Best TMS For Startup Freight brokerage?

This is the kind of information people don't post publicly. The company I'm an agent for has a custom built TMS.

 

For the money, our experience is that you can't beat Ascend.
It has great customizable features and it expands as you grow.

 

Don't start in this business, it's too hard, they say.
No one will haul your loads with a new MC they said.
The industry doesn't need another broker they say.

Don't listen to any of these so called "veterans" and "experts" they are just afraid of the competition.
$1.6 million top line revenue in year one and if we listened to this forum we'd have never even started.

Wishing you great success Capital G

#### right, Let's go 2017!

 

Nobody is saying that you can't make a great living doing 1.6M in revenue as an individual broker. I am fairly certain that you would have made more money on a 60/40 deal where you had all your software, accounting, carrier services, and cash flow handled by someone else. You either would have done a lot more revenue, or you would have spent a lot less on support staff.

And let's be real... You're doing 3-5k a week in brokerage at most with that kind of revenue in your first year. If you pay your support staff 45k (and good luck finding someone who can do carrier services work AND accounting work really well for 45k) you've already given up 21% and you haven't paid for DAT/IT and your TMS yet. You don't have quickbooks yet. And you haven't paid your factoring company their 15-25% yet.

Think on this... if you did 4k a week this year (which at 1.6M is a 13% margin... really great for your first year!) you'd have kept just shy of 125k. Did you clear 125k this year?

 

I think you proved my point.

There are some holes in your numbers above and your pitch sounds like you're a recruiter for agents. I get those calls 3-4 times a week.

I didn't get in to work for someone on 60/40.
Year 1 is not what Year 3 will be.

 

I'm an agent. I don't pretend to be anything else. I'm curious what my holes are because (no offense) my sales are going to be 2-3x yours in 2017 and opening my own shop is always an option. This is just genuinely what my research showed when I decided to become an independent.

But you're basically saying that you would have made more money on 60/40 this year. Unfortunately the numbers I've got suggest that you need ~20M in revenue for it to truly start being worth the hassle to run your own brokerage. You break even on it at like 6-7M but it doesn't start being seriously worth doing until 20M.

Basically your position is 'yeah I'm doing more than twice as much work as boredsocial and yes he's making more money than I am, but in 2 years I'll be getting 100% of my money and he'll still be at 60%'. Technically that's true, but I'll still be making more money than you in 2 years because my sales will be higher because I will have spent my time brokering freight rather than chasing invoices and doing data entry on carrier packets. Additionally your business sucks down cash (which is why I know you're factored. Unless you literally have 400k in the bank that you have nothing better to do with than use for operating capital) and mine pays me every single week. I can use the cash my brokerage operation generates to hire more brokers without worrying about scaling the cash flow/accounting/carrier services part of my operation.

I've also got a first rate claims guy when I need him. I'm also not on the hook if one of my customers decides they aren't going to pay up. There are a lot of risk issues that are hard to quantify but are very favorable for the agent model.

If I'm wrong please tell me how so I can adjust my thinking. I'm not trying to be right on an anonymous internet forum. I want to learn stuff. Obviously the one big advantage of starting your own brokerage is that you can sell it much more easily than I can sell an agency. You'd probably get 2-300% of what I'd get if we both sold equal operations in the open market.

 

There's no right or wrong. Some people need the security benefits of a franchise to balance the feeling of risk when starting a business.
I prefer independent over the agent model. I can do all the back office for much lower cost than the 40%

 

Remember it's back office, finance, software, and claims support. That last one is pretty big those two to three times a year you need them.

I mean look if your background is accounting and you really do run a great back office organization... Then congratulations are in order. If you were rich before you decided to start the business you might even have the operating capital and need 0 backing. Or you're deluding yourself about what everything costs.

I'm going to assume that you're doing it all the right way and know exactly what you're doing. God speed.