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Why does my carrier do this ???

Discussion in 'Motor Carrier Questions - The Inside Scoop' started by chalupa, Nov 28, 2011.

  1. Nov 28, 2011 #1
    chalupa

    chalupa Road Train Member

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    Here's one I don't get:

    My carrier has a run and it's a core customer. Probably represents 20% of his business. Carrier has it priced cheap. ( likely to get the business ) None of the l/o guys want to haul it...too cheap, too far and too much static dealing with the customer....but it makes a good filler if we're slow. You just don't want a steady diet, you'll starve. ( slowly )

    Wouldn't take much to sweeten the pie. Say $75 more in my pocket per load but carrier won't do it....so rocket ahead to a ( holiday ) weekend and the customer calls....no one ( the drivers ) will answer the phone or they make an excuse not to go so...... Carrier calls competition to cover and pays full rate plus FSC !!! Why does he do this instead of sweetening pie and keeping cash in house??

    He would rather lose money than give us a rate increase ?
    :biggrin_2554:
     
    chalupa, Nov 28, 2011
    chalupa, Nov 28, 2011
    #1
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  3. Nov 28, 2011 #2
    RAGE 18

    RAGE 18 Road Train Member

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    Ouch man WTHell?? that is unfair and un-ethic no wonder you guys are pissed so are you guys getting less loads now or no?
     
    RAGE 18, Nov 28, 2011
    RAGE 18, Nov 28, 2011
    #2
  4. Nov 29, 2011 #3
    chalupa

    chalupa Road Train Member

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    And just like that... he lost the account. Seems that his precious "fall back" competitor couldn't muster enough power to cover the work either so the customer pulled the account.

    I find truck mgmt. interesting to say the least.... in their desperate quest to keep us away from a decent living they end up shooting themselves in the foot. Who really lost here? The drivers whom wouldn't pull it or the carrier that lost 20% of his core business?

    And they say we're stupid........
     
    chalupa, Nov 29, 2011
    chalupa, Nov 29, 2011
    #3
    Lonesome Thanks this.
  5. Nov 30, 2011 #4
    BretStep

    BretStep Light Load Member

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    There is probabaly very little room to give up any money to begin with. The owner might have priced it just a little over operating cost to guarantee the work. That is important when an owner has fixed expenses like truck payments and insurance.
     
    BretStep, Nov 30, 2011
    BretStep, Nov 30, 2011
    #4
  7. Nov 30, 2011 #5
    RAGE 18

    RAGE 18 Road Train Member

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    So both you guys and the competitor lost the account? so its up for grabs right now then...
     
    RAGE 18, Nov 30, 2011
    RAGE 18, Nov 30, 2011
    #5
  8. Nov 30, 2011 #6
    chalupa

    chalupa Road Train Member

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    I'll answer you both...... yes we lost the account and the competitor lost nothing, he was working for us.

    And no, the carrier has it priced to market and would have collected 35% of the billables had he made the run. What he should have done is lower his pct. he takes from us if there was no more room at the top for 30% of something is better than 35% of nothing.
     
    chalupa, Nov 30, 2011
    chalupa, Nov 30, 2011
    #6
  9. Dec 2, 2011 #7
    truckfam

    truckfam Medium Load Member

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    They don't see it the way you do.
    We've run into this issue. We don't haul cheap loads for our company.

    If they underbid and lack capacity, that's their money and mistake. They constantly tell us to negotiate a higher price with brokers.

    If it's less than $1.80 per mile, no go on our truck.
     
    truckfam, Dec 2, 2011
    truckfam, Dec 2, 2011
    #7
  10. Dec 2, 2011 #8
    wis bang

    wis bang Road Train Member

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    OP has a tough question but the carrier might look at it from a different angle. When I was at 'Clone School" for Matlack the VP of Sales told us how he had to plan for the growth the stockholders desired plus the amount of current sales that changed over to other carriers for any number of reasons, contracts expire, etc.

    One carrier used to work special percentage deals w/ lease operators on runs they serviced well in order to keep the work when the shipper is pushing for no rate increase -or- a rate decrease to match a competitor's pricing. He often reduced his take to 20% of a smaller pie to keep the lease operator from earning less.

    We still lost some of that work to the other carriers and would win it back because of our superior service which the cheaper guy could not supply. Everytime the work came back it was at the chopped rate.

    They sold the company to avoid going out of business...


    The OP's carrier made a decision to maintain his bottom line. To bad it was the wrong decision but it was his decision. He may find better freight to replace this stuff. Either way he won't be dying the death of 1000 cuts by trying to work a 'deal' with every lease opearator. It is hard to say if he is correct or not; staying in business is not easy right now.
     
    wis bang, Dec 2, 2011
    wis bang, Dec 2, 2011
    #8
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