O/O Owned Broker Co-Op

Bill--I don't understand the point you are making. It seems like you are saying there are a lot of o/ops that feel brokers don't add value. And that you disagree with this position. Is this correct? Would you mind elaborating on the value you see brokers bringing to the o/op?

 

I didn't see any comments about the needed capital. Shippers pay on 30's or later, sometimes not at all. Point of a broker is the ready cash we all need to keep running.

I'm offering any startup like this could work if the capital was provided to get it out of the hole. The trucker has to be paid pronto...... now we could factor but thats like 75% of the load and fees and that still leaves the office, phones and salaries for 30 or so days. ( plus bond, business license etc. )

Last I knew you had to put up 10k in reserve with Comdata just to open the account.... so you would need like 50k to cover the first round of load pmts to truckers.

JMO

 

You could really write a book on this. But to keep this short, it takes resources between “we have a load to move” and “here is the invoice for the load that was delivered”. For some reason there is a group that believes that all the work of finding a carrier, completing contracts, checking insurance, scheduling, dealing with issues that come up, etc are handled by this Load Fairy and it cost the shipper nothing. And along comes a broker and boots the fairy to the curb and takes a cut from the load for work that was once done for free (talking about good brokers and not those that are trying to hit the lottery on every load).
But there is no Load Fairy. It takes resources to do this work and resources cost money. And in most cases a good broker is cheaper than doing it in house. But there are always going to be these guys that bought a job, have zero understanding of business, in general, and want to blather on about how a company should be running a shipping department. But these guys couldn’t even tell you how to calculate ROI, figure out manufacturing cost flows, tell the difference prime cost vs. conversion costs.
But what is common sense is not going to stand in the way of these super truckers. They believe that it is cheaper and easier for a small company that ships 10 loads a week to have a long list of carriers that they look to cover these loads than one broker.

 

For the most part I agree with your thoughts. What value do you place on brokers from a small carrier's standpoint?

 

Bill is correct, and I am the guy with 10 loads coming in to my plant every week.

For the most part, the drivers on this forum tend to look at things from their perspective only, not the companies actually manufacturing a product and needing it shipped.

I do both, hire trucks and have my own truck to haul my own product.

 

No matter how you look at brokers, freight forwarders or dispatch services they are a necessary evil. like it or not

 

Let's say that the Truckers "Co-Op" grew to a 1,000 trucks on the road. I can guarantee you that the majority of Brokers and eventually many shippers would contact the "Co-Op" directly.

A broker that may have 25 loads booked for Friday might just contact the Co-Op first to maybe get 80% of his loads looked after with a single phone call.

 

and that would be all cheap freight.... SO were is the TRUE business part of the co-op?

 

Why? Please explain.

 

Rogue--do you ship van or open deck loads? Do any leave the NE?