Transitioning from Lease operator to my own authority... help needed

You you may want to post this question in the Intermodal section.

You will definitely have to apply for an scac code. Hopefully someone here knowledgeable about Intermodal will chime in.

But if you can't find the answers that you're looking for if it were me I would call the steamship line and ask them what is required for you to move a private customers Freight to them and what's required to move Freight from them to the customer. The incoming Freight comes through customs so I couldn't even imagine the paperwork or if there's any insurance requirement.

Sounds like it could be a good opportunity, but if it were me I would be prepared to completely walk away from them and run my authority in a different direction if needed. They could just be playing you for your naivete in trying to get a cheaper rate than what they have.

Also, if you get your Authority and you had some Freight with them and some Freight with other Brokers you spread your risk out. If You Haul for them everyday in and out and only for them and they decide not to pay you that could certainly put you under. Not to mention they know they have you completely by the you know whats.

Myself, I would be afraid of an all the eggs in one basket kind of scenario, so I would try to figure out how to spread the risk out.

I'm not saying this is what it is, but I've seen this very scenario play out over and over again with contractors. A builder will find someone that's working for one of the excavators working for him, and he'll tell that guy he likes him why doesn't he go in business he wants to do business with him. So the guy quits his job goes out and buys equipment goes to work solely for that particular Builder and next thing you know they are paying him at a rate that he can't survive but he doesn't know any better, and and then they're paying him very slowly getting him deeper in with them, and then eventually not paying him at all anymore and next thing you know all of his equipment gets sold off and now he's looking for a job to pay off all his debt. And the Builder got a whole lot of free work done.

Just something to think about.

I'd be curious to know what you need to due to haul that traits also.

Good luck.

 

I'd try to get a handle on how much those loads will be paying before doing anything. Getting your own authority will take a minimum 4-6 weeks, and any insurance you have now will basically be scrapped and you'll have to get some very expensive coverage for new authority. We're talking 15-30 grand a year expensive. On top of the added expenses, you'll need to have some bookkeeping skills, do all of your own filing for everything, and have some cash reserves in the bank to cover operating expenses for the first month or two.

 

Definitely find out the rates before you jump in. I just spent $700 for a years worth of liability I've not needed with my regular brokers to get my foot in the door with a local shipper only to find she's cut the rates she's offering me below what she offers her brokers.

I had a hat full of other brokers who require the same extra liability that I can now work with, so I'm not out anything other than a potential direct shipper with low rates who will have to get them up if she wants me to work with her.

Having your own authority is 100% better than running under someone else's. Hands down.

Do it

 

Ask the man who does it for a living.
Spend the $45 and join ooida.
I am not a big time life time fan of them. But when I had to make a similar major decision. There business service unit, has all the answers, paperwork, and even would do it all for me If I didn't want to do it myself.