Think it would be fun to hear some broker stories. Here's one from yesterday (although it happens all the time).

Same load posted by two different brokers.
Broker #1 pays $770.
Broker #2 pays $650.

:roll:

 

Double brokering. Alot of that is going on.

 

There is way too much double and even triple brokering going on. One reason there seems to be more right now is because freight is slow. Another reason is that some brokers take a bigger cut than others. You can even find differences in such brokers/agents like Landstar. Perhaps we need to start shedding some light on those who double broker their loads.

 

I like that idea Gman.

Speaking of landstar, here's a story from a few weeks ago.

I call Landstar (MRE) about a load from Baltimore to Erin, ON. The voice on the phone is johnny.

Johnny: "it's lumber. needs 8' tarps, weighs 48,000lbs, pays $650 on 466 miles"
Me: 466 miles? What's your route? My best route over the Appalachians with 48,000 on is 540 miles.
Johnny:I show 466.
Me: Thanks anyway.

Then I call a Landstar guy I know. I ask him about that load. He looks it up and says,

"He's just being greedy. It's supposed to pay $900 and Johnny would get $63, but the way the Landstar system is set up, if Johnny can cover it for less, he gets half. For example, if landstar Johnny covers the $900 load at $650, he gets $125 instead of $63 ((900-650/2). As you can see, the Landstar system is built to screw the truck".

In my experience, Landstar offers the WORST rates of anybody (although I cannot speak for the leased guys). 4-6 weeks ago, the best I found from them was $2/mile for 3 drops and hold it over the weekend. Now those loads are $1.69. I am not impressed with them.

I'd say they were just bottom feeding. If they don't catch a sucker it must go to the leased guys.

 

I'm new... and dont' pretend to understand about the brokering part of it, but something about double brokering just plain doesn't sound right.

If another broker is brokering another agent load, then the brokers should work out a split out of their fees not chop off and take another cut into the pie. (Since there is no benefit from the second broker doing anything.)

 

It's alot of the shippers fault. To many shippers notify their brokers (they seldom put all their eggs in one basket and use just one broker) that they have a truckload going to so-and-so and the 5 brokers jump on it and start shopping it and thats why you see alot of the same loads posted by different brokers at different rates. There is no loyality among shippers. Whatever broker gets the cheapest truck to move it gets the load in most of cases unless the shipper is in a time crunch or some other bind.

 

none of that sounds right. Why do people always wan to screw over someone else just to make a buck

 

Oh, boy... so there really isn't anybody looking after the best interest of the carrier, except maybe the dispatcher to some degree. The brokers only represent the shipper and their loyalty is to get the product moved for the cheapest rate and make a commission for themselves.

Are the rates quoted set prices or can the carrier successfully negotiate a higher price? Does the broker know what the shippers target or top price is? Can and does the shipper net the difference between what the carrier invoices and the shipper's top dollar was?

Is there any particular reason a shipper may not be loyal to brokers? Isn't that part of the brokers job to be there johnny on the spot for their client, the shipper. Sounds like many brokers may just be playing the numbers game at the peril of the trucker.

Hum?

 

We negotiate every load, period. My girl bagged an extra $450 out of a broker the other day. He started at a grand, she got $1450.00. The load worked out to 1.40 a mile (actual driven miles), and got me rolling. I hate this time of year, things are tighter than usual.

We actually had a guy offer us .60 a mile the other day! I about fell over. She got me $2.00 a mile out of the same area.

 

Everything is negotiable. A shipper has a figure they want the load moved for. The broker is generally much more in tune with the current market rates than the shipper is so if the shipper is way off the broker will try to squeeze them for more money. Then with that figure they'll chase trucks to haul it minus the 10%-20% commission depending on what they can get it moved for. The less they get it moved for the more in their pocket.

The better brokers have contracts with shippers. Seldom does a larger shipper use only one broker. A shipper will allot so many loads per week/month to a broker. You perform they might increase your volume. You falter and end up with some lame yo-yo slacker who arrives/delivers late etc you get docked and might lose some freight volume. Do it to often and your soon looking for another account. So it's a good idea for a broker to establish good relationships with quality carriers with upstanding drivers and it's a win-win-win for everyone.

Supply and demand plays a roll as well though. From one week to the next the rate can vary $100 +/- from the same Point A to Point B as a week or two earlier. The tighter the trucks the more the broker or shipper has to cough up to move the same load whereas if there is a glut of trucks the rates are cheaper and they can get it moved for alot less meaning they end up pocketing more.

So the moral of the story is less trucks = higher rates.