Leased on with multiple carriers

[chefdennis]

So it's literally true that there is more to expediting than meets the eye.

Phil, this is by no means a "shot" at you, but there really isn't "more to expediting than meets the eye" to those that have looked at the industry "As a Whole" over the last 5-6 yrs....I by no means consider myself a "expert" on all the facets of expediting, but nothing mentioned here is new to the industry...i seen this and considered running for "multiple companies" back in 2007....but instead seem the issues mentioned here and went to a carrier that held a "exclusive use" lease with me....

 

[ATeam]

Phil, this is by no means a "shot" at you, but there really isn't "more to expediting than meets the eye" to those that have looked at the industry "As a Whole" over the last 5-6 yrs.

There is no question that a person's view of the industry is conditioned by one's exposure to it. I have interviewed and written a couple of stories about vanners over the years but never delved into that part of business because it simply did not interest Diane and me. It might have been better to say, there is more to expediting than meets the eye for those who have not seen it all.

 

[CharlesD]

So it's literally true that there is more to expediting than meets the eye.

Yep. When we first started taking on other units, everything we had was under 10k and the DOT wouldn't even give me a number until we got a straight truck. For a couple years there all we had was an MC#. When I got the DOT number I had to make new signs to include it. The signage is only required by law for vehicles over 10k, but a lot of carriers just require it on all units, most likely partly for professional appearance and partly for a rolling advertisement. And believe me, the rolling advertisement works. We recently signed on a new truck because he got our phone number off the side of another one of our trucks.

 

[ATeam]

...nothing mentioned here is new to the industry...i seen this and considered running for "multiple companies" back in 2007....but instead seem the issues mentioned here and went to a carrier that held a "exclusive use" lease with me....

No-authority vans running with multiple carriers may not be new, but I wonder, is this a growing trend? Sylectus software is new to expediting (not brand new but new enough). To what extent are the no-authority, multiple-carrier business model and Sylectus software related?

 

[chefdennis]

There is no question that a person's view of the industry is conditioned by one's exposure to it. I have interviewed and written a couple of stories about vanners over the years but never delved into that part of business because it simply did not interest Diane and me. It might have been better to say, there is more to expediting than meets the eye for those who have not seen it all.

And that is totally understandable...I really down have much interest in alot of things, but i can speak of most of them in gerealities...The fact that your research into the industry before you entered would certainly be limited to the area you were interested in...When i looked i looked at the industry as a whole and each type of unit as i as you could have gone in any direction ... i went where i did because i am not really fond of following "alot" of "rules and regulations".. You and Diane if i remember right and understand were more on a path to a ST from the start and thats where your research went, so agin the lack of seeing the CV side as it is is totally understandable...

I can say, that since your move to Landstar, you have opened up a boarder line of inquiry into the issues of the industry as a "whole" as to gain a further education to the business going on around you..that is a good thing and it as with this thread, your post and questions have brought out good infomation that my not have been said. For that, others have been educated...Thanks!!

 

[CharlesD]

Phil is right. There is always more to something than the little piece you see. I haven't been in this business nearly as long as many people here, but I keep learning something new almost every week. Being on the road gives you one little piece of the puzzle. Then when you try to book your own freight you get another piece of it. Then running other trucks gives you a different perspective. Since '07 I've gone from being a leased on driver to an independent o/o booking my own freight to having a couple other vans hauling loads under my numbers to running a small carrier with a dozen trucks, driving a desk for 12-16 hours a day. Now I'm trying to expand our access to freight so we can not rely on as much bid board freight and I'm still learning new things I didn't know a week ago. The day you think you know everything is the day you're in trouble.

 

[chefdennis]

No-authority vans running with multiple carriers may not be new, but I wonder, is this a growing trend? Sylectus software is new to expediting (not brand new but new enough). To what extent are the no-authority, multiple-carrier business model and Sylectus software related?

LOL, now you are asking about things beyond my "pay grade"...but i am sure someone like John Elliott can provide a answer (when he get off the airplane)...I will say that for the most part the little companies that are allowing their contractors to lease to others are not part of the Alliance in anyway and chances are are not in the network with the Sylectus operators / carriers and aren't looking to invest on that level needed ...i could be totally wrong on that point, just my thoughts at the moment...

 

[chefdennis]

Phil is right. There is always more to something than the little piece you see. I haven't been in this business nearly as long as many people here, but I keep learning something new almost every week. Being on the road gives you one little piece of the puzzle. Then when you try to book your own freight you get another piece of it. Then running other trucks gives you a different perspective. Since '07 I've gone from being a leased on driver to an independent o/o booking my own freight to having a couple other vans hauling loads under my numbers to running a small carrier with a dozen trucks, driving a desk for 12-16 hours a day. Now I'm trying to expand our access to freight so we can not rely on as much bid board freight and I'm still learning new things I didn't know a week ago. The day you think you know everything is the day you're in trouble.

Amen....

 

[CharlesD]

Actually, many of the companies that allow people to lease to multiple carriers are part of Sylectus. That's what creates the problem. People post their available units in there and sometimes it looks like there are way more vans than there really are. It creates false capacity that doesn't really exist and drives the rates down lower.

 

[jelliott]

From 30,000 ft.....I think it is a growing trend as of the last two years. Progressive Insurance started offering and marketing this insurance. It was not very common or easy to find previously. I think it is already starting to lose favor with a number of guys running for multiple carriers. We see more guys calling wanting to quit the multiple carrier system and go back to a single signed on carrier model. If Progressive decided to leave the market, I think it would cut that model by 80% very quickly. imho.

 

[jelliott]

Yes many of them are on Sylectus. But even if they are not, they create false capacity with customers. Supply and demand are what determines rates. Artificial supply, drives the demand curve down. The shipper is the only one who ultimately wins with this model.

 

[chefdennis]

Actually, many of the companies that allow people to lease to multiple carriers are part of Sylectus. That's what creates the problem. People post their available units in there and sometimes it looks like there are way more vans than there really are. It creates false capacity that doesn't really exist and drives the rates down lower.

As i said, "beyond my pay grade" and "i could be totally wrong", and was!!! Thanks Charles for setting the record straight.

 

[Jenny]

So if a van is signed on with 3 carriers and gets empty n a certain city, he notifies all 3 he is empty and available. All 3 will look to bid freight for him. Often times these carriers are bidding against each other for the same load for the same vehicle, thus is benefits the shipper or load board by driving down the rate.

Thank you for bringing this up. I think that it is something that a lot of people do not realize...


Sent from my VS910 4G using EO Forums

 

[scottm4211]

Thank you for bringing this up. I think that it is something that a lot of people do not realize...


Sent from my VS910 4G using EO Forums

It's akin to punching yourself in the face. There's no real reason for it...

 

[tenntrucker]

I've wondered about this, but for a little different reason. Say my main carrier is mostly into auto industry and I take a load to GM in Kansas City, not much on the way of auto parts coming back. But if I have connections with another carrier with a broader load base it might get me a back haul quicker.

Sent from my DROID X2 using EO Forums

 

[OntarioVanMan]

Yes many of them are on Sylectus. But even if they are not, they create false capacity with customers. Supply and demand are what determines rates. Artificial supply, drives the demand curve down. The shipper is the only one who ultimately wins with this model.

So why doesn't Sylectus devise a way to filter "same units" out of the system?..either thru VIN numbers or plate numbers....effectively ending this trend....

 

[jelliott]

It isn't illegal or anything like that. So Sylectus would really have no place or authority to get involved with something like that.

 

[usafk9]

It isn't illegal or anything like that. So Sylectus would really have no place or authority to get involved with something like that.

Yes, but is there an incentive to get involved....like many of the bigger players causing a stink with Sylectus?

Obviously, I don't have a dog in this fight, but the downward pressure on rates would drive me, and my contractors nuts. I'm just curious.

 

[CharlesD]

Yes, but is there an incentive to get involved....like many of the bigger players causing a stink with Sylectus?

Obviously, I don't have a dog in this fight, but the downward pressure on rates would drive me, and my contractors nuts. I'm just curious.

But you kind of do have a dog in this fight. Things that have an effect on the industry as a whole affect all of us, whether or not your carrier allows this or you are one of the people who does this.

People will say, "But my carrier doesn't use bid board freight so I'm ok." but what if your carrier loses that freight source to a 3PL or another carrier who will turn around and put that freight on a bid board and run it for cheaper? If the shipper can find someone to run it cheaper, they're going to do that.

 

[Turtle]

I've wondered about this, but for a little different reason. Say my main carrier is mostly into auto industry and I take a load to GM in Kansas City, not much on the way of auto parts coming back. But if I have connections with another carrier with a broader load base it might get me a back haul quicker.

That's the theory, and it's what is behind the myth of being leased on to multiple carriers means having less down time. It's the exception to the rule, because the overwhelming number of carriers who allow multiple leases are all bidding on the same freight in the same manner, and do not have a broader load base. Those with a broader load base are not likely to allow their contractors to lease with another company. That's why the notion of being leased on with multiple carriers will get you more freight ends up being a self-deluded myth, in most cases. You end up with the same amount of freight, and usually at a lower rate.

If you are able to selectively pick and choose 2 or 3 carriers who each have different customer bases and methods of obtaining freight, then it's doable. For example, if you are on with 3 carriers, only one could be part of Sylectus, and the other two would have to have their own unique customer bases which are not part of the Sylectus market. Doing this is not easy and requires considerable knowledge of the industry, or an insane amount of luck.