Free to Fail

greg334

Veteran Expediter
ThibodeauxBayou
I really like your idea but got to tell you that it seems just a bit unethical when you examine it closely, unless there is something you are leaving out?

I agree with x06col there, I think that they may want that 15% cut.

Fail to Free,

you said;
"P.S. if people stopped taking the cheap freight maybe the rates would go up... novel thought huh!"

Ok how can you do this when there is nothing but cheap freight being sold to the customer and no other offers being that is acceptable? The only solution I see is to stop taking freight all together.
 

fastrod

Expert Expediter
As long as people keep hauling cheap freight, either because of fear of low acceptance ratings or the take one for the company mentality the rates will never go up.
ThibodeauxBayou good luck I wish you lots of success.
 

ThibodeauxBayou

Not a Member
x06col,

Indeed it was a great deal of sweat and tears. My wife of 33 years will attest to that fact. It was quite obvious from the outset of the initial investment that we could not accept a failed mentality. Its way too much work and determination for most, which leaves the door wide open for the big boys to employ the green grass seekers. I've lent many times a helping hand to those who show a desire in escaping the umbrella of the major carriers. Unfortunatly for most, as you stated , they end up content with the lot. Way too friggen easy sitten around waiting for a beep and a red light to flash.

Interesting concept you chose 15%. We simply recorded names - address and type of business. Any phone book or even the Thomas Registry contains all or some of that information. When generating income for the lively hood of your family and the families of others, any referencerable material is a potential source of income.

x06col ,youre one of the few here that know what it takes to succeeed as a small carrier. Seems our work ethics are similar and i generally agree with alot of your past comments regarding employees. Its a tough life out here and that atmosphere is probably why well never see too many give it a go.
 

davekc

Senior Moderator
Staff member
Fleet Owner
I think anyone would applaud your work ethic. I don't think however I would be sold on your business ethics if you are "moonlighting" under a carriers umbrella to obtain your business.
But maybe I am misunderstanding this carrier relationship prior to this "start up".
In otherwords.....what was paid to the carrier?








Davekc
owner
23 years
PantherII
EO moderator
 

greg334

Veteran Expediter
I think that I mis-wrote, as Dave eluded to, it was not your work ethics I questioned at all but the thought that you actually solicited for work with contacts you made during your tenure as a contractor with loads that you were given by a carrier. They may have spent money and a lot of time building the relationship up with that customer in the first place.

Some companies, like my former employer, view this as stealing and if it happened to them in their industry, they would not stand by and let it happen but go after you for lost income and damages and tie up the thing in court for years just to bleed you dry.

I will give you the benefit of a doubt here because there maybe more to the story.

As for me, I got to say, I don't take names or numbers. I represent my carrier and it is not my place to solicit as one truck or one owner but as one company. I honestly think that I am in the true minority and take a odd view that my reputation means that I maintain my integrity and not allow the might buck rule my thoughts or principles.
 

fastrod

Expert Expediter
The way I see it is that when they got there authority they became a carrier. These carriers low-ball each other all day long to get new customers so I see nothing wrong with what ThibodeauxBayou did. What I do see wrong with this industry is people hauling cheap freight to "help there carrier cover the load" It was the carrier that took the load this cheap and by people covering these loads only brings on more cheap freight loads. Now when people post on here that they turned down cheap freight loads only to be reoffered these loads for more money because no one else would run them does not that make you realize that if everyone quit hauling these cheap freight loads the rates would go up. So the next time you take a cheap freight load to get out of a bad area or get closer to home remember or to help your carrier you become part of the problem and not part of the solution.
 

FREE TO FAIL

Seasoned Expediter
well your comment clearly reflects your ignorance of basic business concepts. Am i driving every mile? am i making money for both myself and the truck while someone else is driving? its all about asset utilization. Do you understand ther concept of reducing fixed costs by maximizing asset usage? i very well could be running at 1.03 as a team after i pay my codriver but i make much more by running the truck harder and reducing my monthly fixed costs on a per mile basis.
 

ThibodeauxBayou

Not a Member
No,No,No........got us figured all wrong

Originally, our business cards had our carrier decaled vehicle clearly pictured. Never never ever did we ever Solicit "our" Business while working a load under another carriers authority. Nothing we did was unethical. We never never ever walked into an account and said "hey guys, we are starting our own carrier business" ONLY after we obtained our own authority did we begin to secure loads via a broker and begin soliciting our own work. This work was performed during out of service and we had a unique vinyl cover that contained the trucks needed numbers. Nothing we did was unethical. Going out and doing your own thing dosnt require you become some kind of unethical scumbag. Being successful doing your own thing requires a mentality of independence and determination.

Once we were 100% on our own, every man,woman or child became a potential customer.

Nice talkin to yall. Its time to go fishing.
 

Turtle

Administrator
Staff member
Retired Expediter
"Interesting concept you chose 15%. We simply recorded names - address and type of business. Any phone book or even the Thomas Registry contains all or some of that information. When generating income for the lively hood of your family and the families of others, any referencerable material is a potential source of income."

Close, but not quite. The phone book or the Thomas Registry is one thing, but...

"We also compiled a list of the names of everyone we met in both shipping and recieving. We had the address's so that was the easy part. Once 18 months passed with our big box carrier we obtained our own authority/insurance and began running in service with $$$ paying loads and then out of service with loads we obtained on our own... We never left a P or D without them knowing who we were and emphasized our quality equipment and presented ourselves as courteous and professional drivers."


Unethical is putting it mildly. You just described a textbook, highly targeted, calculated and systematic approach to corporate spying, industrial espionage, and the blatant, unabashed stealing of customer lists and customers, and then trying to justify it all by saying as long as it's for your livelihood and for the support of your family, it's all good.


Slow and steady, even in expediting, wins the race - Aesop
 

goingbroke2

Seasoned Expediter
Well, lets see.......in your post, you thought 1000 miles per week @ $1.00 per mile was running hard for no money.

Currently, you say your truck is averaging 3455 miles per week. If you are driving half the miles, you are driving 1728 miles per week.

1728 miles/week is about 40% harder than 1000 miles/week.

.....but i make much more by running the truck harder and reducing my monthly fixed costs on a per mile basis.

On a "per mile basis", you have increased your gross pay by .03 per mile. (not including bonuses, etc. that you pay your team mate)

On a weekly basis, on average, you are grossing an additional $680.00 which is great! You are burning an additional $280.00 in fuel too - not great. Now your gross has only increased to about $400.00 per week.

More miles = more gross revenue. More miles = more truck expenses too. Truck expenses require a higher "per mile rate" just to maintain the truck. People, on the other hand, need more *net* revenue to make a living. You have gained more gross revenue, but your truck expenses have increased as well.


Now.........
Assuming the bonuses, etc. you pay your team mate amount to an additional 5% off YOUR pay, it looks like this: $52k x 75% x 95% = $37k ($37k is YOUR gross pay). Divide $37k by 38k miles = $0.97 per mile.

Congratulations! Your "per mile basis" has dropped! You are now grossing .03 less per mile while driving 40% harder!

Disclaimer: math confuses me. :+
 

greg334

Veteran Expediter
The way I see it is that when they got there authority they became a carrier. These carriers low-ball each other all day long to get new customers so I see nothing wrong with what ThibodeauxBayou did. What I do see wrong with this industry is people hauling cheap freight to "help there carrier cover the load" It was the carrier that took the load this cheap and by people covering these loads only brings on more cheap freight loads.

Fastrod, there are really two issues here, one being ‘cheap freight’ and the other leveraging the position you have with the company you are contracted with to create contacts to use to compete with the same company later on.

What ThibodeauxBayou did, get the authority and run under that is a good thing, no doubt about it but outside of that, there is a shade of ‘gray’ so to speak because of one statement. I am being polite for a reason.

Now when people post on here that they turned down cheap freight loads only to be reoffered these loads for more money because no one else would run them does not that make you realize that if everyone quit hauling these cheap freight loads the rates would go up. So the next time you take a cheap freight load to get out of a bad area or get closer to home remember or to help your carrier you become part of the problem and not part of the solution.

Again, there seems to be this fallacy that refusing cheap freight will send a message to the carrier and hence they will increase the rates. This is where supply and demand comes in – there is too many trucks so the supply is there to let the rates drop. Depending on the company the aggressiveness of their sales staff (if they even have one), a company can only do as good as the customer let’s them and the customer will get the stuff shipped one way or another. If they are bidding on freight and have say 250 trucks to move every day or so, it gets even worst without sales to create more opportunities for the contractor. It comes down to this in hard times, whether you want to have your truck move or sit and sitting does actually cost more than marginal running it. OH and remember that the customer will always find a way to move that freight.

Originally, our business cards had our carrier decaled vehicle clearly pictured. Never never ever did we ever Solicit "our" Business while working a load under another carriers authority. Nothing we did was unethical. We never never ever walked into an account and said "hey guys, we are starting our own carrier business" ONLY after we obtained our own authority did we begin to secure loads via a broker and begin soliciting our own work. This work was performed during out of service and we had a unique vinyl cover that contained the trucks needed numbers. Nothing we did was unethical. Going out and doing your own thing dosnt require you become some kind of unethical scumbag. Being successful doing your own thing requires a mentality of independence and determination.

This clears up some most of it but there is something else.

In your other post, this is the exact problem – “We also compiled a list of the names of everyone we met in both shipping and recieving. We had the address's so that was the easy part.â€

This is where the ethics comes into play.

All that other stuff does not matter, it is only this. The only reason for a list like this is to solicit for work, not that you did or would but the list is there and there could be intent. Even though you compiled the list, it gets confusing when the statement is added without a real purpose behind it and that is where the problem is, see what I am getting at?

“We begin not nearly as productive as we had hoped but we were relentless on the phones and contacts were established with the brokerage world.â€

Now I know that you said this and I glossed over it without thinking at first but here is where your hard work went into, or at least I think where it paid off.
 

Jefferson3000

Expert Expediter
>
>Interesting concept you chose 15%. We simply recorded names
>- address and type of business.

========================================

15% was chosen because if you ever contract from a major carrier and then later take on one of their customers, they have a clause stipulating that you indeed owe then 15% of your gross revenue from that same client for at least a year. Your contract as an IC with your carrier may be different, but the contract for partner carriers state that the carrier can demand a 15% brokerage fee if they see that you run directly for their customer. Now, I am not just assuming that that is what you have done. Some customers have multiple carriers they deal with on a daily basis, and so that might make it tougher to prove.

As a regional carrier, I have customers who are shippers, as well as forwarders, brokers and local p & d companies. In fact, one of my "bread and butter" accounts IS a p & d company that services the air freight industry. Because they are a very valued customer, I try and stay away from the local forwarders that they run freight for. Even though I would make more by cutting out the middle man, I won't do it. If one of them finds me for a special job, then fine. But I won't jeopardize that relationship for a quick buck.

I am not saying all of this just for you, but for the benefit of all who may learn from it.

Drive Safe!

Jeff

Driver for 15 years
O/O for 13 years
OOIDA #829119

[em]"Let us be thankful for the fools. But for them the rest of us could not succeed." --Mark Twain[/em]
 

Tennesseahawk

Veteran Expediter
I know in Panther's contract was the stipulation that you could not go after their customers for two years after your contract was terminated. Maybe someone from FXCC could share a similar clause in their contract?

I don't envy you. I too would like to eventually get my own authority, but not my own customers. Simply put, I don't want to get into brokering. Maybe, possibly someday. As far as I see it, there are too many hands in the pot. Brokers getting loads from brokers and selling them to brokers. Before you know it, your cookies have been handled by 3 or more hands. No wonder we're complaining about cheap freight. Talk about cutthroat!!!

-A bore is a person who opens his mouth and puts his feats in it. - Henry Ford
 

davekc

Senior Moderator
Staff member
Fleet Owner
Even though you are out of service, you are still bound to the carriers lease whether you have your own authority or not.
Covering up the carriers sign doesn't exempt you from that lease unless it is actually terminated.
Some non-compete issues may carry for a specific term of time even after a full termination of the contract.
I am not a lawyer, but I still see many legal and ethics issues behind what you did.
Additionally, I see several liabilities based on what you have said.
We have had our own authority in the past, and I think I would approach this from a much different angle to avoid the exposure you opened yourself up to.
You may want to consider a consultation with a transportation attorney. This is certainly not a path a competent one would have you go down.













Davekc
owner
23 years
PantherII
EO moderator
 

greg334

Veteran Expediter
Dave,
Not defending them, because I think I know what they are saying, not sure but I think they complied a list, but worked with brokers not using the list to create the opportunities. Again they have not clarified what the list was for. If it was as I felt when I first read the post, then that is unethical any which way you cut it.

But with that all said, I was told by FedEx, if I had my own authority and wanted to pick up work on my own, I was required to cover up the FedEx signage and apply my own - where the insurance came from was the real issue for them. This was allowed in the lease and discussed with them and my lawyer.
 

davekc

Senior Moderator
Staff member
Fleet Owner
You are correct in that insurance would be one of the issues. If one is "moonlighting", then the carrier would expect their 15 percent or whatever percentage they indicate in their lease. I don't see the Fed allowing drivers to haul their own freight without the Fed taking a cut. If so, I might want to change carriers.












Davekc
owner
23 years
PantherII
EO moderator
 

ThibodeauxBayou

Not a Member
but worked with brokers not using the list to create the
>opportunities.

>But with that all said, I was told by FedEx, if I had my own
>authority and wanted to pick up work on my own, I was
>required to cover up the FedEx signage and apply my own -
>where the insurance came from was the real issue for them.
>This was allowed in the lease and discussed with them and my
>lawyer.





Mr Greg , you broke the code or either came into possession of our secret decoder ring. We thought we had the only one.

Of course theres alot of gray matter in a lot of our society. I can assure all here that ive always been a law abiding citizen and hold a high moral and ethical standing within my being and my community. Ill admit to dancing a pretty high step throughout our transition but never did we violate any laws of the land. I didn't do any 007 shenanigans while under the scope of our previous carrier. I certainly didn't target any one particular client to "steal" at a later time. We went into our own transport business with the intention of just being a small vehicle operation. And small we'll always be.

We feel our success to this point is that the repeat customers know exactly who's gonna be arriving to pick up and who's gonna deliver. They've become trusting in us and we go out of our way to deliver consistent service. Same truck,same driver. Its really just that simple.
 

greg334

Veteran Expediter
ThibodeauxBayou

But you seem not to answer the everlasting question, what was the purpose of the list you compiled?

Just trying to figure out the ties between the list itself and the statement "We feel our success to this point is that the repeat customers know exactly who's gonna be arriving to pick up and who's gonna deliver. They've become trusting in us and we go out of our way to deliver consistent service. Same truck,same driver." because, and don't get me wrong there is an implied message that keeps sticking in my head that you used the list to solicit work, maybe I hit my head too hard on the truck door the other day or I am missing something.
 

ThibodeauxBayou

Not a Member
implied message that keeps sticking in my head
>that you used the list to solicit work, maybe I hit my head
>too hard on the truck door the other day or I am missing
>something.


When we first started out, we just composed a drivers check off list. The data we recieved off the c-link went onto our check off list.
Once we delivered or picked up we inserted the name of individual we dealt with. If we were at anytime asked who accepted or shipped a particcular load, then we were able to at least reference a name.
But also note that we always recorded what time we arrived,departed,address,phone number,skid count,weight,miles,pay,DH,fsc....ect....ect.

Come to think of it, one of the wives is the one who drew up the original document. Forced discipline possibly, but certainly a invaluable tool.
 

greg334

Veteran Expediter
So then I am assuming that the list was nothing more than record keeping for performance evaluation?
 
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