Multiple carriers.. beating a dead horse

[LastChance2]

I drive a CV for a big company and have so for almost 10 years.

2011 I grossed 69k
2012 I grossed 76K

I have a 2 1/2 year old and only spent 12 total weekends outs on the road. the longest was 19 days in June and averaged being away from home less then 5 days. I work for on company and have no headaches.

Well, I'm a math nut (minor in accounting in college) and took the figures we made in the eight months we've been O/O and figured it for a 12-month period and it came to 82,500 gross. Of course that is probably just pipe dreams, but we had a really great eight months as O/O and I'm looking forward to it continuing this year, and hope all of your (everyone's) successes continue. John (my co) will average being on the road about 9 months of the year, so I'm kind of excited to see what I see at the end of December 2013.

Had to edit to add, hadn't thought about his time on the road and time home in relation to the 54k, so in doing that, the 54k is for being on the road for a full six months, he was home a total of two months from May through December. Wow, that makes me even happier.

 

[paullud]

It sounds like your numbers are pretty good and being with 4 companies hasn't hurt you. The multi carrier model gets a bad rap because there are many examples of the carrier not paying. There are issues with having all 4 bidding but as long as you demand a higher rate you should be fine.

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[paullud]

Well, I'm a math nut (minor in accounting in college) and took the figures we made in the eight months we've been O/O and figured it for a 12-month period and it came to 82,500 gross.

It likely wouldn't be that high of a gross because those first few months would be very slow. Once you hit 12 months of operation you will have a better idea of total gross which will hopefully keep increasing.

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[LastChance2]

It likely wouldn't be that high of a gross because those first few months would be very slow. Once you hit 12 months of operation you will have a better idea of total gross which will hopefully keep increasing.

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LOL, hence my pipe dream comment. I would never expect it to be that high, but a girl can dream when she's a number cruncher, right?

 

[LastChance2]

It sounds like your numbers are pretty good and being with 4 companies hasn't hurt you. The multi carrier model gets a bad rap because there are many examples of the carrier not paying. There are issues with having all 4 bidding but as long as you demand a higher rate you should be fine.

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What has angered me the most in the past year is when our brokers call with a load out of Texas saying, what should we bid it for, we tell them our regular rate, and they're like, oh, well, everyone else is running for 60 cents to get out of Texas, and of course we tell them, okay then, call them with the load, because we aren't. So now since we are going to have to at least take our bottom dollar rate to get out of the Laredo area, we now extort them on our bid going in to Texas. It's the only way we have come up with to justify having to take our lowest bottom dollar rate to get out. It's getting that way for New York City area also. And don't even get me started on the west coast gas prices which we have to make up for when heading that way.

 

[Rocketman]

Had to edit to add, hadn't thought about his time on the road and time home in relation to the 54k, so in doing that, the 54k is for being on the road for a full six months, he was home a total of two months from May through December. Wow, that makes me even happier.

That's great! Please understand that we all take time off though. I've not even kept up with my time off, but I do know that I started in the first week of March. I also took about 7 weeks off after July 4th. Those were not my only days at home...just the large chunks.

 

[LastChance2]

That's great! Please understand that we all take time off though. I've not even kept up with my time off, but I do know that I started in the first week of March. I also took about 7 weeks off after July 4th. Those were not my only days at home...just the large chunks.

Well, of course I would hope that everyone takes time off. I only responded with what I did, because of a couple of posts from others (or actually one in particular) where there was a clear point being made that he/she was home a lot and still made about the same amount as what I had posted. I just don't look at it that way, but since there was a post made, I took the time to figure it up. John stays out for about three weeks and then comes home and stays for a week or so. I don't have it figured out exactly how many days he was out and how many he was home (although it is written on a calendar in my office) but just using that average that means the money we've made was for six months, not a full eight. We live in an area where loads come out of (usually around 50-100 miles out), but never come into, so when he comes home it's usually a deadhead from around 300 or so miles. So the three weeks out and one week in works out for us to make up for the deadhead he has to cover.

 

[OntarioVanMan]

Glad it is working out for ya all...

 

[Rocketman]

The multi carrier model gets a bad rap because there are many examples of the carrier not paying. There are issues with having all 4 bidding but as long as you demand a higher rate you should be fine.

Multi carriers get a bad wrap for many reasons. They are famous for going under and failing to pay o/o's. They are famous for multiple bidding on the same unit. They are famous for running the illegal Penske cubes carrying 5,000 lb loads under the radar. They are famous for dragging the industry into the rate dumpster. They prey on people with little expedite experience and convince them that they will do just as well with this system as they will with the conventional exclusive use carrier system. Whether the o/o's choose to believe it or not, my statement still stands. I have yet to see a multi carrier o/o that makes more than I do. In fact, they make less than I do....and....they do more to get that "less" money.

I understand the advantages of having 4 brokers looking for loads. I understand the advantages of being more independent. If the rates were better, I would do it myself. The problem is that the rates are NOT better, they are worse. They can come on here make all the claims they want, but when they tell you their numbers, they come up short....EVERY time. I'm not out here for practice. I'm out here to make money, so I can go home, stay a while and enjoy it. That all starts with the rates.

I don't say these things to stir trouble although many think I do. I say these things to try to get people to see the truth. I try to get people to understand that they are not just hurting the industry by running too cheap...they are hurting themselves. I could quite possibly pay cash for both of the vehicles this lady is talking about her and co-owner have...just with the amount I made over and above what they made in the same amount of time this year. Think about it!

 

[Rocketman]

Well, of course I would hope that everyone takes time off. I only responded with what I did, because of a couple of posts from others (or actually one in particular) where there was a clear point being made that he/she was home a lot and still made about the same amount as what I had posted. I just don't look at it that way, but since there was a post made, I took the time to figure it up. John stays out for about three weeks and then comes home and stays for a week or so. I don't have it figured out exactly how many days he was out and how many he was home (although it is written on a calendar in my office) but just using that average that means the money we've made was for six months, not a full eight. We live in an area where loads come out of (usually around 50-100 miles out), but never come into, so when he comes home it's usually a deadhead from around 300 or so miles. So the three weeks out and one week in works out for us to make up for the deadhead he has to cover.

that other poster is me and I can pretty much say "ditto" to everything you just said.

 

[ntimevan]

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[Turtle]

I have yet to see a multi carrier o/o that makes more than I do. In fact, they make less than I do....and....they do more to get that "less" money....

That's the fallacy right there. They're doing more, and they're making good money, so the perception is they're not only doing it the smarter and right way, but that they're making more doing it. The fallacy is the notion that multiple brokers each have access to different bid boards and e-mail bidding, so they are more opportunities, but where it falls shorts is versus a larger carrier with access to the same bid boards as the four brokers combined, plus additional bid boards, and the same access to the e-mail bidding of the four brokers combined, plus additional e-mail bidding that rarely goes out to smaller brokers at all. On top of that, smaller brokers generally have to bid lower to get the loads, an axiom which is further supported by the numbers discussed in this thread.

On 40 working weeks (roughly 3 out and 1 home) a single cargo van should be able to gross an absolute minimum of $50,000 for the year, with a more realistic number being between $60,000-$65,000. Anyone putting in those 40 weeks and is not getting those numbers, is running for rates that are consistently too low, or they aren't running nearly enough loads.

One also needs to remember that the Rule of Thirds still apply. So when you look at total revenue, it's really more like a third of that revenue is what you're keeping.

 

[blizzard2014]

What has angered me the most in the past year is when our brokers call with a load out of Texas saying, what should we bid it for, we tell them our regular rate, and they're like, oh, well, everyone else is running for 60 cents to get out of Texas, and of course we tell them, okay then, call them with the load, because we aren't. So now since we are going to have to at least take our bottom dollar rate to get out of the Laredo area, we now extort them on our bid going in to Texas. It's the only way we have come up with to justify having to take our lowest bottom dollar rate to get out. It's getting that way for New York City area also. And don't even get me started on the west coast gas prices which we have to make up for when heading that way.

You can extort all of the bids you want, but as a former broker I stopped calling trucks that kept on demanding unreasonable rates for loads. If you want the big money you gotta cut out the broker and the middle man and get the loads right from the source. I do that now. I am working with another company and I get 100 percent of the load money for any load that I book for one of my two personally owned fleet cargo vans. There have been times "being the middle man myself now" where I have made 550 dollars in 1 day off my van. That is after paying my driver his contracted rate and a 100 dollar bonus because I got such a good rate on the load.

Once you become the broker, the carrier, and the fleet owner, only then will you see the kind of money that you need to see in order to really make a good living. I think The drivers should get 70 cents per mile and pay their fuel and the owner of the truck should be averaging 40 cents per mile after paying the driver. But then again I'm the one who has the pipe dream!

 

[LastChance2]

You can extort all of the bids you want, but as a former broker I stopped calling trucks that kept on demanding unreasonable rates for loads. If you want the big money you gotta cut out the broker and the middle man and get the loads right from the source. I do that now. I am working with another company and I get 100 percent of the load money for any load that I book for one of my two personally owned fleet cargo vans. There have been times "being the middle man myself now" where I have made 550 dollars in 1 day off my van. That is after paying my driver his contracted rate and a 100 dollar bonus because I got such a good rate on the load.

Once you become the broker, the carrier, and the fleet owner, only then will you see the kind of money that you need to see in order to really make a good living. I think The drivers should get 70 cents per mile and pay their fuel and the owner of the truck should be averaging 40 cents per mile after paying the driver. But then again I'm the one who has the pipe dream!

Maybe extort wasn't the correct term I should have used. It was more of an expression than an actual fact that I ask for an exorbitant rate. But when the broker says Laredo, we do ask for no less than 95 (and usually closer to 1.00) to go in because we know we're going to be anywhere from 85-93 coming out (depending on which truck it is). And as far as how we pay our driver, we pay for fuel and all reimbursement expenses (maintaining van, faxes, tolls) everything but his food and comfort and although he has only been in our van since September, (and had to take most of November off for hitting a deer and then the holiday while it was at the body shop) he still averaged 30 cents per mile free and clear and when we asked him last week if he seemed happy with the work, the pay, etc., he said yes (we also give bonuses). Now given this is a 49 year old single man who has no real responsibilities or bills here at home (he's been my co/boyfriend's best friend for 20 years), so while you or I may not be happy with that, he had been taking care of his mom for the past 15 years (now in a nursing home), this is the first real income he's made in years and years and he's happy. Will he still be happy with 30-35 cents per mile in a few years? I have no idea, but I hope so, because we pay for everything else. If averaged on a 40 hour week, he's making 325 per week and in the area we live, that's good pay. Sad, but true, west kentucky is probably lower middle class at best.

 

[LastChance2]

That's the fallacy right there. They're doing more, and they're making good money, so the perception is they're not only doing it the smarter and right way, but that they're making more doing it. The fallacy is the notion that multiple brokers each have access to different bid boards and e-mail bidding, so they are more opportunities, but where it falls shorts is versus a larger carrier with access to the same bid boards as the four brokers combined, plus additional bid boards, and the same access to the e-mail bidding of the four brokers combined, plus additional e-mail bidding that rarely goes out to smaller brokers at all. On top of that, smaller brokers generally have to bid lower to get the loads, an axiom which is further supported by the numbers discussed in this thread.

On 40 working weeks (roughly 3 out and 1 home) a single cargo van should be able to gross an absolute minimum of $50,000 for the year, with a more realistic number being between $60,000-$65,000. Anyone putting in those 40 weeks and is not getting those numbers, is running for rates that are consistently too low, or they aren't running nearly enough loads.

One also needs to remember that the Rule of Thirds still apply. So when you look at total revenue, it's really more like a third of that revenue is what you're keeping.

I've read and re-read this numerous times to make sure I've understood that the "they" you refer to is us, and if I'm mistaken, please disregard the rest of this post.

BUT I'm a firm believer in work smarter, not harder. Then again, every job worth doing is worth doing right. On just one of the units, we put 28,787 miles on it from the end of August until the end of December. From those 28,787 miles we pulled in (just on that truck mind you-we bought it August 23rd) $26,662.40. That's an average of 93 cents per mile. Those miles were done in 13 weeks (him being home 3 of them, so actually 10 weeks) which means he ran around 2880 miles per week. Did he kill himself doing it? No, he doesn't feel he did, although I sometimes disagree, but what you're saying is that there is any one broker out here that consistently 100% of the time pays 95 cents or more for a glorified cargo van? I have to be a little skeptical here because I have spoken to every broker's recruiters that are on this board (and a multitude more) and no matter what, they all say never expect more than 85 cents per mile for a cargo van. It's not extended, holds two pallets, 2000 pounds, nothing special. Yes, my CV driver calls me here and there and says I got a dollar a mile or 94 cents per mile, but realistically, we know it's a gift when it's more than 90 cents at any given time. And one of our brokers (and they are a large well established one) just told us that their (and most of their competition's) rates will be going down this year because of the flooding of the market. Sad and I hope they're blowing smoke to try to rattle us for lower bids, (and we refuse to give in) but scary if it turns out to be true.

 

[paullud]

Those numbers for miles and rate per mile sound very good. Your averages beat a lot of the guys at the bigger carriers so you should be happy with your success so far. There is still an underlying risk in dealing with smaller companies but as long as you don't let them get to far in debt with you I would keep doing what you are doing.

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[davekc]

Where are you getting this .85 cents is a benchmark? I am assuming it is based on what you are bidding. The large carriers as mentioned have resources to obtain freight that seldom is available to smaller carriers and or brokers. Some of it is due to size/coverage and other is simply they carry much more insurance. Just common sense, those large carriers have quite a few sales people.
If they could generate the same income working a phone and a computer, you likely would see no value in a sales force. The small carriers/brokers do have a place as much of their work is reliant on the production of the larger carriers and cover their overflow.
No need to complicate the obvious.

 

[x06col]

There is only one thing for sure in this business.......and that is......thay ain't nuthing for sure.

 

[LastChance2]

Where are you getting this .85 cents is a benchmark? I am assuming it is based on what you are bidding.

I'm getting it exactly where I stated I'm getting it. I have spoken to every single one of the carriers listed on EO and a few more that I have dug up on my own, not only spoken to, but have downloaded their contracts, talked to their other drivers, emailed, and really beaten the bushes on this (I don't do anything half-arsed). And a good 95% of them or their paperwork states that standard cargo vans are 85 cents per mile. Do we get more than 85 cents per mile? Yes, even from the ones who state it in their contracts and paperwork. Do we ever bid a load as low as 85 cents per mile? No, never. A typical call goes something like this.

"We have a load going from Waukesha to Strasburg, are you interested?"
"Yes, bid it."
"What do you want me to bid it at?"
Here is definitely where it varies, but it's never as low as 85 cents, usually never lower than 93 cents period.
"I'm not sure we'll get it for that amount. Are you sure you won't go lower?"
"Yes, I'm sure, please bid it at the amount I gave you."

I'd say we get our bid 1 out of 3 times. It would be hard to know, I've never kept up with how many we've gotten versus how many never called back.

But the 85 cents definitely doesn't come from anything we've done in our bidding. Go visit any of the websites for these (even the large ones) carriers and really look hard at their rates, and you will see that 95% of them, if not higher, all offer standard cargo vans 85 cents per mile. I think it's what they say will be the lowest you may ever have to run for, but it is there in writing, and in speaking to the recruiters on the phone. Not making things up, not guessing, not BSing, this is true blue fact straight from their site or the recruiters' mouths. This is their offer that's on the table from the moment you check into running for them. But remember, I am speaking strictly in terms of a standard cargo van.

 

[LastChance2]

Those numbers for miles and rate per mile sound very good. Your averages beat a lot of the guys at the bigger carriers so you should be happy with your success so far. There is still an underlying risk in dealing with smaller companies but as long as you don't let them get to far in debt with you I would keep doing what you are doing.

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They all pay weekly except for one and we get a paper check from them 21 days out from the run. It's never late, I know it's coming, so it's money in the bank. We've not had an issue yet with not getting paid (knock on wood) or being "late." A few instances of being a few dollars off here or there, but so far they're all kind enough to still take my calls or emails and fix any mistakes.

Good tip here, if you don't have a dedicated dispatcher (one company we don't and they have a LOT of dispatchers) always make sure you know the dispatcher's name for when your pay comes and it's not right. They're always good about fixing errors, but I have a feeling they'd save a little time and money if the dispatcher had it 100% correct to begin with.