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It's a Team's Life

How dare you insult me with that rate.

By Linda Caffee
Posted Feb 19th 2017 4:14AM

For those that run on a flat rate this is not the blog for you as that is a whole different ball game. There are only so many ways to slice a pie and we can have big pieces or we can have a sliver of the pie but in the end, it is only one pie. We have had a couple of different percentage plans and the percentage was different with each company.

With one company, we were paid a lower percentage and then were paid to dead head to pick up the load at a flat rate per mile. We were told how many miles we had to dead head to pick up the load and then how many loaded miles and the rate. It was easy to figure how much we made on all miles by dividing the pay by total miles. Then we decided if that figure would work for us.

With another company the percentage rate is higher but they do not include the dead head miles. Even though we get a higher percentage we still have to know the dead head miles to get our rate for all miles. Either way it all boils down to one rate and one set of miles. Pay divided by miles equals rate per mile.

In both situations, the company or the agent both want to make as much money as possible, while the customer wants to pay the least amount possible to get their freight moved. In the middle is us as the companies have to play a balancing game to bid the load high enough to make money and get a truck to cover the load but low enough that the customer will agree to the rate.

While listening to a group of agents talk about their job I realized that they do not have it easy as they are also in the middle. They have their customers that want a load moved and sometimes it has to move fast so the rate is higher and at other times there is not a rush. The shipper though wants to depend on the agent to cover all of their loads so they do not have to keep looking for a truck. The pressure on the agent or with the company is to take the good freight with the bad paying freight and have one of their trucks cover the loads. It is not a career that I would enjoy as the stress has to be tremendous to walk this tight line.

The bottom line is all of this though is that our expenses do not set rates. If we have a $5000-dollar truck payment or we drive a paid for truck the rate stays the same. Our expenses have nothing to do with freight rates it is supply and demand. Before changing companies do the research to see how they pay and what they charge you for. How much is the OmniTracs, how much are permits, can you pick your own insurance, along with many other questions that need to be asked. While the pay may look good upfront the charge backs might take away all of the extra pay. Is the company all about miles to make the income needed or is it more about special handling? Each example works if that is what you enjoy. Find the company that fits you and keep your expenses under control to keep the most money in your pocket.

Bob & Linda Caffee
Saint Louis MO
Expediters since January 2005

Expediting isn't just trucking, it's a lifestyle;
Expediting isn't just a lifestyle, it's an adventure;
Expediting isn't just an adventure, it's a job;
Expediting isn't just a job, it's a business.

1 Comment

  • Greg - February 19, 2017
    Everyone should especially pay attention to the last paragraph. Great blog Linda.

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