Minor problems with broker pay add up. What if I charge a late fee?

Pepper24 · Sep 8, 2017

La415 said: ↑

I write it on the contract in their carrier set up packet, not on each individual rate confirmation sheet. I have an app on my iphone that allows me to add text as well as my signature into contracts they send out. I look at their payment clause and right underneath it, or in a place where there is room, I type something like "Carrier extends x day terms as a service to our customers. Balances not paid within x days of submission of invoice and POD will incur a finance charge of 1% per month."

I usually use their own payment terms - so I'm not changing how long they take to pay - but note that if they go over the number of days that they commit to, I will charge interest. So if they say they pay 35 days from the date they receive the invoice and POD, I say that we offer 35 day terms as a service to them, and will charge interest if they go beyond that.

I don't have as much of a problem with the carriers to who say that they take 40 days to pay - I can plan for that or not accept the load. It's the ones who say they pay in 30 days, then take 45 days to even cut the check that have caused me the biggest problems.

I have also made notes on the contracts in regards to their back solicitation clauses. Two of them have written into the contract that "By accepting the load, carrier acknowledges that this is our customer....and agrees not to accept any other loads from that customer unless it is through (our company.)" They also state that they are entitled to a percentage (the company I filled the form out for today said 75% - the highest I've ever seen) of the gross revenue we make by hauling loads for said customer through anyone but them.

That doesn't work for us, because many companies use multiple brokerages to move their freight, and technically, that wording leaves them the opportunity to sue us if we haul for their customer even through another broker. So if I can, I make a note on those clauses as well.

I doubt they ever actually read the contracts when they get them back - but if they don't question it, It goes in my file as the official copy of our contract.

One broker did see it, and said that I hadn't needed to write that in there. It's just a standard clause that they don't really follow up on, and they know that other brokers give out those loads. I still wanted it in writing, just in case.

I have written addendums on some rate confirmation sheets too, but I usually try to put it into the actual contract. We also have our terms of service posted on our website.
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m16ty · Sep 8, 2017

The "net 30" came about when everything was conducted by mail and it took a few days to mail out invoice, for them to approve payment, and then mail the check to you. In this day and time, when you can send a invoice and get paid the same day from somebody in another country, payment times should be shorter. Now most businesses use 30 days or more just to sit on your money as long as they can.

BUMBACLADWAR · Sep 8, 2017

La415 said: ↑

We are coming off of a pretty bad slump in rates and in business and things have been very tight. While business has picked up over the last month, it seems like brokerages are taking longer and longer to pay. I've called three companies this week who are right at the 30 day mark to make sure they received our invoices and that payment is on the way. (Having found out by experience that if they have a problem with your paperwork, they don't contact you - they just don't pay you and wait for you to contact them...) I was told by one company that their terms are "30 business days" from the day of receipt, and then they only cut checks on Friday, so the check will be cut the Friday after day 30.

I was told by both of the other companies that the check is scheduled to be cut on day 30.

I feel like they are making a point of waiting as long as possible to pay their bills in order to encourage us to utilize their "Quick Pay" programs so that they can keep a percentage. When things were going well and we had a good cushion in the bank, it didn't matter and I didn't pay much attention. Right now, it does matter and it feels like everything to do with our broker/carrier relationships is set up to our disadvantage.

My understanding with most "net 30" business arrangements is that thirty days is a courtesy to allow your customer time to collect their funds, schedule a payment, etc. but the money should be delivered by day 30. If I pay my bills after 30 days, most of my creditors automatically charge a late fee or interest, even if it's one day over.

What is the consensus on charging late fees if the money is received after day 30, even if it's only four or five days late? I understand that legally, the late fee and/or interest has to be written into the terms of a contract, but what if I insert an addendum into our broker/carrier contracts that we will charge a late fee if the payment is received after 30 days? I realize this will probably make the bigger companies stop doing business with us, but I'm tired of feeling like they take advantage of us for that reason - because it's not a flagrant violation of the terms, and because we need them more than they need us, they just keep pushing and pushing the envelop. We're little tiny fish in a very big pond. Too little to fight them on any of it...so they just keep getting away with it.
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TallJoe said: ↑

Correct me if I am wrong, but If there is no mention in the contract about the late payment fees, there is no legal obligation for them to pay it. So the only (it seems) resolute and effective stick on them delinquent ######## is a threat to file against their bond.
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EVerybody is "out for themselves nowadays.and someone is "getting Stuck in the shorts." There ya have it,Sorry to sound Blunt...No Sugar Coati g.J MO

xsetra · Sep 8, 2017

aproductive said: ↑

What can I do if the broker hasn't paid in over 30 days? Solution anyone?
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You file a claim against their broker bond.
Broker should have supplied that information to you . If you don't have it safersys.org. will have it listed.
You call the bonding company, they ask for your paperwork to prove you should be paid.
Everytime I've done this the broker has paid within a couple days. Brokers don't like claims filed on their bond, it can make their bonding rate increase.
Good luck.

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