I wanted to start a new thread about this subject becuz this isn't about any one carrier in particular. It's about the wording, interpretation, etc. of the fsc issue.
Our carrier happens to be one that takes a percentage of the fsc, along with the same percentage of the paid miles.
I was speaking to a recruiter yesterday. He was telling me his carrier pays a 'flat rate per loaded mile, plus 11% fsc, which is 100% of the fsc'.
So I was thinking, they pay 11% of the flat rate mileage, which would come out between the 2 of them, at about $1.25 per loaded mile. But I thought, there's no way they are only charging their customer 11% fsc.
If a load was 100 miles, paid at $1.12 per mile = $112.00 + 12.32 (11% fsc) = $124.32.
Even if the carrier only billed the customer say $2 per mile plus 11% fsc, it would be $200 + $22 = $222. but then the carrier wouldn't be paying the OO 100% of the fsc, like they state. I thought it can't be possible the carrier is only charging the customer $12.32 fsc on a $200 load.
So I called the recruiter back, and I asked.. 11% of what exactly, gets paid to the OOs as a fsc, 11% of the $1.12 mileage rate, or 11% of the mileage amount billed to the shipper? He said 11% of the $1.12 mileage rate paid to the OOs.
So I asked how that could be construed as '100%' to the OO, surely they are billing more than that to the customer?
He said there are all different ways in which a carrier can figure out their billing, but to remain competitive, the bottom line is generally in the same ballpark, or else they wouldn't get much business. He said you can call it whatever you want, split it up whichever way you want, but in the end, most reputable carriers are billing similar amounts and paying out similar amounts to their OOs.
With them, he informed me they work on a 70/30 structure, where the carrier keeps roughly 30%.
Using the above load as an example, the carrier would be billing $1.60 x 100miles, plus 11%, or $160 + 17.60 = $177.60. They would pay the OO $112 + 12.32 = $124.32. They justify saying they pay the OOs 100% of the fsc, becuz they are getting 100% of their 70% portion. They are each getting 100% of their 11% fsc.
So, it appears that even when a carrier says '100% fsc goes to the OOs', it can somehow mean less than that, depending on the wording, and interpretation. I guess the only way to be certain what they 'really' mean, is to invoke your right to see the invoice to the shipper.
PS I wonder why this carrier would only be charging an 11% fsc in the first place, isn't that really low comparatively speaking??this week looks more like
Our carrier happens to be one that takes a percentage of the fsc, along with the same percentage of the paid miles.
I was speaking to a recruiter yesterday. He was telling me his carrier pays a 'flat rate per loaded mile, plus 11% fsc, which is 100% of the fsc'.
So I was thinking, they pay 11% of the flat rate mileage, which would come out between the 2 of them, at about $1.25 per loaded mile. But I thought, there's no way they are only charging their customer 11% fsc.
If a load was 100 miles, paid at $1.12 per mile = $112.00 + 12.32 (11% fsc) = $124.32.
Even if the carrier only billed the customer say $2 per mile plus 11% fsc, it would be $200 + $22 = $222. but then the carrier wouldn't be paying the OO 100% of the fsc, like they state. I thought it can't be possible the carrier is only charging the customer $12.32 fsc on a $200 load.
So I called the recruiter back, and I asked.. 11% of what exactly, gets paid to the OOs as a fsc, 11% of the $1.12 mileage rate, or 11% of the mileage amount billed to the shipper? He said 11% of the $1.12 mileage rate paid to the OOs.
So I asked how that could be construed as '100%' to the OO, surely they are billing more than that to the customer?
He said there are all different ways in which a carrier can figure out their billing, but to remain competitive, the bottom line is generally in the same ballpark, or else they wouldn't get much business. He said you can call it whatever you want, split it up whichever way you want, but in the end, most reputable carriers are billing similar amounts and paying out similar amounts to their OOs.
With them, he informed me they work on a 70/30 structure, where the carrier keeps roughly 30%.
Using the above load as an example, the carrier would be billing $1.60 x 100miles, plus 11%, or $160 + 17.60 = $177.60. They would pay the OO $112 + 12.32 = $124.32. They justify saying they pay the OOs 100% of the fsc, becuz they are getting 100% of their 70% portion. They are each getting 100% of their 11% fsc.
So, it appears that even when a carrier says '100% fsc goes to the OOs', it can somehow mean less than that, depending on the wording, and interpretation. I guess the only way to be certain what they 'really' mean, is to invoke your right to see the invoice to the shipper.
PS I wonder why this carrier would only be charging an 11% fsc in the first place, isn't that really low comparatively speaking??this week looks more like