For the folks that have their own authority....
 

How do you get the foot in the door with a customer?

Do you haul a load for a broker, in the meantime, slip the shipping manager your card?

What kind of "edge" do you try to sell them? I would have my cell on 24 hrs a day, is that really important?

What about stone cold sales calls? How well do those work?

Most brokers have language in their contracts which forbid carriers from back soliciting their customers. If you solicit them after hauling a load through their broker, and they find out, you could be liable for a percentage of anything you haul for them for about 1 year. It is difficult for a broker to collect or enforce this clause, but most have them. The better brokers don't bother since they know that as long as they provide a good service they can keep the account.

If the shipper asks for your business card or suggests doing business with you directly then you are not back soliciting, but it could create some problems in trying to prove it, but not impossible. If you want to develop your own shippers then you need to get out and start knocking on doors. You can make phone calls, send letters of introduction, business cards, brochures, etc., to get your name out there. You will likely need to make a lot of calls before you find a shipper who is willing to do business with you.

I have had a thought about a dispatch service where several carriers could pool together and service some of the larger accounts. It would provide the capacity the shipper wants without giving away the farm. Many shippers prefer doing business direct with carriers. The reason so many use brokers is that they can deliver the capacity to take care of the shipper's needs. Developing your own customer base takes time. Contrary to what some have stated, you can make a living using brokers. You can usually make more with your own shippers. You CANNOT make a living by taking cheap loads from either of them. Find brokers who have better rates and try to stick with them. Stay away from brokers who consistently have cheap freight. Find those who have good rates and start making sales calls as you can to develop your own shippers. You could try to locate those for outbound freight and use brokers to get you back to service your shipper. Eventually you can find shippers on both ends.

Yeah 90 days I think the agreement states I sign that I cant haul for the shipper after accepting a broker load....its ruff starting out and trying to get shippers direct, most dont trust you enough to give you a shot, but suprisingly will use the big carriers who routinly lose their freight on their yards :p

Everything G Man said.

SSay G-mam...isnt there a board right now like that?...I mean that pools some resources together?
Heard there was but forgot about it?

Pepe, I think you're thinking of this one. I don't think it's what GMAN is talking about though.

GMAN, you'd probably just be considered a (geez G I respect you a lot but I have to say the word)...................... Broker :shock: :shock:


:lol:

Maybe a little more explanation.

We did 40 loads for one shipper last year. I think I called the broker on the first load and the subsequent 39 loads the broker called me. Yes the broker is still involved because that's the way the shipper wants it, and I certainly do not mind because rates are good and they pay fast. The shipper often tells the broker to call us and pay more if necessary.

You need to be able to make things easy (save money) for your customer. Figure out how you can do that and you will get shippers. Most guys with one truck will only make things more difficult, so your only way to save them money is to be the low rate. You can be more competitive pulling for local shippers

Pepe, if you are talking about Realtime, rates are very low. I tried the service for one month and canceled. I can get better rates than they offer through a broker. Some shippers offer loads through them but the rates are very low, at least from what I saw.

RostyC, when I say dispatch service, it would not be brokering. Basically, a dispatch service would do the hunting and negotiating for you but represent the owner operator or carrier rather than the shipper. A broker works for the shipper. The broker usually makes more money when he gets a carrier to haul a load for the least amount of money. A dispatch service would make more money as the carrier earned more, at least if it was set up as a percentage of the rate. The dispatcher would watch the loadboards, make calls to brokers and shippers in an effort to find the best paying loads. The dispatch service would only work with those who had their own authority and insurance. It would be similar to leasing on to a carrier but you would be responsible for all insurance, logs and compliance issues. The dispatch service would only search and book loads for you. The other difference is that you would pay a much smaller percentage of the rate than if you leased to a carrier. Most carriers keep 25% of the line haul. But there is a lot of expense involved when you lease on owner operators. You see, when you lease to any carrier they are responsible for paying the cargo and liability insurance on each truck operating under their authority. They must also participate in a drug consortium, check logs, etc., It is expensive to lease on owner operators. When you look at all the expenses a carrier has, the percentage they take doesn't look so bad. By utilizing a dispatch service, you get rid of the most time consuming aspect of your operation, finding profitable loads. I spoke with one guy the other day who has a dispatch service and charges $250/week. According to him, his people do very well. I think a percentage is more fair. That way the carrier only pays when they book a load. If a carrier takes off a week under a flat rate system, he is still obligated to pay the dispatch service. A percentage is more equitable since you only pay for the service as it is rendered. If you take a week or two off then your expenses stop. With percentage, the higher paying the load the more everyone makes. There is more of an incentive for the dispatch service to find the better paying loads. If the carrier wants more services, then the percentage could go up accordingly. The carrier or owner operator still has the freedom to run when and where they want. They also decide whether they want to take a load or not. The dispatch service would work in behalf of the carrier or owner operator.

I bet I lose more than $250 per week because I sometimes take loads within my parameters (especially in low freight areas), without taking the time to search for better paying loads. I pull some of the same loads every week or two, just because there is some familiarity with the route, pickup and deliver.

My wife helps me with some of the calls, but she really can't negotiate the rate very well.

I would think a dispatch service would really need to be ex brokers, with contacts??? I think the dispatch pool is a great idea.

jonboy

I don't think one would need to be an ex broker to make it successful. Contacts would be good, but negotiating skills would be most helpful. I think it could work. I suppose that I just need to decide whether I want to pursue it or not. Looking for good loads takes a lot of time. It usually doesn't take much of an effort to throw something on the truck, but finding the best loads takes time. Most smaller carriers with whom I talk seem to spend most of their time finding good loads. They don't make money until they move freight.

I'm with you Gman your idea will be perfect for those of us who have been driving for many years, but have little experience in negotiating loads.

I will let you know if I decide to proceed with this idea, ISMAR132. Part of what I am considering is how to make the fees fair for both sides. A percentage would probably be most fair to both. That way there isn't anything to pay out if the owner isn't running. Also, it would be an incentive for the dispatcher to perform and get higher rates. Another consideration is how the owner would make payments to the dispatch service. I would not want to get into a long or high receivables situation with this type of service. I would prefer something that pays as we go. I think that it would be best to pay with each load. That way there would not be any billing costs. Payment would be due when the owner accepts the load. The method would need to be worked out.

You should pursue it GMAN, if there's not a lot of people doing it, or doing it successfully, then you don't have much competition. Percentage or flat rate per load is the way to go, business owners wouldn't think they have to pay for nothing. I know I'd be leery of a flat rate per week because there's no reason for them to perform well.

As far as payment you can bill to a credit card as you go. Like I do with EZ Pass or the service I just started to use to pick up jobs in my line of work.
I get an invoice through email and they pull it from the credit card I gave them.

The only hard part in starting anything is finding people to do the work as you want it done. I'm sure you know that though.

Just use the Paypal feature in Ebay and your all set.

I appreciate the input, RostyC and Steve. I don't know anything about the Paypal or how it works. I think that I will check it out. It would probably work out well to have credit or debit card capability. I need to check with my bank to see what is involved taking credit cards. I already have about everything in place that I need to get this started. A friend of mine suggested a graduating fee structure starting at around 4% and going up to about 6 or 7%. I think that might be a little confusing. I would think something around 5-10% as a flat rate would be easier and more workable. I have found that things work better when kept simple. The fee would not be that high for the operator and yet enough to warrant me spending the extra time to find good loads. Having more trucks would increase capacity and could make it easier to get a foot in the door to some shippers and possibly better rates. If the operator didn't want to run, then there would be no money to pay out. If I decide to do this, I don't think that I would want too many operators. This one guy I spoke with had 16 independents with whom he worked. He is doing well with them, but charges a flat rate per week. These people pay a fee whether they run or not. I received a call this week from another guy I know who has his authority. He is thinking about giving it up, sell his equipment and driving a truck for someone else. He is finding it difficult to find shippers and run the truck. He is just not getting the rates he needs to make a decent profit. I thought that since it is difficult for me to do a lot of traveling right now, this might be something to consider. Perhaps we could even offer a broader range of services at a later date, such as fuel taxes, etc., I am just not sure that I want to work that hard. :lol:

GMAN it is really hard for me to understand how I feel like I trust you so much, having never met you but I feel like I do. You are always very helpful and even when I disagree with you ( very seldom )I feel you are putting all the effort you have into helping people. That said, I am currently leased on to a small company and doing OK but have been playing with the idea of my own authority; if you do this I would like very much to be part of it. I currently run a 97 W900, 48X102 combo steel/alu spread.

You may have trouble getting a Mastercard or Visa account. They don't give them out too easily.

Paypal is a no brainer and once your setup the money goes right into your checking account. You don't charge a credit card. Your customer inputs their credit card with the amount of payment and it gets deposited into your account.

GMAN, I think you are the right person for a dispatch service. You are honest, forthright and straight forward. I think you should charge a minimum flat rate per load, say $35 minimum and then you take a percentage after that, so you will at least make $35 for each load you locate, dispatch, baby sit through delivery, but you let the carrier invoice and worry with collecting the invoice. I think a dispatch service is far better than a freight brokerage. We all know how everyone distrusts brokers. Good Luck.

I really appreciate your confidence, baileydale. Life would be pretty boring if we agreed all the time. I always try to be candid with people. Running your authority isn't all that difficult. Then most challenging part is finding good paying loads and the extra paperwork. I think the extra revenue is worth the effort. Some people are more comfortable leasing to a carrier. We all must find our comfort zone. It sounds like you have a good setup.


Thanks for the info, Steve. It sounds simple. I used to have something setup with American Express some years ago with another company that I owned. There are fewer people who have American Express and their fees are higher than Visa or Mastercard. I have an established corporation, so I don't think it will be too difficult to get it set up.


Thanks, LOAD IT. That is a good idea about the minimum charge. The dispatch service would work for the truck rather than the shipper or broker. I would make less with this type of service rather than leasing owner operators under my authority, but would not have the additional expense of insurance, compliance, billing, etc., I have been looking at both areas. There are a lot of up front expenses involved when you lease on an owner operators to your authority. I would probably need to either find some software to help track loads or write something simple that could be used such as in a spreadsheet. Actually, a spreadsheet might be just the thing.

I'll agree with using paypal as you can avoid the charges from the credit companies.

I agree with the pay pal as an option, I think you should look at both though.

Baby steps G, baby steps :D

Hello Steve

I've ben following this thread and I have Paypal for my e-bay purchases but have never used it to get paid for anything ?? How do you get the money out of your account ?? Do they issue you a debit card or some0thing ???

The best way is to give your checking account number,bank name and routing number to Paypal, It's somewhat of a lengthy process. Once your setup anyone can make a deposit into your Paypal account which is separate from your checking account. You can leave the money in there or use that account to buy other stuff or you can just click on the whole amount and say deposit to my checking account. It's really easy and works great.

They also have a debit card that you can apply for and many other options. There is a fee for transactions but it's far less then the Mastercard and Visa fee's.

Thank you Steve.

What are you dong up at this time of the morning back there ??? It must be about 3 am central time ???

Yup, it's 3am. My normal schedule. I get up around 1 then I'm on the road around 2 or 3. Stop around 8 or 9 for a nap then drive until 3pm.

I'm at home right now but not easy to break your routine. I'm heading out for Nebraska this afternoon. Already loaded up on Monday then came home for Thanksgiving.

Sounds GREAT I'm glad to see that you are doing well at this and that you were home for the Holiday. I'LL be joining you next year getting back into all of this. I'm going to Atlanta right after Christmas day (next month) to take My Pete down there for the OUT OF FRAME on the motor at Southern Truck Parts . It's just down the street from the old TA there on ex 39 I believe. THey ae giveing me the best price and warrantee on this and willing to set the motor my way as far as horse-power goes. Don't much like the idea of leaveing my truck there and comeing back to Iraq but it's the only way to get it done so it will be ready when I come home ..

Have a SAFE TRIP !!!

I plan on taking it one step at a time, Rosty. I am not sure that I want to get into the fuel taxes, etc., If I do all of that, I may as well just start leasing on owner operators to my authority. I figure that if I do decide to proceed with this that I will try the dispatching first. I am not sure that I want to get into anything else. I still have details to work out on the method of payment. I could always take Comcheck, TCH or T-Check. :D

There is a fee for getting your money out of Paypal,not sure of the percentage,but I think it's like 1-2%?.There is no fee however for paying someone on Paypal.I use it alot for Ebay purchases and have sold stuff on there and gotten paid thru Paypal.

Here is a transaction that I had where I recieved funds for payment thru Paypal and had the funds deposited into my bank account,looks like 2.9% charge

"eBay Payment Received" "Completed"
$505.00" "-14.95" "490.05" "Withdraw Funds to a Bank Account"

It sounds like the paypal charges are comparable to the bank cards. I spoke with my bank today. They are supposed to have someone call me next week. According to my bank it is fairly simple to set up. I need to find out more before making a decision. Most people have a credit or debit card. I am not sure how many have a paypal account.

Doing business via credit or debit card gives a more professional appearance. You have a good banking relationship, seems like the way to go.

GMAN your service sounds fantastic. Would you bill the brokers/shippers direct? How would that work?

What kind of % are we talking here? Very interested.

GMAN, how do think the shippers you approach will like the idea of more truck companies sending them invoices?
On one hand you could offer them more trucks which would benefit the truck owners, but that could be more paperwork for the shipper depending on how they handle there vendors. They might frown on that, I dunno.

I thought of that today so I figured I'd throw it at ya. 8)

I also agree the credit card or debit card would look more professional, but if you're only dealing with a small number of trucks that could be moot if you know them already.

Allan, I am still in the looking and investigating stages at this point. I have been encouraged to start a dispatch service working with those who have their authority. I would be working in their behalf. I would search for loads and negotiate to get the best rates for them. It would be the owner operator running their authority who would pay the fee. I have had this suggested to me by a couple of people whom I have known for a while who are also in the business. One in particular. He suggested that I consider starting a dispatch service catering to those who have one or two trucks and find it difficult to find the better paying loads. It doesn't take much effort to throw a load on the truck, but does take some effort to find the better paying loads. It takes time to locate good paying loads. Since is difficult for me to drive much right now, it would be a good way to earn some revenue while doing what I would be doing for my own trucks anyway. The difference is that I would be doing it for others. They would still operate under their own authority, pay their own insurance, etc., The only thing I would do is search for decent paying loads. One guy whom I have spoken dispatches about 16 trucks in addition to taking care of his own trucks. He charges a flat fee each week. My idea is a bit different than any that I have seen. I would prefer something which paid a percentage of the load. I think that would be more fair to both me and the truck or owner. If the owner took a week off then he would not incur any expenses for dispatch. He would pay for my services once the load was booked. My fee could be put on a credit card, comcheck, etc., I would handle the paperwork for the load to book it and forward the confirmation to the carrier or owner. The owner would still do his own billing, collections, etc., All I would do is take care of the most time consuming aspect of his business. While he is running I would be finding loads. The fee would need to be cost fair to both of us. Since the owner would still pay his own insurance and other expenses, I was thinking about a fee of somewhere between 5-10% of the rate. My friend suggested a sliding scale based upon the rate. I think that might be somewhat confusing. I think the flat percentage rate would be easier and less confusing. It is much less expensive to pay for a dispatch service than put someone on salary. The carrier or owner would handle all of his own money. All checks would be sent to him. Getting involved in the billing, fuel taxes, etc., is not something that I am thinking about at this time, but might be a consideration at some point in the future. Right now I am only looking at dispatching. If I were to get involved in the other services it would be more like having owner operators leased under my authority. I could not afford to put people under my authority for that amount of money. There are simply too many expenses involved, mostly for compliance and insurance.

I haven't decided that I am going forward with this idea. I still need to work some details out about payment, a fair percentage and whether there would be a sufficient amount of revenue produced to warrant the extra time. I would also need to find out whether this is a service which would be wanted by those with their authority. I would also not want too many people with whom to work. I would want to limit the number of carriers or owners that I would work.

That is a good point about the billing, Rosty. I did have a thought about a central billing program. It would probably be better if each carrier did their own billing. I don't think that billing will be a problem. I would be representing several carriers when I speak with a shipper or broker. There are some brokers who have decent paying loads. Part of the service would be to negotiate better rates for the carrier, regardless of whether I am dealing with a broker or shipper. In talking with shippers they seem to want to work with brokers mainly due to the capacity the broker can produce. They really don't like dealing with brokers. A broker can find 10 trucks whereas a single truck carrier could only provide one and not consistently. A shipper must have assured capacity or his business suffers. By having several smaller carriers running similar or the same lanes, the shipper could be assured of a certain level of capacity. I am not saying that I would only work with shippers. In fact, I would probably need to work with brokers, at least until I could be assured of the capacity and reliability of a particular carrier. It would be my reputation on the line as well as the carrier. I want to make sure that those with whom I associate will follow through. Most shippers are not as concerned about the number of carriers as they are of the capacity. They would essentially still be dealing with one person, as they would with a broker. They would only be mailing a check to different names and addresses.

As far as using credit or debit cards are concerned, those would be used as a matter of convenience. Most people have a credit or debit card. Everything could be handled by computer without having to leave the office. When the owner books the load, I send him the rate confirmation and he gives me his credit card or other payment information. The entire transaction is complete in minutes. A comcheck or similar method of payment could be handled almost as quickly as a credit card.

I would want to approach this slowly and not take on too many new people at the same time. It could also be set up where there would be no long term agreements. Either party could walk away at any time.

I think 5-10% would be worth it.

Just having someone else on the phone could more then make up for it. I'm sure brokers can tell when you're a single truck operation.

10%? :shock: That is over 10k a year. Most dispatch services charge 2-3% depending on the rate. The last two dispatch services I have tried to use were a big JOKE. They were a lot more clueless than me and found and supposedly negotiated loads for LESS than what I found myself. :lol: I would gladly pay Mike to dispatch me :lol: However,I wouldn't want to give a big chunk of my percentage upfront until I see how he works. A good dispatch service should be able to book loads at least a day or two ahead of time and be prebooking outbound loads with higher rates than what the owner can negotiate or find. Since Mike pulls a step I don't know how well he will be able to find reefer loads. :lol: None-the-less I think it will be a great idea or better yet take it one step further: Start a brokerage. 8)

Its a good idea but you need a steady flow of newcomers

Once the fishing guide shows you where the fish are......you don't need him anymore

Some would want to continue to use G-man even after they had discovered new, good paying freight for the convenience of freeing up their time to drive.

Allan, you think that 5-10% would be a reasonable rate? That is pretty much what I was thinking.

DD60, you think that 5-10% would be too high? However, you also state that most dispatch services charge 2-3% but are a joke. You pretty much get what you pay for in this business. I don't see how it would be worth my time for 2-3%. It just takes too much time to locate, negotiate rates and book loads. There are a lot of loads available and takes time to search out those with the best rates and going to areas where you want to go. I am not sure it would be worth it for less than 5-10%. Besides, if you could save time it would be worth paying someone to do the grunt work. A truck doesn't make money until it moves. If I am driving and looking for loads, I can spend at least 1/2 a day or more just looking for a good load. I try to plan ahead, but it is hard to make a lot of phone calls, check loads and negotiate the best rates while driving down the highway. It is usually best to park the truck, check the computer and make calls while sitting somewhere. I prefer to book my own loads in advance, but some of my best rates have come with short notice. If I had not been able to take the call, I would have lost the load.

A good thing about the service is that it is open ended. You can book one load and if not satisfied then you can walk away. The only way I would want to do it is to have payment at the time of completion of booking the load. Unfortunately, many owner operators don't pay their bills in a timely fashion. I think it is mainly due to not getting home as often as they need. Once the load has been booked, my job as a dispatcher would be complete other than a possible follow through to make sure everything went as agreed. It would require additional time and paperwork for me to get into a monthly billing cycle. I think a pay as you go is much more appealing. If you try it and don't like it then you can always go back to the way you were doing things.

It takes a while to learn how each of us works. I would need to get to know each person, where they like to run and their minimum rate that they want to haul. I would then work on loads that paid above that rate. The higher the rate over your minimum would be good for everyone. We are in for some difficult times. Some of the better paying loads will not stay around long. Sometimes it is a matter of being available or in the right place at the right time. I don't think this is a service for everyone. If you enjoy looking for loads yourself, then it may not be for you. The fee would be deductible as a business expense. If it saves you 1/2 day per week looking for loads, then it may be worth it. I think the average small carrier or owner spends more than 1/2 day looking for good loads. I have been thinking about getting my broker authority for a few years. That may be something to think about later. It would be a different relationship. A dispatcher works for the carrier. A broker works for the shipper.



I am not really worried about a carrier finding out where I find loads. It is difficult to find a single source who can keep you moving. Besides, there is still the negotiating part. For instance, I have one broker whom I have hauled loads for $3/mile who has called me with loads which pay less than $1.50/mile. I won't book loads for my own trucks for less than a certain figure. If you use a cell phone, you can use up a lot of your minutes talking to brokers about cheap loads. My personal experience is that each load must be negotiated. I think that if I do a good job that it would be worth it to the carrier to keep the relationship. There is a certain amount of attrition with any business. Some will go out of business. Some may get tired of the paperwork and decide to lease to a carrier and others my sell everything and become a company driver. There will always be those who look at paying a dispatch service $10,000 rather than looking at the $100,000+ they are making. They worry about the money they pay the dispatch service rather than the extra $20,000 they made due to the efforts of the dispatch service. This is not a service for everyone. I think the service could more than pay for itself.

Mike,2-3% would be the amount starting out. Notice that I said 10% was too high. Than again it depends on how the dispatch service keeps my truck moving and at what rate to make above and beyond the dispatching fees. Dispatch-for-hire in Atlanta charges 500.00 a month which amounts to about 6%. They are a BIG joke. After the first 2 weeks and some phone calls I decided not to use them.