Brokers have a bad name...

You have a new MC and you just said you've only been brokering for 4 months, which means your invoices probably can't be factored. Also, as you'll eventually learn, how many dollars per mile the freight pays is only one variable. How many miles, how many days, and where the load is going are all just as important.

This is a rough business... What made you decide to become a freight broker? Did you work for a brokerage before you went out on your own?

 

Call good carriers, offer good price, pay 50% via comcheck on the pick up and the rest in 15 days. You will quickly gain trust.
It also depends how you sound on the phone, when I speak to a new broker and he/she sounds like a rookie (does not know all the load details, mumbles), I just move on. But if you sound very professional, offer good price and do the payment terms I mentioned above, I will go ahead and take a risk (up to $1500 loads)

 

I'm an O/O in business to make money. I'm not against brokers making money. Or anyone else for that matter. That said, there are way too many brokers out there that will pocket way more than their fair share. We've all heard the stories. Broker gets $5k to get a load from point A to B and gets some idiot desperate for a load to pull it for $600. Is it the broker's fault? In some respects, yes. That load should have been offered with the broker leaving themself a fair piece of the pie. After all, it's the ones moving the freight that take on the major portion of the risk and have large amounts of money invested in the equipment to haul the loads.

Just my opinion.

 

If there were bunches of trucks willing to do the job for 600 dollars the broker hasn't done anything wrong. If I buy ANYTHING for 600 dollars and convince someone else to buy it for 5000 I created the 4400 not the person who sold to me for 600. Now the person who paid 5k has a very good reason to be annoyed with me... Which is why this scenario is SUPER rare.

The only time I've ever seen a broker make that kind of money on a load one of my coworkers got a weird quote request from one remote part of Canada to another for a customer. It was a longer partial of weird crates of some sort. He thought about it and decided he didn't really want it so he quoted SUPER high like 3 bucks a mile. Came out to 6500 dollars.

Then the customer went and gave it to him. My coworker goes out looking for someone who can handle it. His first stop is his LTL guy over at Conway to see if he can get someone else to figure it out for him. Conway comes back offering to do it for 860 dollars. My coworker begins praying that this apparently too-good-to-be-true situation is actually happening.

Long story short it got done. My coworker generated 5640 dollars in brokerage on one load. That he was paid 6500 for. Lucky #######. Should he have called up Conway and told them that their fair share was 5720? Is it ok because a big company did it?

The way I see it my coworker asked a customer for ridiculous money to insure that if he ended up having to do something he didn't know anything about he'd be safe. The customer said yes. After that it's his job to figure out the best/cheapest way to move it. He did and he made a decent chunk of money. This customer was big enough that if it had cost 8k my coworker would have paid it so there was quite a bit of risk there as well.

EDIT: With the exception of monster O/D loads that involve more leg work than probably 20 normal loads this is the only load I've ever seen that did >2k in profit. <2% of loads make more than 500 bucks. I did two loads this year that made 1k+ and both of them were specialized. Average load made 212 dollars.

I'll bet that most of the posters here have had the shoe on the other foot at least ONCE. Some broker called you up at 5pm and offered you 4.00 a mile to run a thousand miles because his freight needed to go NOW. You took the load with a big smile on your face. If that broker sounded super unhappy about the situation he was probably losing his ### on the load. If he sounded super happy he was probably in the process of irritating his customer by double gouging them (offering you drastically more than market rate for the truck, charging the customer an above average markup on the load).

 

As you said, it is a matter of building trust and developing quality relationships. Take the time to learn about the trucking industry. Sure, the shippers are your customers, but in reality, your truckers are too. As the person in the middle, both sides have to trust that you are not taking advantage of them, especially considering that your contracts with each party require "confidentiality" regarding rates and agreements.

Take some business cards and go to a local truck show and meet the people who will be driving for you. Make an effort to get to know them. The ones who take pride in their trucks are the ones who will take pride in doing a good job for you.

Make an effort to understand everything that goes into the rates that truckers are expecting/asking. Do you know the cost of fuel or the price of tires? Have any idea how much an oil change costs? Or even what it costs to replace a light on the cab? Do you understand the Hours of Service regulations, so that you know what you are asking when you say that a load has to be delivered by 6 A.M. the next morning, or understand the driver's frustration and anger when your customer kept them sitting in the yard waiting to unload for 6 hours, caused them to run out of hours and miss a reload, and then tells you that they won't pay detention? You have to be an advocate for your truckers as well as your shippers.

Just having an idea of the factors at play for your truckers, and letting them know that, really helps. If you have a load that's really cheap, let the driver know that you know it's cheap - and if you're working on developing a relationship with them, let them know that if they help you out with it, you'll make it up to them somewhere else - you'll save them a load that goes right by their house over the weekend, or pays a good rate, or you'll give them first choice when a new lane opens up, etc. A lot of them will work with you to help you when you're stuck as long as they know you're looking out for them too.

And don't be offended if a truck driver gives you a rate that you feel is outrageous. I've had a lot of brokers scoff at some of our rates...but we can't look only at the rate you are paying to go out there. We have to look at many factors, not just the straight up mileage. Things like tolls, parking costs, higher fuel prices, temporary permits to drive through the state, etc. Some of the states on the east coast charge $48 each way for a tractor/trailer to cross the bridges. In some of the mid-western states, there are rarely any loads coming back, and if there are, they are super cheap. If we look at the area we are delivering in, and there are 25 posted loads within a 50 mile radius, we'll be either sitting for days looking for a load back, or deadheading to the next busiest location.

FYI, ATRI publishes a report annually on the average operational costs of trucking. For 2014, the total cost per truck was $1.70 per mile (that included driver pay). The costs are broken down into categories as well. That would be something good to know.

http://atri-online.org/wp-content/u...onal-Costs-of-Trucking-2015-FINAL-09-2015.pdf

 

What can I do if the broker hasn't paid in over 30 days? Solution anyone?

 

What steps have you taken to this point?

 

I've only called a million times.

 

30 days is nothing. Lots of companies, even reputable ones, now pay on 45 days. Now you can start calling them, ask when the check will be mailed. On day 45 you can threaten them with filing on their bond. Be nice about it when you speak to them, don't burn bridges unless you absolutely have to