Amazon getting into the freight matching business
- Thread starter Paul S
- Start date
30
This could change many thing like no load board and also factoring company not necessaries. Could be some big change?
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Maybe.. I guess we'll see. If they can work on 8% to 10% gross margins as they've claim.. pay COD, wait 60 to 90 days to get paid AND absorb all losses from non paying shippers as well as claims, then they should be able to corner the market.
I think they may have to make a few policy changes as they learn. Id like to see their bad debt list after 60 days. WOW!
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I was thinking the same things only my post would have been long and boring. Short and sweet Freight Broker, nice.
Keep well,
Mike
Keep well,
Mike
30
If this program does gain some traction in the transportation industry, I still can't see the larger shippers (ones with a high level of exposure...chemicals, food, etc.) handing over their freight to an unknown, un-vetted carrier, even if it is handled through a company like Uber. It becomes a bit too anonymous where everything is done via apps and personal devices. Who knows, perhaps it is the future where there are no drivers (autonomous trucks), no freight brokers(all done through Uber app), no dispatchers (no drivers to dispatch). Just one computer talking to another computer with minimal human input. I don't know about the rest of you.......it sends a bit of a shiver down my spine. Can you hear the age talking in this post? Feeling it today as the big 65 clicks in tomorrow.
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But if Uber pays COD and a decent rate the big shippers may not have much choice. Why work for ABC Manufacturing who pays in 30 to 60 days when you can get paid COD by Uber? Of course Uber may eventually want to make a profit too, and then the rate offered may reflect the COD advantage.
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They really don't have to wait for money now, thanks to factoring. Yes I know, COD without all the hangups, cost, and risks of factoring.. and I still believe in Santa Claus..
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This "love fest" for COD is, I believe, misguided. Any business, not just transportation, needs the discipline and the correct processes to properly evaluate the credit risk/worthiness of any existing or potential new customer, before you supply your services. Like it or not, transportation does not operate the same way a variety store does. The accounts payable department at most companies don't have a well stocked cash register on their desk, nor an open cheque book ready to issue payments through out the day. If your receivables are out of control, or you have had to absorb numerous write-offs for bad debt, yes, they are bad, unethical people, but......you made the decision to deal with them and perhaps a review of your procedures is in order.
on a side note, Uber lost about 3 billions (with a B) dollars last year, so its a great concept, and we all love saving on taxi fares etc, but making this model a profitable one for long term is still unproven. Right now, they are buying market share, but at one point the revenues need to catch up with great advertising or it will collapse...so maybe don't give up your loadlink account just yet 
http://www.wired.co.uk/article/uber-finances-losses-driverless-cars
http://www.wired.co.uk/article/uber-finances-losses-driverless-cars
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on a side note, Uber lost about 3 billions (with a B) dollars last year, so its a great concept, and we all love saving on taxi fares etc, but making this model a profitable one for long term is still unproven. Right now, they are buying market share, but at one point the revenues need to catch up with great advertising or it will collapse...so maybe don't give up your loadlink account just yet
http://www.wired.co.uk/article/uber-finances-losses-driverless-cars
When I go to the airport to skip town (a few times a year) I can't fathom why it should cost me a gazillion dollars to pay a cabbie to take me there and then home when I return. I refuse to give my business to UBER because they are trying to steal away the business of the cabbie who paid $100k for his plates, so I pay even more than either of those 2 options to Park N Fly (Valet) and I have to drive myself.
There is logic there somewhere I think.
Happy Friday,
Mike
15
Mike, you just raised the point of cabbie high fare due to the cost of $100k for his plates (which I am not sure if it is true or not). If it's true, isn't the reason to pay such high plates cost for cabbie is solely due to a wish of entering into cabbie business to profit from it? Didn't cabbie made that choice? On the other hand, what are the reasons behind charging $100k, is it a reasonable amount or perhaps it could be reduced by whomever charges it to lower the cab fare.
I guess, I am going to leave it all for cabbie business to decide what is reasonable or not, if they need to stay afloat competing with Uber. However, if we- end user have an opportunity of saving, why should not we take it?
I guess, I am going to leave it all for cabbie business to decide what is reasonable or not, if they need to stay afloat competing with Uber. However, if we- end user have an opportunity of saving, why should not we take it?
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Some time ago when I was younger and naive(r) than I am now I was aghast at the price of cab fares in and out of Pearson. One day I made the decision to leave the airport on foot, with two heavy suitcases in tow. I was quite the sight.. a guy walking off the airport grounds (and its not like there are sidewalks.. they don't make it easy) like that. But as I walked cars would pass me and honk.. and one guy rolled down his window and shouted "way to go man".. they knew what I was doing.
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Cab plates are a lot more than 100k now. They where worth 90k 28 years ago when I leased plates and had cabs on the road in Hamilton. Cab drivers have insurance and back then it was around 8500 a year. I wonder what happens when Joe Uber driver that has never told ABC insurance has a wreck and kills someone and they find out he was moonlighting as an Uber driver.. Uber freight will have a place I am sure for the fly by nighters until Uber catches on. Look at Uship and all the wonderful carriers and brokers that use it. Hell it is worse than the link for reverse auctions, how low can you go.
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Uber Freight is going to operate on low margins because they are looking to automate the whole process of freight brokerage (or matching). There are others who have tried it but Uber is better backed. It's not good for transactional brokers.
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Alot of it is automated already...and no ap or special technology required. Most of us who have repeat loads know how it goes.. we get the same trucks on the same loads every week. Sure, the margins take a beating on that stuff, but there's almost no work involved either. The work and money is in the off the beaten track stuff.. the one off loads or the loads that involve one or more carriers and modes or loads that require five drops in Chicago.