So called owner/operators

The hard part about just bidding a higher rate, we as carriers used to have the upper hand and our dedication mattered. Today, there is an abundance of cheap capacity, and with all the middle men bidding on what previously was a local or regional contract all but the largest carriers have lost any negotiating power we once had. 24 years ago when I started as a company driver we were on a cost plus account and life was good, then it went tier and zone which was not bad, now I am lucky as a carrier to get a decent zone rate and have to hope there are not too many large units to move during that contract period. Further, we don't get fuel surcharges in the car haul market so I have to bid on a specific geographic area for 1 to 3 years at a time with no adjustments for volume increases or decreases or fuel fluctuation and still somehow predict my available capacity to be sure I can service the contract. I wish my rates changed weekly or even monthly, my current bid lasts another 9 months and was for up to 13,000 unspecified vehicles in a paticular geographic area.

Prior to the dillution of the client pool by Autogistics, Ready, Cars Arrive, Toll, etc I could negotiate flexibility into my contract for my region, now it is take it or leave it, they bid the northeast the same as the midwest leaving me to figure out how to make it work. They also closely monitor on time performance and damage claims and always have a larger carrier ready to step in and replace us.

When Manheim rolled out Ready one good sized carrier (50 trucks) stood up for themselves and said not on these terms or at these rates and they were literally replaced over the weekend. There is no standing up to the clients anymore, this contractor stood up on a Friday, Monday morning United Road had 30 trucks servicing the area until RAT found a few new, smaller carriers to split up his previous work.

 

Ok but the carrier that stood their ground. Are they no longer in business? Did all their drivers leave? Me personally if I was gonna lease on with a carrier I'd rather sign on with an owner that's gonna stand their ground and give me fair compensation over the carrier that is gonna cut the rate and still take a large percentage . Sure I might only have enough cars to run 3 days outta 5 but I'll happily work 3 profitable days over scraping by on a 5 day work week.

 

They are still in business, had major layoffs, and are now serving a different territory. It was rough for them for a while. I like that they stood up to the customer, but not all of us can survive if the customer drops us. This one customer was about 40% of their work, big risk.

As for taking a large percentage, I take 15%, and it is a true 15%, all my rates and contracts are open for inspection, and if I take a brokered load the contractor or driver gets a copy of the rate confirmation so they know what it really pays. Contractors are not forced to accept brokered loads, I use them as filler if they are looking for extra work or to keep the company trucks occupied during the slow times. My company drivers are paid either a flat salary or 25%, their choice when they hire on. The 15% I retain from the contractor really only covers my risk for having them run under my insurance and numbers with a little left over for me, remember the carrier is ultimately responsible for the owner operator when you mess up. We eat the damage claim, the hits on our safety rating, even could face negligent hiring in court if you killed someone, so in the big picture 15% isn't much for that risk. Not to mention, the contractor gets paid every Wednesday but I am waiting net 45-60 days for my money, so I am paying you in 7 days or less while I may not see that money for 2 months, if at all. I have been stiffed for upwards of $10,000 more than once, but paid out every cent owed to my contractors. That is hard to do, but it is the right thing to do.

 

Skinny,
If you are servicing a customer out of Benicia or any railhead, you have to move what gets unloaded off the rail every day. The haulaway carrier is obligated to move X amount off the ground so there is enough room for the next train. Trains unload 7 days per week. Back up rail and it's out the door for the carrier. You cannot pick and choose what you move. Welcome to new vehicle haulaway. That's just the way it is. Back in the Hadley days, Benicia to Reno was primo work that the senior drivers grabbed.

 

Well depending on how freight is coming back to CA I can understand where he's coming from. I wouldn't jump on that load unless I could get at least an ok load back. That is one of the hardest roads in the country right? Still though if he doesn't like it then he needs to get his own authority so he can make that call lol

 

The rate is based on being loaded one way. Unless they get rental buy backs out of Reno Airport, there is no traffic back to Benicia out of Reno. That is the new car haulaway business.

 

You're kinda right. I have 2 units and i run one full time. I've learned from the elders that it doesn't always make sense to have the wheels turning just to have them turning. Im sitting at home now because its cheaper fo me to pay my guy hourly to slip plate and grease the trucks than to have him burning fuel and tires this week .
That guy you spoke of is a child if he expected a hand out from your carrier. No doubts about that.

And Brian.. sounds like you run a stand up operation wish you many more years of good luck we need more contract holders like this.
Just an FYI up here in Canada the trend is fly by night companies bidding super low on lanes and then selling the whole company using the held contracts as bait. Guess who's left holding the bag ..

 

$3.42 a running mile....
It would be a close one for me to take. 1-2 backhauls would make that a bit better tasting

 

Understood. However, as I said before, backhaul traffic out of Reno is sporadic if at all these days.
Out of El Mirage, AZ I cut a deal with all the rental companies in Tucson for buyback traffic right back to our yard in El Mirage. It was gravy, but you could not depend on it.