Rates per Mile

Rates tend to be lower in winter months due to over capacity and less freight. There are exceptions, but that is the norm in this business. Rates can be higher when you are running in snow and bad weather simply due to there being less who are willing to run in those conditions. Some will run south in winter and north in summer. We are still subject to economic and market conditions.

 

Rates usually go down a touch in the winter.

 

lol...from all the research I've done, I have come to the conclusion that carriers and O/O don't "charge" for their services - they accept whatever the brokers and/or customers are willing to bestow upon them in their gracious, overbearing mercy.

But it seems like the precious few who ARE willing to set their rate and stick to it, and walk away when they don't get their asking price, are the ones who know how to find those loads, get those rates, and know how to work the system to their advantage, I'm thinking of Rollin' Coal when I think of this type of owner. But even he can't control the market, and sometimes has to lower his expectations a tad to keep the revenue coming.

 

The major problem with this, driver, is there is always someone else out there willing to haul it for less. I understand what you're saying and agree, some can even do this but if you weren't smart when you were young you tend to accept it. Personally I have a set rate if the load doesn't pay it I don't take it, depending on the area.

 

I have a minimum haul rate, even if it is only across the street. There will usually be someone who is desperate or lacks business sense, who is willing to take a load for the first rate offered, whether the owner operator can make a profit or not. We are all subject to market conditions whether we like it or not. But, I agree that too many owner operators and carriers don't have a rate for which they will haul freight. They wait until the shipper or broker makes an offer and then they either jump on the rate or wait on something that pays more. Carriers and owner operators should set the rates. Unfortunately, they actually do. They set the rate when they take a load. When you go to a mechanic you don't tell him what you will pay him to work on your truck. When you call a plumber or electrician, you don't tell them what you will pay them to do work for you. In trucking, the opposite is true. Others set the rate for the carriers and owner operators. That is the real reason why rates are as low as they are today. Shippers set the rate for their products. Shippers also want to set the rate that they will pay a trucking company to haul their freight.

Perhaps the problem lays with the ones who own the trucks. So many enter this business with limited capital and resources where they cannot afford to sit, or so they think. Even when I had truck payments, I would still not haul for fuel money. I have never haul freight just to get me to a better area. As long as we have those in this industry who have no business expertise, limited or not capital, minimal experience and poor credit, we will have lower rates due to owners being willing to haul freight for whatever is offered. Business people understand that they provide a valued service. When you have a strong cash reserve you are more able to sit and wait on a good paying load or deadhead to a better area, rather than taking something cheap, just to move the truck.

 

The thing about supply and demand, though, is that it's supposed to come to equilibrium...the expensive carriers and the cheap ones, and everyone in between - I have been thinking about what G/MAN said about carriers setting the rates. I'm still not 100% sure he's right...seems like the price of everything else is the price the customer is willing to pay for it. But transportation is more complicated than putting your truck on the shelf, putting a price tag on it, and waiting for a customer. It seems so cut throat, volatile, markets can swing quickly, it's a fast paced, ever changing industry. Experts on the trucking industry claim that carriers should now be finding themselves in a good position to charge more for their services - but it's hard to do that when there is so much competition - and also, when you have a brokerage industry that is accustomed to charging more for their services than many claim they should be able to get away with.
And as far as I have read and researched, capacity has been up a good bit from this point last year...and that doesn't help things any for the carrier.

Knowledge about your industry is so important - every industry has experts that know their market inside and out, and know exactly what a good price to charge is at any given time. Mega carriers have access to this kind of info about the transport industry, too. Small carriers and owner ops do not have access to this - all they have is their own experience. Your average owner operator is not in a good position to know keep himself knowledgeable about all the different markets in the US for freight, from a day to day basis. Pricing efficiency is out the window. This is why rates can be so volatile. I think the best o/o are the ones who have been around so long that they know the industry inside and out, and/or the ones who stick to a smaller market and learn all they can about it - like I was saying, Rollin' Coal sticks to a specific area and tries to master that. That is why he can keep his rates up, because he knows where, when, why and how to get them.

I don't think most people know how to price themselves efficiently, based on not enough info, and thus the rates on average are lower than what they probably should be. And everyone has their own idea of "enough profit". For some, $1,000 a week is enough, for others, $2,000 a week may be a little low. Maybe if everyone made it a point to make as much profit as they possibly could, and learn how to do it, maybe rates will get better.

Anyway that's my long post of the night, I'm exhausted from outrunning that tornado in northeast OK.

 

you all make points, i think a lot of it has to do with wether your assertive or not, wether your the passive type or not, wether you are an O/O but still think like a company driver. As soon as you come to this side of the playing field, rather than working for anyone whoever you deal with works for YOU!. i think thats the thing a lot of new O/O's and O/O's without business sense are lacking. U got to put your foot down, build working lasting relationships, showcase your excellence, show and display that your truck is on-time everytime consistent and over exceeds safety, all these simple things that are not taught as a little company guy is what gets you ahead. you must sell your service over competitors wich is a simple thing to do if you can handle yourself and others professionaly, and of course have the experiences andf data to back it up. Should rates go up in the winter, hazdorus driving, etc, OF COURSE they should, but thats only in a perfect world. since this is clearly not a perfect world down here the least you can do is begin to put a 15% to 25% increase on rates given, really explain what that load and your truck is going to be going thru to arrive intact and safely to the agent, and if he/she isn't statsified one of two things will happen, he will be calling RIGHT back shortly once he sees no one will cover his load at your excellence, two he might find a cheep-e to go run it for him but you just saved possibly your life, your truck, extra maintence etc and live to fight another day.

 

If it's a rate that doesn't work for me, I just say thanks and move on. I really don't care what they are offering it for. My minimum or it doesn't go on my truck.

I am getting more and more brokers that I have hauled for agreeable rates for in the past, load boards just are an indicator for me. I still use them, just not as much.