Feature Article: Beyond the Rate

Todd Dills | January 01, 2010

For $70 monthly with Internet Truckstop, for instance, owner-operators can see average days to pay for brokers with a history in the IT system, says Director of Sales and Marketing Leigh Foxall.

The basic $34.95 monthly package from Transcore DAT’s TruckerEdge.net online load matching service includes both days to pay and broker credit ratings, too.

CRST Logistics President Michael Fouts says membership in the Transportation Intermediaries Association is a good indicator of a brokerage’s standing. In an industry of more than 12,000 brokers, he says, “there are only 1,200 TIA members.” Within TIA is the P3 program that allows members to differentiate themselves, in part by carrying a bond level of $10,000 or higher, according to p3program.com website.

Karen Albert combines her gut-level sense of a broker’s professionalism and experience with the broker’s rating, which she gets from Internet Truckstop. “I won’t use a broker unless they have an A rating,” she says.

Getting freight on the hook at the best rate is every owner-operator’s goal. Developing solid negotiating skills can make the difference between a good rate and a great rate.

3 Know your market. Fouts says that in negotiating with brokers, customers can tap into a huge amount of information about markets. Today, he adds, “carriers have the ability to know what’s going on in the market and are much smarter about pricing and supply and demand.”

Rate indexing allows you to see average per-mile rates and compare them to rates over time on particular lanes. Using Transcore’s Rate Index Pro tool, Rutherford gives the example of the lane between Cleveland and Seattle, which in late 2009 trended 20 cents a mile above the national average of around $1.40 for brokered freight.

“All of a sudden in this lane the average is $1.60,” he says. “If you don’t know this info, you’re at a disadvantage. Because most owner-operators have been lazy [about researching this], it puts all of us at a disadvantage. The broker knows most of the owner-operators don’t study this.”

Rate indexing is available with truck posting and load search services, broker credit ratings and more for $105 monthly with Internet Truckstop. A package with limited indexing functionality with Transcore DAT’s TruckersEdge.net load board service is available at $49.95 monthly. The company’s full Rate Index Pro is $29 as a standalone product.

Other dynamic market information in the Transcore service includes current maximum and minimum rates, which give you “ballpark” guidelines, Rutherford says. The ratio of loads to trucks is also key in knowing the supply and demand situation in any given area. You can use this data in preplanning for your return trip or next leg.

In November, examining a load on Internet Truckstop from Tuscumbia, Ala., where the ratio was in favor of the owner-operator, to Jacksonville, Fla., where it was not, Foxall says, “when I get to Jacksonville, I’ll have a heck of a time, so I might go ahead and try to negotiate with [brokers] to get back.”

Preplanning gets you into some of the longer-term negotiation strategies that knowledge of freight markets will allow you to engage. Says Rutherford, “Instead of randomly saying, ‘I’m in Cleveland – I’ll just look for whatever’s going out of Cleveland,’ when you start studying you might be able to say, ‘Hey, I know Seattle’s a good lane out of Cleveland.’ Then we might start studying to find what’s a good lane out of Seattle.”

4 Know how to ask questions. An owner-operator who demonstrates a desire to know load details is negotiating smartly by establishing confidence he or she can be counted on to move the freight.

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