Leased on with multiple carriers

[FlyingVan]

John,
I am one of those that got tired of running for more than one carrier. 2 reasons: 1, I got tired of letting everybody know what I was doing, and tell the other 2 I was under a load, blah, blah. It got old really fast, and 2, the companies that allow you to run for others are usually paying on the cheap side.

Rocketman,
Buying your own primary liability and cargo insurance runs you about the same as paying for qualcomm and work accident/worker's comp insurance.

One positive that I found about running for multiple carriers is that not one carrier will watch all boards at all times, so having more eyes looking increases the chance of getting a load. Also, not all carriers have access to all boards. And, some carriers have their customers where the load don't get on the boards, even though it was a small percentage of loads I ran. Majority of the loads were bid board loads. I know this because on some loads 2 of the 3 companies would call me with the same load, on some loads only one would call.

 

[tenntrucker]

When you say cheaper freight, it is cheaper to their contractors. In most cases the outside carrier is running it for far more than they would pay there own trucks. That is probably what Phil is finding out.

I found this true. I love getting loads handed off to me from the big boys. I always get paid better than they will pay their own drivers.

Sent from my DROID X2 using EO Forums

 

[jelliott]

Like Turri said those are the base requirements. Not really much different than calling TMW or McLeod or any other major dispatch software. But as he pointed out not very cost effective for a real small fleet (no brand really is).

Flying van points out exactly my point with 2 or 3 calling with the same load and bidding against each other. Now the lack of occ acc is a savings but also carries real risk in the event of a bad incident for the oo and his family. Qualcomm can be a great tool for the oo depending on how the carrier uses it.

 

[davekc]

I found this true. I love getting loads handed off to me from the big boys. I always get paid better than they will pay their own drivers.

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Yep....some are still in a state of denial, but you are correct. That is the very reason I like that option of brokering my own stuff.

 

[CharlesD]

There is big money in those short loads and I think a lot of large carriers probably don't want their contractors to be aware of just how much they're getting. We've booked 150 mile loads for $700-$900 recently from large carriers. I know why their contractors turned them down. These were loads that were just long enough to not be considered a mini by most companies, so their contractors would have been given their normal contracted rate per mile. So those get brokered out and our drivers will take them every time because we quote that high for those kinds of loads and pay a percentage. You can't expect a driver to start his clock for 150 miles at a buck and a half a mile. I'd turn that down too.

 

[ATeam]

I suspect you ran more, at a lower rate than you did with FedEx.

Not so. We ran more miles with Landstar because they did not leave us sit and give us fewer long runs like FedEx began to do when they brought more and more company owned reefer trailers into the fleet and gave preferential dispatch to the flat rate trucks that pulled them (which is what prompted us to leave the company). While Landstar has nowhere near the reefer freight FedEx does, our revenue per mile (odometer miles, not loaded miles) was nearly the same with both companies ($0.03 difference) for the year.

It has been said that if you torture the numbers long enough you can make them say anything you wish. I don't want to get into public number crunching and spin.

The short story is that we ran more miles at Landstar at nearly the same revenue per mile (gross revenue divided by odometer miles) and ran the reefer far less, thereby reducing our costs per mile and offsetting, partially if not entirely, the $0.03 difference.

Let me add the the numbers would have been more in Landstar's favor had Diane and I not made bad decisions while we were learning the Landstar system.

For example, an agent called us with a reefer load that we would have declined at FedEx because of long deadhead. But eager to prove our reefer capabilities to this agent and become better known by him, we jumped on the load and knowingly ran it at breakeven or worse. That was a mistake because we later learned that patience would have served us just as well. There were other loads and other opportunities to prove ourselves to that agent over time.

It is not a mistake we will repeat now that we are more attuned to the Landstar system. As I said above, The more Diane and I learn about how freight flows and how our agents work, the better it gets.

EDIT: Thinking about this more, and looking more closely at our 2011 numbers, the thing that most determined our revenue per mile number was us.

In other words, regardless of carrier, if someone was only willing to run for say $2.00 a mile or higher (hypothetical example), his or her revenue per mile for the year would be higher than someone's who was willing to run for say $1.00 a mile or higher.

Diane and I maintained price discipline through 2011, which explains why OUR revenue per mile numbers were similar at both carriers. With few exceptions at either carrier, we stuck to our pricing guns.

That got us fewer miles at FedEx as their rates dropped and more miles at Landstar as they had more loads that met our minimum. It was not about which carrier paid the higher rate.

We were paid by percentage of the load at both carriers and rates per mile varied by load at each carrier. The reason we made 2/3 of our money at Landstar when we worked a half-year at each carrier was because we were able to find more freight at Landstar that met our minimum rate. Accordingly, we said yes to more loads there, ran more often, got more (better paying) miles and earned more money.

At both carriers, we chose sitting over running cheap.

 

[ATeam]

This leased on with multiple carriers thread has been very informative. It is interesting to learn more about this no-authority, multiple-carrier model.

How widespread is it? How many carriers operate this way and is this a growing trend? When you vanners are out on the road, how common is it to find yourself sitting near another vanner who has hired multiple carriers to bid against each other for the chance to put the same piece of freight on that van?

Putting it a little differently. If you do not operate under this model, how much of a difference does it make price-wise for you when you find yourself bidding against these carriers and false capacity? Is it a nickle a mile? A dime? A quarter?

 

[OntarioVanMan]

This leased on with multiple carriers thread has been very informative. It is interesting to learn more about this no-authority, multiple-carrier model.

How widespread is it? How many carriers operate this way and is this a growing trend? When you vanners are out on the road, how common is it to find yourself sitting near another vanner who has hired multiple carriers to bid against each other for the chance to put the same piece of freight on that van?

Putting it a little differently. If you do not operate under this model, how much of a difference does it make price-wise for you when you find yourself bidding against these carriers and false capacity? Is it a nickle a mile? A dime? A quarter?

From what I've seen Phil...is they don't know or not even aware that one might be bidding against the other...also they seem to run in spurts....2-4 loads almost back to back and then sit for 1-2 weeks at a time....and the loads take them to BFE locations for a van without a long DH to get back uncompensated.....They brag...I got an 1800 mile load to Seattle...then they have a 800 mile DH back out...absolutely kills any profit...because they are not getting an above average rate...

 

[usafk9]

This leased on with multiple carriers thread has been very informative. It is interesting to learn more about this no-authority, multiple-carrier model.

I would agree.

Regarding your other post, thank you. However, as it stands now, though, we're content waiting for the beep...or "a new message has arrived".

 

[davekc]

I think the only way that can be continously successful dealing with multiple carriers in a van is to have your own authority. Even more so if you are taking loads out into the woods. As mentioned, running in that fashion is going to bring some loads, but many at bargain prices. If then freight slows, pretty easy to guess who is the last in line for the freight.

 

[OntarioVanMan]

I would tend to go with it IF a small carrier would allow me access to their boards....some small carriers have virtually no dispatch after hours and on weekends...better yet as Dave mentioned to have your own authority and access....

 

[ATeam]

I would agree.

Regarding your other post, thank you. However, as it stands now, though, we're content waiting for the beep...or "a new message has arrived".

That works for both of us. Please note that I have never encouraged anyone to leave FedEx or any other carrier for Landstar and I never will.

Diane and I used to encourage people to sign on with FedEx when we were there because we were doing well and believed that if people did what we did they could do well too. But it's different at Landstar, much different.

At FedEx (before flat rate trucks and preferential dispatch came on the scene), all contractors had the same beep in common. You did not have to know anything at all about how the freight gets into the system. All you had to do was wait for the beep.

At Landstar, it's not about the beep, it's about relationships and knowledge about how freight flows and agents work. That is why I have become an information omnivore about such things since changing carriers. And it is why I cannot recommend Landstar to anyone. There is no way to know how someone may do when relationship, research and marketing skills matter like they do here.

That is not to discourage someone from looking into the Landstar opportunity. As most BCO's are, I'm happy to answer questions (privately). And if someone new comes in, he or she will find the company and most BCO's to be friendly, welcoming and helpful. But if you are accepted and do come over, it remains the case that you will be very much on your own when it comes to making the unique Landstar system work for you.

 

[davekc]

There is a whole other world out there beyond "waiting for the beep".
Knowledge & technology can be a wonderful thing.

 

[CharlesD]

Even as an outside carrier, Landstar is all about relationships. I'm on a first name basis with several agents and they've gotten us a lot of good freight recently and at much better rates than we get from the bid board stuff.

 

[blizzard2014]

You gotta leave the running for multiple carriers gig to the big boys. I have my own authroity and technically run for all of the expedite companies out there. I move loads for each and every expedite carrier on the boards and a few from some other sources. I enjoy working with outside carriers to help them solve their logistics problems - it gives me a great sense of accomplishment. You have to be a really dedicated businessman to run your own company.

As i've stated before, it is much easier to just sit around and wait for someone else to load you up - and that model works for 90 percent of the O/O's in this business - but there are still a few of us who want to go 100 percent off the grid and be 100 percent rogue/renedage! I like being able to take time off without being harassed about when i'm going to go back in service and when I have a bad week there is no one to blame but myself. As far as having skin in the game - I have my van and my fleet vans and my reputation, credit rating, company, and my good name in all of this. My drivers and myself get paid the same day they deliver. I had my fleet driver paid 3 days before the companies I have the truck leased on to direct deposited my account. Needless to say I have one very happy fleet driver that I can use as a reference when I add more fleet vans and hire more drivers.

I don't see how anyone can factor loads and not pay the driver the same day. If you pay decent - pay quick- and treat the drivers like family (meaning they know you are down in the trenches with them) they will stay with you a long time and they will spread the word (by word of mouth) that your company is a class act! I have my fleet van leased on with three different carriers. One of the carriers gets all of the GE loads that the other two do not see and out of the remaining two only 1 has access to NLM. So, as you can see, they are not usually bidding against one another for the same load and each different carrier has their own customer base. The third carrier that my fleet van is leased on with gets 60 percent of their loads via brokers calling them direct when they see one of their trucks posted on the Sylectus board - once again those brokers do not bother to call the other two companies because they have a good working relationship with company number 3 which does not cause much conflict between the companies. My fleet driver has done over 7k miles in 3 weeks and he has mad us our montly qouta so far. Running for multiple carriers can be a good thing if it is done correctly and responsibly.

 

[gflight]

I agree with you except on signage, in Michigan you had better have a sign on your truck, even under 10K. I know this from getting a ticket for this, in Michigan only.