10 trucks that are racing each other to get to the phone to call and take it at 1000.

See this guys? This is the attitude freight brokers ##### to each other about. You've all seen the entitled brokers who suck in all sorts of ways... Here's the trucking company variant. No respect for the person he's dealing with and zero understanding that things are slightly more complicated than 'the broker took too much of the load!'

You want to know another situation where brokers get big margins? Contract freight. This happens because you provide the customer with year round rates. When the market is hot you lose money because trucks are expensive, but you have to fulfill the contract. When the market is loose you might be making 900 dollars a load. At the end of the year you get a nice healthy 15% but you rode a roller coaster getting there. Does that guy owe you money in the loose times or does he get some credit for losing five figures during produce season?

EDIT: The reason I keep treating this guy with so little respect is that his arguments are just trash. It's such first level thinking: "Me want more money, you should pay more money, you bad!" Not thinking about the market or his own place in it, not thinking about the broker and his place in it, not caring about anyone but himself at all. Because who is going to take care of him but him right?

In real life we all have to rely on other people to take care of us. That's why I do favors on a daily basis for my customer during the season even when it costs me a little money and a meaningful amount of time. That's why I pay my regulars layover even when my customer doesn't pay me layover. That's why my regulars run loads for me in the busiest week of the year for only 1-200 more than normal when they could get 3-500 from someone else. And that's why my customer pays me an extra 300 a load on one to three loads a week during the off season. You have to be willing to give somebody something to get anything in return.

And thanks for 'smarmy'. I laughed pretty hard. People have called me all kinds of unpleasant things, but smarmy suggests a kind of polish that I really don't have. Being called smarmy by an honest to goodness communist is pretty ironic though.

 

Can't lie man you got me thinkin outside my lil box here.

 

I left out the worst/best part about contract freight... It's basically being short trucking rates. You've agreed to haul the freight for the customer for x price. If the spot market goes up vs what it did last year you could be forced to give up the account or go out of business (or if you're rich as #### just lose an butt load of money). You could literally end up doing a job that companies pay 80-100k a year for to lose a couple of hundred grand.

Now obviously in the long term this is a good trend for the broker. I won't sugar coat it, the trucks are getting more mpg, the software and the gps and the phones and all that are making the drivers cheaper, the trucks are (supposed) to be lasting longer... The trend line on ppm is down and has been down since deregulation. That doesn't mean that dumb over aggressive brokers don't drop like flies every time the rates bump up hard though... And they do. 2017 is going to be a great year for me and the last year for a bunch of guys who have been riding high the last couple of years and misquoted 2017 back in September when it wasn't so obvious rates were going up. Somewhere out there some account manager at Coyote is selling his soul to the devil to get his rate moved up 10% lol.

 

Yeah not just that but the whole broker deal...several points I hadn't considered, and I appreciate the thought you put into these posts. Not to say I'm gonna change my mind regarding most members of your tribe lol just sayin I appreciate the education

 

Zoinks!

 

Thanks for being honest about how you operate @boredsocial it's been interesting.

 

Nor is it intended to. Like I've said plenty of times it's not like I hold my whole profession in such high esteem. Certainly I have peers who I consider to be excellent, who I think provide an immense value to their customers... But the average broker is just some young early 20 something year old kid. They suck. Just like most 20 something year old kids suck. No self awareness, no perspective, and no real ambition but finding a job, a mate, and buying a crappy house.

 

my honest opinion?

I believe any marketable product should earn as much as the market will bear.

In the different business I have owned, I earned 100% net net mark up on tangible items, and roughly 400% on labor. I admit I am greedy. The idea of business is to make as much as you can squeeze out of the market.

I am just trying to understand how you rationalize your profit structure while you explain it to the general public.

I believe Owners Operators that operate from a profit based business plan have a full grasp on your operation. To some profit is based on time involved in earning as well as costs to earn.

Obviously there are Owner Operators that work with people with your business model. They have built your model into their earnings plan. I never knocked your model. I only questioned your method of earning.

The one thing I find humorous is your constant need to feel like you are in some superior position. Healthy dialogue is when you can make your case without attacking the other guy.

It is almost like you feel like you have created a perfect business model and you have the upper hand on the rest of the trucking industry.

You should make as much money as you can off of your customers. Squeeze them for every dime you can make. As long as you have the market and the customers, go for it as long as the market will take it.