Expediters Going Hungry, For Real

[greg334]

But Phil,

I know of a few WG owners that left and they left not because of their inability to manage their business but because they were not making the money with FedEx. They showed me their stats and their offers and pointed out a few things that I never realized until I was ready to leave myself. It is not all peaches and cream being a WG owner as many make it out to be. In fact there is not much difference in overall CPM between these guys and the surface people I know, so my conclusion is the ‘return on investment’ was not justified for them.

They brought up the question what makes one person out of two with the same exact equipment and the same exact abilities with the same exact qualification get more offers than the other. I experienced this in Indy where I was dispatched around for three offers, the only two other drivers (same truck, same equipment but a lot less dwell time) in the Indy express center. These other two were sitting in the booth with me eating lunch and they refused the offers they got. I never got a call and when I complained about it, the offers were going to someone in Ft Wayne and then a WG unit.

BUT what really gets me is that you and a few others don’t see the problems, many point to the inability of the person to run their business and don’t realize that the company seems to be selective who gets what run.

When I say that the company is the real factor in the success or failure of the person, I mean it. Unless you are independent where you seek out and book the loads, it is up to the company who runs that load.

I am not going to say you're not having responsibilities outside the truck is a bad thing but I am going to say that starting at the top affords you no clue of what really goes on or what it is like to start at the bottom and learn as you climb. I think that the WG program can do better than taking in people with Zero experience and having them in the fleet. Elite means earned, earning means learning.

Oh and one last thing,

Which one is it Phil?

The failures failed because they did not learn the business.

or

This business is not hard to learn.

 

[davekc]

I would agree that the carrier is very instrumental in ones success if they are totally reliant upon them for loads.
Having the best business plan, equipment, or a host of other things doesn't always insure success at a specific carrier.
I think with a struggling economy, we are starting to see that when I take a peek through the classifieds.

 

[pjjjjj]

It seems to me that the people who fail in this and any other business have an extremely high standerd of living....

I've owned a courier business for 4 years......My first year i slept in my car. Because i knew i couldn't afford an apartment

If your overhead is only insurance and gas, You'll be willing to take them lower fee loads. That other guys turn down because they can't afford the run.......

We're still new here, listening to the different opinions and banter, but I have to say that I'm finding it disturbing at times, how some look at profitability. I know I should probably keep my mouth shut because I don't feel like being attacked, but I can't help myself

Personally, I don't know any business owners who would be willing to sleep in their car, for any reason. I can't say that makes them be perceived as having a high standard of living. And even if a business owner were willing to sleep in their car to get their business going, would that sacrifice be so they could give discounts to their customers, or so they could afford a bed to sleep in?

Husb is in expediting, and I own a business also, in which I 'own' the real estate. I make the payments each month on the building, and eventually, I will own it and not have payments any more.

When that day comes, I can't look at it as if suddenly I can give my customers a better price. Why should my customers get to have the same goods and services for less money, just because I now own my building and no longer have to worry about a mortgage payment? That would be nuts. That extra net income each month should go into my pocket, to allow me to grow my business, and not into my customers pockets just becuz I chose to buy a building, as opposed to renting one.

I realize it's not the same for a truck, however, just because someone happens to have no truck payments, doesn't mean they shouldn't be getting paid the same rates as everyone else in the business. Even if a fully paid for truck was dropped into their driveway out of the sky as a gift from whoever, it doesn't lessen the quality of services they are providing to the same customers. It is rather, an opportunity for them to net more profits for their own life and business. Why should the shipper get their 'pay'?

If a dentist happened to get a good deal for used dental equipment at an auction, and he therefore had lower overhead than all the other dentists in town, would he lower his rates to allow his customers to net that difference? Or would he congratulate himself on his own business sense, and pocket the extra profits, perhaps building his business bigger and better and stronger?

I am having a hard time wrapping my head around how a person can say on the one hand that they are running a 'business', and yet on the other hand, they are neglecting to charge going rates for their services. What kind of real business person would cheapen their business and discount themselves that way?

If that is what the difference is between a 'successful' expediter, and an 'unsuccessful' expediter, then it is purely by chance, in that one has the usual operating expenses and one does not. If the person without the truck payments gives discounts to his customers, instead of charging the going rates of his industry, it is him who is losing, becuz what happens when his truck runs out? The extra profits he could have been realizing in having no truck payment, could have been saved towards a new truck, also with no payments. Suddenly, he will have no truck, have to lease another truck, perhaps with payments this time, and he will have a bunch of cheap customers who won't care about the status of his truck issues. They won't be willing to suddenly pay more just because suddenly his monthly expenses became substantially higher. Suddenly he won't be so 'successful', will he?

 

[davekc]

I see your point. My personal standards wouldn't have me sleeping in a car, but "desperate people do desperate things".
Expediting is actually pretty simular to real estate.
They are both driven by supply and demand.
With the weak real estate market, prices are dropping with the exception of a few markets.
Too many trucks in expediting verses the available freight, drives the price down. The majority of customers are price driven.
There are those specific customers that require a specifc service/ brand/equipment but there isn't enough of those type of customers. They are more the exception than the rule.
Doesn't mean there isn't money to be made, but one does have to run a tighter ship than years past.

 

[greg334]

Pjjjjj,
I think that there is a misconception about what we are talking about here when we talk about success and business knowledge.

In reality much of what we are talking about are based on three distinct forms of professionals in this niche market and many use their point of view from only knowing one. These three forms are independent, contracted exclusively to and a hybrid version of both.

The fact that the owner is taken out of the picture completely when you are contracted to a company as a contracted exclusively to owner (FedEx). The company takes on the responsibility of negotiation and sales, it only offers the load to what trucks are available to them in their fleet and then brokers it out from that point. The company makes the selection through different means but there is no assurance that there is equality or fairness in calculating which truck gets what offer some of the time. The owner has absolutely no way of telling the customer "Sure we can run it for you at a $1.90 mile, saving you 30 cents a mile" in that situation and should not.

In the hybrid version, a combination of contracted exclusively to and independent (Landstar and Panther to a point), it is almost the same thing as the first type with one exception, you are free to find load by company sanctioned load board (Panther I think is getloaded and Landstar is their internal board) and the company takes a percentage of it as part of covering expenses and making some money. I don't know about Panther, but I know at Landstar, I can walk into a place, promote the company and my truck and get a run or two or maybe even dedicated runs for my truck. I know of one express truck that did just that, running the same thing back a forth because he stopped in to introduce Landstar to a company and he negotiated with them for runs. It wasn't big money but after a year and a half, he paid his truck off.

Now independent is what it seems to be, many out here in EO land are independent, a few even with a van and making good money but it is a lot of work. I think that it is the ultimate goal for anyone serious enough to make it here. These are not the people I talk about when I post, these are the people who have to be business savvy and know what is going on and they don't need to be explained anything.

Does any of that make sense?

 

[nightcreacher]

dont think im the right one to be here ,but over the years ive found,the people that dont make a living at one company,when they leave, they still dont with another company.Ive been with fedexcc for many years,in 1995 had contractual problem,so i leased to another non expedite company,low rates,but still made a living,just had to work harder.gone from 2002 til 2005, was with another expedite company,rates were low there also,but still made a living til the fuel prices started going up and up,as this company practically had no fsc.Im back with fecc,now for going on 3 years.im as busy as I want to be,i dont have a fleet ,so people cant say im busy cause of that,and right now my acceptance rate is well below standard,but at 4 dollars a gallon,im becoming more selective.my biggest advantage,im a tractor trailer,not as much competition.

 

[davekc]

Makes sense. With regards to Panther, we can solicit or use any board we want to obtain freight. As well if one desired, you could go into a business and solicit them for your services.

Steve is right with his situation in that the tractor business is alittle different because there are fewer of them.

 

[pjjjjj]

I completely agree with the fact that the carrier has the ability to control your destiny, when you're reliant on them alone for any load opportunities. Also agree that one must keep their business expenses down as low as possible.
I was more agreeing with TH above, and more referring to those in a position to decide whether to run a cheap load, who will cheapen the industry by taking cheap loads, just becuz they don't happen to have a truck payment. If a company couldn't get their load delivered for cheap, they'd obviously have to start paying the going rate, and it would be good for that person, AND the industry as a whole.
I'm just confused about some people's perception of success.

 

[x06col]

I don't think anyone is advocating running for less than is desired consistently. Periodicly, making a move for less than desired, IS good business. Depending, on the where's, what's, of your particular instance. Even the naysayers of "cheap" freight, have taken "cheap" freight (to get home rather than DH), and no one will convince me they have not. There are instances that it just makes sense.

Now, look at the number of trucks that "need" to get somewhere on a given day(possibly hundreds) and see what ya got. Someone taking a load to BF North Dakota (home) that you turned down as "cheap" It's all relative. If your financial condition, or mindset is a certain way, then, i'll imagine you'll certainly go hungry. It won't be the companys fault, fuel prices fault, the trucks fault, it'll just be your fault, for being a bonehead.

 

[greg334]

I'm just confused about some people's perception of success.

Don't be confused, I was too at first then I someone made the statement that success is what the individual defines it as.

 

[Broompilot]

I applaude A Team on this Post:

The fact you named Owners Holding Back:

This is where in my expierence I found the Drivers with the least amount of $ to survive a miserable week. If you do not have the Reserves to purchase enough fuel to return home, or even a Bus Ticket than one HAS NO BUSINESS trying to run a Business and this is a Business.

Now when someone else controls all the funds GOOD LUCK cause they are not all Like DAVE CASEY. In fact I have only meet a few Owners I would run for, most NO WAY. Thus I stick by my Story your better off being your OWN BOSS as to many others dissagreement. I have never expeirenced what was written above.

Hear is what Sails in a Partnership DA PARTNER AUTHOR Dave Ramsey

 

[Tennesseahawk]

Pj... if you want to know why some ppl will consistantly run cheap freight, it's because they're STOOPID! Stupid ppl have a hard time in any business. But trucking seems to be a magnet for them. Not much longer tho, as it looks now.

MOST shippers pay GOOD bux to move their freight. But stupidity also comes with some brokers who don't know what to bid. Then, they find stupid owners to take their freight. Some other brokers bid on already brokered freight, so they can take a chunk of money out of the load. There again, they find stupid owners to take the load. Then there are brokers who are just plain greedy! They get a good paying load, then broker it out for pennies. Guess who take it.

You're absolutely right about the numbskulls who lower their standards because their truck is paid off. You'll see them with 15 year old trucks that haven't seen a grease gun since they bought em five years ago. Same drivers smell like they haven't showered in that long either!

Phil... read the paragraph above. You misunderstood what I was saying about shippers. They have every right to get a load for what they can. The brokers help them do that. What I was saying is shame on them when they see the truck and the driver, and not send them away. Personally, I'd be hard pressed to do business with a company who would put freight on a wreck of a truck driven by a sesspool of a driver.

 

[Tennesseahawk]

Broom... your words hit home. But let me add this. Reserves come from somewhere. We all hope that when we get into this biz that running would be plentiful enough to fill one's coffers. That often isn't the case. It's not hard to fall on hard times when one has a few $900 weeks to their name. Yet, when they get finally get a $4000 week, it's enough to pull them out of the pit, only to fall back in the next miserable week. Bad luck is prevalent when consistancy sux! Not all of us who struggle with the pit have no business doing business.

 

[ryansexpress]

If one needs that dose of reality, just go and check the classifieds from the last several days. See a WG'er that sank and is selling his truck and all his WG supplies in a seperate add.
Suprisingly, according to his ad, he only used the items a few times. What a waste of money.
That is probably a good example of a poor return on ones investment.

DaveKC just so you know those 2 ads had nothing to do with each other. The WG equip is mine ...truck is not...I did not sink. I left
FedEx and do not need that kind of equipment anymore. Nothing more to it.

 

[dabluzman1]

DaveKC just so you know those 2 ads had nothing to do with each other. The WG equip is mine ...truck is not...I did not sink. I left
FedEx and do not need that kind of equipment anymore. Nothing more to it.

I just hate it when a perfectly good rumor goes bad.

 

[davekc]

Oops....my bad. The two ads I thought that went together were from Forsyth GA. I thought they were one in the same.
So that is two people exiting the Fed WG from there. The other ad that said "business problems" was from NJ. Another one that has sunk.
I got the two ads crossed. Thanks for the correction.

 

[ryansexpress]

Oops....my bad. The two ads I thought that went together were from Forsyth GA. I thought they were one in the same.
So that is two people exiting the Fed WG from there. The other ad that said "business problems" was from NJ. Another one that has sunk.
I got the two ads crossed. Thanks for the correction.

You are right..I do have 3 ads, one for a 14' Dry Box with no truck attached, one for FedEx uniforms and coats and one for the WG equipment. The truck from NJ was not mine.

 

[Crazynuff]

You are right..I do have 3 ads, one for a 14' Dry Box with no truck attached, one for FedEx uniforms and coats and one for the WG equipment. The truck from NJ was not mine.

OMG FedEx uniforms for sale on the internet . Couldn't a terrorist join EO and buy them ? Haven't you heard about terrorists buying UPS uniforms ?

 

[OntarioVanMan]

I used to buy all my work clothes from a Cintas jobber...good quality shirt for 2 bucks and pants for 5 bucks....overalls for 10 bucks.

 

[Jumbuck]

I HAVE to admit it! I don't have what it takes! I'm NOT a quitter, but I'm not stupid either. After reading your post it hit a nerve. I don't have any cash reserve. I don't wanna sit for days and days without pay for a load. I JUST don't HAVE IT! I'm behind before I even start! I know you guys just want to paint the real picture and don't feel bad about scaring me off, please feel GOOD about saving me from "myself!" Maybe if the economy gets better I might try it, but the way things are now, and getting worse, I just "ain't cut out for the life of an expediter." I'm just glad I made up my mind before I "pulled the trigger!" I must have read almost all the posts on this forum and quite frankly, I don't know how you guys and Ladies do it. I know now it's not for me. Well, good luck to you all and thanks so much for telling it like it is. I KNOW in my guts you saved me from a "world of a**ache, and heartache.
Jumbuck...