If one needs or wants the advance ...thats fine!
In my case it is No Thank you....
In my case it is No Thank you....
more info on bolt
- Thread starter underdog777
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Thought I might as well jump in. In States where Remodeling Contractors are licensed, the amount they are allowed up front is regulated. Most contractors are looking for the material cost up front so if they get stiffed at least the material should be paid for. As far as interest rates it's
28-29 % or more and IT"S MONTHLY not yearly, look at your statement.
28-29 % or more and IT"S MONTHLY not yearly, look at your statement.
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greg334
Veteran Expediter
Well here's the thing, in the short time I have been doing this, I have only seen four times that a company/agent/broker has said "stay there we have a customer who will be shipping something tomorrow" and it come true. This of course is outside the realm of near or strict dedicated work.
I feel regardless what the company says, what their "dispatchers" come up with or the "load planners" see in their crystal ball, it is like going to Madame Vicky and having your fortune told, she can guess about it base on a series of questions and your past but only can take credit if something actually come true.
This stuff has been and always will be based on the need of the customers and not the need of any carrier and the predictability outside of having the customer on the phone setting up the load all comes down to that dirty nasty unrealistic word LUCK.
Some will say it is all in the planning and how you run your business, outside of being independent, thats not true when it comes down to work unless you are an independent. As a driver/owner, you are at the mercy of the company and what they can or more importantly are willing to do for you. Some successful expediters seem to take big credit for their success and say there is little or no luck involved - like the expediting angle St. Mack Truck has been watching over only them and guiding them but it isn't so. They leave out the other reasons why they are doing well and some of it may surprise you what those reasons are or how it happens. But it all still comes down to LUCK.
Now if Bolt was so bad, then they wouldn't be in business and they run their business to suit them, not the drivers. My dealings with the have been good, but everyone is different. To be exact every driver/owner is different, everyone has different needs and different goals in life, Bolt may good fit because of these two things and be a great place to be contracted to or they may be the worst place in the world and just a nightmare - but that is not the company's fault when you realistically look at it.
chefdennis
Veteran Expediter
i have never sat including sat and sun, more then 4 days...thats delivering on thrus night lat or eafrly fri am, sitting and getting loaded on late monday.....
if you are with a carrier that lets you sit 4-7 days during the week, you need your head examined.....
and as has been said, if you need an advance to run a CV, you need to look at your business plan.....if you took the time to do one........
if you are with a carrier that lets you sit 4-7 days during the week, you need your head examined.....
and as has been said, if you need an advance to run a CV, you need to look at your business plan.....if you took the time to do one........
ebsprintin
Veteran Expediter
And, if you are sitting a week or two at a time, an advance is going to do little to keep you tied over for the next week or two. That's why I don't operate with advances being part of the way I operate. If I'm doing so bad that I need an advance, the advance is only going to be a band-aid on hemoraging.
FWIW--I've sat for twelve days before (insert bug-eyed smilie). It was one of those winter slow spells and sort of an experiment. I had something else to do and wasn't looking for work, but thought I'd stay in service to see how bad it could get. I'm sure I could have found work but that wasn't part of the experiment. This wasn't with my current lease.
eb
FWIW--I've sat for twelve days before (insert bug-eyed smilie). It was one of those winter slow spells and sort of an experiment. I had something else to do and wasn't looking for work, but thought I'd stay in service to see how bad it could get. I'm sure I could have found work but that wasn't part of the experiment. This wasn't with my current lease.
eb
OK, there are several things going on here. One is the blurring of the difference between percentage POD money (or a load advance, if you like) and a straight up off-load or off-PRO advance. In this business, whether you get POD money at the time of pickup or after the delivery, is largely semantical. There is a difference, to be sure, but there really isn't in this business (or most other businesses that are independent contractor based). Getting the advance between the time of the pickup and the delivery assumes that the delivery will be made, as as such the term "POD money" will mean load advances on a given load, whether it's paid out after pickup or after delivery.
Some carriers pay nothing until Settlement. Some pay 100% of the load at delivery, but those are generally not expedite carriers, as expedite carriers must hold something back to cover weekly deductions. Most carriers who are non-asset based and have independent contractors comprising their fleet do, in fact, offer some percentage of the load either at delivery or at some time between the pickup and the delivery. They do not do this out of the goodness of their heart. Carriers never do anything out of the goodness of their heart. They do it because it's in their best interest to do so. It affords the small business independent contractor, on which the carrier is dependent, to have a reasonable cash flow for operating expenses. Independent contractors in other industries, like construction, have other outside resources that truckers generally do not have, thus the reason for carriers doing what they do.
In order to help with their own cash flow and to ensure that weekly deductions and other contingencies are covered, carriers will hold back a percentage of monies owed and then settle up and pay out for services rendered 2-3 weeks after the load contract has been completed. Suggesting that one should wait those 2-3 weeks, or longer, to get paid for services rendered, simply because the carrier doesn't get paid for 30 days or whatever, is silly when you compare the financial resources of a carrier to that of an independent contractor. That's a carrier's problem, not the independent contractor's problem. Not to mention, and think about this one for a second, the independent contractor already pays the carrier a rather large percentage of each load to deal with receivables, collections and factoring. You shouldn't have to pay, again, to factor a reasonable percentage of your own loads.
Because of the nature of the business, it is not unreasonable to wait 2-3 weeks for the settlement, nor it is unreasonable to expect a percentage of the load paid out as POD money at the time of the load. What is unreasonable is to levy a 5%, 10% or 15% fee for POD money (regardless of vehicle type), and doing so is not all that far away from outright theft. Actually, more technically, it's an unfair abuse by the carrier of the carrier's position and influence over the independent contractor for a gain, which is by definition, graft. And graft isn't very far removed from theft. It's the same thing by different means.
True enough, bigs and straights have a larger financial burden, but they also have a larger revenue stream. The financial burden, and the revenue stream, of a cargo van is directly proportional to that of larger trucks. Cargo vans may have a fairly minimal capital need, but they also have an equally fairly minimal revenue potential. Charging a fee for POD money for carvo vans and not for trucks, for whatever reasoning and justification they choose to apply, is nothing more than encouraging a significant portion of their fleet to allow the carrier to keep and use their money for a longer period of time, interest free. They do it in part because cargo van drivers as a population tend to have less money and are thus under-capitalized and therefore need more advances for operating capital. Charging them a fee is an unfair abuse of position, and they know it. That's why they charge the fee. Reminds me of one carrier who charges $5 every time they load your Comdata card, regardless of the reason for loading it, even though Comdata charges zero for loading a card and it's done automatically by the computer. It's as unseemly of an abuse as a $3.95 truck stop ATM fee or the 2% fee that Pilot charges your to get cash back off the Comdata card at the time of fueling.
Now, of course, I have been talking about POD money, and not some other kinds of advances. If your truck or van breaks down and you need to borrow money from your carrier, either directly from them or against future settlements, or if you are sitting there and twiddling your thumbs and they call you with a load and you need an advance in order to run it, that's another matter. That's a straight up loan advance, and charing 15% for that is not at all unreasonable, since there's a fee for that kind of service that needs to be paid.
Other random thoughts...
There's nothing wrong with getting fuel money as POD money and then using your own money for operating capital. What's wrong is a carrier charging you for using your own money for that privilege.
Comdata fuel discounts can be significant versus paying by credit or debit card, even if your carrier does not have a fuel discount program with any of the truck stops. Comdata is "cash or cash equivalent" and gets you the cash discount at the diesel pumps. However, there's a $1.50 or $2.00 transaction fee every time you use the card. The carrier discounts at some truck stops (TA in particular) can be a lot, 30, 40 even 50 cents a gallon. But it depends on the location, as sometimes the discounts are virtually non-existent, especially when you factor in an additional transaction fee. At the Flying J you get half a shower credit for 15 gallons of gas or diesel you purchase. That's a $5.00 discount for every 15 gallons. That turns $3.00 fuel into $2.67 a gallon, a 33 cent discount. If you buy fuel at the TA or some other truck stop, 25 gallons will cost you $.06 per gallon in Comdata fees (10 cents per on 15 gallons), so take that into consideration. But if the TA, for example, has a discount of 40 cents or more, it's cheaper to buy fuel there on Comdata.
One thing about Flying J fuel is, it's usually at or very near the 40 cetane mark, which is really low, as most other fueling locations it's 44-46. Unlike octane, which is a measure of BTU's in the fuel, cetane is a measure of ignition at a given temperature and pressure. The higher the cetane, easier it is to ignite, and thus will ignite at lower temperature and pressure. Meaning, a higher cetane fuel will ignite quicker in the combustion chamber cycle, letting the engine work less for the same power, and it gives a more complete burn with less particulate emissions, and carbon residue left behind in the engine. So while Flying J fuel may be cheaper, you get what you pay for. The use of cetane boosters (arguably very important in Sprinters) must be factored in as far as the per gallon cost of fuel.
I buy fuel at the J when I need shower credits, otherwise I generally stick with the higher cetane fuel of the others. Adding Power Service (gray) to J fuel gets me up to where the other truck stops are, and adding it to other fuels gets me up to CARB diesel, which is 50 cetane.
There is little, if any, advantage to using a Comdata card if you are purchasing gasoline. You can use it as a regular debit card, including getting cash back at the time of the transaction, at Walmart and many other places.
Some carriers pay nothing until Settlement. Some pay 100% of the load at delivery, but those are generally not expedite carriers, as expedite carriers must hold something back to cover weekly deductions. Most carriers who are non-asset based and have independent contractors comprising their fleet do, in fact, offer some percentage of the load either at delivery or at some time between the pickup and the delivery. They do not do this out of the goodness of their heart. Carriers never do anything out of the goodness of their heart. They do it because it's in their best interest to do so. It affords the small business independent contractor, on which the carrier is dependent, to have a reasonable cash flow for operating expenses. Independent contractors in other industries, like construction, have other outside resources that truckers generally do not have, thus the reason for carriers doing what they do.
In order to help with their own cash flow and to ensure that weekly deductions and other contingencies are covered, carriers will hold back a percentage of monies owed and then settle up and pay out for services rendered 2-3 weeks after the load contract has been completed. Suggesting that one should wait those 2-3 weeks, or longer, to get paid for services rendered, simply because the carrier doesn't get paid for 30 days or whatever, is silly when you compare the financial resources of a carrier to that of an independent contractor. That's a carrier's problem, not the independent contractor's problem. Not to mention, and think about this one for a second, the independent contractor already pays the carrier a rather large percentage of each load to deal with receivables, collections and factoring. You shouldn't have to pay, again, to factor a reasonable percentage of your own loads.
Because of the nature of the business, it is not unreasonable to wait 2-3 weeks for the settlement, nor it is unreasonable to expect a percentage of the load paid out as POD money at the time of the load. What is unreasonable is to levy a 5%, 10% or 15% fee for POD money (regardless of vehicle type), and doing so is not all that far away from outright theft. Actually, more technically, it's an unfair abuse by the carrier of the carrier's position and influence over the independent contractor for a gain, which is by definition, graft. And graft isn't very far removed from theft. It's the same thing by different means.
True enough, bigs and straights have a larger financial burden, but they also have a larger revenue stream. The financial burden, and the revenue stream, of a cargo van is directly proportional to that of larger trucks. Cargo vans may have a fairly minimal capital need, but they also have an equally fairly minimal revenue potential. Charging a fee for POD money for carvo vans and not for trucks, for whatever reasoning and justification they choose to apply, is nothing more than encouraging a significant portion of their fleet to allow the carrier to keep and use their money for a longer period of time, interest free. They do it in part because cargo van drivers as a population tend to have less money and are thus under-capitalized and therefore need more advances for operating capital. Charging them a fee is an unfair abuse of position, and they know it. That's why they charge the fee. Reminds me of one carrier who charges $5 every time they load your Comdata card, regardless of the reason for loading it, even though Comdata charges zero for loading a card and it's done automatically by the computer. It's as unseemly of an abuse as a $3.95 truck stop ATM fee or the 2% fee that Pilot charges your to get cash back off the Comdata card at the time of fueling.
Now, of course, I have been talking about POD money, and not some other kinds of advances. If your truck or van breaks down and you need to borrow money from your carrier, either directly from them or against future settlements, or if you are sitting there and twiddling your thumbs and they call you with a load and you need an advance in order to run it, that's another matter. That's a straight up loan advance, and charing 15% for that is not at all unreasonable, since there's a fee for that kind of service that needs to be paid.
Other random thoughts...
There's nothing wrong with getting fuel money as POD money and then using your own money for operating capital. What's wrong is a carrier charging you for using your own money for that privilege.
Comdata fuel discounts can be significant versus paying by credit or debit card, even if your carrier does not have a fuel discount program with any of the truck stops. Comdata is "cash or cash equivalent" and gets you the cash discount at the diesel pumps. However, there's a $1.50 or $2.00 transaction fee every time you use the card. The carrier discounts at some truck stops (TA in particular) can be a lot, 30, 40 even 50 cents a gallon. But it depends on the location, as sometimes the discounts are virtually non-existent, especially when you factor in an additional transaction fee. At the Flying J you get half a shower credit for 15 gallons of gas or diesel you purchase. That's a $5.00 discount for every 15 gallons. That turns $3.00 fuel into $2.67 a gallon, a 33 cent discount. If you buy fuel at the TA or some other truck stop, 25 gallons will cost you $.06 per gallon in Comdata fees (10 cents per on 15 gallons), so take that into consideration. But if the TA, for example, has a discount of 40 cents or more, it's cheaper to buy fuel there on Comdata.
One thing about Flying J fuel is, it's usually at or very near the 40 cetane mark, which is really low, as most other fueling locations it's 44-46. Unlike octane, which is a measure of BTU's in the fuel, cetane is a measure of ignition at a given temperature and pressure. The higher the cetane, easier it is to ignite, and thus will ignite at lower temperature and pressure. Meaning, a higher cetane fuel will ignite quicker in the combustion chamber cycle, letting the engine work less for the same power, and it gives a more complete burn with less particulate emissions, and carbon residue left behind in the engine. So while Flying J fuel may be cheaper, you get what you pay for. The use of cetane boosters (arguably very important in Sprinters) must be factored in as far as the per gallon cost of fuel.
I buy fuel at the J when I need shower credits, otherwise I generally stick with the higher cetane fuel of the others. Adding Power Service (gray) to J fuel gets me up to where the other truck stops are, and adding it to other fuels gets me up to CARB diesel, which is 50 cetane.
There is little, if any, advantage to using a Comdata card if you are purchasing gasoline. You can use it as a regular debit card, including getting cash back at the time of the transaction, at Walmart and many other places.
I would say you mirror my thoughts on this. It has nothing to do with what level of capitalization one has or doesn't.
There is only two reasons a carrier would engage in this practice. Either to take advantage of contractors to enhance their own revenue stream, or the carrier is working with very limited capital and can't have that most exposure. Both would be potential red flags regardless of the carrier.
Dave is entirely correct!!!!
It really comes down to the owner operator fully understanding the lease agreement before they sign on with a carrier. "quick pay" option normally always comes at a price. It is the same for a carrier. It is basically the same as the carrier "factoring" thier invoices. A smart contractor should make sure that he is properly financed to operate under a carriers standard terms.
"Standard Terms" varies greatly from carrier to carrier. You should know what the hold back or processing time line is and any accessorial charges that are charged to the independent contractor. Some carriers pay after one week while some hold back 2 to 3 weeks settlement. Personally you should be leary of a carrier that is excessive in "hold back". Many times these carriers are funding operations from the owner operators versus the bank or company funds.
Service charges should exist as a carrier does have expense in providing these. You need to look at those charges and determine if they are reasonable to cover the carriers cost and administrative expense or if they are a revenue stream for the carrier.
It all goes back to the basic stance....you are a business person and you need to make well informed and well thought out decisions. It is not what you gross, it is all about what you net!
It really comes down to the owner operator fully understanding the lease agreement before they sign on with a carrier. "quick pay" option normally always comes at a price. It is the same for a carrier. It is basically the same as the carrier "factoring" thier invoices. A smart contractor should make sure that he is properly financed to operate under a carriers standard terms.
"Standard Terms" varies greatly from carrier to carrier. You should know what the hold back or processing time line is and any accessorial charges that are charged to the independent contractor. Some carriers pay after one week while some hold back 2 to 3 weeks settlement. Personally you should be leary of a carrier that is excessive in "hold back". Many times these carriers are funding operations from the owner operators versus the bank or company funds.
Service charges should exist as a carrier does have expense in providing these. You need to look at those charges and determine if they are reasonable to cover the carriers cost and administrative expense or if they are a revenue stream for the carrier.
It all goes back to the basic stance....you are a business person and you need to make well informed and well thought out decisions. It is not what you gross, it is all about what you net!
chefdennis
Veteran Expediter
John wrote:
Thanj you John....it really is that simple......
Thanj you John....it really is that simple......
My "based on what I heard" comment was based on what I heard from a representative of the company working the booth at a trade show event while he was wearing company logo'd attire so I presumed it to be somewhat better than dubious although still questionable to a small degree like anything else out of the mouth of any company person.
RLENT
Veteran Expediter
It's not at all semantical - if you are capable of assuming the viewpoint of the carrier - if you are only capable of seeing it from the position of the contractor, then yes, it is semantical.
Looking at it from the viewpoint of a carrier, advancing monies on a load not yet run carries much more risk, than advancing monies on a load delivered.
That should be plainly evident - hang around a truckstop for a bit and talk to a few of the goobers out here doing this (especially in vans)
While they are likely in a minority, these individuals do pose a risk.
And therein lies the problem.
Yup - and it's a perfectly valid business model, in light of the nature of the business and billing model involved. This isn't a cash transaction-based business, like Home Depot or Walmart. It is one that is largely based on some extension of credit to the customers that are paying for the service.
I would suggest that holding back to cover weekly deductions is not something that is strictly limited to expedite carriers only.
No doubt true ...... most (but not all) do .....
Of course, if one looks at "most carriers" you are by far and away talking about the operation of semi's ...... not cargo vans. The wherewithal to operate a semi is different by orders of magnitude - especially one that might be running team and not solo, and has the potential to rack up a huge amount of miles in the several weeks before standard terms would become due.
One could argue that no one ever does anything out of the goodness of their heart ...... carriers, contractors, .... or the common man on the street .... it's all entirely out of self-interest only .... I don't think that is always necessarily true .... but then I'm a bit of an idealist
In the case of straight trucks and semi's I would agree ..... since the operating expenses are significantly higher .....
In the case of cargo vans and Sprinters, not so much.
Such as ?
Really, I think what you (we) are talking about is credit - unless there is something else that I'm missing ?
Generally speaking, credit is something that one has to pay for.
That is certainly true.
Such a statement is largely based on mere assumption ...... it has to be .... since most carriers - certainly expedite carriers at least - are largely privately-held .... and so one has no real insight whatsoever into exactly what their available financial resources are ..... it is certainly true that the financial resources of a carrier, as opposed to a contractor, are greater .... they would have to be, since their financial demands are correspondingly greater.
But your assumption seems to assume that just because they are greater, that there is an abundance of uncommitted resources that are not being utilized .... coffers of unused money just lying around or something....
In the case of the few publicly held expedite carriers (Fedex, Landstar, Express-1) at least two (Fedex, Landstar) have other operating units beyond expedite. I don't believe that Fedex breaks out their numbers for Custom Critical separate from the other operating units, as a matter of public record. Not sure about Landstar.
In the case of Express-1, who until recently was largely expedite I believe, have you actually reviewed their financials in order to determine what their financial resources are ? (It's a rhetorical question - because even if you had reviewed them, without being intimately involved in the management of the company it is unlikely that you have any real understanding of what's involved with managing their cash flow)
Further, it is reasonable to assume (since we seem to be making alot of assumptions here) that the resources available to smaller expedite carriers, may well be drastically different, than the larger players - who often have other operating units which generate revenue.
It should be plainly evident that, a smaller business, is not going to have the same resources as a much larger one. Hence there may well be significant differences in the manner that they operate.
While it certainly is a problem for carriers, to suggest that it is also not potentially a problem for an independent contractor who would service that carrier is just foolish ....
Such a statement assumes that any factors which effect the entity which one services either cannot, or will not, have some effect on the nature of the relationship ..... whether one as a contactor, is actually aware of, or knows about it ... or not .....
I would submit that such factors do indeed have an effect on the nature of the relationship between carriers and contractors - and anyone who thinks that they don't is just kidding themselves.
Such a viewpoint would seem to indicate that you view the nature your relationship with your carrier as one where you are a consumer and the carrier is a vendor of some product or service .... that's certainly one way to look at the relationship. And if it has served you well, by all means ..... continue ......
Another way to look at the relationship would be to consider that your carrier is your customer, and that you provide a service to them and that they pay you for rendering the service.
In fact, I think if you were to look at the generally accepted definition of the word "contractor" it would prove informative as to exact nature of the relationship.
I'll make no pronouncement of judgement as which is the better manner to approach the relationship and leave that to the readers to decide. It is an individual decision.
Your own loads ........ well now, there's a very interesting viewpoint .....
Did you go out and call on the customer to secure their business ?
Maybe you fielded the phone call when they called in to book the load ?
Or perhaps you bid the load on a bid board to secure it ?
Are you providing the insurance to cover the customer's freight while it was being transported ?
Or maybe you will be doing the billing of the customer for payment when the load is delivered ?
Or following up to ensure that payment is collected ?
Or selling the debt to secure payment in a timely manner ?
If the customer doesn't pay and you can't collect, will you be eating the debt - or will your carrier write off the debt and pay you for running the load anyways ?
Or is it that were you just sitting there .... waiting for the beep ?
Now ..... please remind me once again ........ whose load is it ?
Using the above logic - which IMHO, is utterly flawed by the way - one could, by inference, say that when a carrier (or any business for that matter) hauls a load (or performs a service) for a customer, the carrier (or business) should not have to pay to factor the invoice to receive early payment of their invoice, beyond standard terms.
Of course, most here know, that just isn't the way it works in the real world.
Considering that most customers probably don't pay for haulage for around that amount of time, yes, that's quite true - it isn't at all unreasonable.
Credit terms that carriers are allowed to extend to customers responsible for payment are established by Federal Regulations - by default, the credit period is 15 days which begins upon the day following presentation of the invoice to the party responsible for payment. Carriers are allowed to extend that time frame - up to 30 days, maximum - if it is incorporated into their published tariff. These rules are covered under §377.203:
Extension of credit to shippers.
(The terms "shippers" above meaning the party responsible for payment)
Assuming that a carrier is prompt with the billing (which may be dependent on the driver providing a copy of the BOL signed by the consignee, as POD in a timely manner), one is probably looking at least two weeks before receipt of payment can reasonably be expected.
It isn't at all hard to imagine the rather significant amount of accounts recievable float required to fund any carriers business .... even when all customers pay on time. (Of course one can possibly speed up the cash flow, by either offering a discount for early payment, or by selling the debt ... both of which potentially effect profitability and reduce cash overall)
Moving beyond that, if one is to consider the matter of actually expanding one's business - as opposed to just maintaining the present volume - then the inherent problem of financing that expansion becomes readily apparent - or at least it should.
By the way, speaking of expansion and growth - did I happen to mention that my carrier for the third time in the past 4 years, has yet again has been named "Carrier of The Year" at GPSNet Technologies Expedite Alliance Conference, for having the highest year-over-year sales growth ?:
Bolt Express Named Carrier of the Year Again
Got to go get my annual DOT inspection done, but I'll try and reply to the remainder of you comments later, if I get a chance.
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Considering the amount of contractor money held in escrow there is minimal risk to the carrier in advancing 40% of the line haul amount of a load. That amounts to maybe 1/3 of the total pay for the run counting FSC etc. and it's highly unlikely that one single run is paying more than 3 times the total escrow amount. Add in the weekly profits the carrier makes off each contractor on QC and other fees and their risk is more than covered. Now, if a van operator is on a run paying more than $2000 in base linehaul or a bigger truck is on a run paying more than $6000 in base linehaul the advance could exceed the escrow amount.
Since money isn't given until the freight is loaded it's presumed it will be taken to the delivery. Certainly things can and do happen but each mile ticked away reduces the carrier risk. In those very few instances when a contractor can't make the delivery they usually continue working with the carrier and even things out on the next load.
RLENT
Veteran Expediter
Please square the above comment with the comment directly below, made by you, earlier in this thread:
Lesseee .... first you think it's someone else .... and then you've now suddenly recalled that you had this conversation .... dunno .... maybe testing for Alzheimers ought to be part of the DOT Medical Exam ......
Kinda odd ..... ya gotta admit .....
Yeah .... well ..... it appears that company personnel aren't the only source of dubious info .....
There is always the matter of what was actually said, and the matter of what was heard ....... they are, often, quite different, owing the inability of one individual to actually "get" what is being said by another.
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greg334
Veteran Expediter
For those newbies sitting on the sidelines there is a very important point being made in Rlent's post;
I colored the important points of that comment for a very specific reason. Actually that is the way everyone should look at it until they establish a working relationship with the company.
Regardless how you cut it this is a business, not a paid vacation or a do something for retirement but a business and you are part of the service chain when you contract to a company - this seems to be a often forgotten issue with many who don't get it or think they are always being screwed by a company.
A lot of companies will sugar coat the real contractor/company relationship by saying "your a partner", "your a value added service provider" or "your part of the team" - none of it is really true. If you had been a partner or part of the team, then you would access to more than what is on the qualcomm, not limited to calling "dispatch" up and asking questions as one example.
I colored the important points of that comment for a very specific reason. Actually that is the way everyone should look at it until they establish a working relationship with the company.
Regardless how you cut it this is a business, not a paid vacation or a do something for retirement but a business and you are part of the service chain when you contract to a company - this seems to be a often forgotten issue with many who don't get it or think they are always being screwed by a company.
A lot of companies will sugar coat the real contractor/company relationship by saying "your a partner", "your a value added service provider" or "your part of the team" - none of it is really true. If you had been a partner or part of the team, then you would access to more than what is on the qualcomm, not limited to calling "dispatch" up and asking questions as one example.
This thread is starting to take the shape of a Obama health-care bill.
No need to complicate the simple.
At the end of the day, it comes down to carriers that engage in these practices, are a red flag for someone pursuing a relationship with a carrier.
No need to complicate the simple.
At the end of the day, it comes down to carriers that engage in these practices, are a red flag for someone pursuing a relationship with a carrier.
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RLENT
Veteran Expediter
That is absolutely true ..... bottomline:
My carrier (Bolt Express) does not have an advance program for cargo vans or Sprinters, preferring to allocate their resources to those who have, in my estimation (and apparently theirs) a far greater need for advances.
If you are cargo van or Sprinter operator and that won't work for you, then it's probably not the place for you - because if you ask for money in advance of your normal settlement date, they may provide it (in spite of the fact of not having a advance program for those vehicle types) - but you will pay for it.
While what Greg said about about being a "partner", or "on the team" is to some degree true, it is also true, as a consequence of the nature of the relationship due to an exclusive lease, that to some extent, one is a member of the group (team, etc.) - if only at the periphery, on a limited basis. To what degree that's true for any individual is something that only the individual can determine for themselves. It's your decision, and up to you what you choose to make out of it.
The following is strictly my opinion alone, and doesn't necessarily reflect the stance of the company (indeed it might well be unpopular with them), or anyone who directly works for them:
If you are a cargo van or Sprinter owner-operator who is either in a situation where you have inadequate capital currently to operate, and/or have a history of mismanaging your finances to such a point where you regularly don't have the ongoing capital to operate, then please, please stay away - go hire on with some other carrier, whose standards may be such that they will accept and/or tolerate such contractors.
Personally, if you have those types of problems, I'd just as soon you weren't on my team - because, generally speaking, people that have those types of problems also have alot of other undesirable stuff going on.
Maybe .... but of course there are many aspects that go into the evaluation ......
It could be that you would prefer to be treated like an adult and not woken up 4 hours early for a delivery at a consignee ..... when you are already sitting in their parking lot ......
Or it could be you would like to take some time off .... without the company unnecessarily withholding your settlements .....
Or it could be that you would just like to have to your settlements paid to you accurately, ontime, regularly on an ongoing basis ..... without having to call up, navigate the corporate maze, and fight with some doofus about whether the matter was going to have to be sent to "Research" (good grief ......) or a whole host of other factors .....
One always has to weigh all factors that go into evaluating whether or not you wish to have a relationship with any particular company.
For me, the non-availability of an advance program was never an issue:
I never expected my customer to provide the financing of my operating capital - I just sort figured that was my responsibility and part of what I bring to the table.
Of course, everyone's mileage may vary.
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No, actually it is semantical. It's a qualified semantics, and I stated that there is a difference, but qualified the semantics and put it in the proper context. Yeah, on the surface of it, looking at it narrow terms, dismissing certain factors, sure, there's a significant risk involved in advancing POD money before the load is delivered. But, as Leo detailed, the end result is that it is, in fact, semantical, and that's looking at it from the point of view of the carrier. Because of all the factors involved, and the carrier and the contractor both assuming the load will actually be delivered (which is not a false assumption since nearly all loads do in fact get delivered), whether you get POD money at the time of pickup or after delivery doesn't really matter very much. I've run for carriers who have done it both ways, and the end result of either method is so semantical that I could care less which way the carrier chooses to pay POD money.
Granted, very small carriers have a much greater risk in paying POD money at pickup, and those are the carriers who should probably not do that. But, for example, if I were to be offered a 1000 mile run right now, my POD money at pickup would be 45% of my 77 cents per mile, $346. I currently have in Open Payables, money that has yet to be paid out to me at Settlement, far, far more than $346, so the carrier giving me that POD money at pickup represents little to no risk at all.
True, it's not a cash transaction-based industry, except for one small segment of it. All of the various chain links between raw materials, manufacture, warehousing, inventory, and delivery are usually covered with good faith credit or commercial paper, except that one final delivery link, that of the independent contractor who delivers the goods. It is cash transaction-based, since it is the contractor who must outlay cash to perform their services, unlike every other segment in the chain. Since the contractor performs services on a load contract basis, this puts the contractor at a significant disadvantage to the other links in the supply chain.
Nor did I mean to suggest otherwise. It holds true for any independent contractor who is leased on with a carrier. Company drivers and those with their own authority do not have this situation.
Actually, it's really not much different at all, and certainly not by an order of magnitude. Teams can certainly rack up more miles than solos, but a solo in a tractor can actually rack up less miles in a week than a solo in a van. A team van can rack up as many miles as a team truck. If you look solely at risk and expenses and compare trucks to vans, you're right. But if you also factor in revenue and revenue potential, it all evens out. It certainly takes more cash to operate a truck than a van, but the payment for doing so is proportional. There is far less risk in operating a van, but the reward is likewise far less.
Trucks have higher operating expenses, but they also have higher revenues. Vans and Sprinters have lower expenses, but they also have lower revenue. The percentage of the line haul that is used for operating expenses is generally the same without regard to vehicle type. Sprinters and vans aren't special, they don't somehow have a significantly smaller proportion of their revenue going to operational expenses.
Credit, yes. And truckers do have access to credit, although rarely low-cost short-term commercial paper credit, But credit in other industries, like construction, can come in many forms, some without any additional cost, like extended payment terms from suppliers. A contractor I know, for example, routinely obtains building materials from Lowe's, and does so on 30-day payment terms. He does not pay anything extra for those terms. (Actually, he gets a significant discount over the normal selling price of most items).
Actually, no, it's not largely based on assumption. You're merely assuming that I'm assuming. But I'm not. It's a general statement based on how carriers in the industry operate. Sure, the are carriers with little to no financial resources, but I'm not looking to detail all of the possibilities. That would merely further complicate the simple and Dave would simply explode. Smaller carriers will generally have fewer resources, larger carrier will generally have more resources, generally speaking, generally.
"and so one has no real insight whatsoever into exactly what their available financial resources are ....."
Unless, of course, one has been given the details of what those financial resources are by the owner of a small carrier. Once you know the details, insight is real easy. For example, did you know you can factor a block of loads, or a portion of those loads, far cheaper than you can factor them individually? Depending on who the customers are, of course, a carrier with broker authority can do that and be afforded the discounts, whereas an independent contractor generally cannot.
Actually, that's an assumption in and of itself. A small non-asset based carrier may very well have fewer financial demands than that of a single tractor-trailer owner/operator.
"It should be plainly evident that, a smaller business, is not going to have the same resources as a much larger one. Hence there may well be significant differences in the manner that they operate."
I don't recall stating any differently.
Well, I never hinted at "potentially". If you introduce "potential problems" into my statement, then it fundamentally changes my statement, and the meaning of it. But my statement, on it's own, is not a foolish statement. If I'm contracted by a carrier to perform a service, and I fulfill my part of the contract, the carrier is expected to pay for those services under the terms that we have previously agreed to. How they do it is their problem, not mine. If they have a cash flow problem, yes, it may affect me, but it's their problem to solve, not mine. Not getting paid introduces a problem outside of my statement. I want my money. It's up to them to pay it, by whatever means necessary.
I've stated in these forums several times precisely how I view the relationship, and it's far from how it is characterized in the above statement. By definition, the independent contractor is the vendor, not the consumer. However, with respect to receivables, collections and factoring of loads, I am, in fact, the customer and am paying the carrier for a service.Such a viewpoint would seem to indicate that you view the nature your relationship with your carrier as one where you are a consumer and the carrier is a vendor of some product or service .... that's certainly one way to look at the relationship. And if it has served you well, by all means ..... continue ......Originally Posted by Turtle
Not to mention, and think about this one for a second, the independent contractor already pays the carrier a rather large percentage of each load to deal with receivables, collections and factoring.
"Another way to look at the relationship would be to consider that your carrier is your customer, and that you provide a service to them and that they pay you for rendering the service."
That's precisely how I look at it, because that's precisely what the relationship actually is. I could go out and get my own authority and insurance then broker my own loads and deal with collections and factoring, but I don't want to deal with all of that, so I pay my carrier to do it for me. It's that simple.
"In fact, I think if you were to look at the generally accepted definition of the word "contractor" it would prove informative as to exact nature of the relationship."
No need to insult my intelligence.
Yes, it is, considering that once the load is on my van I'm financially responsible for it, and I paid someone to find the load for me in order to run it.
"Did you go out and call on the customer to secure their business ?"
No, that's what I pay my carrier for.
"Maybe you fielded the phone call when they called in to book the load ?"
No, that's what I pay my carrier for.
"Or perhaps you bid the load on a bid board to secure it ?"
No, that's what I pay my carrier for.
"Are you providing the insurance to cover the customer's freight while it was being transported ?"
Actually, yeah, I am.
"Or maybe you will be doing the billing of the customer for payment when the load is delivered ?"
No, that's what I pay my carrier for.
"Or following up to ensure that payment is collected ?"
No, that's what I pay my carrier for.
"Or selling the debt to secure payment in a timely manner ?"
No, that's what I pay my carrier for.
"If the customer doesn't pay and you can't collect, will you be eating the debt - or will your carrier write off the debt and pay you for running the load anyways ?"
No, that's what I pay my carrier for, - and yes, that's what I pay my carrier for.
"Or is it that were you just sitting there .... waiting for the beep ?"
It's not an either/or situation. They aren't mutually exclusive. I do both. And I do both quite well.
"Now ..... please remind me once again ........ whose load is it ?"
Mine. The split second the load contract goes into effect, it's my load. I'm 100% responsible for the safe cartage and delivery of it, with the exception of those responsibilities that I pay my carrier to assume. Each carrier may have different levels of responsibility. With some carriers, if I were to break down en route and could not deliver the load, it would still be up to me to find a way to get it delivered, either by obtaining alternative transportation such as renting a truck, or by me personally finding someone else to deliver the load on time. I would have to in effect hire a subcontractor to do the job for me. With other carriers the responsibility is more of a shared responsibility.
In any case, when I used the term "my own loads" I was referring to the loads that I haul on my van and that I am to be paid for, loads that I am responsible for and therefore take temporary ownership of via surety bond until delivery. It's common in the industry to use the term "my load" to mean whatever you are hauling, whether you are an independent contractor or a company driver regardless of who obtained the load or how it was obtained. Instead of "my own load" I suppose I could have said "someone else's load," but then none of what I said would have made any sense in the context of which I was speaking.
That's 100% true. They don't have to. Their business will be far more successful if they do, tho. But they certainly don't have to. Some carriers in fact, don't.
"Of course, most here know, that just isn't the way it works in the real world."
I submit to you that "most here" don't even know the details of how factoring works. <snort> Not that most here would have a need or reason to know about it, tho.
"Credit terms that carriers are allowed to extend to customers responsible for payment are established by Federal Regulations"
Yeah, I know.
"Assuming that a carrier is prompt with the billing (which may be dependent on the driver providing a copy of the BOL signed by the consignee, as POD in a timely manner), one is probably looking at least two weeks before receipt of payment can reasonably be expected."
Due to the use of electronic banking and digital imaging throughout the entire supply chain, more carriers are getting paid quicker by more customers (this is particularly true of the larger 3PL customers who tend to pay quicker than the norm). That's not to say that 2-3 weeks is now suddenly an unreasonable amount of time to wait for payment, because it's not, but quicker payment is also allowing more carriers to offer a "fast pay" option to their contractors (for a nice fee, of course), where the loads are settled at the end of the current week. It is no longer the case where most customers will only pay from the original invoice and not a digital image. From the initial bid to the final bar code scanning at delivery, everything is electronic and traceable, and payments are being made faster. Not all customers pay quicker, to be sure, but there are certain segments of the industry where line hauls are being paid very quickly.
"It isn't at all hard to imagine the rather significant amount of accounts recievable float required to fund any carriers business .... even when all customers pay on time. (Of course one can possibly speed up the cash flow, by either offering a discount for early payment, or by selling the debt ... both of which potentially effect profitability and reduce cash overall)"
That's absolutely true. But just like the independent contractors have a significant float in loads waiting to be processed as part of the settlement payout, once you get beyond a certain period of time the cash flow becomes more or less consistent, or at least consistent enough to handle operating expenses, including payables.
No, you didn't mention it, but I'm sure Bolt will be happy that you did. My carrier wins awards, too, but they don't pass all that much of it along towards my load pay, either.
Nothing to reconcile. Because of what I heard from one company individual from one company I thought it was that one company taking a far too large percentage (my opinion) of the contractor's money not Bolt so my comments don't suggest any sort of ailment. Thank you for the concern for my health and well being though.
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