BROKERLESS LOAD BOARD

A shipper has too much to do than worry about 100 guys calling that's why brokers are even around.

 

This is a retread of an idea that isn't going to change anything with rates.

 

U ship ...

 

OK so you're an O/O, so you do one truck, but the truth is this wouldn't work, the solicitation for this service would be too costly and be passed onto us.

By the way, if you are begging for more money, you are doing something wrong.

 

The customers who would buy this already have logistics departments who use DAT/IT/etc. You have a grossly overblown idea of what brokerage profit margins look like as well. They aren't as high as you think because freight brokerage is a very competitive business.

You're certainly right that the loads that have been 'stepped on' like 3 times are trash. The big corporate freight doesn't pay trash because of middle men though... It pays like trash because they know EXACTLY what it costs to run a truck and are only going to pay that+ 10% maybe. And they are assuming you pay the driver like .40 a mile at most.

 

The big corporate stuff isn't always trash... they do know what it costs to run a truck. They also know what a large empty mile % they would face if they could not find freight paying the same on the way home. It's sort of like .... say their cost is $2/mile for their own outbound product - are they turning around and driving home empty and repeating? Now their cost is $4/mile outbound and revenue home = 0. Many of them are not interested in the trucking world for this reason and not to even get started on the liability reasons. They know it is often most cost effective to pay somewhere between their $2 and $4 for example and not have to deal with the headaches of running a trucking company, even if they have the odd load they have to pay maybe even more than what the round trip rate would be. On very short local work it may be beneficial for a customer to use their own trucks - look at how Costco does it. They won't save any money and it would be a logistical nightmare to farm out all that work. Expensive any way you cut it. They keep complete control over the whole operation and it appears to run very smoothly. Why don't they haul the product they buy into their own distribution warehouses? All the reasons at the start of this essay.

Brokers aren't all bad - all they are really, are salesman. Find the good ones and drop the bad ones by the wayside. They do the same thing with carriers - vet the good ones and let the poor performers go to the bottom of the list. This is a capitalist country - if anyone feels the broker is taking too large a cut they are free to solicit the customer directly or perhaps pull the same load for another broker who offers more for the same load, or hey maybe even become the evil broker themselves... imagine that. Customers who have lots of freight can either pay someone in house to find their own trucks and schedule them and then follow up by cutting checks to multiple trucking companies for the variety of loads they have - or they can cut one check to a broker who will take care of all the scheduling. Either way there are costs that must be paid. Unless you find someone willing to do all that work for free..... and hopefully you don't find that special someone in the mirror ...

 

I have been a long time reader and finally decided to create an account.


The whole Brokers make 20 percent is 100 percent false sir. I can assure you now a days it is less than 10 percent.
Brokerage has become very compeittive and only way to get foot in the door is to take loads for dirt cheap.


Take TQL everyones favorite broker on here. They cold call a customer to meet sales goals. They offer 10 percent below market and end up moving a load just to claim "They landed a new account" .

I have a book of business of around 3 million in revenue a year and last 90 days my margin has been 7.6%. You can say I do not know my job well enough or you can say I am lieing. Either way I do not benefit from either.

 

This is what a successful freight broker looks like folks. At 60% (the going rate for established brokers) of gross he's grossing 136,800 a year. Not a bad living by any means, but also not INSANE money given what he does. I'm guessing he moves longer distance stuff from the high sales number and the low margin. Assuming his average load pays him 4500 dollars he had to move 666 loads last year to make that money. That's 2.66 loads per day and these loads take up 4+ days of driver time. He is brokering 12+ trucker days of work every day he comes to the office.

If he did it moving shorter haul commodity freight like steel/lumber/mulch then he moved TRIPLE the loads and works harder than I do. And he has my undying sympathy lol.