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Saying "no" to cheap freight!!

mdpettrey

mdpettrey

Seasoned Expediter
To anyone who knows me, knows that I have always preached not to let you or your company sell yourselves short and haul freight for nothing!! We in the Expediting business are Specialized Carriers and we should get paid for what we do! I see more and more everyday people advertising themselves for hauling freight for rates that I wouldn't even start my Truck or van for!! Question is why? Why would you do this when you know in the long run you will end up operating at a loss? Is it desperation or trying to get new business? I know the answer....and running freight for CHEAP IS NOT THE ANSWER!!! The Truth of it is we see many carriers doing it and when a customer tells you "well i got a quote for (X)" and you tell them "that's less that what I pay my drivers, it really starts to make you wonder how and why!! Remember this... it is very easy to lower rates to a customer, and near impossible to raise them and once you get that ball rolling it's really hard to stop! I am very open to hear everyone's thoughts on this!!

Kind Regards,
Mike Pettrey
C&M Transport, Inc.
 
Opel2010

Opel2010

Veteran Expediter
Owner/Operator
I guess you know that here on EO, we are just few expediters that are communicating on forum, while out there are thousands that maybe never heard of EO, so they'll never know your thoughts about cheap freight. And many of them don't care if they drive for less, they care to run all the time. Now, put it this way: driver X gets a load from MI to Laredo let's say for $.80/mi then he gets a load going back to MI the very same day after delivery, for $.60/mi. Once he's back in MI, he'll say "I left MI three days ago, now I'm back and I made $2,300. Other guys are still sitting and waiting in Laredo for another week or more til they get the price they're waiting for. During this period I can do two more round trips"
 
xiggi

xiggi

Veteran Expediter
Owner/Operator
They grossed 2,300. That's a far different thing from making the same amount.
 
jjoerger

jjoerger

Veteran Expediter
Owner/Operator
US Army
Some don't understand the difference between gross and net. Most don't know there costs to operate.
 
OntarioVanMan

OntarioVanMan

Retired Expediter
Owner/Operator
Van "A" does $1.10 loads...his cost per mile is say .40
Van "B' does .90 loads.....his cost per mile is say .20

Both NET .70

If one profits and can pay themselves then I would say..it sucks right now to have a high CPM....
 
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OntarioVanMan

OntarioVanMan

Retired Expediter
Owner/Operator
mdpettrey said:
To anyone who knows me, knows that I have always preached not to let you or your company sell yourselves short and haul freight for nothing!! We in the Expediting business are Specialized Carriers and we should get paid for what we do! I see more and more everyday people advertising themselves for hauling freight for rates that I wouldn't even start my Truck or van for!! Question is why? Why would you do this when you know in the long run you will end up operating at a loss? Is it desperation or trying to get new business? I know the answer....and running freight for CHEAP IS NOT THE ANSWER!!! The Truth of it is we see many carriers doing it and when a customer tells you "well i got a quote for (X)" and you tell them "that's less that what I pay my drivers, it really starts to make you wonder how and why!! Remember this... it is very easy to lower rates to a customer, and near impossible to raise them and once you get that ball rolling it's really hard to stop! I am very open to hear everyone's thoughts on this!!

Kind Regards,
Mike Pettrey
C&M Transport, Inc.
Click to expand...

look at the straight trucks rates.....$1.80? gee whiz.....straight cost more then double to operate then a van...so it would follow you'd get vans doing .80 lke their big cousins.....right?

Also..over the years I've known 5 or 6 drivers for your outfit....what exactly is the level of cheapness you are talking about here? Sample numbers you are seeing?....
 
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jjoerger

jjoerger

Veteran Expediter
Owner/Operator
US Army
OntarioVanMan said:
Van "A" does $1.10 loads...his cost per mile is say .40
Van "B' does .90 loads.....his cost per mile is say .20

Both NET .70

If one profits and can pay themselves then I would say..it sucks right now to have a high CPM....
Click to expand...

If one has a paid for van or truck they can run cheaper. But, if one ever plans on replacing that paid for truck or van one will find out in the long run they shouldn't have run so cheap.
Justifying running cheap because your CPM is low doesn't make it right.
Running cheap just hurts the whole industry.
Drive less, make more!
 
Unclebob

Unclebob

Expert Expediter
Owner/Operator
We drive vans. Some of us have expensive vans and some have cheap vans. It doesn't take a rocket scientist to drive a van. Anyone that can scrape up $4,000.00 can buy a van and get in this business. If they fail their will be 2 more to replace them.

We live in a capitalistic society which means you have to be able to compete or fall by the wayside. This is a very competitive business with no skill sets required.

We can complain about low rates and we will have as much success as when we complain about the weather. We need to find ways to stay competitive. That could mean cutting expenses. It could mean stressing to our customers why we're worth a higher rate. Don't be surprised if that second path is all uphill.


Sent from my iPad using Tapatalk
 
jjoerger

jjoerger

Veteran Expediter
Owner/Operator
US Army
What happens when your company is the cheapest and you are running your wheels off and suddenly a new player enters the game. This new player decided to undercut you buy $.20 a mile. Now you are sitting and this new company is getting all the loads. Do you cut your rate to be cheaper? Where does it end?
 
OntarioVanMan

OntarioVanMan

Retired Expediter
Owner/Operator
jjoerger said:
What happens when your company is the cheapest and you are running your wheels off and suddenly a new player enters the game. This new player decided to undercut you buy $.20 a mile. Now you are sitting and this new company is getting all the loads. Do you cut your rate to be cheaper? Where does it end?
Click to expand...

well if someone like that comes long .. we either compete or get a different job....that is America....

no one is entitled to a living.....you have to earn it...
 
Unclebob

Unclebob

Expert Expediter
Owner/Operator
jjoerger said:
What happens when your company is the cheapest and you are running your wheels off and suddenly a new player enters the game. This new player decided to undercut you buy $.20 a mile. Now you are sitting and this new company is getting all the loads. Do you cut your rate to be cheaper? Where does it end?
Click to expand...

You do the same thing a business person does in all other businesses.

You evaluate the current condition and either learn to compete or you go out of business.

That's what happens every day.


Sent from my iPad using Tapatalk
 
OntarioVanMan

OntarioVanMan

Retired Expediter
Owner/Operator
jjoerger said:
If one has a paid for van or truck they can run cheaper. But, if one ever plans on replacing that paid for truck or van one will find out in the long run they shouldn't have run so cheap.
Justifying running cheap because your CPM is low doesn't make it right.
Running cheap just hurts the whole industry.
Drive less, make more!
Click to expand...

and your point would be?....
I do what is best for OVM Transportation....
What right is....i use my low overhead as the competitive edge.....and make i sweet profit to boot...

the next operator will do what is best for themselves...that is the way it works....this isn't a love fest and group hugs thingee.....
 
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scottm4211

scottm4211

Veteran Expediter
Owner/Operator
I'm just glad to be associated with a company (Load One) that places a greater value on my services than many here seem to place on themselves. I've talked to many driving for C&M that feel the same.
 
OntarioVanMan

OntarioVanMan

Retired Expediter
Owner/Operator
scottm4211 said:
I'm just glad to be associated with a company (Load One) that places a greater value on my services than many here seem to place on themselves. I've talked to many driving for C&M that feel the same.
Click to expand...

Me too.....:)

no one has established the term "CHEAP" just what level are we talking?.....nearly better then 90% of the industry must be between .80 and $1.00 all your bigger carriers are .90 .95 is that cheap?

dang you just earned another free lunch.....LOL
 
ntimevan

ntimevan

Veteran Expediter
Owner/Operator
scottm4211 said:
I'm just glad to be associated with a company (Load One) that places a greater value on my services than many here seem to place on themselves. I've talked to many driving for C&M that feel the same.
Click to expand...

I see another Free meal in your future.......Lol
 
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