Dumb independent expediter question

greg334 · Oct 21, 2005

I am off the road this week because I have to deal with a jury duty summons and winterizing the homestead. So sitting here I was thinking of my ventures throughout KY and Ohio the last few weeks.

I ran into three different ‘independent’ expediters running cargo vans at three different places in a span of two weeks. I listened to their stories and still can’t believe their luck. Each said they are averaging 2000 miles a week so far since July with one saying it has been so busy he has average 3000 miles a week in the past few weeks. Each also said that they are getting anywhere from $1.25 to $1.50 consistently (not including FSC), which I doubt but would be great if true. They book their own loads and of course have their own authority/insurance, etc.. two of them gave me details of the load boards and how to bid on the load, which I should have written all of that info down because I forgot most of the info.

Now I know that this may be a lot of B*** but this is three different people at three different places telling me about the same stuff.

Here is a question for you “independent” expediters, well actually anyone can answer; is it actually possible to book my own loads and make a living at it in a cargo van?

Tennesseahawk · Oct 21, 2005

Greg... you should've written down those websites x(

It's possible, that with enough contacts you could run a van independantly. However, like I said in a previous post, you'll spend your off time finding loads. I don't know about $1.50/mi, but it is higher than the normal company rates. And as far as 2000-3000 mi/week, I guess it could be possible. I just don't see it as likely, unless you take super long runs consistantly, and are extremely lucky. I'll message you if you want to talk more about this.

teacel · Oct 21, 2005

had to edit my spelling before someone beat me up!!!

Greg

Did you ask these 3 drivers if they have a home or family? Do they have anyone or anything to support? Living in a van running around the country bidding on load after load, one can survive, and even have fun doing it.

If you are a home owner, and/or family man, I would say YES! It is possible, but not likely for an average person. It takes work! Unless you can find a niche service, or customers who are willing to invest in you the possibility is slim. Say you find a customer, who is willing to talk, and you give the customer a lower price, they still may not change carriers. WHY! The familiarity and blending of the organizations give a natural bias against change, and the cost of disruption within that company can be very costly. The customer will use your lower price to beat up/threaten their existing carrier and get a service up grade, price reduction or both.

It is extremely rare for a carrier to fire a customer or resign an account. We are all so hungry for that incremental revenue that we keep serving them long after their value has diminished.

I started the very same way, in 1987 only I took it a step further, and started hiring O/Os to drive my other vans and even their own vans for me. I now have an office and warehouse, running 12+1 vans and box trucks. The 12 are drivers and the +1 is me wearing every other hat needed to make it work.

Most of the work we do is local, but I do have some dedicated routes that cover 600 plus miles daily. THIS IS NOT B S EITHER!!! Ask anyone who knows of me, which is likely to be most members on EO before 2004.

The $1.25 to $1.50 is also real, for a cargo van! In fact I consider it cheap. Look at what the companies are paying the IC drivers. Double and triple that, for their cut, depending on the type of load and service needed. I can deliver freight about $0.30 per mile less than most companies and still make and pay my drivers more than they do. I have to say the average cargo van expedite load is about $1.90 to $2.00 per mile. Then of coarse there are accessorial fees.

It took me 3 yrs to learn the 5 W’s, and another 4 yrs to learn each person’s role and tweak it for my needs. I opened as a business in 1997; ten years after I started running independently.

NO I WILL NOT SHARE ANY OF OUR TRADE SECRETS! But will help anyone willing to try it.
I also offer consulting service, for those in need.

BigDiesel · Oct 21, 2005

I think after looking into certian load software and boards that it is quite possible to make 1.50 cpm or more. But your gonna spend a lot of time getting those loads and you will pay more for insurance. I think its easier for most O/Os to let a carrier take care of all the hassels of loads , bills of lading, pay, insurance. And not to mention the hassel it seems to be to get your own authority.

geo · Oct 21, 2005

i run for egl in hampton roads area of va, running mostly local
in a sprinter and making more with a spinter than i did with my western star and home 90 percent 10 percent out of town
i run about 800 miles a week on the avg and making any where
from 800 and up
you have to work, and keep moving so
local work is fast pace and harder than expediting as you are trying to get the second load each day or load good for that first load each day,

don't understand why people alway want to run 2 or 3 thousand miles a week whey you can make same amount of money running less miles
you have to plan plan and plan somemore to make it work what ever you do
i won't run for .90 cent a mile

greg334 · Oct 21, 2005

Thanks for the info; it is becoming clear to me how this can be done. I would like to hear more about this subject.

Teacel what is your consulting fees? Maybe you would write a book? I would be very interested in learning what you have to offer. Of cause I don’t expect you telling me everything you know (your trade secrets), just helping out if I ever go this way.

Bigdiesel, What software are you talking about? I talked to one load board company today that mentioned that they are following everyone else by providing information via XML formatted data. Which means my system can grab the file and update my own site to centralize the information. Is this what you are talking about?

Geo, in my area it seems like I could find local work but I like to travel and I figure that if I can see different scenery, I will keep my sanity. I used to do a lot of local work as a lab courier, putting on 300 plus miles a day, six days a week in the Detroit area but that was really frustrating with the constructions and traffic. I got tired of driving pass the same rotting animal carcass on Southfield freeway for my last three weeks on the road, thank God for my move to dispatching.

Oh one more question for anyone who can answer it. If someone gets their authority and insurance, how does the insurance thing work if you have another driver work for you under your authority? Would they work under your insurance with their truck or would they have to provide insurance?

Crazynuff · Oct 22, 2005

The insurance has to be carried by the carrier with authority . The leased operator will need bobtail and property insurance for their truck but the carrier has to provide the insurance required by FWHA

teacel · Oct 22, 2005

Geo,

I thought $0.90 was all EGL would pay a driver? With a van that is.

teacel · Oct 22, 2005

>Thanks for the info; it is becoming clear to me how this can be done. I would like to hear more about this subject.
>
>Teacel what is your consulting fees? The fee is set on an individual bases. We interview each client to determine an estimated cost again based on what you are looking for. We charge an initial visit fee then by the hour thereafter. Let’s say you are a manufacturing firm who is using hourly employees, and own vans/trucks doing your deliveries. We visit your facility; observe your operation for a day, week, or month depending on the different aspects of your operation, (you decide that). Once we gather enough information, we then amalgamate a report, offering you several options, including the cost of each. Our goal is to show our client the most cost effective way to get his product to his customer in a timely manner. This type of service can cost a company as little as $500 or as much as $10k. The average cost to most clients is in the $4K to $5K range., Maybe you would write a book? Funny you mention a book! Davekc, Rich and I have talked about the very thing I would be very interested in learning what you have to offer. Of cause I don’t expect you telling me everything you know (your trade secrets), just helping out if I ever go this way. Whenever you decide to do it, we can meet, have lunch, or dinner, and you can pick my brain and me yours. YA! I still learn from those just starting out. Most newbie's have so much energy, and are thinking 100 miles an hour. Some even brainstorm new ways of doing things, I never even thought of.
>
>Oh one more question for anyone who can answer it. If someone gets their authority and insurance, how does the insurance thing work if you have another driver work for you under your authority? Would they work under your insurance with their truck or would they have to provide insurance?

That depends on you and how you want to set it up. Remember most drivers look for the easy way out. No matter how you set it up you as the carrier still have to carry insurance whether the driver does or not. Again depending on the number of driver you have it may be cheaper for you to carry the cargo and general liability.

As for what insurance to purchase, there are many different packages one can buy. Using your example above; the company hires a driver as an IC who is then responsible for carrying his own auto/vehicle insurance. Most underwriters require that the owner of the vehicle carry certain liabilities on the policy. Say you hire an IC driver using a van, not hauling hazmat; your insurance carrier may say that driver must carry 100/300 on the auto. A driver that owns a bigger truck will have to carry more.

You the company or carrier, can but a combination of several different types of insurance. IE: General Liability - liability per occurrence – uninsured motorist – personal injury – physical damage – so on, Umbrella Liability – set your own limits, Cargo Insurance – set your own limits, Errors and Omissions Liability, Dishonesty Coverage (bonded) Nonhire and owned insurance – this one is good to carry because it protects you and your assets with each driver you have a contract with.

As I tell everyone who tries to sell us anything – We are insurance poor. If you can make you insurance note each month the rest is cake!

When you are ready to by, let me know, and I will give you the name of our carrier. I shopped and shopped till I found my present carrier. I guaranty they give the over all best rates for what I do.

BTW Greg – THE ONLY DUMB QUESTION IS THE ONE YOU DON’T ASK!!!
GOOD LUCK!
TONY