Freight 360

Exceptional Service & Effective Communication in Freight Brokerage | Episode 262

• Freight 360

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This week on Freight 360, we explore what makes a freight brokerage truly outstanding, focusing on driver fitness, equipment maintenance, and service reliability. We discuss the potential impact of an East Coast port strike and dig into effective sales strategies, emphasizing the importance of understanding customer needs and leveraging real-time market insights. Additionally, we address the challenges small carriers face and the vital role of communication in ensuring operational success. To cap it off, we share a casual chat about recent NFL games and a motivational quote to inspire our listeners.

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Speaker 1:

Hey, welcome to this week's episode of Freight 360. We've got a special episode. Nate is actually on Capitol Hill up there meeting with the FMCSA and Congress and lawmakers to help understand what we can do with some of the issues we talk about on the show. So good luck to Nate out there this week. I think he's actually at a golf outing today so hopefully plays pretty well and represents our industry and our company on the course. Steve and I are going to be doing an episode. I hopefully it plays pretty well and represents our industry and our company on the course.

Speaker 1:

Steve and I are going to be doing an episode. I think it's going to be a really good topic. We are going to dig into how freight brokerages provide value, what value actually means and we hear this a lot is like oh, we're a service. We, most brokers, compete. We have better service, right, because it's a commodity at the end of the day, right. We want to talk about what that actually means. What is service and how do you define it and what can you do differently and what customers look for when working with a brokerage and the difference between a shipper working directly with some motor carriers and a brokerage and what and how those things differ and why right. So before we kind of jump into it, let's get a little bit of sports recap. How did the Bengals do last weekend, buddy?

Speaker 2:

Well, you know, in true fashion playing the Chiefs, we lost to the refs. So that's how that went. I mean overall it was a good game. I mean Bengals usually start off pretty rough every year and to have a good game like that against the chiefs it was refreshing to see that maybe we weren't on the same track as the previous years progress, but we'll see. Yeah, excited to see what the next week has who are you guys playing this week?

Speaker 2:

I'll be honest, I have no idea. I've got a baby do any minute and trying to get everything under control now at work. I'm just kind of I'll forget the games even on if I'm not paying attention.

Speaker 1:

So for sure. Well, a little early. Congratulations. I know it's going to be literally around the corner. Hell. It could be later. During this recording I might lose you. It might be later, that it might be later this week.

Speaker 2:

Yeah, she's. She's 38 weeks in the. This is our third and, uh, our first one was three weeks early, so I'm just waiting on a phone call, that's awesome, did you catch?

Speaker 1:

uh, I know you had mentioned the notes and I I heard about it, but I didn't get a chance to watch the game. Sunday I was at Disneyney on ice with my daughter, but um two I know, gotten like pretty much knocked almost into what what people told me looked like he almost had like a convulsion like that bad. I didn't see it, though, did you like?

Speaker 1:

a three yard line or something I heard or was like very close to the end zone and he just yeah, I I didn't see it, but I know he had another concussion like that.

Speaker 2:

I think it was last season where he had some posturing which is pretty bad and it seems like he maybe should be headed towards early retirement. But I'm sure the Dolphins will try to and himself will try to hold that out.

Speaker 1:

But we'll see that's what I heard. You know, living in Dolphins country, I know it's top everyone's mind around here is on, and himself will try to hold that out, but we'll see. That's what I heard. You know. Living in a dolphin's country, I know it's top of everyone's mind around here is on the local news basically every day. Steelers ended up pulling a win against the Broncos and the Broncos aren't looking terribly great this year and Steelers got a little bit of criticism for not being a little more aggressive, but at the end of the day, a win is a win is a win.

Speaker 1:

So starting off the season 2-0, that's good enough for me. On the news front, I know you had posted something from Paul over at Frey Caviar. Looks like the dock worker strike looks almost certain. Looming US East Coast port strike could disrupt 550,000 containers weekly, prompting shippers to turn to Canadian ports as a potential alternative. Anything more in this article I got a chance to skim it, but anything worth digging into here.

Speaker 2:

I mean for the most part, if you've been paying attention to it, it's just kind of highlighting what we already know, that they really haven't come to an agreement and the potential for a strike is just getting greater and greater every day. I do know Frey Waves put out an article today, this morning, that President Biden had come out and said that he wouldn't be intervening in the strike, which added a little more certainty to what could happen so we'll see it could be a pretty good shakeup here in the next couple of weeks.

Speaker 1:

Time will tell, All right, Well, let's dig into this. We were talking a little bit about this off air before we got on and this has been top of mind as I've been talking with lots of clients about it as well as like people on my team. You hear this all the time, right, Free brokerage or shipping, it's a commodity, right? Like I mean, again, I don't think a truck is a truck. I mean there's different driver fitness, there are different levels of equipment maintenance in regards to reliability, so I mean, I don't think it is, you know, exactly the same across the board. But I think, from an outsider looking at our industry, a truck picks something up from point A, gets it to point B right, If another truck can do that. Like they're very similar.

Speaker 1:

It's kind of hard to differentiate beyond providing the thing that company needs, right, Shipper needs their product picked up, taken to their customer distribution center, wherever that is. That's the thing they're paying for. So we always hear all the time all these large, especially the large freight brokerages, and one that I used to work at is like hey, we've got the best service, right, we compete on service, right? Well, like, I really want to dig into what does that mean? Like, what is service? How do folks define that? What does that mean in our industry and how, and what are the things that somebody can do to actually compete more competitively, you know, against the market so that they can get more business or service I'll throw that out there their customers, better than they maybe were by other brokers or even carriers or any providers, whether it's a 3PL or 4PL or direct to carrier relationship.

Speaker 1:

Right so and I want to start kind of with you with this is like what does that mean to you? Like, what does service mean in the context of a freight brokerage? How would you say you provide service? Would you say you provide good service? Start there. Would you say you provide excellent service? What is your opinion of your ability to work with a shipper?

Speaker 2:

ability to work with a shipper. So I think the biggest thing for people to understand is, like, service isn't necessarily a step-by-step process that's written in stone. It's going to vary from customer to customer. So, for example, say you've got a customer like Nike or Nestle that's really big and established. They're going to have a transportation department and that service that you're providing is going to be different than, say, the mom and pop butcher shop down the street that has no transportation department or any idea on how transportation works.

Speaker 2:

So you need to kind of look at your customers and see what, what is it that they need and how can I provide the service? What is it that they need and how can I provide the service? So, for example, if it's a mom and pop shop, you're going to have to educate them on how the supply chain works, like if they're shipping different areas, how does produce affect their rates. And you're more of an educator and a mentor to this customer versus someone like a Nike, who some of the people you're working with are probably previous brokers that wanted to get out of the hustle and grind. So they know the industry. They just want to know that you can communicate what you're doing, how you're doing it and that their product is going to be on time.

Speaker 1:

So and I think that's a good point, right, and I think I think the thing I think that precedes that right, is like well, how do you know what is important to anybody you're working with and I don't care if it's freight, brokerage, insurance, real estate, financial services, software If you are selling into anybody, you first need to understand a little bit about them. Right, like, what is going on over there? What might they need, what might be valuable to them with someone they're working with, in whatever context? That is Right, and the best way to do that is to first ask questions. Right, like, you've got to learn a little bit more about them. Right, and again, Nate always gives me shit about it, but like you know, whether it's a proverb or not, like God gave you two ears and one mouth. Right, like, use them proportionately.

Speaker 1:

I think about that all the time because, again, I enjoy sales. I'm an extrovert, I like to talk. Right, I could my daughter's this way. Right, like she has a very hard time listening because she's so excited about what she's going to say. I think that's really common for personality, types of people that tend to go into these industries. Right, and that's not a bad thing, right. But again, there is the other side of it, meaning like you really have to be or at least myself I'll speak for myself, as I think I work on this every day is, even when I'm excited to share something, I'm not learning anything about them. If I'm talking, I'm learning when they're talking and I'm listening Right, so I get more valuable information listening than I ever get talking. Right Now for sure. Once I've understood where they might have gaps in either their understanding to your point of how the market works, how and what we can do in different scenarios, then I fill those gaps, hopefully with information that is relevant to them, so it helps them make better decisions or makes their job or life easier. Right, that, to me, is one of the paramount first things that you need to do. That, to me, is like one of the paramount first things that you need to do Ask questions, learn and understand. Where is this customer or prospect in the industry? Right, how long have they been in it, how, what and how are they operating? Right? Because the one thing I want to say right, that I think is important to the context of this conversation is, I think, again, a lot of us assume that when you call into a large company and I'll start with a big one that if you're speaking to somebody in logistics at a very big company that they know more than you do about the industry or that they have more experience Maybe they do, but how they operate is very differently than how a freight brokerage operates Right and because of that they see things differently. So, for instance, if you had to book your own trucks now think about this.

Speaker 1:

For any freight broker out there, if you've got loads to move, it doesn't matter how many numbers right Say it's 10 loads this week or 20 loads this week If you're a shipper, you have a stagnant list of the carriers you can reach out to, right Like you aren't getting access to the market in real time. You've got a list of your approved carriers and brokers. You send out the loads. They give you rates. You choose the best rate correlated with maybe the service of that meaning on time percentage for that company that has worked with you in the past. They try to get the best price with the best service right, but again, they're static. They don't change on a given week and think about it Like when we need to get onboarded with one of these larger companies, whether you're a carrier or a broker. Like, it takes a week or two. You got to get the paperwork, you go through procurement, you sign the agreements. There's a whole process to vet who they work with as a vendor before they can even start to use them. Right, it's a very much longer timeframe than us as a brokerage.

Speaker 1:

Now let's take what it looks like for a freight broker. Right, you got 10, 20 loads. We are accessing the open market all day. Now, again, I'm going to assume that we're covering loads from a load board for newer brokers out there. But that's what I mean by the market. Whether you're calling carriers directly or calling posted trucks or emailing carriers. Like, you're accessing the market, right.

Speaker 1:

And the thing that is different that we see that I don't think shippers see as much is take Friday afternoon, for example. Right, like we used to call it a TQL. Like fallout Friday, right, because in the afternoon, when loads have to get picked up that day because they can't sit there over the weekend, right, it's very common sometimes for a shipper to have a steady rate all week and then that carrier can't pick up the load for whatever reason, right, but say it's one o'clock in the afternoon they go to recover that load. They send the same load details and rates to us as brokers and carriers and expect us to be able to get the same truck for the same price as if they gave us that load on Monday and any broker out there knows the price at three o'clock on Friday afternoon. To get a truck loaded by the end of that day is not the same price as if you booked it at nine in the morning on Friday, and certainly not Thursday and maybe not Monday or Tuesday. Right? Why? Because we are really in the market.

Speaker 1:

And what does that mean, right? So, like, just say, you've got a lane coming out of like somewhere rural, like I don't know. I always kind of pick Sparks, nevada, because it just sticks in my head there's not much around it. So if you've got to get a load picked up from there and you've got four hours to pick it up, there might literally only be six trucks within 150 miles of that facility that meet your requirements, that have that insurance, that are empty and can actually physically drive there, pick up that load before they close. So it doesn't really matter what DAT pick up that load before they close. So it doesn't really matter what DAT, truck stop or any rating tool, says what you should pay, because what you will pay is what you can negotiate with those 10 dispatchers, no-transcript, that is the best you're going to be able to pay.

Speaker 1:

That is the accessing of the open market, right, and that's a perspective we see as freight brokers that our customers just usually don't see, unless they were brokers, because they don't operate the same way, they don't have the same tools, they're not built with software. Like we have to vet a carrier in 30 seconds to determine their insurance, their out-of-service percentage, their driver fitness, their ability to vet fraud. We do this in a very small amount of time. They take days and weeks to do what we do in minutes or seconds, right. So we see a very different market with very different fluctuations than they get.

Speaker 1:

From their perspective. Now, they might assume and they might, you know, believe they know what that means, but until you experience it, I think it's very different, right, and I think that's some of the context that you were just saying is like when you're educating a shipper, your customer, trying to explain what is different in different scenarios, they very well might not know what that means. So it is incredibly valuable if you can explain it to them in a way that doesn't come across condescending and make it seem as if, like, you know everything and you're telling them how to do their job, which I think is also important, like how do you approach that?

Speaker 2:

Yeah, I agree, it's just. I mean, kind of like you were saying before, you know two ears, one mouth, so you kind of have to listen. You take cues on the phone. I mean all of it. None of this happens. Listen, you take cues on the phone. I mean none of this happens. None of this booking the freight, none of this finding carriers None of that happens until you get a customer.

Speaker 2:

So before you get a customer you have to prospect and you have to cold call. So you're going to have to talk to these people and when you're talking to them you get an understanding of their personality type. Some people you can talk to them as an educator. Some people you've got to take a more personal route. It just depends on the personality type and how receptive they are. So some people will appreciate the educator tone and they will lean into your perceived expertise, whereas other people they just they just want to talk, which is perfectly fine. And then one thing I wanted to mention and to take a step back when you were going through the book and the freight and all that is for the listeners out there.

Speaker 2:

There are different freight brokerage models, so service could be different. So for me, for example, I'm a cradle to grave employee, so I am handling the customer side and the carrier side. Some of the people that are listening might work for some of these larger brokerages that have a carrier side and a customer side. So your service may be taking care of your carriers, making sure that you're getting the lanes that they want for prices that they can, and then your counterpart the customer phasing side the brokers are bringing in freight for you to cover with the carriers that you've established a connection with. So service could mean different things to this industry. It just depends on where you are and how you're being tasked to work.

Speaker 1:

And I think that's one of the things. Like you have advantages of what we'll call it a pod model, where it's split between two different departments or two people. The advantage is you have efficiency. Right, when people can do the same task over and over again, they get better at it, they get faster at it and it's easier to stay in one lane to get more work done. Go back to Henry Ford and the manufacturing line. That's what pioneered this right Specialization. Do this thing over and over again, you get faster at it. The guy next to you does this thing all the way down the line. Right.

Speaker 1:

Now, the disadvantage to your point is communication right. Like if you're just talking to customers, you're also now removed. In the same way, the shipper is right, because all you hear is what your rep is telling you and rates and things. Sometimes you get as much information as you need. Sometimes you don't get nearly enough and I think, like when I've worked in these scenarios, like communication is really important. Like you want to ask these questions as to what they're seeing, what they're hearing. Right, because the market can shift from day to day, afternoon to morning. Right, you need to be aware of these things when you're dealing with the customer from the carrier side, so that you can help educate your customer or help let them know how and when you can help them. Hey, look, if you get this load and you need a cover by 10 in the morning, I can probably get you a 22. If I got this at two in the afternoon, I'm probably going to be a 2600 for this lane because, like, there just aren't that many trucks late in the day and they tend to get all booked in the morning Again. If that's a scenario and your team's telling you this, this is really valuable information to provide back to your shipper, right? That is again, one other definition of service.

Speaker 1:

The other thing I wanted to ask you about and I thought about this a lot lately, right is to a lot of shippers will have benchmarks of the size of assets they want to work with. For a motor carrier, like, we only want to work with carriers that maybe have 50 or more trucks, maybe it's a hundred or more trucks, maybe it's 25 or more. Right Now, it's not always the case for sure, but there are definitely them out there and if you've prospected enough, you've seen this, especially from the carrier side, right. Why do you think that some shippers have preferences to work with a carrier that has a larger number of assets versus a lot of carriers with a smaller number of assets. Like, if I have a choice as a shipper and I can choose two carriers that have 50 trucks each, or five carriers that all have 10 trucks, why do you think they have a preference for the larger carriers over the smaller ones?

Speaker 2:

Well, to become a larger carrier you have to be somewhat organized and you have to have processes in place that can provide communication. So there's a level at which the growth of the company starts to match some of the service to a brokerage, because they have to build out these things to provide service for dedicated customers. Now for the shipper I would say that's short-sighted because they could have a single truck company that is in their backyard that likes to go to the place local. So now that one guy they're missing out because they've limited their scope to this many carriers. But it also brings their vetting process and approved vendor process narrower and more streamlined so they can get people approved fast. So you can see why a shipper would do it. But it also cuts themselves short, which is why brokerages are usually included in the vendor list, because we will work with that guy.

Speaker 1:

Yes. So, and I don't want to go back right Cause, let's go with the obvious ones. The obvious ones are if you're a company, you want the smallest number of vendors. Why? Because you got to write less checks. You have to reconcile less accounts. It's less work for accounting, it's less work for the accounts receivable and accounts payable. Right, it's also less risk to the company, because every time you bring a vendor on, there is some inherent risk, not more and less in different scenarios, but there's always a preference in procurement to have less vendors than more, because it's more work, there's more chance of mistake, and they got to hire more people to reconcile more accounts, right.

Speaker 1:

Now, the second obvious one well, if you've got 50 trucks, it's more likely you'll have a truck when I need one than if you have five. Right, just the obvious one More tends to be more likely that you would be able to help. Now, I don't think that's necessarily true, because some of the larger carriers like literally have more dedicated freight and less drivers that need loads in some scenarios, so like they literally have less availability sometimes than the smaller ones. But I do think that is a common belief, right? And now I want to segue into the one that you talked about, which I think really important, which is smaller carriers. Right, like there's only so many people there, like think five trucks, think one truck owner off. Right, like, if you've got to drive your own truck, like you've got to make sure you are make you are up to regulation on your equipment. You got to make sure the service. You have to literally do the hard work of physically driving a truck, making sure you're safe, making sure you're rested, making sure you're doing the physical job correctly, because there's a lot of risk driving 80 some thousand pounds down a highway when there are pedestrians and you know just cars on the road. Like that is a huge thing that you need to pay attention to.

Speaker 1:

That, to me, is far more important than anything else, right? So once you have those right, like there's only so many hours in a day, so like, even if you're very organized, it's very difficult to find time to talk to shippers and to call them out. From a sales perspective, it's also very hard to be available when a shipper actually needs to speak to you Because, like, if a shipper has a problem, they don't know when that problem's happening. Like they come up unexpectedly, by definition in our industry. So if it's 12, 15, and all of a sudden the shipper needs help and they want to call that smaller company, it's harder sometimes to reach somebody that can even answer the phone, let alone respond to an email, because they literally might be driving a truck, right? So, like, that is the first thing that I think is important.

Speaker 1:

The second is, like organization right, like, smaller carriers tend to be very good at driving and doing those things, but tend to not necessarily have their arms around exactly what their costs are, their expenses, which loads they moved, like last week, or even if they do like to be able to have that paperwork readily available. If a shipper needs, hey, can you resend me that certification, can you resend me that paperwork? Right, they either have to wait till they pull over or hopefully there's a dispatcher that can do it. But again, that is a whole other job to do on top of a very important one, which just makes it harder to do, right?

Speaker 1:

So what are some of the things that you think you've done as a broker that helps bridge the gap between a smaller carrier that is a better fit for the lane that the shipper needs. To your point, they probably will give you a more favorable rate sometimes because that lane really might work for that driver. Like he's literally either deadheading or getting random brokered loads back home and there's a shipper that has that load every week on the same day he's there and it would be the perfect fit, meaning like the driver would benefit tremendously and the shipper would, but like they can't work together for these reasons. How do you bridge that gap and what are some of the things you do to help make sure the right carrier can work with the right load for that shipper?

Speaker 2:

So there's two sides to that. There's two answers to that question, the first one being the customer facing side, which is you know, I have this carrier. That's really good for this thing. It's a great fit. They just can't handle the volume, or maybe they have an issue. Something breaks down. So that means me, as a broker. I need to have backups available so that there's no service gaps. That's important, yep, and the customer needs to know that, regardless of whatever the issues are, that this freight is going to get picked up and delivered on time. So pause there.

Speaker 1:

Yeah, because I'm going to pause there for a second right and I want to set the scenario for everyone. So if you've only got one driver as an owner op and he's supposed to pick up a load in Memphis going to Pittsburgh and say he's picked up that load four weeks in a row, no problem, every Thursday at 10 am. But let's just say tomorrow, like this Thursday, that truck, at no fault of his own, was stuck at his receiver right Way longer than he was supposed to, because that receiver right Was short staff, two people called off sick, they got one guy unloading trucks instead of three, and it takes five hours to unload the truck instead of the normal hour and a half. So this truck is just literally a victim of the circumstance. But the shipper's like well, I need to make sure my load still picks up Right. So from there, what are we able to do as a brokerage that a motor carrier or a smaller one can often not be able to do?

Speaker 2:

So to answer that, we can source another truck Sometimes, if it's, if we're alerted soon enough, if the carrier is that good and we know in advance, the shipper may not even know that we've replaced that truck. The pickup facility should know, because we should be relaying who's picking this up, the MC's picking up it's a different truck showing up, correct, but your customer, who may or may not be on site, we'll never know the difference. Now to go back to the carrier side. You have a good carrier. That's really consistent.

Speaker 2:

If he was working with that shipper, he may have a service failure that may prevent him from picking this load up again, whereas us as a broker, it's like, hey, no harm, no foul, no big issue, just get your stuff fixed, sort it out, and then, when you're ready to go, we'll put you back on the line. So now you've maintained that rate, you've maintained that relationship, and then on the backside he got stuck at a receiver. That wasn't a good fit. So me as a broker saying well, why did you get stuck? Who were you working with? How can I help? What are you looking for? How can I? So now I've got a lead generation built into my carrier relationship that I can now go source freight for this carrier to make sure he's getting back on time.

Speaker 1:

And in addition to that, right like you can either help that carrier find another or more effective load to at least get him back without losing a ton of money or having to get a random load. You can help to your point prospect that area to maybe find a better lane that works better for that carrier that is more reliable. But we can literally go and help create more value for that motor carrier and we've created better service for the shipper because to them the load was still picked up on time, it was still delivered on time, even though we were able to, in our words, like recover that load with another carrier from the market again to the earlier point in maybe like five minutes or 10 minutes. Right, we can do that very quickly accessing the market.

Speaker 1:

A shipper is not able to. The best they're going to do is email a bunch of motor carriers hopefully first, probably and they're going to go well, hey man, I can't reposition an asset in 45 minutes to get that load. I can get it tomorrow and the shipper goes well, it's got to pick up today. This is now where the brokers can come in, access any available trucks that meet their requirement in this very short amount of time to make sure the service to the shipper is steady, every load was still picked up on time. There's no difference to their customers, to their business, and we're able to provide value back to that motor carrier because of communication right.

Speaker 2:

And one thing when you were talking about the vendor getting trucks, carriers established 50 plus. You know that vendor process. One thing that I thought about I don't know if this is true or not, maybe any shippers watching this could leave it in the comments but I would imagine, especially your midsize companies, shippers probably have adopted a vendor process from their procurement for the raw materials and have established that to transportation. And it's not the same thing, because you can look at vendors for raw materials and you're like, look, I need this bulk thing at this price to make us profitable. So now you can whittle it down to a few and it's got to be X size. You do that to transportation, where I don't know what the stat is. Dat has put it out a few times, but the majority of your capacity is not on load boards, correct. And here's the other thing.

Speaker 1:

I want to point out like, because I have a few clients that are very large shippers, um, a few of which almost monthly with their legal team and with the risk team, and this is like a $6 billion company, right, like very large company. So, to your point, we are sitting in conversations with risk and legal that want to put in procurement requirements, right, and again, think about it from their point of view. They want to mitigate risk, they want to protect the company from catastrophic liability, they want to protect the company from, you know, catastrophic liability, they want to protect the company from all the things that they think could potentially harm them. But what they don't realize is they only have that point of view, right, or that context. They're just looking at how to protect themselves, right.

Speaker 1:

However, when I'm in these meetings, the thing I'm pointing out usually is like, hey, every time you change those and make those more stringent, you make it harder for this brokerage that you want to launch to actually solve the problem that your department has. And they're like oh well, you know some of our equipment, you know we'll say is, you know, 750 grand, but most of our loads are whatever, $100,000. We want to raise most of our insurance requirements to whatever $250,000 or $400,000. Requirements to whatever $250,000 or $400,000. And it's like, okay, that makes you less risky. However, that prevents your team from actually working with the carriers that are going to be available in the time you need it to keep the service you need for your customers Actually being able to book these trucks as a brokerage, right, and when you don't have those two different points of view to your point as a shipper, they just create these agreements and these requirements based on what legal and risk says and they go just sign it.

Speaker 1:

Or else I can't tell you how many brokerages and people have reached out to us over the years ago. Should we sign this agreement? It's ridiculous, it doesn't really make any sense and we wouldn't even be able to book trucks if we follow this to the letter, right, and then the shipper will go or the logistics person goes oh well, don't worry about that, everyone just signs it and does it anyway. Well, that's even worse, because now the agreement has absolutely no ability to protect anybody from anything because nobody's paying attention to it. Right, and again, different points of view create different situations, right, and I think that's a really good point.

Speaker 2:

Yeah, and to speak on that, I do. It's been a couple of years, but I did work with a shipper that had their own brokerage and by the time I started working with them, their brokerage, because of this reason that you pointed out, had stopped hauling their freight because it was too difficult because of the restrictions that the owned company had put on them as a brokerage. So they stopped hauling their freight to maintain profitability and keep that brokerage open. Um, so yeah, I think it's. You know it, is it a bad thing? No, but again, it's one of those things that you need to look at, because an insurance policy for a single truck of a hundred thousand dollars and all the other general liability, all that stuff, I mean that could be thirty thousand000 a year that you're asking just for minimum, and now you want them to have $250,000, $400,000. I mean, your small fleet single trucks, they're not going to have that unless they have the customer that's writing the checks already.

Speaker 1:

Yep exactly, and I think, again, that's often overlooked from a shipper's point of view and we see it all the time as a broker, right? So, like, what does service mean in that scenario? It means helping your customers sometimes understand how their procedures are creating their own problem, right? My favorite one in that same scenario is, like when I'm trying to we get this question a lot recently from my few episodes ago about like well, this question a lot recently from my few episodes ago about, like well, what do you do when a customer wants to pay a lower rate and like they're so low, but yet they keep denying my quote? And then they come back to me, you know, four hours later, the next day, and want me to move it. Right, those to me become really obvious because, like, when I find out that a shipper just keeps doing this, trying to pay the absolute least rock bottom price in every scenario, right, just think about this as a brokerage.

Speaker 1:

What would happen if you tried to pay literally the lowest amount of money in every single load in every scenario? Do you think more of your trucks would fall out on you or less? Right, like literally that policy and that procedure of trying to beat every truck and every broker, down to the lowest absolute rate, regardless of the scenario, is going to create more trucks canceling, more fallouts, more rejections. That's why they end up running around with their hair on fire, constantly recovering loads. It's because this policy of pay the lowest, no matter what, creates more of the problem they're trying to solve right, and again, you can't always get them to change what they're doing, but I think it's really helpful sometimes to be able to help them understand there is a correlation in some way between price and service. It's not direct, but if you're going to pay a fair rate, you will have less rejections and less fallouts.

Speaker 1:

Trucks will stay on your loads longer. If you're paying somebody a buck 50 a mile because that was the only truck and you had that only load, at nine in the morning and an hour and a half later there's another load available for two bucks a mile. I know it's not ethical and I know people we shouldn't be doing this in our industry, but it's in that carrier's best interest most of the time to just cancel that load. Grab the other load, because they're literally losing money at a buck 60 a mile. They only ran it because it was the only one available If they can make a few dollars and not lose money like they're going to operate in their best interest. That's capitalism. That is why these trucks fall out more when people do more of this.

Speaker 2:

And if you want to pay the lowest rates, just, I mean, just understand, your name will be dragged through a Facebook group somewhere, somewhere. I mean, the most common thing I see right now is screenshots of brokerages posting dirt cheap loads and then in the comments you'll see someone saying oh, I know this lane, it's this shipper, this receiver, and they're blah, blah, blah. So, like you know, can you do it? Yes, is it great? No, or do you want your name dragged because that's's? I mean, look at, uh, like Costco drivers love going to Costco because they're in and out, they usually those lanes typically are good paying and they have a good name, they have good reputation. Um, and that's how you'll continue to maintain service at the level that you desire, by not pitting people against each other.

Speaker 1:

Yes, now I want to talk a little bit about emails. Ok, what does service in the context of written or email communication mean to you? What are some of the things that maybe you do differently? I don't know, or better, or however you want to define it. What do you do and what have you learned related to how you email and communicate with your customers in the context of service?

Speaker 2:

So I'm going to sound like a broken record, but again, it's one of those things that, over the last five years, that you tailor your communications to the person, to your audience, that's what you're doing.

Speaker 2:

Yes, your audience is your customer or it's the carrier in some cases and you have to understand what is it that they want to hear and when. So, for example, I have customers that you know if something goes wrong, I may or may not have to tell them, just depends on the severity of the situation. I can handle it and then send them an email recap afterwards, and that's all they want. I have other customers that need to know the minute something happens and I have to communicate that as fast as possible. And then, in the context of how I do it, you know some of them are older, so it's got to be a little more formal. Yes, sir, no, ma'am, and some of them are my age or were more friendly, and it's writing my emails almost like sending them a text. I can misspell words and it's not a big deal, you know, but it's again, it's catering your communications to your audience and their expectations, and that's what. That's what the service is.

Speaker 1:

Agreed and I think again it goes back to asking questions to really understand what would be helpful, right. Call it valuable, helpful, call it whatever you want, right, like if you're my customer. I want to ask you before onboarding hey, stephen, I know you said you want tracking on these loads. What's your preference for tracking? Do you want real-time updates fed to you all day through emails every hour? Do you want a portal that you can log into and see it when it's convenient for you? Or do you want updates sent to you once in the morning, once in the afternoon?

Speaker 1:

I think everyone kind of assumes more is better, right, but I can tell you when you're on the receiving end, like I don't want 45 additional emails, sometimes on communication Like that makes my job harder, not easier. Sometimes you need communication literally twice a day On some loads. You want it more because maybe there's more risk, there are more reasons that it could go wrong and the customer needs to know more. Because their customer needs to know more for whatever reason, right. Sometimes they want more updates closer to before it picks up, once it's loaded and once it's rolling, then once a day.

Speaker 1:

Then they want an update three hours before it delivers to make sure they know nothing's wrong and they can notify the customer if they need to reschedule a delivery for whatever reason. Right? It very much depends on what is going to be helpful to your customer, not what you want to do or what you assume should be helpful to them. Ask the question, right Again, like assumption is like the mother of all F-ups. That was a line from like, I think under siege in the nineties, but like it always stuck with me because, like anytime you're just assuming something, you should ask yourself that question. Did they say they would need this? Would this be helpful? And don't guess. Ask the question. Pick up the phone.

Speaker 1:

We always talk about and everybody asks like well, how do I find more reasons to talk to a prospect or a customer? How do I follow up? What do I say? All these things that we don't know yet. These are reasons you can use to pick up the phone, to call a prospect and to ask a few questions. Another opportunity to build some rapport and learn a little bit more about them, right? Because just assuming that because one company you've worked with likes it this way does not mean the next person you're working with, even at that same company, wants it the same way, especially at a different company, right Right.

Speaker 2:

One of my favorite quotes that my grandfather told me it started. The company is, and we can edit this out if we need to, but to assume just makes an ass out of you and me, correct? And that's 100% what it does. Yes, they're my two favorite sayings related to assumption. Yeah, Whether this carrier fell out and you assume oh, I don't need to tell them, I'm just going to recover this. You know, you're just you're causing issues, Correct?

Speaker 1:

So Tom's going to recover this. You know you're just you're causing issues Correct. So yeah, that's well, that's a good one to segue into. You know bad news does not get better with time. If something is wrong, the best time to tell your customer is immediately. Their biggest fear is that something has gone wrong and they're unaware of it and they can't plan or change things because of it. Right To me, that is one of the most important things in service for a brokerage is if you aren't knowing where your trucks are before their pickup, before their delivery, and letting your customer know before the pickup or before the delivery that it needs either adjusted or they will be late for whatever reason.

Speaker 1:

Those things are almost always solvable and aren't really a problem if everyone knows before. If you wait until after and their customer their loading dock, their distribution center sends the email to them and goes there's no truck here, it's 10 o'clock, it's quarter after 10. Where are they Now? The customer that you work with looks bad because they don't look like they know what's going on with. The customer that you work with looks bad because they don't look like they know what's going on with the people they booked you look bad because you didn't communicate it to them, right, and the whole situation just gets worse, right? None of those things get better by waiting and hoping, and I think that goes to something I was talking about earlier a few weeks ago.

Speaker 1:

It's like that is a difficult conversation. That is why people don't do it. That is why shippers are scared to work with newer brokers. They're terrified that when something's wrong and there's a difficult conversation to be had, you're going to avoid it and hope it gets better. It does not.

Speaker 1:

You are not going to be successful in this industry if you are afraid of dealing with conflict or owning up to a mistake, even if it wasn't your own. You've got to stand up for the carrier. Sometimes it maybe was a driver issue, maybe it wasn't, but you've got to be the first person to own up to that scenario, make that phone call ahead of time and be honest and transparent with what happened and then, more importantly, what you're doing to solve it or remedying it Right. Because if you go to somebody and you let the shipper know this is an issue and then tell them how you're going to solve it, ok, that's helpful. Not telling them at all does nothing but make their life more difficult and less likely for them to want to work with you Right, right and the worst, the worst form of communication.

Speaker 2:

the worst contact your customer can get is an update on their load that didn't come from you, good or bad. If it comes from somebody else, they learn information about a load that they gave to you. It's like a black eye. Yeah, it's not good, so staying ahead and then again you know if it's bad news. Writing in an email is probably, especially if it's a new customer. You should not be sending bad news in an email is probably, especially if it's a new customer.

Speaker 1:

You should not be sending bad news in an email ever. Pick up the phone and you know, pardon the gender, but like man up for, like the old saying, like I don't care if you're a guy or a girl, right, I think the saying is appropriate. Like, stand up for it. Look that I mean again, you can't look them in the eye, but like, if you could, that would have been the best. Right. If something goes wrong, the absolute best way to address it is to look that person in the eye and tell them right.

Speaker 1:

The second best is the phone. If you are sending an email, it is very obvious that you are too scared to call them, and there is nothing that irritates me more when a coworker does this, when anybody does this to me, especially people that I talk to twice a day. And then when something goes wrong, all of a sudden they're sending me an email Like why are you sending me an email? Like you call me about everything else you've ever needed to tell me. And then, whatever months or years I've been working with you, and all of a sudden, when something gets difficult, I got to read a two paragraph email. I don't even read them. I literally will pick up the phone as soon as I get those emails and go. Why did you send me this email? What's going on?

Speaker 1:

because, again, you can't really address it to me that reminds me of like the internet keyboard warriors, right. Or like, oh, they're going to be super tough guys and do all these things behind a computer and behind a pseudonym and no one knows who they are right. Like this is a professional setting. Like you need to have the character to stand behind your work. If you can't stand behind it and put you in front of it or behind that work, to me that's not integrity, that's not character. Like Nate talks about that from his old boss at LDI that used to say that you have two things in this industry your phone and your integrity, and if you lose one, you're screwed right.

Speaker 2:

Integrity and character, to me, go hand in hand in that scenario yeah, exactly, and and I mean just the nature of our position, like we are the middleman, so sometimes, most times, that bad news is not a direct result of us, but we still have to have that conversation. So it's the best way to look at it is to take that opportunity to practice that skill of bad news and delivering it.

Speaker 2:

Yes, the more you practice it the better you get at it, the easier it gets Right, and that'll translate straight to your cold calls and your prospecting as well. It'll make you more confident on the phone. They may say whatever, insert common objection here and if you're giving bad news to customers not that you want to do that all the time but that will help you take on those objections a little bit easier and then you can just go on to the next cold call or you can break it. But it's all a practice on your tone and your composure on the phone and that's one way to look at it.

Speaker 1:

It's funny. I'm reading a book right now from my book club and it's on risk, and the book talks about gamblers and professions that are in high stress scenarios, like literally high stakes gamblers, guys that are in like World Series of Poker, hedge funds, companies that make huge bets, but also folks that take, like, very large risks climbing mountains in the military. Any context of that, right, and the thing they talk about in the beginning is that, like, nobody's immune to that feeling of nervousness, like that is a physiological response to fight or flight, to fear. Right, that is why your face gets red, your blood vessels change, the blood literally will move from your brain down to your extremities, as if you feel like you want to run. Why? Because it's a survival instinct. Right, the reason you see people achieve high levels and operate in those, and you'll hear them say like, oh, they're immune to risk, or like, oh, they don't have a tilt button, like they don't get upset. They are not physiologically different people. They did not grow up in some weird place where, like, they just don't feel the same fear we do. It's that they've practiced this more. They've done this over and over again. So when they feel that in their chest and that uncomfort and that fear that prevents everybody from having that conversation. The reason it's easier for them to do is because they've done it more right. Harder things get easier the more you do them. They do not get easier by avoiding them and hoping that they get easier later, right?

Speaker 1:

The last thing I wanted to cover and segue into a little bit is like communication related to carriers, right and versus the shippers, and this is something that I've run into recently a few times with a couple of customers, and the first thing I want to point out is we are intermediaries, we're in the middle, right? So the first thing I want to point out is anytime you get information from a carrier, before you send it to your customer, you need to verify it. Why do you need to verify it? You need to verify it because as soon as it comes out of your desk or your mouth to them, it's now your responsibility. You are going to be held accountable for that information. Does that ring any bells with you or provide any?

Speaker 2:

Yeah, yeah, I had this issue literally last night. I have a lane that we cover with a larger carrier and at like 5 o'clock the dispatcher sent me an email and said, hey, this truck's still not loaded, not moving yet. So I'm emailing him to verify. Try to call him with this answer. And then I get in touch with the cold storage and I said hey, I'm being told this truck's not loaded yet. They've been there for going on five hours. Now Can you give me an update? What's the issue? And the response back. And then my customers are in this email as well. The response I get back is oh, they've been loaded for an hour. Here's the BOL, it's checkout time.

Speaker 2:

So now I look like an idiot because this dispatcher could not get back to me. So I got to handle that this morning, which is what I was doing before we got on here. It's like why? Because the issue was the dispatcher was looking at the ELD and not looking at or talking to the actual driver. So the driver still showed up on site, but that's because he drove out of the dock, parked his truck and started his 10 hours because they were going to let him stay overnight so he could run first thing in the morning, perfectly fine. But this measure didn't see it that way. He thought he was still in the dock, which is the issue now. Is that a common mistake? It can be, yes, but they need to be more clear Trust, but verify Right, exactly.

Speaker 1:

And I'll give you a couple. Like one I had a tanker going to pick up at a customer and we had to send priors over. Like for lots of tanker loads, they need to have a certification letter on letterhead from that carrier that these are the last three loads were in that tanker because some have approved priors like there are some commodities that can go in that tanker before and some that can't right because they don't want some chemicals to mix and other reasons right and I sent one over and I didn't look at their kosher certificate and the trailer that they certified wasn't on the last updated kosher cert. Now again, it wasn't the end of the world because they were on the new updated one, but what happened was I sent this to the customer and the customer literally the owner of the company was on copy and he's a very detail oriented person. He immediately went and looked, saw it and emailed back right. So now everyone else in that company was at least aware that I sent this over without letting them know I needed to also send the updated kosher certificate right. Again, not the end of the world, I was able to go back at the updated one and everybody was fine. But it was just another reminder that any time information is coming out of your mouth, your computer, whether you're writing it or saying it, you're now responsible for it. So you need to make sure whatever you're getting is accurate before you move it on to the next piece. Right?

Speaker 1:

And the last thing I wanted to say, too, just related to this, is one of the other ways we were really able to provide value is like I've had so many shippers, even in the past year, right that like again, we're in the same scenario like they didn't want to work with smaller carriers. However, they wanted to pay lower than market rates and just some examples like the we'll say, the more organized carriers in that market, in that area of the country, they'd want like $4,500 per load. Well, some of the smaller carriers were willing to run it for, say, three grand or 3,500. And the main reason is like the bigger company needed more money because they have more staff, they have more back office people working there, they have more people organizing these documents, making sure they're there and available, and they have literally paying people to answer the phone. The smaller carriers literally had somebody sometimes it was like part-time, a few days a week to get paperwork arranged because they're not profiting enough to have more people there yet. They're growing right. But the reality was the shipper wanted the better rate with a smaller carrier, but in the past, when they worked directly, they couldn't get the documents on time. And it was again another reminder for me of like I was able to work with the smaller carriers, pull two or three of them together, instead of the shipper working with one larger carrier, just like we were talking about earlier.

Speaker 1:

And then what I'm literally doing is help coaching and training this motor carrier the smaller one, to get me these docs in advance. And what does that mean? That means like not just sending load tenders over for the six loads they got to move this week. That means every day in the morning, at seven o'clock in the morning, I'm sending them the updated schedule for the next seven days every day, every afternoon. Here's the updated schedule for the rest of the week next seven days, because things are changing and again a new dispatcher that sometimes works part time isn't going to see every email. They might miss one.

Speaker 1:

So it's my job to literally help organize the carrier, because that's what they need right. They needed somebody to operate almost like a dispatcher. Now I'm not their dispatcher, but as a freight broker I can operate like a pseudo dispatcher for them temporarily. Hey, just reorganizing you. Just a quick reminder. This guy's got to be here. We need these documents for this load, we need this for this one, and when you do that every day, it helps coach, like that carrier, the smaller one, into getting into the habits that we do all day, because all we do is deal in information. They have way more responsibilities than I have in that scenario. They're going to make sure the tanker's clean, they're going to make sure that the equipment's running correctly, that it's service, getting the right drivers on the right ones. They're doing all these other things. I'm helping provide value to them by one, the organization, and then two.

Speaker 1:

When they're emailing me, sometimes the subject lines don't match up to the right loads. I know what they mean. Like, oh, this load's delayed, but it's in the subject line of a different load. Well, if that went directly to my customer, honestly they would be confused and my customer would get frustrated and say, look, I can't work with them anymore. What I'm doing in the middle is not just helping the carrier. In some of these scenarios I'm repackaging this information. So once I get it to the earlier point, I'm going to verify it, maybe make a phone call or text message to make sure it was correct. Then I literally will rewrite the email, put the correct subject line. And then I literally will rewrite the email, put the correct subject line and then I send it to my customer. So to my customer, they feel as if they're working with a very large carrier at a much lower rate.

Speaker 1:

The carrier is getting more business. In fact in the past few months they're getting. They're able to add more trailers, more drivers and they got more business. So they're growing. They're benefiting my shipper benefits because they're getting what they need. And in the middle I'm providing value to both. And again, I'm not making a ton. Like maybe we're making like 12% margins on some of these scenarios. However, that value is going to both sides. Nobody's beating one side up or the other in these scenarios. Like we're literally creating value sometimes both for the carriers and the shippers in these scenarios so that they're able to work together because they're just not either staffed or have the training or maybe have the funds to be able to hire these people. Yet we can help them grow. Then, when they hire some people, then they're going to probably charge more rates and maybe they'll work with different people, but for the time being, we're able to help carriers actually grow and do more when we do these things and we're able to help service our customers again better by making sure communication is clear, concise, accurate, verified and up to date.

Speaker 1:

Right, and those are the things that I think we provide back to shippers that people overlook when they hear the word service. Right, Like it's just this big blanket term and I think people just think it means, oh, I'll just get you a truck when you need a truck. Like that is like the bare minimum table stakes. Right, the things we talked about in this episode, I think, are really details, tips, however you want to look at it that you can start applying to your business to do more business with your customers, to work with more carriers, to do more loads, to get better pricing in some scenarios. Right, Like these, to me, are the things that make a freight broker excel. I don't know better than the rest compete. I mean, how would you define it?

Speaker 2:

Well, and so, yeah, it makes you a more well-rounded service provider, not just to your shippers but to your carriers, which, again, we're an intermediary. The shippers pay the bills, but the carriers do the work, and we can't do anything without either. So we have to cater to both, and two of the things that I wrote down that I want to touch on from what you're talking about is the first one I wrote down was cash flow. Carriers run thin margins. That's just, especially in the market that we're in right now. Cash flow is very important and I know most freight brokers that are listening to this, you and myself. Getting paperwork PODs, especially that start the timer for payment from the carriers, feels impossible sometimes because they're just caught up in all the other stuff that they need to do and then they don't understand that if you don't send them that POD, you don't send them that invoice. They're still waiting. That 30-day timer hasn't started. It's not based on when they deliver, it's based on when you get the paperwork to verify that they have delivered. So it's educating them on cash flow, and then adding on to that topic is, you know, especially these smaller carriers they may not understand their operational expense. So you need to be an advocate for your carriers to understand what the costs are for them, specifically to their company, and advocate for them, for your customers, because that creates a better relationship, that creates more stability, gets them better freight and then they trust you. Now you can be pseudo sales for this company to go, help them find other freight which then is funneled through you. That's just more business.

Speaker 2:

Exactly the other thing I wanted to touch on. You were talking about emails. Man, I don't know. I could have one load with a carrier and I can get 40 different email threads on that one load and it's like dude, just keep it in the thread. Why are we starting a new email? But again, just keep it in the thread. Why are we starting a new email each time? But again, I mean most, most of these carriers are, you know, I always say blue collar boys with their diesel toys. You know it's. They may or may not know how to work a computer. And then you've got to be that buffer between what the carrier is saying and how the shipper wants to see it. So you may get a bunch of information across multiple sources and then you've got to funnel it down and give it to the shipper.

Speaker 1:

Agreed, sleep man Well. Good conversation. Any final thoughts?

Speaker 2:

Go Bengals. I know Nate's not here, but the Bills seem to be having At least a better start than we are. But we'll see. I'm sure we might play them later this year. I can't remember.

Speaker 1:

Fair enough, and whether you believe you can or believe you can't, you're right.

People on this episode

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Benjamin Kowalski

Co-host
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Nate Cross

Co-host