QuestionQUESTION: Hi I work for my boyfriend's trucking company. We have 3 drivers including my boyfriend. We are leasing all 3 trucks only and don't have our own trailers. (yet)We were able to contract with a shipper since we are owner operators. We are new to the industry as owners and I had a concern about how the shipper is dispatching their loads. I am in charge of expenses, bills, fuel, overhead ect. The problem I am having is that this company will get the load from a broker and then dispatch it to available drivers. When we get the information we fuel up and off we go. We are unaware of the price of the load and /or the back loads. This makes it very difficult to plan a trip especially OTR with fuel costs being as high as they are. We don't know how much we've worked for until we receive the settlement at the end of the week. The company takes 25% and we get 75%. Is this normal shipping protocol? Is there away to find out how much the loads are worth? The drivers have raised this concern with the company however they say this is the way we do business. Because we don't have our trailers we cant work with a broker directly. Any information would be helpful. Thanks
ANSWER: Marie, there are a couple of issues here. First there is no reason why the shipper or carrier you are hauling for cannot give you the rate up front. As an independent contractor you have the right to refuse the load if it doesn't pay enough. Of course then they may just stop calling you. I'm not sure I understand if you are under contract to a shipper or a carrier, or if you are just doing trip leases. I assume you do not have DOT operating authority. At the very least I would start checking around for other companies to do business with.
Here is a website you may already be aware of that addresses a lot of owner operator issues.: http://www.ooida.com/
Let me know more details what state you are in, etc. and I might be able to help.
Jim
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QUESTION: Hi Jim, thank you for your prompt response..to clarify I apologize I'm new to the industry lingo, we are contracted with a carrier not a shipper. They pay for insurance on the trailers and are registered under their company. We are leasing our trucks through them. One day cab and two sleepers. We do have our own authority also. The carrier is based in Connecticut..They also handled our IFTA..this first quarter. I just think its bad business since we're deemed independent contractors we should know the price of the load as you say, we should be able to say yes or no..granted we're just starting out since January as owners so we want all the loads we can get. However as of late they are OTR loads and our fuel costs are overturning our profit..I mean I realize the fuel costs are hurting everyone but its more for managing purposes. Thanks for the link I will look there too for some info..The guys wanted me to go to freight brokering school so we would have our own broker "me"..do you think that would be wise? any schools you can suggest. I looked at Brooke Transportation Solutions. Any info on them?
thanks
ANSWER: Marie, you say "We are leasing our trucks through them." Does that mean that you are leasing the trucks from the same company that is providing the loads? Are you locked in with them or could you change carriers without losing the trucks? Look over your contracts to see what your exit or cancellation options are. There are many other carriers that you can lease to that will treat you better. As for brokering your own loads that is an option. I do not have personal knowledge of any of the many brokerage courses and schools that are available, but if you want to know a little about brokering check out their organization at http://elink.tianet.org/elink/am/template.cfm?section=home
You can run under your own authority and find loads through a broker but there are several pitfalls to that operating model. 1st you have run a good business and know your fixed and variable costs. 2nd you have to be careful which brokers you deal with. And 3rd you will need adequate cash to carry the float between when you incur expenses and when the broker pays. If you own or lease your tractors independent of any carrier your best bet to get started and really learn the industry is to contract with one of the established national or regional carriers that will treat you as a business partner and have adequate business to keep you running. Here are a few places to look:
http://www.owneroperatorjob.com/
http://www.justtruckingjobs.com/index.asp
http://www.truckflix.com/
http://www.everytruckjob.com/truck-driving-jobs.html
Hope this helps
Jim
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QUESTION: Jim, thanks for the links as I am sure they will be helpful. We are leasing the trucks from the same company we are taking loads from. When they pay us our settlement they take the truck payments out first..We are in a "don't bite the hand that feeds you" kind relationship. We want to be independent but the expenses or extra cash flow we need to be independent is being fronted by this company. So we're bound by them however the owners feel that this is ideal since we have no start up capital. For example we just had a major repair done on one of the trucks. Its blew out its turbo on the Mass Pike..since we don't have roadside assistance the carrier called their tow truck and covered that bill..we also use their mechanic.Then when our settlement comes in they take their money back that they spent on us. Problem is again we have no idea what they are going to take. The guys feel like they are helping us out we'll just have to wait and see what the bill come out to. But anyway I will do some more research I thank you for all the information.
Marie
AnswerMarie, looks like you need to keep working with this company for a while since they are helping to get you started without any up front investment. As you say, keep doing your research, and when your contracts are up for renewal you will have a better idea of what your other options might be. In the meantime try to keep the current relationship on a professional business level and get the carrier to view you as a business partner rather than just a replaceable driver.
Best of luck.
Jim.
