Question for Brokers " What do brokers consider a fair rate per mile for freight?"

Discussion in 'Freight Broker Forum' started by robbiehorn, Feb 4, 2014.

  1. cruzsanta

    cruzsanta Bobtail Member

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    Mar 18, 2014
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    As a broker I find it too difficult and time consuming to capitalize on seasonal market fluctuations. My usual practice is to work mostly with customers that are mostly or totally dedicated to my services.

    My prospecting process does not include responding to requests from quotes from shippers, known or unknown. If they want to spend a dollar to save a dime by soliciting 6-10 quotes per shipment that is their right.

    The perceived ROI a company thinks it is getting versus reality is often wrong. If the quote administrator makes $15.00 an hour, each quote and subsequent negotiation takes X time which equals Y spend by the company to get a cheap rate. This is done day in day out.

    Not only does it lead to poor service, because how many lost quotes does it take to stop responding, but when the weather becomes what it was a few weeks ago in the mid-west, you can forget getting helped. They trucking company drives right by on their way to the loyal customer.

    Bottom rates are not the fault of anyone really, but when brokers win the daily lowest price game they hurt the shipper, the brokerage and the trucker.

    Try something different, get line item data with costs from the shipper. I usually get at least 3 months worth of information. I run the rate analysis, tell them the bottom line number, the lanes where I'm good and where I'm not. But, if i show a better rate overall, combined with the service they can expect-they usually give it a try.

    No cherry picking lanes, no constant price negotiation and they receive good service from me and the trucker because they allow people to make money. The hard part is being obsessed with customer service and issue resolution.

    But, those are good problems to have.
     
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  3. rollin coal

    rollin coal Road Train Member

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    Wasn't trying to beat you up sorry if that's how it seemed. There are just some undeniable truths in life and business. And this not to beat up on any of the downtrodden truckers you've run across but a shortcoming of many is the inability and/or outright refusal to recognize and admit mistakes.
     
    Green-eyed Lady Thanks this.
  4. trees

    trees Road Train Member

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    You're fine. You had a question, and it was a good question. Ethics, ethics should be our word for today. Some brokers are ethical and will negotiate in good faith, a very large number of brokers are not. Is lying illegal? All depends.....
     
    Green-eyed Lady Thanks this.
  5. trees

    trees Road Train Member

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    A broker is always going to do one of two things, either lowball an initial offer or ask you "how much do you need to make it work?".......

    How you respond is the difference between success and failure.

    I adopt an equal, but opposite, mindset......truth be told, I'm trying to help myself to as much of the shippers rate as I can......

    So, in summary....they're trying to keep as much as they can, and I'm trying to take as much as I can. Throughout the whole process I am absolutely civil......

    The system works, I get what I want, they get what they want, and the shipper moves his item.
     
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  6. trees

    trees Road Train Member

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    Let's not kid ourselves......it's absolutely true. Nobody is in business with the intention of making other people money, if they are, they won't be in business for long.....

    The ones who are "fair", are making calculated decisions.... they are looking for someone to provide more than just a one time service, their generosity doesn't come from some "goodwill" center in their heart.

    A successful businessperson is someone who can calculate accurately, on a lot of different levels....
     
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  7. Tesla49

    Tesla49 Bobtail Member

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    Aug 17, 2016
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    I am an ex truck driver so I will say this knowing I will be crucified but just want the truth to be told. It cost money to get a customer, you have to spend a lot of time negotiating and more to get someone to use your services, not only that but the insurance is almost half of what a truck driver pays for his truck because Brokers
    can be held to the same liabilities as the carrier should the carrier get into an accident or damage the freight, A carrier may lose, decline or fail to pick up a load, at a loss of $700, but a broker can lose a $70,000 annual customer because the carrier failed to do their job properly. Also the broker generally has to wait 30...60...90 days to get paid, on average that could cost 8% off each load as most brokers have to have operations loans to stay in business. Carriers or Truck Drivers are not what I remember them to be when I was driving, we looked at every bill of lading, load locked and strapped loads, we were courteous to the shipper and receiver, as we realized that we represented the broker or customer, and in doing so it lead to more business. Age eventually led me to become a broker, and a good number of carriers, will accept a load then not come through, or just be plain rude to a shipper and talk business in front of the customer about how much they are getting paid, or how far they have to drive. less and less properly inspect and secure the load or even read the bill of lading to make sure the shipper actually gave them the correct freight. The reason why brokers are in business and the reason for brokers to begin with is because shippers don't have the resources to spend vetting carriers, and getting a good rate, they also use a broker because it puts them in a safer position if something goes wrong, they can go after the broker. It's like anything else in this world, the majority of us work really hard to put food on the table, and the minute you think you are getting cheated while someone else gets all the easy money, is the day you should get out of the business and do something else.
     
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  8. Tesla49

    Tesla49 Bobtail Member

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    Aug 17, 2016
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    Also note that it is called supply and demand, if you have 10 trucks in an area and only 1 load, the cheaper guy will get it, and in most cases be the one to keep his business till the economy turns around, to where there are 10 loads to the 1 trucker left standing.The one that sat his truck while the insurance and mortgage still needed to be paid has to get a better paying load to help cover what he lost from sitting, expenses still accrue while you are sitting,so it is the most detrimental mindset to not take a load especially since no one knows when that good load will come. The best you can do is just try to negotiate the best deal you can get, and while you're on the road, you are putting yourself in the best position to get that good paying load, while the guy that feels he is worth more than a cheap load, will still be home sleeping. negotiate, budget, and work, that is how you survive and put food on the table for your family, not cry whine, and sit.
     
    Last edited: Aug 17, 2016
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  9. rollin coal

    rollin coal Road Train Member

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    Well you went off on the deep end with that second post. Probably some of the other 9 trucks deadheaded to a better market. Some more may choose to sit because they banked enough money in better times to be able to park some in leaner times. And a few will grumble, piss, and whine how the rates are too cheap and how we all need to go on strike because they stupidly booked a poor rate into a consumption area. The guy taking the cheap one either made it on the way in, so had easy options to take it or deadhead. Or he is one of the desperate whiners who finally caved in to reality. To assume they will be a winner in business because they took that load, is a real stretch. That's the broker in you talking trying to make a sale.
     
    Last edited: Aug 17, 2016
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  10. Tesla49

    Tesla49 Bobtail Member

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    Aug 17, 2016
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    The ratio of survivors is greater than those who sit and wait for better things to come. Fortunoffs is gone while Walmart and its vendors compete to survive. For years when everyone was screaming that LTL is dead and the future is Truckload, in 2008 the Truckload guys shortly thereafter put liftgates on the back of their trailers and had a better chance of survival when they started picking up some LTL. The cheap 1 pallet job, turned into 26, 1 pallet jobs, trucks stayed on the road and the new norm was born. Dinosaurs are gone but we still have ####roaches, I would rather be a surviving ####roach than a dead dinosaur. Take what you can get my friend, and do it with the same professionalism that you would do it for the better paying loads. The rest will take care of itself
     
    Last edited: Aug 17, 2016
  11. gokiddogo

    gokiddogo Road Train Member

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    Ontario Canada
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    I hate playing the roller coaster ride when I know the rate is a contract rate. Be fair to me and give me the same rate every time and when the market changes a bit in the trucks favor I will still pull it for the same rate. Lowball me when it is in your favor and I will gouge you when the market is in my favor. Or you can continually post your loads and get a new carrier every time never knowing what level of service you will get and always be making those phone calls everyone hates making when the carrier is late for some bs reason, if you can even find where the load is at all.

    For markets like produce, where yes the rates go up and down, just be fair with me. I realize the produce buyers are paying ever changing rates. Take your 8 or 10% or few hundred off the top and give me the rest. Don't try to lowball me in the morning because in the afternoon, if I even still consider taking your call, or have not taken a load from someone else, I will gouge the heck out of you. And when you tell me you "don't have that much in the load", how exactly will that be my problem? You expect me to work for peanuts while you take the lions share of the load then when the tables are turned that isn't kosher? Brokers like that I couldn't care less if they ever call me again. I also have no qualms about later soliciting their customer. I understand you have to wait 30, 60, 90 days to collect. Carriers have large upfront costs also. The payment is due every x day of the month. The mechanic wants his money immediately. The fuel wants the money immediately. The driver wants his money every Friday. All the while you complain when the industry standard of paying the carrier of 30 days is too much for you to cover? Come on, man.

    Just be fair with us. That is how you will find the good ones.
     
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