Can someone explain!?

[heel4you]

Ok, looking over alot of information packages from Expedite companies. I am reading:

"62% of revenue is paid on accessorial charges and backhauls".

Could someone explain what this means....I am new to all of this and I know that if you don't ask the questions it's your fault if you make a wrong decision by assuming.

So, with that said...if this is a stupid question, I'm sorry.

I would appreciate any and all info!!!!

 

[Broompilot]

Lets say you get to a location and you have to hand unload it the customer would be charged for your time and you will get 62% of that. Back hauls are a dream come true, one I have not yet had happen yet. You take a load from Detroit to Atlanta, get to the location on time and they refuse the goods. You now get to take it back, no rush though so enjoy it you will not make as much but still, you can relax and take your time.

 

[LDB]

When they use the term backhaul I think they are usually referring to a job that isn't one they locate and dispatch you on. Say you take a load to Great Bend, KS. There isn't a lot there and nothing in need of expediting. You either deadhead a really long way back to the freight zones or go on the internet or happen to talk to somebody from Acme Widgets there who mentions they need a shipment taken to Indianapolis and it pays $600. You call your company and tell them you found a load. They call it a backhaul and it gets you to a better zone without deadheading. You get $372 and they get the rest. Look at those things carefully. Although Panther are among the thieves who steal your manual labor money they are one of the best on backhaul taking only 15% and giving you 85%.

Leo Bricker, owner trucks 3034, 4958
OOIDA 677319
73's K5LDB
EO Forum Moderator 1+ Years of Service
Expediters Online.com - The Best is Getting Better!
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Support the entire Constitution, not just the parts you like.

 

[davekc]

How are they stealing your money? If something is a hand unload, why did you take it knowing their contract? That is your own fault. We haven't had a hand unload in over a year.
Pay on a percentage only has a value if you know what was charged. We had a past situation with a company that at that time paid 65 percent. They made the mistake of giving us a load were we knew the operations manager. Upon investigation, we found our pay for that load was 49 percent of the gross. Much different than 65. And as expected, that was our last hauled load for them. When confronted, they originally denied it until proof was provided, then it turned to, take us to court.
You quessed it, they paid that run at 65 percent. Makes you wonder how many other runs that was happening on????
When asked for prior bills they flat refused. No surprise.
At least it was a short lived experience.
That company has since switched to a milage based pay system.






Davekc
owner
21 years
PantherII
EO moderator

 

[sunshinetomorow]

sunshine is there a reason you don't name the company? Or is that not politicaly correct. After all how else are we to know who to avoid.

 

[davekc]

It would be unfair in this case because they did change a percentage of their management, policies and pay structure after this event.

Had it remained unchanged, I would have a far different opinion.




Davekc
owner
21 years
PantherII
EO moderator

 

[LDB]

They are keeping money that should be yours since you are doing all the hand work. It is no different than if they say you buy the fuel and we'll give you 62% of the fuel surcharge. I agree that if you sign the contract that's all you'll get however the practice itself is wrong and the companies that do it need to see themselves for what they are doing.

Leo Bricker, owner trucks 3034, 4958
OOIDA 677319
73's K5LDB
EO Forum Moderator 1+ Years of Service
Expediters Online.com - The Best is Getting Better!
-----
Support the entire Constitution, not just the parts you like.

 

[davekc]

Each has a different purpose. Fuel surcharge is designed to cover the difference from a benchmark index price to what the current price is on fuel.

Hand unloads or other accessorial charges are a negotiated item either by the load or contract. Why would the company not be entitled to something for obtaining the work?

FSC are negotiated as well but any discounts are awarded to the shipper not the carrier.
Of course there are those brokers and carriers as well that take a percentage of the FSC as well. Look at the LTL freight, it is mostly flat rate even though the broker is charging the customer.
OOIDA has hundreds of cases were this is going on.






Davekc
owner
21 years
PantherII
EO moderator

 

[terryandrene]

Leo, et.al.:

Let me provide an analogy that might help you understand the rationale of your carrier, and most all others, taking a portion of the accessorial charges.

You just bought a basic truck and in adition to the $XXX you paid for the truck, you paid additionl monies for all of the accessories. Would you expect the dealer to throw in all those goodies at no profit to the dealer? Do you think they deserve more than wholesale cost of the extra items you ordered so they can pay the sales staff, accounting folks, management and all other costs of running a business?

It's no different with expedite carriers, They have expenses associated with the arrangement of the run you're on, and the extra work or equipment use. Your carrier also must pay its sales staff, accounting folks, dispatch and all the other costs associated with running their business. More importantly, you agreed to the split fee arrangement when you signed the lease with your carrier(s).

I, for one, think you publicly discredit yourself when you call your carriers thieves for doing exactly that which your lease agreement specifies. It's one thing to state your disagreement with your carrier's policy, it's altogether another thing to falsely accuse them of an illegal activity.

Terry

 

[LDB]

In deferance to others I'll use the phrase "keeping some of the money that should be yours for doing 100% of the manual labor". I am in no way implying the companies shouldn't make enough to pay the employees as well as make a profit. I am only saying that in the case of pay for manual labor the party performing the labor should receive 100% of the pay. If the company is operating at such a slim margin that not keeping 32% of hand load/unload fees is going to put them under they are doing something wrong somewhere.

Leo Bricker, owner trucks 3034, 4958
OOIDA 677319
73's K5LDB
EO Forum Moderator 1+ Years of Service
Expediters Online.com - The Best is Getting Better!
-----
Support the entire Constitution, not just the parts you like.

 

[davekc]

I am only saying that in the case of pay for manual labor the party performing the labor should receive 100% of the pay. If the company is operating at such a slim margin that not keeping 32% of hand load/unload fees is going to put them under they are doing something wrong somewhere
=======================================================
That thought could be applied to milage within a run as well. You drive and pay all of the costs....why should the carrier get anything?
If they sold the work, they are entitled to something.
Just my opinion






Davekc
owner
21 years
PantherII
EO moderator

 

[RichM]

Basically you sign an agreement with a carrier to get a certain percentage of the revenue for a particular trip. The carrier brokers the trip,charges for accesory options and if you are not happy with it you can refuse the trip. One interesting point would be if you damage the freight in loading or offloading, do you pay 62% of the deductible or 100%. Of course you pay 100% but he carrier may lose a customer due to your actions.

 

[Tennesseahawk]

I understand what Leo's saying, and I think it's getting blown out of proportion. Come on, Dave... he's not talking about milage here. Everyone knows your company is also the broker. He's talking about physical labor... bending, lifting, hurting days later. Does a company plan on that income to survive? I doubt it. It amounts to miniscule cash, and 38% or whatever means squat to a company's bottom line. Why do it? Because they can.

When I went thru orientation at Express-1, we were told about this. I asked her, in front of the group, why they take 38% if they didn't get their hands dirty? Her reply... I don't know, they just do.

I think where the idiocy of this is, that companies actually tell their contractors about the percentage. Why not just say you get $xx for fingerprinting a load? They don't tell you the bottom line of what they made off the load. Why not do the same with all the accessorial charges? All they're doing is creating conflict with their contractors.

 

[kg]

we all gripe about the practices of expedite carriers when it adversely affects us on a particular run, or screws up our day or week.
however, it should be kept in mind, by all of us that run for carriers, that we are privileged to service THEIR CUSTOMERS in a manner prescribed by the CARRIERS, in a professional way that reflects positively on US and the CARRIER!

to think that the carriers are not entitled to compensation for services rendered to their hard earned and serviced customers is absurd.

be thankful you are able to be self employed and service the customers for a fair return on your investment.

if you want a bigger piece of the pie start your own expediting co.

things could be worse, you could be in the streets of iraq.

just my opinion

 

[SHARP327]

Well what do you do when you arrive at the shippers dock to find that you have to load the truck and theres been no mention of hand loading compensation and the shipper says something to the effect of....well every other driver loads their own truck!

A quick call to the dispatcher gets....Oh! we always load the truck at this shipper and we don't charge them for it because they're really good customers.

Of course my reply was WOW! why didn't anyone tell me? because I would have turned the run down had I known in advance!

What would you do?

I loaded the truck and Bi...ed about it almost all the way and swore I'd never do another run for them again!, sadly to say I forgot who gave me the load but I remember where the shipper was!

 

[davekc]

I know he was using just the handle load issue and not milage. I was throwing out a simular parallel of thought.
Certainly agreed that it is a small amount, but that small number times every occurance, times every truck, could amount to something significant depending on the carrier.
Just a different observation



Davekc
owner
21 years
PantherII
EO moderator

 

[ATeam]

There are a lot of ways you can slice it regarding accessorial charges. My carrier (FedEx Custom Critical) has a large and very good sales force in the field. Their efforts produce many of the loads we haul. Without them, my revenue would be diminished. Without me and other drivers, they would have nothing to sell.

When they sell a run or a contract for numerous runs that involves say inside delivery charges, it will likely mean, if I accept the run, that I'll be using a lift gate and a hand truck to move the freight off the truck and inside a building where no loading dock exists. For that labor, my carrier will charge say $100, some of which they will keep for themselves, though I was the one that moved the freight inside.

I do not begrudge my carrier that money. To obtain that load and the revenue it produced, I had to do nothing more than wait for the Qualcomm unit to beep. My carrier sold the load. I delivered to the customer what the carrier promised. The alternative would be to sell the load and accessorial services myself (get my own authority), or decline the load and wait for a load that did not involve my labor and the extra money my labor would produce.

If I wanted to be a truck driver only, I'd specialize in no-touch freight and probably be happiest running in a drop and hook operation. But I don't want to be a truck driver only. I'm a proud expediter that provides a full range of expediting services to my carrier and carrier's customers. I do more than haul freight. I am the solution to whatever problem arose that required the expediting services I provide.

Sometimes that means wrestling tall and heavy computer cabinets off the truck, onto the street, into service elevators, up 20 stories, down long hallways, and through narrow doorways. It also means I can take time off anywhere I wish, see the country, enjoy quality time with my wife (and co-driver), park the truck at Cracker Barrel, and earn more money than most of the people I serve.