Why Shippers Need Brokers and How to Handle Load Hostage Situations | Final Mile 108

Speaker 1: 0:19

Welcome back. It's the final mile the Q&A session all about you guys and your questions for us and your feedback and comments. So please take a moment to check out the sponsors in the description box. That helps support this channel. Check out all of our other content, including the Freight Booker Basics course, if you're looking for your educational option for yourself or for your team. And we got some good questions today, but we wanted to want to start off. We just we just wrapped up a sales conversation. What do you think, ben?

Speaker 2: 0:47

I want to set the stage right. So lots of people, from our point of view as people that sell things, whatever it is, always wonder what it looks like from the other person's perspective. Right and right, when we got done with that episode, nate got a great follow-up from a tech company that wants to sell his company a product. However, nate's company already chose their other provider and I want you to literally kind of just as I set the stage and go into it exactly the way you told me. It right, like even from the message to you, because it is perfect.

Speaker 1: 1:18

Yeah. So I didn't get very good follow-up. So we were looking at a certain software, a certain tech tool that we're looking at getting and we checked out, you know, a bunch of different options for it and the sales. I mean we ended up going with a product that meets our needs, exceeds what we need, exceeds what we need. But, more importantly, there's a relational aspect with this company that we were able to develop over time and that came through great conversation with multiple different people in their organization great follow up, very tailored conversations Everything we were talking about in the last episode. Right, there's trust.

Speaker 2: 1:57

You know them, you like them and you trust them.

Speaker 1: 1:59

Yeah, like a lot by the time we signed a contract with this provider, like we hadn't even gotten follow up contact from a lot of these potential providers. So this one follows up and is like, hey, you know, we'd love to schedule a follow up demo. And I'm like, oh yeah, we already signed a deal with so and so. And he's like, oh, can I ask why, Like? And I'm like, ok, like, and I don't have to take time out of my day to tell somebody why I didn't go with them. So, you know, I forgot about the email. And then he tried to call me and I was like, hey, I'm busy, I'm away at Army. I told him yeah, hit me up next week, I'll definitely give you five minutes for some general feedback. Like you don't, you don't even have to do that. Like I'm busy, but I at least.

Speaker 2: 2:42

I definitely wouldn't have done that.

Speaker 1: 2:43

So I've had the conversation with other providers that have had given me a lot of follow up, built some rapport with me and I felt like I almost owe it to them to explain to them why we didn't go with their solution, but why I thought their products great, but a different one was better for us.

Speaker 1: 2:58

So, anyway, this guy, he's not very tailoring the conversation with me. And then he's like hey, when he emails me like when is good this week, and I was like I'm pretty flexible thursday and I thought he would have suggested some times or ask me more details. He just sends me his calendar link, says book a time and it's like 6 am, 7 am, 8, 30 am or like his options, and I'm like dude, I'm working first of all, that's the most like unpersonalized. I get the calendar, booking is great, yeah, but I just, you know, it just feels very informal and the times like if you know, I work in brokerage, like what the hell, are you thinking that I'm going to be up like in personal, right, yeah.

Speaker 2: 3:42

No, like, and again, like he could have just framed that and added like one sentence to change the entire tone of that of hey. I'm going to send my calendar link yeah.

Speaker 2: 3:53

I appreciate you taking the time. I only have early morning Thursday. If that doesn't work, let me know I can shoot you a couple other dates, right, like anything, to just make it seem like you're actually talking to another human being, not somebody. That's like okay, great, pick a time. Like dude, I don't work for you and I'm not going through your calendar to find something that like. Again, it's not that the calendar is the issue, it's the fact that it was just impersonal, like there was just no context to like how you would communicate with another person doing you a favor in this scenario.

Speaker 1: 4:25

Yeah, with another person doing you a favor in this. In this scenario, yeah, like whenever I send out a calendar link, I'm always like, hey, if you want to let me know, can you let me know some days, times that work best for you? Or if you want, here's a, here's a link to my calendar. If you prefer to just see what I have available ahead of time, yeah, and it's just that little shift in the way you say it that I think makes the big difference instead of just like here's my calendar book, something. Um, all right, let's get to our other questions. First one one of my customers has been requesting quotes for me for a year but never awards me the business. How do I politely tell them, no? So this is like you know, you get the customer that you know you're on their email list for all their here's this shipment going out. You quote them and they never give you business there. Here's this shipment going out. You quote them and they never give you business.

Speaker 1: 5:12

I feel like we've had this similar question before. I'd probably pick up the phone and call them and find out, like, try to get some feedback. And like, hey, am I not replying fast enough? Or you know how does my quote look compared to what you're actually booking everything for? I want to get some context. That's my take on it. But if you got somebody that for a whole year, I probably won't even let it go that long before I'm trying to have that conversation. What's your take on it?

Speaker 2: 5:35

Yeah, I would have not let that go for a year. I would have called probably two weeks in after I sent the second quote. Just, hey, want to know if you got that one and check in with you to see how my rates lined up with your expectations. Was I in line with kind of where your target rates are too high, too low? Just want to know, was I fast enough for you to get the rate when you needed it? Just looking for anything that I could do to be able to help, you know, work with you a little easier, make your life a little easier, right, Anything to just get some feedback on where you're falling, right?

Speaker 2: 6:05

Because again, like from the shipper's point of view, what are they doing? They're literally going okay, I'll add you to my list, they put you on literally a BCC list and then every time they get a load they just hit send Whoever's the fastest or the cheapest in a lot of this freight. That's who they go with. They're not putting a lot of thought into this and then those probably aren't relationship type customers anyway. But you also don't know that.

Speaker 2: 6:26

Because here's the thing I want to point out that could be true for maybe 5% of their freight, but there might be 25% of their other loads where they work with two or three brokers every single week that they trust that is high service, that is not price sensitive, that they are willing to pay fair price and fair rate for good service. It's just these loads happen to be the cheap ones, that the customers don't care when they get delivered. So they're like, hey, whoever's got the cheapest truck and get it picked up the soonest, you guys can have it. But you don't learn any of those things and have no idea what the other side is doing or cares about, unless you're not interacting with that person.

Speaker 1: 7:01

Yeah, I had a guy a couple of years ago he's not with us anymore, but he his entire book of business that he ran was all lumber load lists where they would literally tell you here's what it's paying, and it was like here's my rate. Whoever could get a truck first, like won it. And so that's why he said like, if you know, in situations like that, if if you're not getting the load, it's because someone was just faster than you.

Speaker 1: 7:26

Right not getting the load. It's because someone was just faster than you. But had you not called them to find out why you never got the load? You know you're sitting there wondering like what, why am I not getting anything?

Speaker 2: 7:34

And every customer is a little different, so and you can go one layer beyond that too. And if you really want to compete in that freight, the next question is like okay, if I really want to move, this is my only customer right. The next question is okay, what's my competition probably doing? If they're beating me and I'm getting my rates back or my truck offer in within 10 minutes and someone's beating me every week?

Speaker 2: 7:55

That broker probably didn't have a truck, is probably just taking the load and hoping they can cover it before the cutoff, and if they do that enough times, eventually they're going to fail. So now my conversation with that shipper is going to be like hey, it seems like everyone's been kind of beat me to the punch how things been going on your end. Oh, pretty good. Why do you ask? Well, because I'm assuming that, like, if people are grabbing these loads off you in a minute and a half to two minutes, like they're probably taking them without a truck in hand, because like that's not even enough time to talk to a carrier before they call and send your email.

Speaker 2: 8:28

So I got to imagine at least some percentage of your loads aren't getting picked up when they're supposed to, or some percentage of these loads are getting picked up late.

Speaker 1: 8:36

Is that affecting?

Speaker 2: 8:37

you at all Right Like you can keep going beyond that to play that one level above it if it's worth the time.

Speaker 1: 8:44

Yep. Next question Someone asked why doesn't the shipper skip the broker and go directly to the carriers? I just love that somebody asked this. So this is a curious new listener. I'm guessing they're new to brokerage and trying to understand, like, why do we exist here? It's a great question and this is we've. We've used this all the time to help explain our role. One of the value adds that brokers provide to shippers is that they don't have to have a full-out traffic department that's able to source carriers, vet carriers, schedule things with carriers, do all the things with carriers that we pay all the different carriers right.

Speaker 1: 9:22

So we, you know, we pay for tools and marketplaces to get us access to things like DAT and vetting tools like Highway or RMS or whatever you're using, and we spend time and we have processes to make sure that we're not getting, you know, defrauded by somebody or scammed out of something. Great example one of one of the guys on our team, legitimately like a customer that he lost that he's getting back in the door with what. What they did was they tried to hire someone internally to do with the brokers job and it resulted in them like, like what was it? Like they ended up something happened and they're paying like a ridiculous tonu on a specialized equipment and they overpaid on it. They ended up paying like twelve thousand dollars for a tonu, and it was because the girl didn't realize that, just because. So she screwed up and they moved the shipment to like Monday from Friday.

Speaker 1: 10:18

So the truck shows up and she forgot to cancel them. Truck shows up and she just decides, oh, that's my mistake, I'll just pay them their full rate anyway. And it's like what are you doing? So she just cost this company $12,000. But because of that mistake, that brings the conversation with the broker back on the question hey, maybe this is why we were using you. We could have prevented all of this. And so, basically, this girl three months worth of her salary just got like burned because she made one mistake. This is one of the reasons why brokers exist and they don't go direct to care.

Speaker 1: 10:50

There's a time and a place to go direct to carriers. That's a great one.

Speaker 2: 10:55

And here's the other one, right, like, put yourself whoever asks us whether you're a carrier or a broker, right, think about your job as a shipper, right, if your job is to arrange the pickup for 10 loads a day, okay, you've got to make sure all 10 of those pick up on time to get to your customer, okay. Well, if you want to use a carrier that has less than five trucks, right, you might have to coordinate with literally 10 different companies every day. That's 50 different companies right On top of that making sure your load gets delivered, picked up on time, dealing with your warehouse, making sure everything's arranged, all your POs are in order and all your other responsibilities at that shipper right. What people don't realize is, like, that is a very different job to communicate with three companies versus 50 every week. The second thing is, if one of those trucks is stuck at their last delivery, as a shipper you don't have access to just go to DAT and book a truck. And even if you do have access and some shippers can like, do you have the vetting software to make sure the company you booked is the company that you thought you booked? Is that the company that actually picked up your load? Right. And then also you need to set them up to also pay them quickly. Like you've got to be able to get that carrier vetted, onboarded, get all of their insurance documents, get them to sign all of your agreements and do that inside of like two or three minutes with that dispatcher before that truck books another load.

Speaker 2: 12:19

And like shippers one like you said, don't have the tools, don't have the experience, because, like that's not what they do all day, and also like their back end accounting team doesn't want to pay a different 50 companies every week.

Speaker 2: 12:32

At the end of the month you might have 200 different companies you're sending payments to right. Like that is a huge cost for a shipper to do that on top of what they're already doing. So when people go like, oh, why would they pay even an extra 200 bucks a load, like that's money they could keep. Well, then they got to hire someone else in accounting, then they got to pay for the software, then they've got to train their people to be able to vet, book and negotiate quickly and without any mistakes and without getting robbed and without understanding the nuances of how our industry works. And like shippers aren't in that business, they're in the soup business, they're in the basketball business, they're in the furniture business, they're in the steel coil business, like they're not in the shipping business, like that is just a necessary aspect of their business. That's not what they want to focus on. That's not how they make money.

Speaker 1: 13:21

Whereas what we do is we are not in their business. We are in the shipping and the vetting. And then here's the other side.

Speaker 2: 13:28

So from the carrier's point of view. You have four trucks. This shipper emails you every day and goes, hey, can you pick up this load? And you're like, no man, all my trucks are booked today. Well, imagine that times 200. So the shipper's emailing two, 300 carriers every day going can you pick up this load? And now they get 50 emails coming back going no, I don't have anybody today. Can the load move tomorrow? Now they're replying to every one of those like, no, I might have this load tomorrow, but I don't have it today. Can you take it today? No, you can't take. Like that is a lot of communication and just think about, like your to deal with a smaller number of points of contact to access a larger number of trucks. That's what we provide.

Speaker 1: 14:10

Even look at this. Like some larger customers that build out in-house brokerages, they still separate the role of the brokerage versus shipping.

Speaker 2: 14:19

Correct. So just almost always separate entity, separate business model, separate credit rating, separate everything.

Speaker 1: 14:27

Yep, our last question this is a comment, actually there's. One of our more popular reels was a clip about a load being held hostage. So I'll read the comment and it gives feedback and then a question and then we'll answer it. So the listener said got to love seeing, or got to love all the seething carriers in the comments. Brokers need carriers, carriers need brokers. Saying that all brokers are bad because you had a bad experience is low IQ.

Speaker 1: 14:54

When it comes to holding freight hostage, if a carrier has a layover a day to deliver and is demanding a thousand dollars layover to deliver the load when the amount agreed to on the rate count is 150, am I the scammer for accepting the demands under duress and then reducing the rate to the appropriate amount once it's delivered? Or is the carrier the scammer for trying to use the opportunity to charge me an unreasonable amount? I think there's a gray area here and it really depends on how it's all panning out. So if a carrier if the carrier is not at fault for the reason for being late on something and is asking for more money, I don't think they're in the wrong for asking for that. If it's an egregious amount, like you know, a thousand dollars for a layover is pretty steep, right, like 500 bucks maybe. Maybe depends on the equipment type, but we're talking like when carriers are asking for like three thousand more dollars. Like that's an egregious amount, right? If a carrier is asking for a simple layover fee, right, and depending on how long the layover if it's like they were supposed to pick up at four and now it's eight the next morning like I don't think 500 bucks is unreasonable because that's about a day's worth of their time. Um, now, this case if a carrier has clearly taken an opportunity to pounce on you and ask for more money because they know they can screw your customer relationship up, I don't think you're in the wrong.

Speaker 1: 16:16

And that was the whole point of that clip. Is that what we've done is we'll agree to whatever they're asking for and we'll just annotate it to get it delivered, and then, yeah, we're just going to deduct it off the rate con and their final payment, because we literally agreed to it under duress. But if they're asking for a reasonable amount and it's not their fault, then I'm going to go to my customer and try to work something out Like, hey, I understand, we wasted this carrier's time. I'm not about taking anyone's money or being falsely leading people.

Speaker 1: 16:45

The whole point, whole point of that, that conversation we had in that clip was if a carrier is like you know, there it's, it was their fault, they missed something. You know, a lot of times it's like they tried to book two partials when it was supposed to be a dedicated and they're going to be a day late or whatever, and they're, you know, demanding more money or whatever the case might be. That's when we've used that scenario. What is your take? Where do you kind of draw the line on? Where does the broker step over the line versus where is the carrier overstepping the line?

Speaker 2: 17:16

I start by defining the word scam, right? I've literally looked it up Dishonest act, fraud, a trick or a ruse, right? So the thing that I would want to understand in this situation is what was communicated and what happened To your point. If the broker tells the carrier you have an 8 am delivery appointment and when they get there they realize it's first come, first serve, there's 25 trucks ahead of them, they don't get unloaded all day and have to lay over to the next day, right, that's probably an extreme situation where the broker was either incorrect or outright lied to get the load delivered, to get the carrier to take the load. And in another scenario, like you said, which is probably the least egregious, is like, maybe the carrier did have like a 4.30 appointment and the shipper just couldn't get them unloaded on time and he said, well, you'll be first to unload tomorrow morning, right, ok, like now, the broker didn't do anything dishonest and maybe the carrier probably deserves 350 to 500 for having to lay over the whole day and maybe they have to cancel their load and they need to be able to recoup that because now they don't have a load tomorrow and they look bad to their customer, which isn't the broker's fault isn't the carrier's fault, is the shipper's fault. And that scenario, just like you said, you want to understand where the carrier is coming from and why it occurred and then maybe go back to your shipper and be like, hey, listen, like what can we work out for labor for this guy? My driver had to cancel his load tomorrow. His customer's pretty upset, like he's only asking for 350. Can we make that work?

Speaker 2: 18:46

Now, in the other scenario, like where you were just in the wrong, you didn't pay attention to the detail, it wasn't an appointment, or you outright lied and told him he had an appointment at eight in the morning so he would take your load. Then, like, for sure that falls on the broker. And, like most things, it isn't black or white. The answer is somewhere in the middle. Right, what actually occurred in working with both or all three parties to find the thing that solves it for everybody?

Speaker 2: 19:12

And the responsibility is sometimes on the broker, sometimes it's on the carrier, and sometimes it's on the shipper, and sometimes it's spread amongst all three of them. Right, and like you really have to work through these things, not just make black and white decisions based on what happened definitively, but understand, like, why that happened in the first place and who understood who and where the communication was clear, where it was incorrect and where it might've been a little gray, and you should have been a little more clear in how you sold the load. But without those details it's really hard to determine, like who is at fault more or less and it's usually a percentage. Maybe it's 30% your fault, 70% theirs, 60, 40, 50, 50, or 33, 33, 33, where the ship were screwed up, the broker made a little mistake and the carrier was a little late for their appointment.

Speaker 1: 19:58

Yep, it's a great analysis there. Good questions. Keep them coming our way Again. You can leave a comment in YouTube, you can send us a message at our through our website, freight360.net, and we will continue to add them to our final mile segment. Final thoughts, ben.

Speaker 2: 20:14

Whether you believe you can or believe you can't, you're right.

Speaker 1: 20:19

And until next time go Bills.