Carrier Sales: Stop Losing Money On Loads | Episode 340

Margins don’t randomly drop to 3% - it usually comes from poor carrier sourcing, weak vetting, and sloppy execution. Tighten your carrier sales process, use real market data, and guide shippers with clear options to protect both margin and service.

At the end of the day, pay for the right carrier, manage risk proactively, and avoid cutting corners that turn small issues into expensive problems.

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Transcript

Where Margin Gets Lost

SPEAKER_00 0:19

All right, carrier sales and even customer sales. We just wrapped up a really good episode. I hope you guys give it a listen all the way to the end. Today we're breaking down more so of where can you find margin and avoid losing money when you're actually selling these loads. So if you're a if you work for a Chicago model brokerage where they separate the uh account rep that deals with the customer from the carrier sales rep that finds the capacity and deals with the with the trucks, um, we break down specifically things that you can do. And even if you if you're a cradle to grave and you just you wear both of those hats, it's really important on all the different things that you can do to get the right truck in the right place at the right price for your customer to service them and and make sure that you're not leaving money on the table. So we we share some stories about things that work well versus the opposite of things that are done terribly and result in 3% margin. So, Ben, what were your thoughts on this one?

SPEAKER_01 1:17

Yeah, I think it's a really good episode. We covered a lot. I think this is one of the least focused on areas of improvement for brokerages or even just a broker with a book of business. Whether you're a cradle to the grave by yourself, or you've got a team, or you're hiring a team, or you work at a big company. Like to me, this is one of the most effective and least looked at areas to improve everything you do. Because it improves the margins, the carriers want to do more business with you, you get better fits for better loads, customer gets better service, better pricing. Everybody wins when you do the stuff we discussed just a little bit better every day.

Seven Years Of Freight Lessons

SPEAKER_00 1:55

Yeah, there's two ways to improve your margin in freight brokerage, and that is to either get more money from your customer or to pay less money to a carrier. And we kind of talk both sides of that in this episode, a little bit more on the carrier side, but we do um we do kind of break down the customer side as well. So make sure give it a listen all the way to the end. Let us know what you think in the comments, and let's hop into this one. Welcome back for another episode of the Freight 360 podcast. Ben, we're up to 340. Um, I uh it's crazy to think back at how long we've been doing this. And I was reading some of our YouTube comments and got a bit of a chuckle. The the one guy was like, I came back after a while and Ben looks like a caveman or something like that.

SPEAKER_01 2:38

And uh this morning, I was laughing.

SPEAKER_00 2:40

Yeah, it's funny. I I think back to like I'll see clips from like four or five years ago, and you know, I'd lived in a different house, and um just some of the stuff we were talking about with different like news going on that's you know very different now. So come a long way.

SPEAKER_01 2:58

That is one of the cool things too, because like recently I'm I'm one of our clients, I'm like training the whole company, right? And it's a lot of different stuff. So like I'll run a training and I'm like, oh, wait a minute. I'm like, you and I did a video on that, or like I'm like, oh, like you did an eight-minute video, or I'm like, I've got content, and I'm like, hey, like this is super helpful because I'm like, you know, when there's a lot of people, like I might see a group like every other week or sometimes once a week, and I'm like, I'm like, there are like 10 videos that explain what I just explained to you in 10 different ways that would be like super helpful for you to like review to learn faster. And I'm like, they're also fairly entertaining for teaching logistics. So I'm like, that's probably pretty good. But it was what I noticed was what you just said. I'm like, oh, I'm like, I've lived in like three or four different places since we started this channel, and I'm like, it also makes me feel really old because I'm like, I look way older than I knew in that video. Like, it's kind of like nostalgic in a sense, because I'm like, yeah, like we've been doing it for seven years now, I think.

unknown 4:02

Yeah.

SPEAKER_01 4:02

Six or seven around.

SPEAKER_00 4:04

Seventh year, yeah. Yeah, so time flies, man. Well, if you're brand new, that just tells you how much other content is out there. So check it out. There is a wealth of knowledge available across the website and the YouTube channel, uh, blogs, full-length podcasts just like this. There's the shorter videos. We'd spent probably two years pumping out a bunch of shorter content.

SPEAKER_01 4:24

Uh way more than two years. We did that for like four years, where you and I did one every single week. So there has to be a few hundred topical videos on everything we discuss on the podcast full length.

Playoffs Talk And Draft Notes

SPEAKER_00 4:39

Yep. Share us with your friends, leave us a comment. We do take listener questions from typically like the Facebook group, the YouTube channel, um, et cetera. Um, and you got the Frey Broker basics course that's on our website as well. So check that out. Um, this episode is brought to you by Send TMS. So if you are looking for a TMS, it's a great option, especially if you're small to medium-sized brokerage. You get all the the tools and the tech that you need without the price tag of a McLeod or something along those lines. So give a send a uh uh check there or checkout there. You do uh get 90 days for free, no card needed, but you have to have a referral code. We do have one down linked in the comments, so check that out. All right. Um sports. Well, it's uh unusual for me to be a hockey fan, but I've been really tuned into the NHL playoffs since the Buffalo Sabres have uh have been um making a a push into the playoffs here. They they lost last night, um, game five. They're up three games to two, so they'll be playing again Friday night, the day that this episode drops um against the Boston Bruins.

SPEAKER_01 5:52

But you got your uh Penguins, Penguins pulling into game six, down three, two right now, but they're making it a series.

SPEAKER_00 6:00

Yeah, it's good because you get some of those, like it doesn't matter if it's uh basketball or hockey, whenever or even baseball. Like when you get some of these best of seven series and they're over in four, you're like, okay, none of those games are even entertaining because one team clearly dominated. So there were two series that ended 4-0, and um, but yeah, this is you know, this is good. This is this is fun stuff. It's um I got a brand new Sabres flag flying outside my house to replace my Bills flag that was up there. Um but the NFL draft was last week, too. So you got like, dude, your Steelers got that. I can't remember his name. The dude's huge, though.

SPEAKER_01 6:38

He's like, well, I mean, I guess everyone guy who's been playing football for three years, right?

SPEAKER_00 6:43

The guy that you're receiver, your pick. I gotta look this up now.

SPEAKER_01 6:46

The one guy they were talking about.

SPEAKER_00 6:48

I remember I texted you, it was just nuts.

SPEAKER_01 6:51

Yeah, there's somebody else. I think we picked up a receiver that has been playing football for like three years. Oh, really? The second pick. They were talking about it. I can't remember his name though.

SPEAKER_00 7:00

Yeah, so you got an offensive tackle. This dude's 321 pounds. I don't even know how to say his last name, but Max. Max, I he I don't know, he played at Arizona State. I'm not like huge on like draft prospects. I really like some guys are like they follow them all throughout college. I don't, so I can't really speak to it. I watch a little bit of college football, but um, I love seeing these guys develop in their first couple years. The uh the Bills, like we went to the draft party on Thursday night, is like basically they I think I was talking about last week on the show, like they they've the practice facility, like they put TVs up, and uh the new coach Joe Brady came out and talked a little bit, and then there was a Sabres game simultaneously, so they put the Sabres game on. Um, and we stayed there for a little bit, and we knew like the Bills were drafting late, I think like 25th or 6th or something like that. And then we go home and the Bills traded back not once, not twice, but three times, and once again made no first round picks and didn't draft anybody until the uh second round. But ended up getting um TJ Parker, uh edge rusher out of Clemson, and then we we got some pretty decent uh um defensive players to kind of fill the Swiss cheese run defense that we've got. But I think the big the big story was um I can't remember his name, but I think it's Vanderbilt's quarterback was like a Heisman trophy runner-up and didn't get drafted.

SPEAKER_01 8:34

I thought he was on Indy, I thought he played for Indiana, but didn't get picked up at all.

Privacy Lawsuit And Tracking Reality

SPEAKER_00 8:38

I saw no no Indiana in the Indiana quarterback, Fernando Mendoza went first overall. Um I think it was the Vanderbilt quarterback, but that's what they were talking about like all over the news. Like he was literally in the running for the Heisman trophy and didn't get drafted. It's kind of like last year, like Shador Sanders eventually went later to Cleveland, I think in like the fifth round or something like that. I can't remember, but he threw his own like draft party and was like hoping to get drafted in the first round and didn't. So yeah, and then got prank called, which is also pretty funny. Oh man, that's funny. Um yeah, so we're uh you know, we're we're coming up on summertime here, so get ready for all your mini camps and all the good stuff for the upcoming football season. But um was there any golf? I'm sure there was, but anything notable? Maybe I don't see. All right. Well, news. Um we had this is interesting. I was just talking talking to you about this before we hit record, but I was pulling listener QA this morning and I saw someone posted in our Facebook group. This lady is filing a lawsuit in federal court against and I briefly read it. I didn't go too in detail, so I might be missing a lot of context, but she's trying to trying to go after truck stop, RMIS, I think DAT was on there too, highway, TQL, Care 411, Gen Logs Motive, and others. Basically, the whole thing as uh as a I think as a motor carrier, she's basically saying that like all of the technology that's out there now for vetting and tracking is an invasion of privacy, and it's gonna lead to like human trafficking and money laundering and all this stuff. And I was thinking about it, and I was like, yeah, like a lot of stuff has advanced over time. I was like, but that's not just the trucking industry. Like, how many times a day do you get like a spam phone call, and then you know, over time your cell phone provider starts to like auto-block that stuff, or your iPhone or whatever phone you use starts to say like potential spam, things like that. Like, your data's out there. Like, there's been data leaks, there's cameras everywhere, and um I don't know. I think just like with the trucking industry, because of the risks that are out there, the industry has evolved in you know into a place where if we're not doing business face to face, and we're not, as brokers and and motor carriers, uh, technology, and I think that's where a lot of this stuff has come from.

SPEAKER_01 11:16

That's also true, but also like it's it's a business, not a person, right? And there's different privacy rights for like a business, right? Like, how why would you want to hide a business? Uh would be like the first question. Like, I there's not even the same privacy, uh I don't even know how you would say it, standards, laws, regulations for a person versus a legal entity. And the second is like it is a commercial vehicle that is on the public roadways that is regulated for safety by the government. And it's like I I don't because I know like gen logs in those companies, like they obscure, like you cannot see the images of the persons in the truck driving it, but you can see the vehicle. And I also know that like they absolutely do not capture data for just regular vehicles. If it's not a commercially licensed vehicle, that data is not captured at all for the same reasons because like one is a business, is licensed and regulated by the government for safety, among other things, and the other is just you or me driving down the road. And there's very different standards for those things.

SPEAKER_00 12:31

Yeah. I saw a podcast recently too. It was like a I think it was like an ex-CIA guy, and he was like, you know, people often can get confused about privacy. Like, nowhere in our constitution or bill of rights are you granted the right to privacy. To hide. Yeah, like it's not it's nowhere. Um, but it's interesting because like, you know, you think back to like post-9-11 and people there's the I can't even remember what it was called.

SPEAKER_01 13:03

Freedom, the Freedom Act? Freedom of Information Act? No, that's FOIA, where you can get information from the government, but basically when they passed that phone lines and all that stuff.

SPEAKER_00 13:13

Like all of it.

SPEAKER_01 13:13

Like so everything you do is absolutely being read and processed by some government agency at some level all of the time. And the other thing is like I always think back to like there's a saying that came up decades ago was like, if you aren't paying for something, you're the product. So when you signed up for Facebook 20 years ago, and all of their service agreements in that legal agreement is the ability and authorization for them to take every piece of information they can garner from you when using that and on your phone to sell to other people so that they can remarket things to you. Like you are the thing they're selling to advertisers. Yeah. And every time you download one of those apps, like there was an interview with the guys, it's probably CIA guys was interviewed that was like if you have ever downloaded TikTok on your phone at any point in time, even if you've deleted it, China has everything you've ever done on your phone, basically. Like all of it, anything you've ever done, even if it didn't have authorization to other aspects of your phone. So again, yes, but also everybody like there's literally an industry of data brokers that are selling all of this back and forth to different entities.

How A Reefer Load Got Stolen

SPEAKER_00 14:20

And like the tracking thing's legitimate, like this is high value stuff. We actually like there's theft out there. We had a load stone this week, or presumptively had a load stone this week. Um, and what's crazy, and we're we haven't gotten to the bottom of it yet, but like a carrier was vetted and booked, was sent a rate confirmation using multi-factor authentication, which means go they have to have their email verified and get a phone, a code texted to their phone, and then the load gets picked up, and there was an ELD issue where where the mistake happened is there was an issue with the ELD connection in um highway, so the broker just decided to go with cell phone tracking and not get any pictures, and then he like didn't get any updates, and he calls the carrier's FMCSA number, and they're like, We got our email hacked, that's not us. You you got scammed, and then we're like look, but like we had like good, clean tracking. Um cross country from like Jersey to California, and like the driver went all the way to like the delivery location, and then like the uh we thought, oh, maybe it was just double brokered and you know they were running late, and the the original carrier we booked was just like we have nothing to do with it, we got hacked. Um, and then it would actually still deliver on time. Um, but then like the tracking cut out right when they got towards the delivery, and um we got like security footage at the pickup of like who got loaded and it was someone impersonating the carrier that we thought we booked. So like they the carrier that there was a lot of the the broker made a lot of mistakes. Like the carrier that he booked had all flatbeds and it was a reefer load.

SPEAKER_01 16:14

What got stolen?

SPEAKER_00 16:15

Frozen seafood. Luckily, we had insurance on it that covers theft, but it's still like it's a headache and it causes customer relationship issues. But you think about all that and it still got stolen. This is why we do these kinds of things. Like the security footage, like you you're worried about us tracking um where you're at. The it was amazing the level of detail that we were able to see on this driver and the truck, and like I'm I don't doubt that something will come out of it because they have like the driver, his driver's license, they have like all the video of him and the pictures of his truck and literally everything on camera.

Killing Post And Pray Coverage

SPEAKER_01 17:53

So here's the new one, too. The new one that is coming up more frequently is so a truck driver that was working for a company that was stealing freight in your instances, right? Yep. What they're doing now, since some of the tracking and fraud prevention is getting better, is that driver will get a job at a legitimate above-the-board carrier, work there for a month until they have a load that is going to be worth stealing. Then that driver working for a company that has nothing to do with fraud, theft, or anything underhanded, will coordinate with another thief to meet them somewhere on the way to delivery, will transload it or trailer interchange, give them the trailer to a thief who will take that trailer, the driver keeps going, then the driver reports the theft and goes, I don't know what happened, I was at a truck stop, and now I have someone else's trailer. Then he gets fired because he doesn't follow the protocol of the legitimate company, but the driver doesn't care because that was the whole point of taking the job for a couple weeks, then goes and works somewhere else and does that again. Yeah. Because our heather employment records aren't great either, and that's now the way they're using to just outright steal things.

SPEAKER_00 19:14

Yeah, that's pretty crazy, man. Pretty crazy stuff.

SPEAKER_01 19:18

Yeah. So speaking of carriers, if you want to jump into carrier sales and strategies, yeah.

SPEAKER_00 19:24

So the reason we were talking about like, hey, what should we talk about today? And carrier sales, this is a great point. And it kind of like leads back to like what I just said, like a broker that you know failed to do a couple of things. Even if like they did, you know, every other load perfect, you make one mistake, one vulnerability, it's the theft, right? And that that that can happen. But I see a lot of people that and oftentimes it stems from like how just how they were trained or lack thereof training, is they their customer has a load. What's that?

SPEAKER_01 19:58

Post and pray.

Good Cheap Fast Pick Two

SPEAKER_00 19:59

Yeah, exactly. That's exactly what it is. They they just post a load and they pray that like somebody calls. And like that's literally we always called it that was post and pray. And they're just like someone calls and they get so excited that oh my gosh, someone wants to haul my load, and they just book the first available guy, and the rate's like terrible. Like, I got a I got a guy right now that just started with us, and I had to have a conversation with him last week, and I was like, I was like, dude, I was like, your margins are like three percent. Like, what are we doing here? And I'm like, we can't, we can't have that business. Like, and he's like, Well, this is what the carriers are offering me. I'm like, and are you, you know, I'm like, are you if you get a carrier that doesn't have the best rate for you, like do you then tell them no? And he's like, Well, no, I just assume that that's like what the going rate is. I'm like, that is not how this works. Like, but it's but that's like how that's not how this works at all. That is like how he how he learned it, obviously, at his wherever he started. But like I had a guy, um, I had to help cover someone's load, I think it was like last year, and what was perfect was he had he had told me, um, here's my target rate, here's what I got in it for my customer, and here's the wiggle room I'm willing to go because I don't want to go less than X amount, you know, margin. And I was like, that's perfect because now I know, and we'll kind of like we'll get into this in a little bit, but now I know what kind of working wiggle room I have wearing the carrier sales hat, right? And if a carrier is way outside of that target pay range, it's just not a good fit. And if they're not willing to come down, it could be because it's a deadhead 500 miles for them. Um, or you know, it puts them way out of the scope of where they want to be for their next load, which is gonna cause them a deadhead on the back end. So you just understand that like just because someone calls you because they see a posted load doesn't mean that they're the best fit or even a fit at all to haul your load. So that's kind of the premise of all this is like the carrier sales role. And when we say carrier sales, we mean the function of actually sourcing and securing a truck that meets your standards of quality, can get the job done and execute at the level of service you need, and the price point is going to um you know fit. So we always say like speed, quality, price, you typically are gonna get two, but not three of those three things. So if you're gonna have the cheaper rate and it's gonna be, you know, quality service, you might not be able to get it today. You might have to book that that truck out two days in advance because you're gonna spend more time looking for it. Or if you want it now and it's gonna be high quality, you're gonna pay a premium. And that's those are kind of the things you got to look at. It's it's it's very uncommon to get all three of those. Um, it can happen, right? You can just happen to be lucky and get the guy that he his broker just canceled on him, and he'll take any load, and he's trying to go exactly where your load is going, and and all that. And that stuff can work out, but it's not really the rule, it's the exception.

SPEAKER_01 23:07

So my favorite, like the the sign we used to have in our office when I was at TQL was like we offer three kinds of service good, cheap, and fast, but you can only pick two. Good and cheap won't be fast, fast and good. Won't be cheap and cheap and fast won't be good, right? Yeah, like you're typically going to have, and this is the same thing you do with a customer, they always tell you they want all three. I want it cheap, I want it fast, and it's gotta be perfect. Your job as a skilled salesperson is to get that person with unrealistic expectations to pick which of the two are more important than the third. It's not that third doesn't exist, but you've got to weight them, right?

SPEAKER_00 23:49

Yeah. And a good sales person.

SPEAKER_01 23:52

Because the shipper oftentimes is just told this when they're trained, like, this is what we're trying to do. So it's got to be cheap, it's got to be fast, got to be perfect. Then you've got to let them know as a broker, like we have lots of different carriers, and they are all different values for different reasons, right? A guy with a brand new truck, right, that is going to be the most expensive, that has 25 years of training and has great technology, reliable ELDs, a great maintenance schedule, like that person is not going to be the same price as someone driving a 25-year-old truck who has two years of experience and is working off a burner phone. Like, because even just the simplest thing, there's a just higher probability that truck breaks down for some reason. Anybody that's had a car older than five or 10 years old knows that if you drove it across the country every day of the week or every week, at a certain point, like something is going to need fixed or replaced. It's the same thing with the truck. Like you don't have to overthink it. The second is like technology relies to, like you said, tracking. Well, what is tracking's value to the person actually paying for that service? That's the shipper. Some of them need to know when that shipment is actually expected to arrive because the customer might need to know, but also because that customer might need to be planning things over that three or four day period. If you're shipping stuff from coast to coast, that's roughly five days. That company that is going to receive it might not have five days of inventory and might need to be buying other inventory for the next three days without overbuying, waiting for the truckload or multiple truckloads coming from the other side of the country. So, like that is also like inventory planning for a business that allows them to make sure they have product on the shelves to buy. Grocery stores are a great example. Like a grocery store is really big. Guess what? A grocery store doesn't have a giant warehouse on the back of it with more food if they sell what's on the store shelves. It's just being brought in over and over and then put on the shelf for us to buy. There's distribution centers that are theoretically their inventory, but the same thing happens. Like you need to time when your inventory is coming for businesses like that. That's service. That's why that's important for those types of industries.

SPEAKER_00 26:06

We've all seen what happens when the something triggers people to overbuy toilet, right? And the shelves get empty. So, like COVID was a great example, right? Anytime there's a big storm coming, a hurricane coming in your area, a snowstorm in my area. People go and they wipe out the shelves. And yeah, there's a little bit of storage for the stock guys to go get the unloaded stuff or the stuff that was unloaded from the trucks and put them on the shelves. But like you said, there's not a whole warehouse full of like a week's worth of stuff in there. That's why you have deliveries coming in like every couple days to these grocery chains, um, because they only have so much room on hand. And you're absolutely right. That that timing is is crucial when it comes to this stuff.

Customer Options And Market Truth

SPEAKER_01 26:45

Here's another example. Again, these are like the use cases that we're going to explain, like how and what you're gonna do to make this to provide the service you're actually promising your customer, I guess is a simpler way to say it. But like another really obvious one that I've run into a lot, I need it really cheap, but it has to be perfect. This was one for construction. So, whatever we were shipping, and I can't even remember what it was, needed a crane to be able to unload the truck and take whatever was in that truck onto the job site, maybe like the second story or third story of a building for construction. I think it was like H V A C something really big. Okay. Now that thing that was coming in that needed craned was coming on a train into Chicago. The project where it was going was like only like a hundred miles away from the rail yard in Chicago, right? Customers like, oh, it's gotta be super cheap, arguing we want it done the cheapest way possible. And then this is the job of the sales person. I'm like asking questions. I'm like, well, hey, how are we delivering this? Because when you do it really cheap for drayage, like we know when the container's gonna come into the rail yard. So as soon as it's there, we can send a driver to pick it up. But the cheapest way to do that is it's drop trailer. Like literally, we'll go pick it up when it's available, when the driver has the time, he'll leave it there. You let him know when it's empty and he'll pick up the empty and bring it back, right? Like that's your cheapest, right? Then the second would be like live unload. But now whoever's unloading that has to be ready when the guy brings the container. The problem is you kind of know when the container's available, but not always. Because sometimes the driver goes in and the train says it's there, but it's not. It's still on the train and the train is literally on the track, hasn't made it to where they unload it, where the cranes are. So like it's theoretically there, but you can't pick it up, right? So I'm like, okay, well, we can do this cheaper, but like, what how are you unloading this? Because I'm like, it's a big item that looks like you're probably gonna need a crane. They're like, oh yeah, there's gonna be a crane. And I'm like, okay, well, how much is that crane per hour? And are you doing anything else with it? They're like, no, we're gonna bring the crane in that day to unload it, get it into the building, and then the crane leaves because it's$750 an hour for the crane. And I'm like, okay, so like you're expecting to time this perfectly between a train, a truck, and a crane. And if we're wrong by an hour, we lose$750. They're like, yeah. I'm like, okay, like that is not the best way to do this because it can't be perfect for a lot of different reasons. And the thing you want to prevent is the$750 an hour. Because if he's three hours late, the whole transportation bill is only$1,200. You just spent$2,000 on a crane that is doing nothing waiting for this, right? So these are scenarios where like you want to ask enough questions to see like, what are they trying to achieve? Yes, I knew they wanted it cheap, but they didn't think through the fact that what they expected is never perfect, which is what we bring to that table. So, like, these are the things that are like real practical reasons why you have to make them pick two, even though they're telling me or you I it needs to be all three. And you're like, okay, but like that isn't actually what you want. What you really want is a fair price with a reliable carrier to do it as cheap as feasible without a big mistake, because that's more expensive than you save here, right?

SPEAKER_00 30:10

Like, and again, yeah, when you're talking with your customer, those kind of those consequence-based discussion points, I think, are really, really, really helpful. Um, and this is where, like, when you're when you have a model, so sometimes you hear called like the Chicago model where it's split, where you've got like in that scenario alone, right? The carrier sales rep is not even the one that's talking to the the customer, right? So you got to make sure you've got not only the the account rep having a good conversation with the customer about the price and the available options, but having that communication between the account rep and the carrier sales rep so that they understand the implications here. And that carrier sales rep, oftentimes you can, you know, if you're in that split model, um, or if it's if you're called a grave, you're just it's just you, right? It's important to make sure that those options and what you're seeing out in the field from when you're talking to carriers that are calling in, that you're communicating what those options are. So like you could if the customer can find out, like, hey, I know your your um target price was I'll make it up, like$2,000, but um, you know, we're we're not getting anything remotely close to those options right now. So, you know, if this is if it's urgent that it's gotta go today, we're gonna have to look at a higher budget for this to get shipped today or picked up today. Otherwise, we could look at a few days out or next week and see what we can try to source. Because I think that's a big thing too, is just bringing options to your customer, right? Getting them access to the market is is really one of the big services that we provide.

SPEAKER_01 31:43

Agreed. And again, like I know we're gonna jump and pivot into the carrier sales, but like this is really also related to how you talk to your customer. So many brokers, right, that I've seen are like, well, my customer just asked for a rate, so I just sent the cheapest number. This is why, like, I'm always calling the customer, going, hey, like, what are we trying to do with this one? How important is this load and why? And people are like, well, like, why would you do that? And I'm like, well, in your example's a perfect one. Hey, especially this year, rates are fluctuating again the way they used to, which they haven't done for a while. So this is probably new to people, even that have been in the industry for a few years. But like the market is now going up and down, mostly up. So, like, a customer might be used to seeing an invoice for a certain lane, we'll take yours, two grand every Tuesday for the past two years. So they're just expecting two grand. Now you are looking at the load boards and you see every other posted load by every other broker today is$3,000. Your customer does not see or know what you see. So if you aren't having this communication, your customer might wait until four in the afternoon for this$2,000 truck that you could see is never going to come through and then get angry at you of like, dude, like, where's my truck? Like, you usually get me a load all day. And then you're like, oh yeah, I just didn't have anyone. And they're like, there's no trucks? But that's not really true. Like, there were trucks. Well, you need to communicate to your customer is like, okay, it's 9 30 in the morning, markets at three grand. They're used to paying two. I'm gonna call my customer, like, hey, the market is much higher today. It looks like a lot of other companies are shipping the same lane and they're paying about three grand. We are not gonna be able to get a driver to take your load for two grand when everyone else is gonna pay him three grand for the same work. Because the next question after you explain that is how important is this load? Maybe the rates go back down tomorrow, maybe they don't. But if you need to ship this out today, this is what I'd say is like you have a choice to make. I can't lose$1,000 just because you're used to paying two grand. Every other company in your city is paying this amount. If this has to go today, that is your best option. And then you allow them to make that choice. And there's just so many folks just like, I think aren't doing that, which is like 101 communication. And that's the other value we bring to a shipper other than the truck, right?

Target Pay Max Pay Visibility

SPEAKER_00 35:08

Yeah. And this is where I think your when you look at the carrier sales process in that role, having good data inside of your TMS, I think is going to be very helpful. So, like in your TMS, if the accountant rep is able to put in a target rate, kind of like what I mentioned before, um, I think it's really important for the the carrier sales rep to be able to see not only what that target pay rate is, but also understand what the customer's charge rate is so they can see what that margin is and maybe see what that buffer is. So they know that, hey, if the margin right now is, if we've got, you know, a few hundred dollars in this, they might be able to make the assumption, hey, I might go back to the account rep and say, do we have any more wiggle room on you know on the target pay rate? Because I see the margins at 300, right? Understanding, understanding what those numbers are gives you way more insight when you're going into these conversations.

SPEAKER_01 36:06

The second biggest issue I see is like we took it from like the broker and the shipper, the customer, right? The next thing I see is in companies that have a separate side for dispatch and covering loads than the person talking with the customer, right? The biggest issue I see is like exactly what you said, that communication isn't happening. So I'll talk to the sales guys and the brokers that are like, my care sales reps don't ever get these loads covered. I'd make so much more money if they can get them covered. And then I'll go and talk with the dispatchers in the next day. And I'm like, what's going on over there? They're like, Well, they keep giving us loads. We give them trucks, we'll take the same example for where the market is, three grand on this lane this week. And then they don't call the customer and have a conversation. They just tell us, no, my customer wants to be at two grand, so nothing happens, right? Yeah. And then the sales guy's mad because he's not getting trucks for two grand. The dispatchers are upset because they worked all day and got them good options for the market, which is at three grand today, but neither one of them are talking about what happened, which means the dispatcher's information and knowledge about the market doesn't make it to the sales guy, and the sales guy doesn't get it to the customer. So the customer just keeps getting angry at the whole brokerage because their loads aren't getting moved. And all of it is just because it's a long game of telephone, but nobody's actually using the telephone to communicate back and forth what actually is happening.

Vetting Questions And Lane Fit

SPEAKER_00 37:29

Yeah. So like I pulled up um one of uh one of my teams is really good at this, and I just pulled up one of their loads in real life. So, like the from the perspective of the carrier sales rep, I'm in the like the operations dispatching side of the load right now, but I can see in here, they've got listed the customer's charge, and then they have a target pay and a max pay. And you can list it as a percentage, as a um flat, like a dollar amount of the margin that they're that they're targeting. But it's very clear from an operational perspective here that, you know, in this case, I'll just make the numbers up. Like my target pay here is$900 and my max pay here is$975. Right. And that's based off of, you know, what that um, you know, what that team has agreed upon on all this. But and then you can see in here, I've got my customer rate is, you know, whatever it is. And I understand that if I if I can get this sold for$900, we're gonna hit my target margin, but I can go up to$975 in order to get it moved, and that's okay on this load. So now I know I'll keep those same numbers: 900 target, 975. If a carrier calls me and says, you know, hey boss, what's the best you can do? And I'm like, hey, this one's going for 900, and the carrier comes back and says, Can you do 11? Like, no, like that's first of all, that's higher than what my customers paying me. Um, but you can have that blatant conversation of like, no, like hey, 900 is what we got. I can see if we can get a little more on it, but like we're not even in the same ballpark right now. And that's when the carrier might come back and say, All right, can you do a thousand? And you're like, no, like we're still we're still too far off. Like I said, nine's the target. I could see if I can squeeze a little bit more out of the customer, but that's really what this one's going for. And you can have those conversations. And you know, just because a carrier is asking for more money doesn't mean that you have to go up on it, right? Um, and also we're not trying to be greedy here. Like, you can look at the data and the analytical tools. So if you're on rate view or on rate mate or on Sonar, green screens, whatever your internal TMS, and you could see like, hey, the market for this load right now, we're in that target range. That$900 is is within that range of what the what the market's been paying for this. Um, and then you could, you know, you start to ask more questions like, you know, where are you located now? And you find out, oh, well, they're four hours away and they've got a deadhead, and that's why they're asking for more money to cover for fuel. And it's like, hey, I we just might not be the best fit. Um, you know, keep my information if you want, but I'm gonna I'm gonna move on and try to get this cover with a better suited carrier for this specific load, and you move on to the next one. And you typically get an idea of how um, like based on the amount of inbound calls you get, and you could also look at, like you mentioned before, what are how many other loads are being posted in that um specific lane outbound, and then look at like your load to truck ratios on your different tools to see how many brokers are posting loads versus how many carriers are posting trucks. You can kind of get a sense of like, is this gonna be an easy load for me to cover or a hard load? And obviously, the more calls you're fielding, it should be easy for you to cover because there's more interest in it. If you're not getting any calls or a very few amount of calls, that gives you very clear, distinct feedback that there's not a lot of interest in this. And it's it could be either based off of where I'm trying to send this driver to, or just based on where it's shipping out of, if there's just not a lot of capacity in that area. Is it a very specialized niche type of equipment that there's just not a lot of in general in that region? Um, but those are like a lot of the things when you're wearing that carrier sales hat, whether you're a solo cradle-to-grave broker and that's just one function of your job, or if that's your sole job is to be a procurement specialist where you're just out there here, here's all the loads we need covered for the company, and I got to go out there and find capacity for them. It's really important to understand um how much margin you have to work with, how much wiggle room you have, what's the target, what's the max. And, you know, the first call doesn't have to be the carrier that you book, right? And there's all the other things too that we didn't even hit on as far as like, does this carrier even meet my criteria? Like, I usually one of the first things I'll do is like, what's your MC number? Right? Boom, I'm pulling them up in my vetting site.

SPEAKER_01 41:59

What's your MC number? When and where are you gonna be empty? And then they tell you, like, hey, have you delivered there before? Because that question tells you whether or not their assessment of how quickly they'll be unloaded is true, right?

SPEAKER_00 42:12

That's a really good point.

Negotiation That Uses Real Comparisons

SPEAKER_01 42:13

Yeah. Like that is one that like has just been beaten into my head that just happens without like thinking. It's like those are just the first four questions of when and where are you gonna be empty? What's your MC? What do you where are you looking to go? Right. Is like the first couple of questions. Because to your point, as they're talking, I'm looking at the MC, looking at the insurance, does that match what we're looking for, right? Driver ability, age of out of service, maintenance, all those things. But the other thing I would add to what you said, which is great, like I always look at it like this. If I've got to work a load, I'm first looking at two things. What have we paid and have we run this load? Is like my first thing. Because that tells me like, what is our company and our resources and our negotiating ability and our freight, what has that been? Because like that can just be different on a lane, right? And I learned this also really quickly at TQL is like one example. There was a lane I was trying to cover, and I look at our TMS data, and I'll never forget it. I'm like, everybody in the company was paying like$1,700 for like the past four months, like every load was within$50 of this number, right? And then there was one broker that was paying like$1,100 every week for multiple loads. Like the whole company is paying right around where the DAT average is, which is the second thing I look at. What are we paying? And what is the market average everyone else? And I look how close they are. And I'm like, this one broker was running like quite a bit of freight, like$700 less than everybody else, and with multiple different carriers. So it wasn't like a dedicated carrier for some unique situation. And I'll never forget it because like I picked up the phone and called because I was just so curious. I'm like, this makes no sense to me, right? And I was like, hey, it looks like you run this lane pretty often. And it looks like you're beating like the entire market by like 30% every time you move this load for four months. Like, am I missing something? And when he explained it, it made perfect sense. He goes, Oh, yeah, like you guys all are paying the market rate when you guys get your load. He's like, My freight, he's like, I pull the loads when there's a cheap carrier available. I'm like, what do you mean? He's like, oh, my customer has this lane every day and has multiple loads available all the time, but it's never urgent. So like they just will literally wait until a carrier needs that load to go where it's going. And then they pull the load, get it ready, and then the driver takes it. So I'm like, oh, like, how's that work? He's like, oh, there's like 10 lanes, my customer can move at any point in time every day. I think it was actually lumber. It was some like building commodity. And he's like, it's just never time sensitive. So like my team posts all 10 loads every day. And then every carrier that calls, just like you said, they literally have this conversation, MC, when and where are you going to be empty? Hey, just so you know, like this is not freight that needs to move today. But if you want to meet our rate, these loads are always available. So basically, they worked this and talked to the carriers that all these carriers knew there was always a backhaul available on that lane. It was always gonna be cheap, but it was fast to load, fast to unload, no headaches. And the customers just only cared about price, didn't care about service, didn't care if they broke down, didn't need communication. The only thing of those three, good, fast, and cheap, they cared about was cheap, because none of it else mattered. And that's why he was literally able to beat the market every day, because like they were okay letting their freight sit as long as it needed to until the price was met. And I'm like, oh, that's where in my head you've heard me say. I'm like, you get a rate or a date. If you tell me the day it's got to move, I gotta pay the market rate. If I can bring an option to you and it can sit for whenever, then I can probably meet your rate because like I can just wait for somebody that like actually needs that and that's fine. Those are like your two extremes. Because to tie this into what you said, I'm looking at our history, I'm looking at the market. Then if I'm really working a lane for a customer, like myself is cradle to grave, I go and look at what everybody else is posting today. And I'm like, oh, did the market change from what all of this history has shown? DAT, whatever, green screens, sonar, any aggregate rating tool gives you the average of what. Happened, my system shows what has happened with our company, then the market is like, what is going on today? Because sometimes it will change a lot in one given day. And we talk about this. Maybe it's weather, maybe there's a snowstorm, maybe there's a ton of produce that just became available at harvest this morning that no one was aware of. And the carriers know because, like, there's just a ton of loads available out of nowhere, and it drove the rate up. There's lots of things that will change that on any given day. And once you see that, now I can go back to my customer and be like, hey, I know this is where it's been. This is what's happening today. What would you like to do? Move it today for the market rate or wait till tomorrow. I don't need to make that decision. That's your decision to make. My job is to bring you options.

SPEAKER_00 47:11

Yeah, the your internal data. I love that you brought up, you know, when you looked that up and saw the guy playing under the market rate, because that internal data is, in my opinion, worth more than anything you're going to see online because it's true information about your company. So I just pulled up another load in our system. And hopefully in your TMS, you can see order history and you're sharing that visibility to the right people, right? I understand if you don't want to share customer-related information across the board, but carrier-related stuff, I always think about the carrier network of a brokerage, should be for the entire company, right? Because we want to use repeat carriers. We want to have good utilization metrics, meaning we're using carriers more than just one time and moving on. We're building a real relationship with them. But I picked, I pulled an available load that's picking up on Saturday. And I can click right on, and hopefully you're setting up your home screen or your dashboard or your planning board, whatever your TMS calls it. Hopefully that board that you're working off of has the ability to see things. Like in my case, I can see order history that matches that lane. I can see load board available truck postings that are in that lane that's feeding right into my TMS. I can see carrier offers. So if you're, you know, if your carrier sales team has a carrier that calls in and they weren't the best fit for a um a load, but you still took down their information and the and the rate that they offered. That's good information to have. So I could see in this one, to your point, how much you can fluctuate in the last month. Um, we probably got two dozen uh loads that we ran in this specific lane. This is uh looks like it's like a Nashville to Atlanta or Atlanta to Nashville, basically. So fairly short, maybe four-hour trip. Um and I I can see that again, this is we're looking for um this coming weekend. So it's in in the near term. If I go back in the last month, I see I'll just go off of line hall alone, because obviously accessorials and fuel, if they're broke or not, which they are in this case, um, those are gonna vary. Um, but line haul alone, which gives you a pure indicator of this is not related to diesel prices, this is just pure supply and demand in that lane. I've got recently just over$700. If I go back um a week to two weeks, I see fluctuation up to$800, then down to$600. And then I've got uh if I go back to the beginning of the month, we're at$900, right? So within a month, you saw fluctuation of hundreds of dollars on line hall, which is really when and that under a thousand dollars, we're talking like 30, 40 percent swings, right? In a uh in a specific uh lane. And this is reefer, and it is, like I said, it's Atlanta. So you see it in flatbeds though, too.

Fair Pricing Without Taking Advantage

SPEAKER_01 50:08

What's that? Yeah, there's other lanes where this happens very frequently. In flatbeds, end of month, end of quarter, you'll see huge spikes in production and massive uptick in rates the last week of every month. If the last week of the month is the last week of the quarter, too, like that's a big spike. Like this happens in a lot of different things. And then this is also related to how you negotiate with a carrier, right? Like I was doing a training on this yesterday, and someone asked, Well, like the carrier's saying fuel's more expensive, so I should he wants like an extra$400. And I'm like, okay. And I'm like, well, here's the question I would ask you, right?$400 more than what? And they went, Well, what do you mean? I'm like, well,$400 more than what you offered, or$400 more than what everyone else is posting this load for on the load board, or$400 more than the other carriers that reached out to you and said they want the lane. And they went, huh? And I'm like, now think of it this way if five drivers call you, are any of them paying more fuel than the other ones? Like they all get the same price for gas. So, like, yes, fuel is more expensive, but one driver isn't paying for more gas than the other four that call you to take that load, right? They're like, no, I guess not. I'm like, so would you ever pay one driver more than the other because of fuel? They're like, no. I'm like, correct, because it's level across the playing field. It does matter to your customer if fuel went up a lot from last week to this week, because their rate goes up, because everyone's does, but like, that's not a negotiating point. Like, that doesn't even make sense for a driver to be like, I need more because fuel is. If you're comparing his offer rate, what he wants, to what the other drivers and dispatchers call you. And I'm like, the best way to negotiate with anybody is to compare them to themselves. And here's what I mean. I'm like, hey, most brokers go, well, like this is all the money I have in the load. And I always say, like, does a dispatcher ever believe that? And everyone goes, no. I'm like, okay, so how helpful is that to get them to come down? They're like, not very. They usually just hang up. I'm like, okay. Now, if you want to pay$1,200 and the driver or dispatcher wants you to be at$14 or$15, and you've talked to four other carriers that are close to$1,200, but might not be close enough on time, where they're empty and when they're empty. And you're saying that other brokers are posting the load for$1,200 and the guy you want wants$16. I'm like, you don't want to say my customer can only go to 12. You want to say, I've got three other carriers that have called me that said they'll take it for$1,200, but you're going to be empty a little sooner. I'd rather go with you, but I can wait for them. Happy to give you a little bit more to make the deal and for me to cover the load sooner and not wait. But I can't pay you$400 more than the other carriers that have already called me for this load. Because now what are they going to say? Like, that's just true. Like, I'm comparing you to the other options I have that are going to do what you are going to do for me. So, like, I'm like, it's like anything that you would ever buy ever. Like, if somebody's going to go cut your grass as a lawn care service and they want$1,000 and everybody else says they'll do it for$500, what would you tell that guy? Well, I think you'd probably be very good at this and you seem very reputable, but everyone else said they can do it for$500. So I can't really pay you a thousand. That doesn't really make a lot of sense. Yep. Like it's not psychology. It's just this is what you do in every other negotiation.

SPEAKER_00 53:34

Anytime you buy anything decision is really what it is.

SPEAKER_01 53:37

It's what you do when you buy a car. It's what you do when you buy anything where you're actually going to negotiate a bit on prices. Like, I'm not going to buy it at this dealership if it's 20% more expensive than the place across the street. That's what you would say. Yeah. Like now it's just the truth. Precisely.

Checking Competing Loads Before You Pay

SPEAKER_00 53:50

So yeah, the um the kind of the summary here, um, the carrier sales role. I have seen account reps and business development reps who are customer-facing spend a lot of time to build a relationship and get access to work on customers freight just to have the carrier sales portion really um cause it to be not profitable. And then it's like, well, this is a bad customer. It's like it's not a bad customer. You just shit hit your car. So um good stuff. Um anything else on the the carrier sales bit here?

SPEAKER_01 54:30

No, but I would, if anybody finds this helpful and wants more on this, I was thinking about this week. I was gonna ask you, I'm like, we could probably put some content or a course together on carrier sales. I think it is absolutely an area that companies don't focus enough on. I think they tend to focus a lot on sales. They complain and point at margin a lot, but rarely are they looking at the side of it. There's always two sides of the business, right? Yeah. What you sell a product for and what that product costs for. Ours is a service. You got cost on what you're paying the truck. And like, I the thing I want to like end on or really get across is like this is not taking advantage of carriers or finding some way to literally like take money out of carriers' pockets. Like, what it is is like you want to pay the best rate available in the market on any given day for anything you do. So, like, that's what we're talking about. Yeah. And like you outlined this very well in the beginning of this, which is like, if I have two options, one truck wants$1,500, one wants a thousand, the guy who wants$1,500 might be not the best fit for my load because he's empty 300 miles away from where my load's picking up. That's why he needs and should get$1,500. And if there were no other trucks that could pick up my load today, I would pay him$1,500. But if there's a truck right up the street that's going to be empty and can pick it up in an hour, he only needs$1,100 because he doesn't have to drive so far to pick up the load. And that's what we're talking about. Like strategically finding the best fit for your loads gives you better pricing. It is not taking advantage and stealing money that a carrier should get for running the load and performing the work. It's just finding the best fit for the work, and that's all we do as a job. Like that's literally it.

SPEAKER_00 56:12

The last thing I'll add in too is like there has been such an advance of technology and data that you can typically find with various vetting platforms. It could be gen logs, it could be highway, it could be you you name it, right? You could typically see where this where these carriers tend to operate, right? So you know if it's a lane that they run often or if it's a lane that is not common for them, right? And I think that's important to use the tools available. And um you can skip a lot of the you can skip a lot of the like questions that you'd first have on the phone with a carrier that you've never dealt with before, because you can see the data to give you kind of that that you know base layer of information on them. So definitely um, depending on what you can afford, I recommend have some kind of whether you want to call it like intelligence, you know, software or whatever's in your tech stack that you can afford. Obviously, the more companies scale out, the the more access their their reps will have to that stuff. But um, something is better than nothing.

Final Takeaway And Sign Off

SPEAKER_01 57:19

So here's another simple one that is basically not free, but you're probably already paying for. If you're posting a load, you can search other loads, right? So when a dispatcher is negotiating with you on what to pay, guess what else that dispatcher is doing? Looking at all the other loads that are exactly like yours, calling those brokers and seeing what is good and what is not so good about each of their loads. That is either going to be when it picks up, how heavy it is, how long they expect to wait at pickup or delivery, and how many stops, pickups, and deliveries. They are optimizing for the most amount of money with the least amount of risk. They want to one pick, one drop, first come, first serve with the least likelihood of detention that pays the most money. That's their job. Our job is to find the best fit. But so many guys covering loads as a broker or for a brokerage, don't look there to see what they're competing against. And also, like, don't even look in some of the loads. Like if I'm trying to pay three grand and there's a$4,000 load posted, like you can literally just push one button and see the comments. Oh, that's a one-pick four drop. That's different than mine. The dispatcher is going to tell you you should pay the same as the other broker because that's how he negotiates with you. And all you've got to do is literally look there, which takes three seconds and go, yeah, like the one I looked at yesterday, load was going from Nigales to like Philly. But when you search the loads on the load board, that picks up Brooklyn or the Bronx, right? And the Bronx was eight grand. They wanted to pay like seven grand to go to Philly. And they're like, well, all the dispatchers say they could get eight grand. And I'm like, pull up a map. Which one do you think is more of a headache if you had to drive a truck to go to the most populated city on an island in the world with the highest tolls that you can't walk in and out of in under a day, or to drive a truck there, or to go to Philadelphia that you just drive in and out of? I'm like, that's why that one's eight grand. That's why yours should be seven. If you just looked at it on a map, you would know. But the dispatchers are telling them, well, I'll go take a load for eight grand. There's plenty of them going up there. Yeah, but they're not telling you the whole truth, which is yes, technically there are$8,000 loads, but it's a hell of a lot more work and risk to go to the Bronx than it is to go to Philly.

SPEAKER_00 59:34

Yep. Yeah, absolutely. Good stuff. Final thoughts, Ben.

SPEAKER_01 59:39

Whether you believe you can or believe you can't, you're right.

SPEAKER_00 59:44

And until next time, go bills.