What constitutes "double brokerage"?

[Henry]

In my opinion, almost everyone double brokers. I am personally ok with it, as long as everyone gets paid.

I know for a fact that some people say they don't double broker, when i know they do.

We rebooked freight , but not very often and we always pay the carrier.

 

[wesward]

I so agree
seems to be the ones that cut the double brokering up are the one that are doing it
And they are huge companies
no names being added
so if they are doing it them selves they why do they cut it up so bad and wont pay people if they double broker

Come on people think hard about this

 

[loaders]

Wesward, I think hard about it all the time. As a result of all that hard thinking, we don’t do it and go out of our way to prevent it happening to us. Henry, no, almost everyone doesn’t do it. I am sure you are oK with it because obviously you haven’t been “bitten” in a double brokerage situation or experienced the complications that can occur. You haven’t had one of your customers call you asking why they are being hounded for payment by some carrier you never knew of. Or you haven’t had your freight held hostage by a carrier you have never heard of. Both of these scenarios can be the result of double brokering gone bad. Why anyone would entrust their freight to someone who then gives it to some other unknown party defies any type of logic in my opinion. Sure, some people do it all the time, that doesn’t make it any less risky.

 

[lowmiler88]

I love the comments of "everyone does it" and "I won't mention names". Henry and Wesward what companies do you work for? If you think double brokering is ok then I have a list I need to put your names on.

 

[MikeJr]

I love the comments of "everyone does it" and "I won't mention names". Henry and Wesward what companies do you work for? If you think double brokering is ok then I have a list I need to put your names on.

People sitting around me are wondering why I'm laughing so hard I'm crying.

Happy Monday lowmiler88,
Mike

 

[what1ship]

Its all about Transparency. If the company paying knows that for whatever reason you cannot handle a particular load and offer to find someone who can look after and your client is okay with it, then it is a value added service and you are a service partner.
If you had no intention of moving the load, pretend you did, and just want to get in the middle and make a quick buck on it, you are a "double broker" and a fraud.
If you had no intention of moving the load or paying the carrier who did the work, you are a thief who should be prosecuted to the full extent of the law.

 

[loaders]

What1ship, I understand your point about transparency, and in a perfect world the example you give sounds quite reasonable. However, as evidenced by the numerous threads on this site, the reality is that double brokering, in the vast majority of cases, results in disaster. The two negative examples you cited seem to be the norm in our industry not the exception. Knowingly entering into a double broker situation is akin to walking across a well marked minefield. Yes, you might make it safely across but if you don't, the results can be catastrophic.

 

[what1ship]

Very true. Being transparent and trying to help out can often lead to a unhappy ending if the carrier you use or suggest is the wrong one. The old expression "no good deed goes unpunished" sometime can apply. But, so can turning down the load. I was not trying to endorse the option, just offering a definition of the term "double brokering" which can vary depending on circumstance.

 

[loaders]

If the party you locate to cover my load (after you realize you can't cover it) is in my data base and is an approved carrier, OK.... I guess.... maybe, but first a couple of important questions need to be asked. In this situation, are you going to invoice me as if you had done the load, and if so....why? Did you offer the other carrier the same rate that I offered you, or are you going to make a couple of bucks on the deal, in other words, acting as a freight broker? You see, this is where the trouble can start. If you said to me, "we got all screwed up here and I can't cover your load, but I just spoke to Sam's Trucking and he says he can do it.....here is Sam;s phone number". Or even, "why don't you try ABC Trucking or XYZ, they both run that lane, here's their numbers". Wow, no problem, thanks for your help, let's try and do something together next time, what a service oriented carrier you are!

 

[wesward]

Glad to see everyone out there getting opinions in on this topic. Lets keep this going. I think it really helps

 

[FREIGHT15]

I had a situation come up last week , our company took a load from another carrier, only to find out they had been given the load by a carrier we know very well...… the company that brokered the load to us had a note in their carrier package stating that they can use " partner" carriers ….. to me this is a backdoor double broker move, anyone have any experience with this type of thing?

 

[loaders]

A carrier who claims to use "partner carriers" is just another way of saying, if we can't haul your load on one of their own units, we will broker it out to another carrier. It is a sure fired way to get the original rate diluted in a big hurry.

 

[jackhole]

A carrier who claims to use "partner carriers" is just another way of saying, if we can't haul your load on one of their own units, we will broker it out to another carrier. It is a sure fired way to get the original rate diluted in a big hurry.

We claim to use Carrier Partners , what does that have to do with double brokering loads - nothing is the answer , as long as you are not brokering freight that has already been brokered.

 

[loaders]

Absolutely correct jackhole. If you have a load from one of your customers that you cannot service with your own trucks, you employ a "partner carrier" to move it. As a freight broker, that is exactly what I do every day with every load. I wasn't suggesting that the use of "partner carriers" was automatically proof of double brokering, however in freight 15's case, it appears that it is.

 

[FREIGHT15]

Agreed, using partner carriers happens, but I believe that if you ACCEPT a load from a customer and can't move it on one of your own assets that you should be upfront with your customer about the fact you are going to use a partner carrier, failure to inform them in advance of you asking if a " partner carrier" can take the load for you in my opinion is double brokering but can be explained as partner carrier

 

[Michael Ludwig]

A good example of where the term "partner carrier" gets besmirched would be the way a brokerage firm like Laxxxxde used to use it (maybe still do) ... they would market their services to customers as if they had some wheels of their own and would call in carriers that they have vetted to meet the customer's standards to help them out, when in truth about the only wheels Laxxxxde ever owned were like two Audi's and a Cadillac.

On the other hand, I use partner carriers to help me with my work (most are on this forum), and I am used as a partner carrier to help others with their work. The partner carriers I use are every bit as good a carrier as I am, and in turn I am every bit as good a carrier as the partners that use me.

In general, the term "double broker" can be pretty much applied to anyone getting in the middle of a transaction and offering zero value add, for a price.

Keep in mind that the vast majority of brokerages in North America are basement operations. These are the people that take a load from another broker, take out their 10%, and pass the load onto either an actual carrier or even another broker. They know nothing about the load, nor do they take, or accept, any responsibility for the load. They are a zero value add. Simply taking someone's hard earned money and offering absolutely nothing in return.

These are the people that everyone has problems with.

Don't be one of those people ... you wouldn't like the way most if us here would treat you .

 

[loaders]

Correct as usual Michael. In a double broker situation, the person rebrokering the load doesn't know the actual customer, nor do they care about whose goods they are making a quick 10 points off of. Their only concern is who will be paying them (quick pay if they can) and how cheap they can rebook the load. This doesn't even include the potential jeopardy the original broker places himself in, if he knowingly participates in such an unethical practice.

 

[wesward]

This is great information
But as per everyone's statements it looks like everyone "Double Brokers" just some screw others and never pay carriers and some do not and pay carriers
Am I correct?

 

[Michael Ludwig]

In a sense, yes. The conversation may go something like this;
"Hey Bob, thanks for the load offer. I don't have any of my own trucks, but I have a buddy that has one there. I work with him all the time and he's good people. Do you want me to pass along his info so you can set him up in your system, or do you just want me to hire him for the job on your behalf?"
"Hey Mike, thanks. This is probably just a one-off so go ahead and hire him, and you can pay him through your system."
"Okay Bob. Yes, it's just a one-off as my truck will be back in position next week. I'll get my buddy on the job and we'll get it done for you. Here's his contact info in case you need it"
To my buddy "I don't have anything where you are, but Bob has a load he will put you on. You're not set up in his system so he'll give me the load and I'll give it to you. Bob is paying me $x.xx and if you want to wait until he pays me, that's what I'll pay you. If you want it quicker, I'll need a couple points."
So yes, technically it's a double brokered load. The difference being that everyone is in the loop and knows exactly what is going on, and who is doing what.

The double brokered loads that everyone has a problem are the ones that are a zero value add as I explained above.

 

[loaders]

NO! "Everyone" does not double broker. If a carrier wants to place one of "his own customer's" shipments with another carrier, no problem, he is brokering that load and probably picking up a couple of bucks. If that same carrier gives my load to another carrier, that is double brokering and is unethical and should be avoided.