Current Rates per Mile
- Thread starter ExFedEx
- Start date
Yes, thank you RLENT, you read what I was asking. On the old FECC settlement statements they would give you the total billing of each job you did, the percentage paid to the driver (and at the time it was 58%, mere trivia), but they also gave you (meaning us) the billing per mile that they charged the customer. I'm just curious as to what that charge is these days; is it $3.50/mile, $4.50/mile, $1.25/mile?? With the cost of fuel being three times as high these days, and all the companies trying to pinch pennies, it sure would be a shame to see the billable rate at that same $2.50 /mile. Any driver from any company can answer this if you know the answer, not just FECC drivers.
I didn't miss the original question but don't know what they are charging any specific customer nor do I know what the annual average charge per van mile is but do suspect the charge to the customer depends on who the customer is. I was merely giving the correct figures for what they are paying a van at this moment for the categories I'm certain of.
Yes, there is definite truth to the the statement that each customer probably does get charged differently to some extent. I can recall doing a 45 mile run and getting paid $132, then the next day I could run for Owens Brockway or Ashland Chemical, drive 70 miles, and end up with $56. Thanks for the fond memories...NOT! 
If the going rate for vans is .85/mile, then at 58% the rate is $1.46/mile; if it is .77/mile, then the rate is $1.32/mile, IF the 58% commission to the driver is still in effect. However, it looks as though "it was some grand idea from an expert..." to do away with the commission, according to Greg. What a shame.
What is "FSC", and what is this detention at $6 per quarter hour after 2 hours you are talking about?
If the going rate for vans is .85/mile, then at 58% the rate is $1.46/mile; if it is .77/mile, then the rate is $1.32/mile, IF the 58% commission to the driver is still in effect. However, it looks as though "it was some grand idea from an expert..." to do away with the commission, according to Greg. What a shame.
What is "FSC", and what is this detention at $6 per quarter hour after 2 hours you are talking about?
We get paid a flat rate of 85 cents plus a Fuel SurCharge (FSC) that changes weekly based on the EIA Nat'l avg for diesel fuel. It brings you fuel operating costs back to $1.20 a gallon based on a 15 MPG van. We get FSC on ALL miles authorized by FX.
The flat rate thing, while it has been a big grumble to a lot of people does have some advantages. It allows FX to go after more freight knowing that they will be able to get it moved whereas before it would be turned down alot by contractors wanting to sit around and wait for the "perfect" run.
The good old days were the good old days, today, there are new players in the van expedite market who have garnered market share by low ball rates. FX was loosing business to theses guys because if they bid low enough to get the freight....the contractor on percentage would refuse the load (as his revenue would also fall) and FX then has a service failure as they can't move the load. Now, FX knows exactly what it will cost for them to get the freight moved and they can bid accordingly and if they bid low...THEY suffer not the contractor as his rate does not change. Revenue to a van at FX changes based on whether the customer pays any of the "extra" charges like tolls, extra fee's, waiting time etc. FX has gotten a LOT better at getting these fees from the customer since the new plan took effect (at least it has for me).
The new way also allows them to move trucks around without loosing money. If they end up with too many trucks in an area and a good customer somewhere else may be underserved, they can bid on freight, low if they have to, to get the vans back where they need to be. It works because to the contractor, it is a paying run just like anything else, and for FX it isn't just paid DH which is a complete loss to them. I know FX is doing this, they have used it to move me back to Canada where they need me more. Some of the loads I used to wonder why they did it (I would see the $$ charged on my settlement) but now I realize it just makes sense.
The van world changed....FedEx adapted.
The new plan my not be perfect and it may not be in the contractors best interest compared to the old way, but as shipping rates tanked, the contractor didn't have to share in ALL of the pain. I will still take the system we have now over some of the others that are paying .60 a mile with no FSC but give you a lot of miles.
Ok, bring on the pompom/ purple Kool-Aid comments.
The flat rate thing, while it has been a big grumble to a lot of people does have some advantages. It allows FX to go after more freight knowing that they will be able to get it moved whereas before it would be turned down alot by contractors wanting to sit around and wait for the "perfect" run.
The good old days were the good old days, today, there are new players in the van expedite market who have garnered market share by low ball rates. FX was loosing business to theses guys because if they bid low enough to get the freight....the contractor on percentage would refuse the load (as his revenue would also fall) and FX then has a service failure as they can't move the load. Now, FX knows exactly what it will cost for them to get the freight moved and they can bid accordingly and if they bid low...THEY suffer not the contractor as his rate does not change. Revenue to a van at FX changes based on whether the customer pays any of the "extra" charges like tolls, extra fee's, waiting time etc. FX has gotten a LOT better at getting these fees from the customer since the new plan took effect (at least it has for me).
The new way also allows them to move trucks around without loosing money. If they end up with too many trucks in an area and a good customer somewhere else may be underserved, they can bid on freight, low if they have to, to get the vans back where they need to be. It works because to the contractor, it is a paying run just like anything else, and for FX it isn't just paid DH which is a complete loss to them. I know FX is doing this, they have used it to move me back to Canada where they need me more. Some of the loads I used to wonder why they did it (I would see the $$ charged on my settlement) but now I realize it just makes sense.
The van world changed....FedEx adapted.
The new plan my not be perfect and it may not be in the contractors best interest compared to the old way, but as shipping rates tanked, the contractor didn't have to share in ALL of the pain. I will still take the system we have now over some of the others that are paying .60 a mile with no FSC but give you a lot of miles.
Ok, bring on the pompom/ purple Kool-Aid comments.
youngsamuel
Seasoned Expediter
This is one of the main points of contention NO ONE KNOWS. At least those who continually harp about rates. I asked in another post for a bid and have not recieved any quotes. People love the idea of the free market with no competition. Please refrain from the rhetoric about how this market is not free. It is the most free currently available. There are too many factors around each load. Is it a long distance, will it go to a city with freight readily available, is it empty totes or some item needed asap by the gov't? I suppose if the owners of the most prominent expedite companies were on here griping about cheap freight and drivers who need to be pampered we would be discussing that, but they aren't. So does anybody want to bid the load in "are you smarter than your carrier?" or whatever it was.
BTW If there was a load that paid $2.42 a mile for a seven hundred mile run and it weighed 2800lbs would you put it in your Sprinter? As they say around EO just sayin.....
BTW If there was a load that paid $2.42 a mile for a seven hundred mile run and it weighed 2800lbs would you put it in your Sprinter? As they say around EO just sayin.....
No, I don't care if it pays $500 a mile, my talk of too much weight for a van is based on safety and nothing else. I see guys who take these 3000 lb loads in their Sprinters and vans. Combined with all the personal stuff most carry they are over the GVW limit for their van. Some care....others roll the dice...I won't. All that money means nothing when I rear end a truck because I can't stop safely.
The topic of rates...I think what most are upset about is how new players in the van expedite market have gained market share not by offering good service, but rather by offering very low rates to get business. We can all gripe about what we get paid. Are we qualified to know what a customer should get charged? Most of us aren't. How do we know if the customer pays on time, will we incur extra expense collecting the money, does the particular customer nit pick every single invoice to lower the price after the fact, do they have a habit of delaying loading or unloading and then refuse to pay wait time? As contractors we don't see this stuff, so therefore we are not qualified to answer the original question about what to charge the customer...we ARE qualified to talk about what WE get paid and to complain about load offers that are cheap to us and are likely bid that way. The only folks who can legitimately answer your "what to charge" questions are independents on here like transporter or 60MPH, and based on the limited info you provided I doubt they would offer up an answer. I sat at dinner one night and watched what transporter goes thru to get loads.....it is FAR from a simple process to determine what rate is right to charge the customer. Our costs as contractors are all pretty much a known factor so we can more easily decide if it is cheap or not.
Thx Piper, yes, I figured out what FSC was when I saw your other recent post here. That threw me off because that was never a part of the settlement check; we were just paid a flat commission rate and everything was figured in to that total.
As far as new players in the van biz, check this one out: I am working for a small family owned expediting/air freight/courier biz here in Los Angeles, still have my same van that I used in the Rpberts/FECC days, so I get some decent sized loads as opposed to the other drivers who want to use their family cars. FECC contracts out to us when they are short van drivers in the LA area. This is a slap in my face: I would get full pop on these runs, now my company gets these runs for what I used to get (I'm assuming this of course) , now I get what my company pays me after taking their cut out of the deal, which I know is a very small percentage. Talk about a shame... On one FECC run I even called up recruiting to see if they were looking for So Cal van drivers to join the FECC fleet, he (Aaron I think it was) told me they were covered just fine in So Cal. I said "That's funny, I'm doing a FECC run right now..." He replies back that they outsource their runs to whoever can cover the load, they will do that sometimes. So, bottom line, it is about survival these days, my company will take the load and get it covered just to keep the drivers busy, to satisfy FECC as a customer/broker, and also for my companies survival. The drivers probably don't even know that it is a FECC load, they really don't care, as long as they see a paycheck at the end of the week.
Also, just as a side note, this little company I work for pays FSC for ALL miles, not just loaded miles, and the rate varies as well depending on national fuel prices. And of course there are other brokers and customers, not just FECC. So, back to topic, who knows what the customers get charged per mile, I guess that is the old way of thinking, now it is about bidding and getting the load in the first place, just like getting your kitchen remodeled or a new roof put on your house, the customer will go for the cheap rate. I have been told to get ready for a really good run, only to sit and wait for nothing, because the customer never will call my guys back because we try to get a decent rate but the customer found someone who will do it for less. In this era it pays nothing to sit empty and ***** & moan about society, any load is a good load as much as I hate to say it.
Maybe this should have been posted on the other thread, but it is still relevant I think to the overall "theme" going on here.
As far as new players in the van biz, check this one out: I am working for a small family owned expediting/air freight/courier biz here in Los Angeles, still have my same van that I used in the Rpberts/FECC days, so I get some decent sized loads as opposed to the other drivers who want to use their family cars. FECC contracts out to us when they are short van drivers in the LA area. This is a slap in my face: I would get full pop on these runs, now my company gets these runs for what I used to get (I'm assuming this of course) , now I get what my company pays me after taking their cut out of the deal, which I know is a very small percentage. Talk about a shame... On one FECC run I even called up recruiting to see if they were looking for So Cal van drivers to join the FECC fleet, he (Aaron I think it was) told me they were covered just fine in So Cal. I said "That's funny, I'm doing a FECC run right now..." He replies back that they outsource their runs to whoever can cover the load, they will do that sometimes. So, bottom line, it is about survival these days, my company will take the load and get it covered just to keep the drivers busy, to satisfy FECC as a customer/broker, and also for my companies survival. The drivers probably don't even know that it is a FECC load, they really don't care, as long as they see a paycheck at the end of the week.
Also, just as a side note, this little company I work for pays FSC for ALL miles, not just loaded miles, and the rate varies as well depending on national fuel prices. And of course there are other brokers and customers, not just FECC. So, back to topic, who knows what the customers get charged per mile, I guess that is the old way of thinking, now it is about bidding and getting the load in the first place, just like getting your kitchen remodeled or a new roof put on your house, the customer will go for the cheap rate. I have been told to get ready for a really good run, only to sit and wait for nothing, because the customer never will call my guys back because we try to get a decent rate but the customer found someone who will do it for less. In this era it pays nothing to sit empty and ***** & moan about society, any load is a good load as much as I hate to say it.
Maybe this should have been posted on the other thread, but it is still relevant I think to the overall "theme" going on here.
FedEx will outsource for various reasons, some of which have nothing to do with if they have any of their own folks in an area.
If the load is low priced, and FX cannot make what they feel is an acceptable return on it after they pay their contractor, they may outsource.
If the load is going to an are where they have no customers and they know they will be paying a lot of DH pay to relocate a contractor...they may sub it out.
If the run is over 700 miles long and all they have is solo guys in an area...they may sub it out.
We get paid FSC on all of our miles too, All DH to layover, All DH to pickup and all on the load (going to get groceries...uh...no), if you think about my second scenario above about why they may outsource a run, all that DH pay and DH FSC can ruin the profit on a run for FX....when they outsource, none of that matters. I have been at customers and see an outsource carrier who is also doing a pickup. When we compare notes about where we are going it usually make sense why it is the way it is.
If the load is low priced, and FX cannot make what they feel is an acceptable return on it after they pay their contractor, they may outsource.
If the load is going to an are where they have no customers and they know they will be paying a lot of DH pay to relocate a contractor...they may sub it out.
If the run is over 700 miles long and all they have is solo guys in an area...they may sub it out.
We get paid FSC on all of our miles too, All DH to layover, All DH to pickup and all on the load (going to get groceries...uh...no), if you think about my second scenario above about why they may outsource a run, all that DH pay and DH FSC can ruin the profit on a run for FX....when they outsource, none of that matters. I have been at customers and see an outsource carrier who is also doing a pickup. When we compare notes about where we are going it usually make sense why it is the way it is.