How to expand my business

Discussion in 'Expediter and Hot Shot Trucking Forum' started by 24kHotshot, Nov 20, 2019.

  1. 24kHotshot

    24kHotshot Medium Load Member

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    Is getting a dispatch service under my company name a legal business?
    I'm training a friend that is between jobs currently on dispatching. In about 6 months my current dispatcher is taking a long vacation and I like his service so training the friend to give the same type of full service. I was wondering if I train the friend in dispatching is it legal to offer this service to other O/O and having the dispatch service under my company name. Do I have any extra liability on my company doing this?
    I often get asked by other hotshots where ever I stop to load/unload if I know of a dispatching service. My dispatcher currently doesn't want to take on any more drivers. So far 7 of them asked me this over the last 2 weeks of work. Seems like it would be a nice addition to my revenue.

    Also, leasing on other hotshots to my company, how bad can my business/insurance/safety score be affected by a driver? If a leased on driver messes up and it causes an increase in insurance would it go away after they are fired or is it a mark on my company's record for good?
     
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  3. Lite bug

    Lite bug Road Train Member

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    Focus on your business. After you are in this a few years you will know enough to answer these questions for yourself. One driver’s mistake can ruin you.
     
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  4. 24kHotshot

    24kHotshot Medium Load Member

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    Just getting my friend started on the dispatching. He is a sharp guy and will catch on quick. He will be handling all dispatching needs and will dispatch me when my regular guy goes on vacation. I will continue driving and focusing on myself and my hauling end of the business.

    As for leasing on drivers, if a driver's mistake can ruin me than I won't be leasing on. Not worth the risk.
     
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  5. crocky

    crocky Road Train Member

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    A dispatcher under your own company can only legally dispatch your company's truck(s). There are guys calling themselves dispatchers and dispatching random trucks from random companies but they are operating illegally. You have to be bonded and essentially be a broker to be legal because what a dispatcher is actually doing is re-brokering a load so that dispatcher needs to be operating under authority..
     
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  6. Lite bug

    Lite bug Road Train Member

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    A dispatcher works under the Carrier’s authority. The dispatcher is under contract with carrier. A dispatcher may operate under multiple carrier’s authority. At least that is how I understand it.
     
  7. Lite bug

    Lite bug Road Train Member

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    When you are first starting out it is very difficult to discern false information from fact. So many people saying so many different things. So people even saying things that they know is false just to side track you. Even people that have been in this industry for years believe things that are not so.
     
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  8. Lite bug

    Lite bug Road Train Member

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    You will know when the risk of leasing on or adding a employee when the right time and opportunity comes. Just not right out of the gate. Personally I tend to be conservative by nature, also being older risk is not something I am interested in unless the reward is assured.
     
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  9. Lite bug

    Lite bug Road Train Member

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    By having a in-house dispatch service your contacts will grow at a much faster rate. The time will come when the brokers will be calling you every day and you will be able to choose the best freight and lanes possible. Here is the thing that I suggest the dispatch service will be harder to stay in business than yourself. I would say pay your guy and not take any proceeds from any other clients for at least a year. Allow both to grow. When I started a guy I knew was starting a dispatch service. This guy struggled for a couple of years until he got established developing relationships with brokers and having a successful track record. Many times I payed him just to keep him afloat, knowing my long term success could depend on his success. After a couple of years I knew I needed to do everything on my own.
     
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  10. crocky

    crocky Road Train Member

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    That's not how it works... Did you hire them to your company, do you give them a 1099 or w4? if not, then they are not your employee they are working for themselves. If they are calling brokers they are negotiating rates ect.. they are acting as a broker according to the FMCSA definition.



    By industry statue if you are working for more than 1` MC you are classified as a "Broker"

    What are the definitions of motor carrier, broker and freight forwarder authorities?



    • A broker is a person or an entity which arranges for the transportation of property by a motor carrier for compensation. A broker does not transport the property and does not assume responsibility for the property
    ^^ That is exactly what a dispatcher does which is why there is no separate definition for a "dispatcher" in the FMCSA definitions.

    You can legally be a dispatcher for 1 company.. But the moment you do it for more than one you are classified as a Broker by the FMCSA


    Yes people are doing it, but it doesn't mean they are legal.. It just means the govt hasn't decided to target them or doesn't care if they do it or maybe even isn't aware people are doing it.. Who knows..
     
    Last edited: Nov 21, 2019
  11. Lite bug

    Lite bug Road Train Member

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    1099
     
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