There's a lot of stupid carriers out there...

M

Manitoba Moose

Member
Jul 27, 2009
322
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Otterburne, MB
10
Here's our story...

We have finally had enough from one of our former clients (and I'll explain the former part in a bit), Canam Steel in St. Gedeon de Beauce, PQ who we have been doing business with for a few years.

We have been brokering loads to a number of trucking companies and have been paying absolutely decent prices on all loads. These are all deck loads, legal and oversize including B-train loads from St. Gedeon and Laval area to all parts of Canada. Rates we have been paying range from about $3.25 to $6.00 per mile average so I don't want crap from anyone, ESPECIALLY FROM CARRIERS, on here regarding rates.

Well, this year, when it's time to submit our rates, we are told that we are way too high. 33% too high... They are going to be sourcing their own equipment and would use us for back up. An example of this is that they are paying carriers $5200 (keep this figure in mind) to run 1900 miles with an 10' high load on the deck from St. Gedeon to that hotbed for re-loads, Estevan, Sk. Our rate to them was $7800 and we put it out to the trucks for $7,000 so a 10% profit. There was 17 loads and they covered all but 4 loads. The trucks had 3 days to get there for crane appointments.

They called us to help them cover the 4 left over loads and would pay us the $7800 we quoted. It took all of 2 phone calls and they were booked. Trucks were loaded and unload appointments were made by the trucking company. One load instead of arriving in the afternoon, got there the following morning.

I received a call from the trucking company that they were going to be late and the new unload appointment had been approved by the receiver that they could unload the following morning since the crane was there for the duration of the entire project. I hadn't even hung up from the carrier that Canam was on the phone screaming "charge back fees" would apply.

We told them that under no circumstances were there to be a hold back on that load because there was no downtime for the crane. He refused to agree so we told them to stuff their loads, called and emailed the trucking companies advising them of what happened and to deal directly with Canam and invoice them directly (copied Canam on all the correspondence to the trucking companies). We sent the carriers a copy of all the load confirmations we had received from Canam and for Canam to pay the carriers directly and not ever bother calling us again. We are done with them.

Now back to the title of this post...

The reason Canam reduced their rates by 33% is that some of the carriers we were sending in decided that they were going to deal direct with Canam instead of through a broker and went in with ridiculous rates (remember the $5200 above?). And who can blame Canam for not taking advantage of stupid people? It's not their fault carriers are stupid and are offering them ridiculous rates.

So, now instead of the carriers making $7,000 and dealing with us, they are charging Canam $5200 and dealing directly with the manufacturer. Well good for them lol...

I am not 100% sure which carriers are the back door artists and very poor businessmen so I will not be naming any carriers on here. And these same carriers will probably be the 1st to scream that brokers are killing his business and stealing all his money. Yep, some real intelligent people out there...

If any of you brokers out there want a real class act manufacturer / shipper, please feel free to call them directly. I'm sure you can Google them and good luck to you. Please let me know how you make out...

Yep, there's a lot of stupid carriers out there...
 
Manitoba Moose said:
Yep, there's a lot of stupid carriers out there...
Click to expand...

As a "carrier" I dont think "stupid" is the word, I think desperate to have their "ownership" directly with the shippers. In any event, they (the carrier) should have kept things as they were with you and not back door you that I agree. And sometimes I say, "you have to fire your customers". You did the right thing.
 
I have been experiencing an increase in this type of cost reduction by a few of our customers as well. I am sure it is instigated by upper management who are looking for any way possible to reduce their costs. For years, most manufacturers have looked at transportation as a necessary evil, strictly an expense that does nothing to improve their product or sales volume. When the word from above comes down to reduce/cut, etc. the first place to look is transportation. For a traffic manager, all he/she has to do is look in their rate quote file and start pulling out the lowest rates. In Manitoba Moose's case, it appears that in spite of the good service he provided to his customer, the customer decided that rates, and rates alone will determine who they use. Hopefully in this case, the customer will experience enough service failures, "no shows", and other problems to realize......"you get what you pay for"!
 
Unbelievable

I think you are being a little too soft on those carriers.

Ethics aside , why would a carrier take such a drop in price? From $7000.00 to $5,200.00 is a little crazy.
 
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Another big problem is that the "stupid" carriers will eventually decline in their service level because they are not charging enough to do the job right. Then the "stupid" customer is up a creek because they have saved money on transport but lost money in productivity etc. And they are both right back where they started. Try as you will to prevent it, it will continue to happen. This is an instance where I have to say some carriers don't get it. If you are getting good paying freight through a broker or another carrier, be thankful and do a good job. Don't think you could do a better job yourself for less money.
 
Yes it does feel really good to "fire a client" somedays. We will miss the revenue it generated but this client was so high maintenance that it really wasn't worth all the aggravation and expense of having someone on call just for this client 7 days a week.

At the end of the day, all you have left is your integrity and we are not willing to give that up for any amount of money. This business is tough enough all by itself let alone have fickle companies to deal with and them wanting you to kiss their butts at every turn.

Sorry but that's just not the way we do business...
 
Very well put! Manitoba Moose & Loaders.

The time shall arrive in the very near future. (By Law / Congress / Government Polices)
That CARRIERS will have to deal ONLY with Freight Brokers & 3PL Companies.

Take for example - 2006 New Jersey Supreme Court states that "An employer may be charged with negligence in hiring an independent contractor where it is demonstrated that he should have known, or might by exercise of reasonable care have ascertained, that the contractor was not competent." This law is similar in most states and has been upheld in the courts in the case of accident involving hired carriers causing injury or death.
In 2006 - New Jersey accident, the shipper was charged with negligent hiring because it hadn't proofed a carrier's registration, insurance, or licenses to determine that they were in order.
The standards are difficult for shippers/clients/customers. But the courts are not
sympathetic in dealing with these cases so shippers need to assess their carrier hiring procedures to determine how they will testify if and when they are sued.

Just my, 2Cents!
Have a nice day!
 
Keep dreaming Pharlap and someday we will get $10.00 for every mile we run, drivers will be plentiful and trucks will get 35 miles to the gallon.
 
Pharlap said:
Very well put! Manitoba Moose & Loaders.

The time shall arrive in the very near future. (By Law / Congress / Government Polices)
That CARRIERS will have to deal ONLY with Freight Brokers & 3PL Companies.

Take for example - 2006 New Jersey Supreme Court states that "An employer may be charged with negligence in hiring an independent contractor where it is demonstrated that he should have known, or might by exercise of reasonable care have ascertained, that the contractor was not competent." This law is similar in most states and has been upheld in the courts in the case of accident involving hired carriers causing injury or death.
In 2006 - New Jersey accident, the shipper was charged with negligent hiring because it hadn't proofed a carrier's registration, insurance, or licenses to determine that they were in order.
The standards are difficult for shippers/clients/customers. But the courts are not
sympathetic in dealing with these cases so shippers need to assess their carrier hiring procedures to determine how they will testify if and when they are sued.

Just my, 2Cents!
Have a nice day!
Click to expand...

I really didn't want to go there but I'm being drawn there by this comment by Pharlap...

It seems that you are a proponent of government intervention and regulations and if you look at history, government intervention has always been a positive influence on the average person (he says with his tongue firmly planted in his cheek).

Take minimum wage as 1 example of government helping the poor. Has that helped bring them to middle class status or to be independently wealthy? Nope... All it has done is force employers to raise their rates for product and make the minimum wage people pay more and then go back to government for another increase and the cycle repeats itself.

Oh, and what about setting up a new department of croonies to administer all these new rules that you want the government to put on carriers and brokers. More people on big pensions forcing more regulations on our industry. Yep, that is so what we need right now...

I will stop here with this one example and I can think of a million things to add on to this but I'm sure the thinking and wise people on here will agree that government intervention is the last thing we need.

Please feel free to add your own ideas on how government and forced legislation has helped our industry.

Now back to your regular programming... lol
 
Pharlap said:
Very well put! Manitoba Moose & Loaders.

The time shall arrive in the very near future. (By Law / Congress / Government Polices)
That CARRIERS will have to deal ONLY with Freight Brokers & 3PL Companies.

Take for example - 2006 New Jersey Supreme Court states that "An employer may be charged with negligence in hiring an independent contractor where it is demonstrated that he should have known, or might by exercise of reasonable care have ascertained, that the contractor was not competent." This law is similar in most states and has been upheld in the courts in the case of accident involving hired carriers causing injury or death.
In 2006 - New Jersey accident, the shipper was charged with negligent hiring because it hadn't proofed a carrier's registration, insurance, or licenses to determine that they were in order.
The standards are difficult for shippers/clients/customers. But the courts are not
sympathetic in dealing with these cases so shippers need to assess their carrier hiring procedures to determine how they will testify if and when they are sued.

Just my, 2Cents!
Have a nice day!
Click to expand...

I guess this is a less than $2.00 a mile kinda broker.
 
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I sympathize, but are you sure its a carrier who undercut you? Shippers receive calls everyday from carriers and brokers looking for freight. Maybe the guilty party is another broker...or maybe the shipper did his own research and determined that $5200.00 is a more appropriate rate. If you're paying the carrier 7K and he decides to backdoor you to get 5.2 K..that just doesn't make a whole lot of sense. Good prices are great...it means that you can pay your carriers well and still make a decent commission for yourself..however the downside of good prices is that they effectively invite competition. This is why competing only on rates doesn't work so well.
 
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