Carrier Vetting for Freight Brokerage Success | Episode 226

Speaker 1: 0:19

Alrighty, welcome back for another episode of the Frey360 podcast, and today is going to be a great episode. We're going to dig into vetting carriers. I know we've talked a lot about double brokerage and fraud in the past, but we really haven't done a whole lot of content lately. Ben, on specifically the fundamental process of carrier banks, we'll get into that in just a bit, but if you're brand new here, welcome to the show. We're glad you found us. If you want to continue to share this with all your friends, check out all the other content, leave comments on YouTube, subscribe all that good stuff. And if you want to learn more about Frey360 and our training, make sure to go to Frey360.net. Check out the Frey Broker Basics course. It's a full length, in depth training that'll help you succeed as a Frey Broker. Ben, how are you today, man? Doing well, man, you know what's awesome.

Speaker 1: 1:10

I'm a way to make it to the playoffs. I know I was going to say like somehow and it's funny because we were talking with Ken Atamo last week, who's a fellow Pittsburgh yinzer like yourself, and he, kind of like, mentioned that he gave up on the Steelers. And here we are going into playoff football, bonus football, and the Steelers and the Bills are playing each other on the wildcard in week one, which is pretty cool. I didn't think that mean you would ever be able to, because we've never had that happen before on the show. We've had regular season matchups. But for the Steelers to come to Buffalo, to Orchard Park, and play a game this Sunday at one o'clock, it's going to be interesting, man, we'll see.

Speaker 3: 1:52

And he gave it a one o'clock.

Speaker 1: 1:55

Yeah, one o'clock, so the quick, I'll just go through some of the NFL stuff here. The Bills hosting the Steelers, 10 point favorites. I'm naturally going to take the Bills in that pick there just because they're at home. They're hot right now and the Steelers are. I think would you consider Mason Rudolph as like a third stringer or a second stringer? He's not your starter, that's for sure.

Speaker 2: 2:19

For sure. I mean he was third string. At the beginning of the season they were questioning why he was on the roster.

Speaker 1: 2:24

Yeah, I mean, dude, he had a Superman looking win, though Also like he literally looks like a quarterback, what's that I said a quarterback compared to what some of the other games.

Speaker 1: 2:36

Well, he, I was going to say he also looks like Superman, like the with, like the long hair. What's that? What's is a Clark Kent? Right, superman? I can see. I can see him putting on some black framed glasses and ripping open the shirt a little bit, seeing the ass underneath, but who knows? So we'll see bills. I mean 10 point spread. I don't like a double digit spread, so I wouldn't take the bills to cover 10. I would love to see it, but I just don't. I don't know if that's going to happen, but who knows?

Speaker 1: 3:07

You got the dolphins who oh well, first of all, how about them? Bills, man, like they went from not even making the playoffs potentially to being the number two seed. So that's the big takeaway. Go Bill is super excited for it. But then you've got the dolphins going to the chiefs. So I think Casey will take care of business there and you got the Browns and Texans. That'll be an interesting game on Saturday afternoon. Raven's get the buy week. On the NFC side. Cowboys will be hosting the Packers. I think they'll take care of business. Rams I will assume a lose to the Lions, and I think the Eagles will take care of business in Tampa Bay on the road. So that's your, that's your playoff picture as it stands now. We're going to watch this unfold over the next month.

Speaker 2: 3:49

Speaking of who won the poll.

Speaker 1: 3:50

it was Steely McBean, oh yes, yeah, so Steven, unmute yourself. Do you have his name or Steven's muted? He doesn't know how to use a computer, but that's fine.

Speaker 3: 4:04

No, I do not have his name yet, but I have sent an email so hopefully by the time this airs we will have information in the show notes.

Speaker 1: 4:13

So, yeah, congratulations to was it Steely Mc? Something, it was Steely.

Speaker 2: 4:18

McBean 82.

Speaker 1: 4:19

Yeah, congrats. And he or she I don't know if it's a guy or girl One by. I don't even think anyone had a chance in the last week, I think, unless, unless they just totally like collapsed. But what stinks, man? As I looked at it, steven, you and I came in third and fourth place, but we both missed picks. It's like I missed two weeks of picks. I don't know, don't know how. I think you missed a week of picks. I missed.

Speaker 3: 4:43

I missed two, I think two and a half weeks. Yeah, building, building my project in the basement kind of ate up a lot of my time. And then on Sunday at like two o'clock, man, I didn't make any picks.

Speaker 1: 4:58

Yeah, for sure, for sure it happens. And then you know you could. You could clearly see like participation tailed off as people were so far like they're so far out there, like I'm pretty much they either forgot or they just started giving up. But we at one point I think we had like 50 or 60 people that had signed up, whether or not they were actually active. But that was fun, it was a good, good way to do the season. I definitely want to continue that in future years. But congratulations to Steely McBean. Whatever for a $250 prize, it'll probably come in the form of an Amazon gift card. It's just kind of the easiest way to do it. But love to see it, love the participation and we'll see how these NFL playoffs shape out. Other news and sports you see Tiger Woods dropping a 19 contract, 27 years. Yeah, was there a reason for it?

Speaker 2: 5:48

My assumption is just that, like the amount of money probably to retain him and where he was at in his career he's probably I know he talked about you know obviously he's playing less, if at all, and recently in the news he was talking about you know a shorter schedule, playing a tournament here or there, and I got to imagine Nike's probably just like hey for the amount of money that we're allocating to this. Maybe it makes sense to. I don't know, somewhere in there was an impasse, but they both seemed to talk about it in really good light and either one of them seemed like disgruntled or anything. They both had really nice things to say about you know the relationship and the near 30 year history they had together.

Speaker 1: 6:23

The one thing that surprised me is that I used to have Nike irons and I lost. I was at a tournament, like a scramble, and somebody accidentally took my pitching wedge and I went to buy a new one and I was like it was like 2016. And they were like we just discontinued all of our golf. We're just going to a parallel. Now we're not, and I'm like what? So I couldn't even get a replacement club. So I'm like okay is the fact that they stopped the actual golf equipment side. I wonder if that had an impact, because then you know, if Tiger's playing, he's not swinging. A Nike driver or anything anymore.

Speaker 2: 6:59

Oh, that's in a long time, well, almost 10 years.

Speaker 1: 7:01

I mean, it was 2016 when, I think they discontinued, and it's 20, 24 now, so yeah, he's, he plays with him, and he started his own clothing brand, yeah, and.

Speaker 2: 7:11

But his irons they specifically made and he worked with them. I think that it's going to bother me now. My cousin bought them. You could literally buy his irons right the exact same ones. And my cousin bought them when they came out that year just to kind of have a set in his office, and I got the swing them. It's pretty cool, super cool. Taylor made, yeah, and they're.

Speaker 1: 7:31

You know, his set of irons, p7 TW iron by Tiger Woods, by Taylor made Interesting so yeah. So I think that that'll that kind of makes sense as to why. But hey, the the 2024 golf season's back. They just had the opening I can't remember the name of it the opening match this past weekend, though. So back in the golf season, I mean those guys play year round, but I mean it's distinctively the new season. So in news, we just had a newsletter go out earlier this week and there wasn't a whole lot of crazy in the marketplace. Trade was up based on US imports this month, couple reports of the driverless truck companies that are now advancing to the next phase, where they're removing the human from the cab, and their testing process. So we'll see where this goes.

Speaker 1: 8:27

I actually had a thought about this, though, when I was driving. I was in Albany, new York, this weekend and I was driving back through a snowstorm. It took me like six hours, when I should have been like just under five, and I thought to myself, as I'm there like white knuckling my steering wheel and, you know, a semi is are flying down the road because they're way more comfortable driving in a snowstorm than I am, because I do it all the time. So, like you know, you got friggin slush going everywhere and there's snow covering up the lines. How do these driverless vehicles like? How does a Tesla know where the road is when there's snow on the ground?

Speaker 2: 8:58

They can't, at least the ones that I've been in, they can't. In fact they don't even work in the rain. So I think, from what I've read and it's been a while, but they're basically only starting them in the Southwest like areas, and it's also mostly because of the way the streets were there, because I think Google started testing their car Waymo years ago in the same types of cities, because the way the cities are laid out, they're flat, they're straighter roads, I think, and they have less weather issues, because even the two cars that I've had one, I think they use Doppler, like the same thing they use for radar and for golf balls and things. Yeah, but if it's raining, especially if it's raining hard, like my warning systems come up and it just immediately says like isn't working, like I don't pay attention to this lane departure, all of those things don't seem to function. So I don't think that they've solved that yet.

Speaker 2: 9:52

And even for lane, like my last vehicle, compared to this one, this one's a 24. The last one was a 2020 or 19. If you drove through an intersection that had construction there, like you know, where they repaint the lines and some of them are blacked out temporarily, it would literally yank my vehicle to want to pull me into what used to be the lane Because you would have to like literally, kind of like stop it from doing it, and it was like really unnerving for a while. The new one's not as bad, but I mean they're very sensitive, from what I've seen to.

Speaker 3: 10:22

That's interesting. So to touch on that, you know the when you go to log into something and it has you like pick out the crosswalk or pick out the people or the motorcycles or whatever.

Speaker 2: 11:41

Or you have to train.

Speaker 1: 11:42

Like that. You're not a robot test yeah.

Speaker 3: 11:45

Yeah, so that's used to train the cameras for vehicles.

Speaker 1: 11:50

Interesting. They're always like very pixelated though, right, so I think that's the point.

Speaker 3: 11:56

They use a combination of the cameras, that's true, and radio waves to sense what's around them. Fair enough.

Speaker 1: 12:06

Well, we'll see. I was just curious when I saw that and you know I always love the advancement of technology and I think it's going to be a big part of our space, especially with whether it's advancement to electric trucks or driverless trucks or, whatever the case might be, some way to make the supply chain more efficient. I just I still can't picture an all driverless trucking fleet. I just can't. I think that there's something about like the fact that I use the phrase white knuckling down the road, like you have to have that like human intuition and almost like a little bit of fear too, to make smarter, safer decisions. But I mean, who am I? I'm not an engineer that creates artificial intelligence and machine learning for driverless vehicles.

Speaker 2: 12:56

Here's the other interesting thing too right Like they are, they're running now in San Francisco driverless taxis. They have been for a while. There's a couple of really good interviews I've listened to where tech reporters are driving around in it and like there's just a lot of odd things that are happening. One had the accidents were really publicized and it scares the shit out everybody. So like there was one where it like hit somebody and kind of drag them like 30 feet because it didn't know they were on the outside. It was pretty recent and it like I think it might have shut down one of them temporarily. I don't even remember the results, but I know that happened. The other thing, and this is kind of funny, but they were saying like the amount of people having sex in driverless taxis was like astronomical and something that like nobody thought would be a problem that they now have to like kind of solve for.

Speaker 2: 13:45

But, I think it's going to be a while, but I'm also hoping that it does help with two other things. On that point, there was a recent New York Times piece I read over the holidays that like pedestrian accidents are up some astronomical amount like 3, 4, 500% of just people getting hit by cars now and fatalities. They think it's two reasons pedestrians walking around staring at their phones and not paying attention, and people driving their cars and staring at their phones and not paying attention. And living in Florida and being hit by a few cars. As a pedestrian, to me I'm like I really hope my daughter when she, 15 years from now, possibly doesn't have to drive a car. It's kind of like my hope, yeah.

Speaker 1: 14:30

I mean hey, my job.

Speaker 2: 14:31

I kind of hope. It never happens.

Speaker 1: 14:33

I think, yeah, I think, if you remove the driving, we're going to have another skill you're going to learn. I think that's just how history has progressed. And unrelated news Do you get the morning brew?

Speaker 2: 14:45

Yeah, I haven't read in a while, but I do still get it.

Speaker 1: 14:48

So I read it like periodically. That's where I saw the Tiger Woods thing and I also saw the one section this morning this is from we're recording on Tuesday. It says it's the real estate section, which is always somewhat relevant to brokerage because real estate and new builds tend to and that tends to kind of follow the overall economy right. But this was this one specifically was about Buffalo, new York, and it said I mean it talks about Bill's mafia Manifold. But it said Buffalo, new York, will be the hottest housing market in the US in 2024, thanks to affordable home prices and strong employment rates Zillow projected. So if watching Bill's fans welcome the team home yesterday from the AFCE title when doesn't give you the urge to move there, then this might. It said it cost a home in Buffalo averages 248 K below the national average of 347,000. So almost 100 K cheaper. And typical Buffalo Nian pays 1800 a month for a mortgage, 1300 a month in rent. Buffalo has the highest rate of new jobs per home out of the 50 biggest cities. And lastly, the Biden administration named Buffalo a tech hub for semiconductor manufacturing, which means the city could get billions of dollars in government funding via the chips act.

Speaker 1: 16:04

I didn't know that. But hey, a little shout out to Western New York. If anybody's listening. It sounds like our housing. I mean, I've always, I've always appreciated what you can get for your money, like housing wise here. Because, like, if you were to take a house here and slap it in the New York City area, even like 20 miles out, you'd probably pay four or five times the amount. So for sure Easily.

Speaker 2: 16:28

For South Florida I'm like you're at least your average home prices. I think in Palm Beach it's $550, $650. And like the whole county in Miami-Dade it's probably that or more. Because there are a bunch of news articles that, like now, the average home price and basically all of South Florida is above like every limit for a normal mortgage and like even the state's mortgage programs or insurance programs don't cover them.

Speaker 1: 16:50

Now I bought my first house for like $120,000 and it was a three-bedroom, had a half-finished basement, was a full acre, was against a 400 acre farm. It was sweet man, and I'm like you can't even, like I mean prices have gone up since then but like people would hear about that and they're like that's insane, like literally insane how affordable it is, but it's very similar to that.

Speaker 2: 17:17

Like I would say like real close to Buffalo numbers from what you just said. You know most of my friends and family all live in there, so pretty familiar with just the real estate market up there. It's real close to Buffalo's prices so you can move into something reasonable for, like you know, 250 grand and that doesn't get you a studio apartment here for 500 square feet, yeah.

Speaker 1: 17:40

Yeah, one lot you mentioned in Pittsburgh, even though Pittsburgh's not part of the stat. Pittsburgh adds to this stat, but the I think it's the first time in NFL history the three great lakes teams all what would they say? The three lake Erie teams all made the playoffs. So, like Detroit, cleveland and Buffalo all made the playoffs. You guys aren't too far Pittsburgh, you know, maybe a hour and a half to get to the lake, but that was interesting, fun little fact. All right, well, we'll start with some carrot vetting here. Right, can I do?

Speaker 2: 18:16

it. Why vet a carrier? What is vetting a carrier? Let's start with what vetting actually is.

Speaker 1: 18:20

Yeah. So we're talking about doing a little bit of research on one of your trucking companies or motor carriers to make sure that they meet the standard that you're looking for, right, like vetting. So the reason, I think and I'm going to have a very straight to the point educational video on this, probably releasing in the next week or so, but this will be more of a full length discussion on it and we can tell some stories and experiences of what we've been through and why this is important but to really set the stage here, the importance of vetting a carrier is there's I mean, there's safety, there's your reputation, customer service. So you have to remember that we don't physically take possession of freight.

Speaker 1: 19:08

As a freight broker, our job is twofold. Number one, to serve our carrier base. We want to find them good freight, to get them where we're going right and make sure that they're not going to have issues, and that's we have to vet out good customers that are very communicative for that to be good. On the other side, we have to service our customers to make sure that their shipments get where they need to go, on time, without delay, without damage, and all of that, and that's going to come down to us selecting a reliable, trustworthy motor carrier to get the job done all right. So think about the implications. If you have a late shipment or damage shipment, you can lose a customer over it.

Speaker 2: 19:48

I want to go back even a second for fundamentals, right, so fundamentals, what does vetting mean? Right? Just definitions. Right To make careful and critical examination of something, or to investigate someone or some company thoroughly, especially in order to ensure that they are suitable for the job, right, I think? Freight brokerage what most people miss is like, in its most simplest sense, we are just outsourcing the hiring job from a company that ships things. Like that's what we do. They have a department that hires trucking companies and they also vet the trucking companies for age and all the things we'll talk about in the show.

Speaker 2: 20:26

So when you are working with a customer, all you should be doing and its most simple sense is understanding everything they do to vet their carriers for their risk profile for that company and what they've decided, and then apply the exact same criteria when you're hiring the carriers on their behalf, whether it's insurance, age, reliability, all of those things right. So our job, really? People think it's all these different things and we ship things and we move things, and those are all really true, but in its simplest sense, like we just get paid to hire trucking companies faster than a shipper can and to do it more nimbly in a market where you might be doing this in 45 minutes or 10 minutes as opposed to a shipper, that it takes a couple of days or a couple of weeks or longer, we also become experts in this right.

Speaker 1: 21:09

So it's more than just hiring that truck. It's finding the right truck with the right equipment at the right time, at the right price with the right all the stuff we're going to go through as far as, like you know, inspection, history, safety stuff, all that stuff right, and we have to become subject matter experts at this so our customers don't need to worry about it. They should be able to say, ben, I trust you, just give me the truck here. As long as we're within the price range I know you should be able to do a good job to get me a good truck here. So very important. And failure to do this properly can and likely will result in you losing a customer or losing a chunk of their business because you failed to give them adequate service. So that's why it's important.

Speaker 1: 21:54

I want to start out. These are in really no particular order, but I want to start off with verifying a carrier's authority. This is a very, very basic starting thing to look at. So you're going to usually ask a carrier, hey, what's your MC number? Or, if they're just an interest state, like maybe a Texas only or California only carrier, they might not have. Well, they're not going to have an MC number that comes from the Department of Transportation or FMCSA. They're going to have a DOT number issued by their state, okay, so like Texas DOT number or California DOT number. So, anyway, you want to get that identifier, typically an MC number, and you want to verify it through either one of the third party systems that ties into the FMCSA's database or you can go right to FMCSA. It's the Safer website, s-a-f-e-r. If you just type in FMCSA into Google it'll probably pull up.

Speaker 1: 22:44

First option will be like the company snapshot from the Safer website and type in their MC number or their DOT number or their name or whatever it is, and you should be able to pull up a screenshot profile of this carrier. That'll show verify their authority. You, they have a motor carrier authority that's current and not revoked. So that's number one, because if you hire a carrier that's not authorized, it can't do that because they're not legally authorized to haul your freight, it just is.

Speaker 1: 23:17

That'd be like if I called you Ben and I was like hey, man, why don't you go rent a U-Haul and I'll just hire you to go to my customer's freight Right, and it's like no, you can't, the job is broke or it's very clearly defined what we can and cannot do as an intermediary. So when you're checking authority, do you do anything in addition to that? Like some people will look at the age, right, they might want to see hey, I want to make sure they're in business for nine months, six months, three months, whatever the case might be, is there anything that you look at specifically, like revocations or anything like that?

Speaker 2: 23:50

On Safer. The things I tend to go to look at are the out-of-service percentage and I look at the power units and I look at the so we'll get down to that in a little bit here.

Speaker 2: 23:58

But as far as the authority by itself, like just motor care authority, I usually look at the time and I'll be honest, I know we want to go through this fundamentally, but I use highway predominantly now to do all of this. So, like when I go into their system, I look for a lot more than I did before because I can see more right. I look at their authority age, I look at all of the warnings and all the other things that we'll get into later, mostly though the age, and then looking for red flags, and if it's been there for like a month, I'm going to ask a couple of questions.

Speaker 1: 25:47

Yeah, there's a lot of subjectiveness too. Some company I've worked for a company where they said you have to have authority for 180 days and then we lowered it to 90 days, but you could have a carrier that was only in business for two months, that was told no, even though they might have been a company driver for 20 years before.

Speaker 2: 26:05

And they decided I want to buy from my own become an owner operator, so that's why I like-.

Speaker 2: 26:09

And I want to point out real quick, before you go past, that some of my best carrier relationships have come from those situations where you ask questions and you find out that like, oh, this guy, just like you said, has been driving for 20 years and decided to go on his own maybe two months ago, right, Tons of experience, understands the market and just really wanted to open his own business. And when you can understand why it is what it is right, you find out, like I have, that lots of other brokers didn't want to work with them. So guess what? I got better service, I had better capacity and I had more reasonable rates and we were able to work together. I helped them grow their business, they helped me grow my business and it was mutually beneficial. But you've got to ask the questions to understand to your point what is behind.

Speaker 1: 26:50

Whatever you're looking at, yeah, there's a story behind a lot of things. So, remember, when you're looking at data on a website like you mentioned, highway I personally use it as well it's a great way to aggregate all of the FMCSA data plus a vast amount of additional data that highway pulls and creates themselves, and it puts it all into one place to give you a really easy one-stop shop to make a good decision. So I found carriers that have a short young authority and they can oftentimes be way better than someone that's been around for four years. So next up, insurance, and we've done full length episodes on insurance and the different things like that. We're not going to get in too much detail, but the two main things that I want to mention here are most carriers are going to have 100k and cargo coverage and another million in liability.

Speaker 1: 27:49

The caveat to that, the other side, is not every customer shipment fits into that. It's not always a square fitting into a square hole Because your customer has a $150,000 value shipment or requires some other type of coverage that your carrier might not have. That carrier might have an exclusion for a certain kind of commodity. What you want to make sure is that you're double checking and this just is communication. If your customer is moving frozen snow crab, you should very specifically ask the carrier hey, does your insurance cover frozen seafood? If they're not sure and they can't give you a definitive yes, you're going to want to get something in writing from.

Speaker 1: 28:34

Well, either move on to the next or get something in writing from their insurance agent who underwrites the policy, or someone who can speak on behalf of that person who underwrites the policy and verify this policy does in fact cover frozen seafood, because a lot of that. I just picked that commodity because it's one of the more common ones to be excluded, like eggs as well are certain kinds of berries. But verify if it's not a standard freight, all kind that's going to fit within that $100K and $1 million standard policy limits. You need to verify or find a different carrier or get an insurance solution to fill the gap.

Speaker 2: 29:09

I want to point out this has nothing to do with the insurance. Your freight brokerage carries Totally separate. It doesn't matter that you have contingent cargo, it doesn't matter that you have general liability. It does not go on top of what your carrier has and it does not work in place of so. If you got a load and it's $150K, that carrier better have $150,000 in cargo insurance, if not your customer better be okay with it only being partially covered.

Speaker 1: 29:37

There are some customers that they have high value freight but they choose based on the low percentage chance of them having a claim. They choose to have partially uninsured shipments because they likely find that they save money on rates overall versus losses that they claimed. That's kind of a rarity but it can exist if your customer is okay with it.

Speaker 2: 30:02

And some of them have large umbrella policies at a corporate level that also cover that risk that we're not going to get into now. But if your customer is telling you this load value is this, you need to ask them hey, we want to make sure this is all covered. You better make sure that carrier has exactly that amount and no less.

Speaker 1: 30:19

Exactly Moving on the list here inspection history. So this is one that tends to come up as far as we're just talking about the quantity. I'm not talking about the results of it yet, we'll get there in a minute but this is one of the telltale signs of red flag for possible fraud or not. And what I mean here is consider this a motor carrier has 20 trucks. They've been in business for five years but for some reason they're showing zero inspections on their history and they've had zero VIN numbers inspected, zero roadside inspections, zero driver inspections. All of that zero, huge red flag.

Speaker 1: 31:02

Now if a carrier has, let's say, three trucks and they have five inspections in the last year, that's a realistic type of metric, right, they don't have to have 100 inspections, but it should be commensurate to the size of their fleet. So if you look at a large, for example, I did this like yesterday, just out of curiosity I looked up Prime and I think, steven, you and I were trying to take a look at some of the metrics and we'll look at on that in a minute. But a company like Prime has got thousands, of thousands of reefer units, like their map on highway is pretty much just a bunch of blue dots because they've got thousands of inspections. That, like that's just the reality of a large fleet, now when you're small. I looked up at one truck fleet and they had like two inspections. Make sense, though they got inspected a couple times throughout the year for, you know, for one vehicle.

Speaker 2: 31:54

If you've got over one year's of business and no inspections red flag.

Speaker 1: 31:58

Why is it a red flag? Because likely what they're doing is taking loads and double brokering them to somebody else. How?

Speaker 2: 32:04

do you know that? Why is that the case?

Speaker 1: 32:06

Well, I don't know for sure, but my gut's going to tell me that, because if I've been in business for two years and I've never gotten inspected, I'm likely not actually driving my trucks down the road. Someone else's trucks are getting inspected, which means I'm likely taking the load and rebrokering it to somebody else, who then, if they get inspected, it's going to be reported on their MC number.

Speaker 2: 32:25

Yeah, so again, we don't have to do that. Why do companies do?

Speaker 3: 32:26

that.

Speaker 2: 32:27

Well, let's go just all the way through. And why do companies choose to do that? Why have an asset MC not run the business on your trucks? What are they doing? Why is that happening?

Speaker 1: 32:39

I mean, I'm going to give you my honest opinion here, as they're either fraudsters or scammers or they're just too lazy to be able to go out there and solicit business themselves, so they're going to take it from a broker and put it out on someone else's truck. They're just the middleman. They're becoming a middleman. That's being lazy, whether or not they're paying the actual truck versus stealing the money, and you can go down that rabbit hole and our other content on fraud and double brokering. What they're doing is wrong and this is what you can look for to prevent that. It's probably the number one telltale sign. Is inspection history lacking or not existing at all when it comes to a carrier?

Speaker 2: 33:16

Where we found this a ton. One of our clients is a couple are in the auto transport business and it is so prevalent in the two made load boards. I'll just match and I forget what the other one is off the top of my head, I don't know the other one.

Speaker 2: 33:31

So many of the carriers in there when we went through and started vetting them that are exactly this Two years no inspections.

Speaker 2: 33:38

Couple trucks, every single one, no inspections. And then when you talk, and then our client is like, well, you know, I'll talk to the drivers when they're on site and see who's there and it's like it's never the same MC and it's exactly what you're saying. They're carriers that are like, hey, we can get an asset MC sit on a load board. Brokers will call us, give us business and then we can rebroker that freight without them knowing we don't use, they don't have a license. So they're misrepresenting themselves just to be able to get business easier. Then they give it to their buddy who and again anecdotal but a lot of them don't have any insurance. So not only are you not booking the carrier that you thought, but another guy shows up and you have no idea if they have any insurance, let alone the right insurance, and now your customer's freight is just rolling down the road with absolutely no coverage if anything goes wrong and it happens a lot on that side of things from what we could tell.

Speaker 1: 34:30

Yeah, so we'll go it. Now we can kind of peel back the layers and look at, oftentimes, the result of those inspections. Hopefully they have inspections, but we'll look at violations, the safety rating. Safety ratings aren't as prevalent now because, like I'm pretty sure over 90% of carriers are unrated, just because the sure amount of new entrants that came into the market the last couple of years.

Speaker 1: 34:52

This was a stat when we were in DC with TIA last year. It was kind of like they would ask us like, oh, why don't you guys just use the DOT's database and see if carriers are, how they're rated? And we're like, well, that used to be great 10 years ago when it was like satisfactory or conditional or unsat, and now it's pretty much they're all unrated because they just haven't been. They don't have a safety rating. But the inspection results you can see. So if a carrier gets a roadside inspection you can see if they have, oh, just a one-off little tire tread or tail light out or something. But if you see something like a trend where it's always the same maintenance issues that they're clearly being lazy on red flag, they're likely like low tread. You're going to likely blot a tire versus someone who doesn't have low tread.

Speaker 2: 35:51

I just wanted to say. When you're going through these, the thing that goes to my mind is, like every conversation you have with a driver, that's super frustrating, where it's like, oh, we broke down and you have a carrier that constantly keeps breaking down, which means they're not as reliable. These are the reasons that these things happen and they're the same carriers. And again, I'm not trying to be negative, but you can't get the same rate per mile if you're constantly going out of service, because I can't trust that my customers' loads get delivered when they're supposed to, so you're going to pay them less money because you have an objective number. It's not somebody's opinion. They're not managing their maintenance well and they keep going out of service, so it's very likely that happens with one of your loads. So these are super important and, I think, really often overlooked from both sides the carrier side and the broker side.

Speaker 1: 36:37

Yeah, so actually one of the things that Stephen and I looked at yesterday was when you're in FMCSA or highway or whatever vetting site you're using, you can see the results of the inspections and how those results compare to the national average of all trucking companies. So there's four categories. One of the two main ones that we deal with are vehicle and driver, but it also has hazmat and then IEP, which we didn't know actually is intermodal equipment provider. Did you know that, ben? I did not. I didn't. I've never come across that for an inspection thing.

Speaker 1: 37:14

But so, basically, vehicle and driver, so you're going to show how many inspections they've had, how many out of service events they've had. So you can get dinged from an inspection but not put out of service. But there are certain violations or accumulation of violations that will put a driver or a vehicle out of service until it's corrected. So, for example, I just pulled up a random carrier. It said in the last 24 months they've had two vehicle inspections and 16 driver inspections. Zero violation or zero out of services for both of those, which results in a 0% out of service. The national average for vehicle out of service is 22%. That was kind of shockingly high to me, which means almost one out of, just over one out of five vehicle inspections.

Speaker 1: 38:02

Roadside is puts a truck out of service. So very important. This is also capturing the last two years of data, so there could be some bad actors or, like you know, just some underperformers on there. Driver inspections was much lower national average just over 6.5%. So yeah, and if you keep looking at the data on a carrier's profile, you'll see crash history. If it involves injuries, fatalities, toeways, things like that, these are all really and then you can go into like the. You can go down like a rabbit hole in the. It's called SMS results for FMCSA, it's the safety measurement system. You can see literally ever inspection, the results, the. You know all the dings against them.

Speaker 1: 38:46

So what I typically would recommend looking for here is, as a broker or as a company, we should probably have some sort of like baseline expectation. So like, in my opinion, low tread and failed like brake pads. I would never use a carrier like that because that's just blatant. You know, poor maintenance those are things that are extremely preventable, predictable. You see them coming if you're properly maintaining your equipment. So those are terrible.

Speaker 1: 39:16

Also, things like if a driver is busted for controlled substance unless they've been fired and we have documentation that that driver is not there anymore.

Speaker 1: 39:24

I don't want a driver who's been caught drunk or high on my customer's load, but if you see things like you know they were their logs, like they went over on their driving hours, you know four months ago, right, there's a lot of reasons that could have happened If you see a crash or you know a lot of the other things, if they're like here and there, but you know there's very few of them and there's far, far between each one. That's a lot different to me than a trend of continuous violations and not a service. So you have to kind of figure out your comfort level, do a little research, find the story behind why this carrier has the results that they have, and then you ultimately decide you know, based on what your research and your vetting has been are you comfortable with this driver or this trucking company? So what's the approach you take, ben, when you're looking at safety scores and you compare them to the national average, or does your cameraman have to give a no-go on it, or what's that look like?

Speaker 2: 40:32

No same thing you just did.

Speaker 2: 40:33

Like I mean, I kind of go through it and I've done it now thousands of times, so like I just have a feel for kind of what I'm looking for. I look at the out of service percentage mostly and again, for me too, like I ask lots of questions because I want to talk to lots of my carriers like one to one, so like I ask a lot of these questions to see if the numbers match up with the story right, and if they don't, then I'm like okay, this doesn't seem right. And then I also look at the flags from highway for like well, for where the authority was, multiple authorities in the same location, all the things for fraud, because fraud's really big right now. But as far as, like I'm like if you got a decent fleet and you're out of service, it's like around average, a little above or a little below. I'm pretty okay on either end of that and I see things that are egregious, way above national average. To your point. I'm going to go right back to my carrier and talk about cost versus not cost.

Speaker 1: 41:24

All right. So next up, I want to dig a little more into. We'll use highway as an example here. It doesn't matter if you're using highway or carrier, or sure, or carrier 411 watchdog, which is managed by highway. Now right, there's a whole bunch of ways to get reviews, reports, warnings about motor carriers, and you should absolutely be using some sort of system to do this. So reviews on Google or DAT you tend to find like very skewed, because people will. It's like yeah, people leave a bad review when they're pissed, but very rarely leave a nice review, unless you like ask 10 people, you might get one that'll do it.

Speaker 1: 42:06

So you can look at those just for reference, to get context, and take them for what they're worth. But if you ever have like one of these Excel sheets of hey, here's all the bad MCs out there and what was wrong with them, those are valuable but they, you know it's also only as good as the data that was input. There could be a bad, a bad addition on that list. Or just because someone's not on that list doesn't mean they're perfect. But look at things like you mentioned some of the red flags that highway gives like oh, there are 20 MC numbers associated with this same address.

Speaker 1: 42:43

Red flag, because you can't have 20 trucking companies all at a PO box, right, Where's their terminal? Where's their home home base? Same thing with, like if that person's phone number is associated with a different MC, right, it doesn't mean it's terrible. They could have worked there previously. But you want to understand why. Why is my phone number showing up? Or why is their phone number showing up in someone else's MC? Same thing with if there's a brokerage at the same address, Not terrible. My company that I work for appears to be a why we have a trucking company too. They have the same address, but they're two different companies. But if someone has a brokerage in a two truck operation at the same address, they can't take 20 loads in one week Because if they are, they're either putting them through their brokerage or they're double broker them out to somebody else anyway.

Speaker 2: 43:32

That's the big thing too, right, and I don't think people think about that often. But when you are looking to have multiple loads booked right, take a look at how many trucks they have and make sure that that math adds up right. Yep, you're going to be giving somebody five loads a day, right? That are 500 miles or whatever, and they've got one truck. They're not running them.

Speaker 1: 43:53

So the other thing too. This is just very basic, straight forward. Just blatant reports, highly will tell you report of double brokering, report of fraud, report of their identity has been stolen by somebody else, right, and you can get a description and narrative of what happened. Contact the author of the review if you want my take on all of this. Right, if I see blatant like three double broker Fraud reports, like don't use them, just don't use them. Okay, put them on, do not use in your system.

Speaker 1: 44:20

But if somebody has maybe a weak authority or a new authority or a weak inspection history, or If they have a phone number associated with another MC, like things that could be bad but aren't for sure, just take additional measures To make sure that you are dealing with the person that you think you are, that they are who they say they are. They have the truck they say they have in the location they say they have. So what we do is, if we hit well, typically we just want this to be done all the time Eventually you'll usually gain trust in some of your carriers, hopefully. But a newer carrier we're gonna say like, hey, we're gonna, we're gonna want GPS tracking on this load, we're gonna, we're gonna want to see a picture of you at the pickup. So our you know we want to make this is for us and also for our customer verify that they've got the right truck there and all that stuff.

Speaker 1: 45:11

But it's really hard to fudge that stuff. I did see one. We had a guy he's like does this picture look real? Someone took a picture of a truck at the pickup and like Photoshopped their name and MC on the side of the truck and the only reason we figured it out is because, like, the quality of the photo was far less.

Speaker 1: 45:32

There's a much lower quality than like the logo the high, like the high quality, like text that clearly was put in there. I'm like Photoshop or like someone's iPhone. But yeah, you know, in that case have them take a video like hey, here's my truck name on the side, here's the pickup boom. Like that's a great easy way to do it. So yeah, and you know, highly does a pretty good job at forcing people to verify their identity and location, all that stuff. So yeah, but yeah, I mean that's my big take on those reviews and whatnot.

Speaker 1: 46:03

I Want to we got a couple more here. Tms history I know we're getting kind of long on the discussion here, but this is good stuff. Look in your own TMS if you've used them before or someone else in your company has. Look at like Frequency or reviews on them on time percentages. Have they fallen off of a load? Did they have driver issues or complaints? Like these kind of service failures or Internal notes should be annotated and if you're not Recording whether they did a good job or a bad job or somewhere in the middle, you're doing yourself and your company a disservice, because that's like the most valuable data you can have is your own personal experience with a driver or a carrier versus what somebody else has said online it's my take on it.

Speaker 2: 46:43

And I think it's really helpful too for the rest of the company, right, because the nice part about that is when it's internal, you can be a little more honest right with what's happening, because it's not to the public, it is for your own company's purposes. The other thing that's nice about those is like, even when something goes wrong and you see those, you can just quickly call the broker that, put them in there and just go. Okay, walk me through the situation just so that I can understand it. Was it a one-off? And most of them that I'd found because we lean on that a lot when I worked at TQL because there's Everybody was in the system for the most part like you'd find out that it was usually some point of contention.

Speaker 2: 47:17

Where was maybe a little bit the truck's fault, a little bit the shippers fault, a little bit the brokers fault, and everybody just kind of got pissed off at each other and then it escalated. Yeah, I'm like, oh, okay, well, that's not really, you know, a reason not to use this truck. I mean, when you see things like takes loads, never answers the phone, never calls back, don't know where my load is, even if they deliver, like okay, depends on the load, I'm shipping. Right, that might be okay. That might not be okay, but those are really really valuable insights to I Don't know cultivate.

Speaker 2: 47:49

Get into a place where you can access them, because if you don't create them and spend the time to put them in your system, they won't be there later for you to read them when you run into that carrier again. So even for one-man shops, it's really important that you're keeping notes for the carriers You're using that you like to, not just the negative sides. Hey, there are positive notes from a carrier, what you like about them. They should also go in a different group so you can know when you need to use them for what right.

Speaker 1: 48:13

Yeah, I always recommend just kind of put a bow on that statement is Whether or not you actually use a carrier, like ask a couple questions and add notes to your TMS. It's totally different topic. We've talked about this before. As far as like building a care network but say you talk to a driver, you're vetting them out and then you find out they don't have the right. You know they don't have enough hours or something. They don't have they some things not a good fit for this load. But you still want to find out, like oh, they've got three reefers that are available every Tuesday in Chicagoland. Like put that your TMS. That's huge, that's great data.

Speaker 1: 48:45

All right, find out something which leads me to my last Voting point, which is verifying their equipment and their drivers hours. And again, this is not an all-encompassing list, but these are some of the highlighted ones. So when I mentioned equipment type, right, if they need a reefer, make sure they have a reefer, not a vented van, not a dry van, because you think the temperatures just right. They need to have an actual reefer unit and you need to make sure that they have a properly working Reef for unit on the front of that trailer. And driver hours I mentioned as well. Make sure that driver has enough hours Available in their week or in their day, or in both their week and their day, to get To the delivery on time and the pick up on time, for that matter. And if it requires a team, make sure that that team is going to actually act as a team.

Speaker 1: 49:32

And the reason I bring that up is we had a situation earlier or late in 2023 where we needed a team team drivers for a load. We got verification that there was two drivers, but they didn't drive like a team. They didn't drive 11 hours each for 22 hours a day. They drove like one drove six and one drove five, so they a team that drove as if they were just a single person, so they missed the delivery. Like, that stuff's important. Like, set the expectation, verify that stuff up front and as well as any kind of Rate deductions that may come from your customer due to these services, valor. So equipment types you're verifying. Also, like, think about your Extra equipment. Like if you need chains, straps, tarps the size of the tarp, pipestakes, I think. What else right?

Speaker 2: 50:25

flat back versus a connoisseur.

Speaker 1: 50:26

Stoga, step deck versus a double drop like your open deck ones can be very specific. Make sure the dimensions and the weight and all that is discussed. That stuff's all huge and, again, not an all-encompassing list, but pretty good starting point, very thorough starting point to make sure you're doing your due diligence. And I recommend go to our website for a 360 dot net the resources. There is a dispatch checklist which will have a lot of the different stuff in here to help you quickly and easily you know vet carriers and get all the information that you need to make sure you've got a good driver. So what do you think, man, anything we missed in this list? There's probably a bunch that we could add to it, but we only have so much time. Yeah, I mean, there's that much to add.

Speaker 2: 51:09

I mean, for the most part we covered exactly should be looking for why you should be looking for it. I think the other, only last, important thing to say is like this should be done always and I know the times where this is most often overlooked is also, for whatever reason, the times where it tends to bite me in the ass or I tend to see it right. It's the, the loads where you've got Really no time, your customers yelling at you you need to get a picked up. The truck you thought was going to pick it up broke down or can't make it. Now you've got less time to cover it, so your only option to remove this is a truck. It has a questionable MC, right? Should you run the load with that carrier and hope that it's okay or not?

Speaker 2: 51:47

Like, because that's really where the pun intended rubber meets the road of doing this right it's yeah, it's easy to do it all the time in the world. It's a little more, not a little. It's a lot more difficult to do Little more, not a little. It's a lot more difficult when you're you've literally got something on the line like hey, I made a commitment to my customer. The only guy that can now save me is a little questionable here. What do we do here? And to me that's where you want to ask lots of questions, because there are some instances where that could absolutely bite you in the ass and should not be that truck, and sometimes you probably could. And it's okay if you understand and ask enough questions, understand why the numbers are what they are right.

Speaker 1: 52:22

Yeah, I want to add in. Yeah, that's such a good point, ben. What I've seen is when there tends to be an issue with the load, a lot of times we'll find out the broker says man, I was so desperate, he was the only one I could find and I shouldn't have been. I should just should tell the customer I didn't have, I couldn't find a truck Right, because whether it's double broker, or they don't show up or the load they're like 10s of thousands of dollars.

Speaker 1: 52:51

Oh yeah, yeah, that's a really good point. And you know you'll probably speak by. You know, for every one of those ones you get busted on until you don't, you buy a squeak by here and there and it's not worth the risk. It's not worth the risk. So well, great discussion, man. So going back to the weekend here, bills, steelers, I'm friggin so pumped. I'll be at the game. I'm going to be sitting down on the hundreds this time and like the 30 yard line, so it's not going to be my normal seats in the warm under the heaters. I want to be on the elements. It's gonna be freezing, cold, doing the legit northeast tailgate. It's gonna be cold, snowy. It's gonna be a good one, man.

Speaker 2: 53:33

I wish I could be up there to go to the game with you. I will be sitting on my warm ass couch, sitting here watching on my TV.

Speaker 1: 53:40

There you go, there you go. Anything else you want to hit on in this?

Speaker 2: 53:46

episode here. Put a bow on that one I think we did pretty good. Maybe do a short firm video where we can do walking through it. Yeah, we will.

Speaker 1: 53:52

That'll be out in the next couple weeks, so hopefully you guys get a real it's great, like you could probably the video that I'm gonna have out there will be under 10 minutes great one to share with your coworkers or anyone that's new as like maybe a training tool, because it'll take this conversation, really tighten it up and be able to give it to you in a small bite serving size. But this is a really good. You know, share this discussion as well, because this is we went through a lot of detail here so definitely good stuff and for sure it's all free. It's all free, so Alright final thoughts.

Speaker 2: 54:29

The only cost is stop what you're doing. Take a minute like it on YouTube, drop us a comment like us on wherever you're listening to us on a podcast app. All that stuff helps us. It's literally the only thing we ask for for all the time we put into creating all of this library for everyone out there.

Speaker 1: 54:45

Yeah, and even if your comments just like hey, thanks, great video, that's good, that's engagement and that helps us on YouTube, so please go ahead and do that.

Speaker 2: 54:54

Oh yeah, there you go whether you believe you can or believe you can't, you're right.

Speaker 1: 55:00

And until next time, the ASCE Champions Go Bills.