Developing a Spot Market Freight Rate

January 22, 2008 – 7:01 pm

You have always want to be the last air ride Van in LA is the comment used in our school to start Spot Market Rate Development discussions. The carrier can get $10/mile in knowing how scarce trucks are that day. I am always asked how freight rates are arrived at, the answer, the market.

TranscoreTo find the market in a few keystrokes on a website Transcore.com, I can find where trucks are short and rates are high. Go to DAT Partners within Transcore.com and “ask” for all of the Trucks within a given radius of a city, once obtained, “ask” for the loads in the same given radius, and then you will know the ratio of trucks to loads, TRUCKS called SUPPLY, and LOADS called DEMAND, and if supply exceeds demand=lower freight rates than expected, and vice verse. When you know what the ratio is price your truck accordingly when broker call to book your truck. Without supply information you could leave as much a $1/mile on the table.

I am still amazed that some of my students working with brokers in the spot market for loads home don’t make counter offers. I suggest all truckers learn to HAGGLE over rates, always give a counter-offer when told the miles and money. We train people to haggle successfully at our school and our Home Study has great sales approaches. I suggest a minimum of 20% counter offer, and prepare to settle at 10%. Real brokers will offer 15 to 20% below where they intend to settle. Brokers faced with a plentiful trucks won’t bargain so you will have to know when to hold’em and when to fold’em.

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Freight Claim for Damage

December 21, 2007 – 3:37 pm

A lot of students report that they have suffered for a claim for damage. Remember, the trucker is 100% liable for loss in the cargo they are transporting. The broker may be if they get involved in the actual loading or placarding of cargos or in anyway control the actions of the driver

The burden of proof for the Consignor/shipper or the consignee to make against the trucker, is “the Loss was caused by your act of transportation”. Shippers are implicated if the package(s) are not secured to a pallet correctly as well, and it is the role of the broker to referee between the trucker and the shipper, to negotiate the claim to its logical conclusion.

Drivers who are picking up “used goods” must be wary and take pictures of the cargo before going on the trailer, on the trailer at pick up, and on the trailer at delivery, then again when cargo is off the trailer, just to protect themselves. As a Broker, I always send rate confirmations to protect the trucker hauling “used equipment” from the high frequency of damage claims.

Salvage is the biggest damage claim issue. Salvage belongs to the trucker or his insurer underwriter. Consignees who deny salvage, but make a claim for loss, hurt their case by preventing trucker loss mitigation. Claims like “3 boxes damaged on pallet” and the first thing a broker or shipper should look for is where are the 3 boxes. Trucker keeping the boxes accepts the claim and prevents subsequent disallowance. Naturally, a claim for loss when the whole pallet is kept by consignee, will be disallowed especially if the trucker believes that salvage would allow them to “mitigate the loss values”. The trucker abandons salvage and is thus accepting the loss at full value.

Concealed (Hidden) Damage. Bill of Lading marked “clean” and free of damage. Consignee has 12 days to open and inspect, after 12 days - no claim rights. Remember; Consignee has the burden of proof to prove that the loss after inspection was caused by the trucker in the delivery. Commonly, if the freight was carted off the truckers trailer by a forklift, consignees burden get virtually impossible to prove.

For a case by case resolution, you can resolve claims using an on line service www.freightclaimresolution.com where if both parties agree to mediation on line, you can get an amicable settlement after the review of all claim issues.

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David Answers

December 17, 2007 – 9:11 am

Dennis L. “I did a load for another trucking company. Everything went fine and now he does not want to pay. I sent an invoice to his customer for my services, can I do this and legally put them in collections? I’d like to clear it up before the year end and clear my books.”

Answer: Yes The BOL is the motor carrier property UNLESS you were acting as an Authorized Motor Carrier hired by another Authorized Motor Carrier . On any Brokered Load at the time of pick If you are an AUTHORIZED MOTOR CARRIER, INSERT YOUR NAME AND MC NUMBER at the top of the BOL, deleting any other name, and if not allowed, at he delivery Use Your OWN BOL and getting your POD on your own BOL, sending in both BOL’s with your invoice. All these are the acts of an Authorized Motor Carrier. The Broker works for you, not the other way around. Send them all out for collection if you have to. At the least make a claim against the Broker’s Surety Bond, NOW not later. See the website loadtraining.com and print out free publication “when a Broker doesn’t pay” dd

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Donna B. “I receive your information by email and find it very interesting. I’ve watched your free online DVD but this business opportunity and schooling doesn’t seem to be for beginners or is it?”

Answer: Some of my largest success stories are people who have trained with me, who had 0 transportation experience. You would be my easiest pupil, because, I don’t have to break old transportation habits. My program is for beginners dd

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Freight Claim for Shortage

December 17, 2007 – 9:09 am

Shortage is a frequent freight claim according to my student trucking entrepreneurs. We have discussed SL&C as a valid defense in installment#3, but shortage is generally theft while the driver wasn’t looking, which is driver negligence. I even had some drivers report that they were too tired to count the goods in and out of a truck. They are just asking for a shortage claim by opening their trailer doorsFreigh Claim without providing supervision. SL&C means that when signing a BOL for the cargo install the letters SL&C to denote that the trucker is limiting liability to the pallet count, not piece count. “Driver denied access to count” should be noted on BOL every time this is the loading or unloading circumstance.

With a BOL signed SL&C and there is a shortage in piece count, driver needs to note the circumstances on the BOL such as “ box removed from pallet for inspection” or “shrink wrap cut after pallet removed from trailer”, or whatever the driver feels is the cause of the shortage.

Shortage of pallet, generally means that the loading driver made a mistake in counting the pallets going on, leaving a pallet on the consignor’s dock. Call dispatch and ask that shippers inventory be count checked, before a claim is made.

When a driver picks up a sealed trailer, they can protect themselves by noting on their log book that the trailer was sealed (seal in tact) and upon delivery, get the name of the receiver who witnessed breaking the seal and enter it in your log book. SL&C should be entered on the Bill of Lading at the time you take possession of the dropped trailer.

Notation on the BOL must occur before the Consignee signs the BOL. The BOL is the property of the trucker, and the Consignee is “incidental to” and not a party to the BOL. If there is not enough room for notation, break out a blank BOL and complete it clearly noting BOL #2. The driver controls the Bill of Lading (BOL) notation. Driver should make a report separate from the BOL or talk to the Broker, if a brokered load. The Broker plays the role of Judge Judi and negotiates completion of delivery. If any party, consignee or consignor, or broker says “don’t worry about it” make that notation on the BOL and write the full name of the person excusing the loss.

Posted in Freight Claim | 4 Comments »


David Answers | First Day

December 12, 2007 – 10:44 am

We have had a great response so far and with yesterday being our first official day up i wanted to go ahead and answer some questions that were submitted. If you have a question for me you can click on the ‘Question’ link above, or you can leave a comment on the post that interests you.


Brian G. “My black hat is not as black as it once was in this current freight market. How do you see the freight market short and long term?”

Answer: Demand is low, that is true in general, Regional and flat bed still maintains good numbers The pendulum swing will start in the spring 36 to 48 months large demand


Craig H. “Can there be any liability filed against a dispatcher?? Can a dispatcher legally collect a commission for his service??”

Answer: There is liability in everything you do. Dispatching is Agency for an Authorized Motor Carrier an is less liability than the other agent of a motor carrier the Driver. Can they collect a commission yes. Most smaller (50 pwr units or less pay dispatcher as much or more than CEO salary, because dispatchers are the economic point of sale for motor carrier

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The Bill of Lading (BOL) as “Title” to cargo

December 6, 2007 – 10:26 am

The Bill of Lading (BOL) is title to the cargo and property of truckers. Brokers may not declare an interest in a cargo, or be listed as an “Additionally Insured” on truckers Cargo Insurance, unless an untrained trucker gives up their trucking rights in a “Continuing Broker Contract. Brokers who demand the “original” at billing time are not Master Brokers, and don’t know regulations specifically says “copy of Bill of Lading”. 49 CFR 370 et seq.

The Bill of Lading is the ruling Contract for Interstate Commerce and is backed by section 8 of the United States Constitution. It is a contract between the Trucker and the Consignor/shipper. A third party may be listed in this Contract, as they are not a “mode” of transportation and are un insured- hauling is between the trucker and shipper. The consignee is “incidental” to this Contract under Law.

If you are a trucker with Authority working with anyone who presents a “License” for loading, you need to scratch out the broker’s name on the BOL and insert your own name and MC #. Brokers may not declare an interest in a cargo as they are uninsured. .

If the Consigner/shipper refuses to let you the trucker change the name, then deliver the cargo on your own Bill of Lading listing yourself as the “carrier”, and invoice broker with both copy of the original BOL and your own BOL as “Proof of Delivery”.

Brokers must accept this practice as they “work on behalf” of the Trucker’s Authority. In the event of non payment by the broker, trucker with Authority has the power to invoice the consignor/shipper, and/or consignee. The Consignor/shipper and Consignee, have no defense against your truckers collection efforts. Having paid a broker, doesn’t relieve the consignor/shippers obligation as they are considered to have paid their Agent – the broker. The Consignor/shipper created the Bill of Lading between themselves and the trucker with Authority, a valid and premier Contract for Interstate Commerce.

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The Broker’s License

November 10, 2007 – 12:19 pm

Obtain the License the same way you get Authority, complete the OP-1 on the website www.FMCSA.DOT.GOV and pay the fee $300. After they get your applicat6ion, DOT issues a “Decision” to give a License if the applicant completes a BOC-3 (process Agents) and a Surety Bond in 120 days. The largest Surety Bond company is at 800 595 2615.  Keep in mind most brokers fail; 1 in 19 survives three years).  In fact the bondsman will tell you that 40% of Surety Bonds are cashed in 12 months. Those who train and become Master Brokers increase their odds of success to 1in 2 . The broker License allows a person to be a travel agent of freight without liability as cargo insurance is not required.

The License is not Authority, even if the government says it is . Unlike Authority, where a person may take possession of freight FOR Interstate commerce,  brokers is LICENSED to arrange transportation, NOT AUTHORITY TO TAKE POSESSION OF FREIGHT.  Broker’s may not put their name on the Bill of Lading using a broker’s license only.  if they are a trucker with Authority hiring a subhauler  they don’t need a License.

Anyone who puts their name at the top of the Bill Of Lading (BOL) is 100% liable for loss. Again why would a broker risk putting their name on the BOL for a 15% commission, especially without insurance? Untrained brokers make the mistake of believing trucking and brokering are the same thing.

The most common beginning broker starts as an “Agent” for a broker. No License or Bond required. The broker will train and nurse the start up to success. There is usually a Contract involved and the commissions earned are 70% for the Agent and 30% for the Broker doing the Agents paperwork, and disbursing the funds involved.  The Agent creates their own “shipper following”. Agency coupled with Authority is the best way to truck. The Trucker invoices the shipper retail directly for loads hauled by them, and brokers out excess freight to truckers with Authority. You cannot be a successful trucker with Authority without being a broker. The free market to too vast and too complex. All of the Nations largest truckers, broker, even the post office.

Posted in Brokers License | 2 Comments »


Trucking Authority

October 10, 2007 – 12:18 pm

Trucking Authority free at fmcsa.dot.gov, of course you have to pay the government fee of $300, but it is so easy to walk thru this website and complete the form OP-1 and submit payment with a credit card. Or you could pay a consultant to help you get your Authority and their fees range from $150 at OOIDA to $1000 plus the government fee from the most expensive consulting choice.  Consultants can give you immediate help and directions, well worth their costs.  All you need is a truck and Public Liability Insurance Policy. Get insurance quote and Authority in one call 800 832 8570.

After getting your Authority, you should be prepared to be audited by DOT after receiving your Authority. They will show you how to do correctly use Authority, as we will at school .

Authority allows you to take possession of freight in your own name, for Interstate purposes. Shippers will work directly with you if you have Authority.  You will be able to invoice shippers at Retail Freight Rates directly, eliminating brokers from your life, You will  add $.50 cents per mile. Owner Operators earn $.75 cents/mile as they are receiving 30% less than wholesale Freight Rates (Wholesale Freight Rate is Retail, minus a brokers commission).              You should learn how to broker, as your new shippers will offer you more freight than you can haul. It is imperative you find shippers, because if have your own Authority and work with brokers, you will go broker. The sales objective of every Trucker Authority is “ to never work with a broker again .  visit www.loadtraining.com where you can print a free text book, “Guide to Higher Paying Freight”, which will explain the advantages of having trucking Authority in more detail. There is one Text Book that will help you in trucking sales. Brokerage Operations Manual $99; 200 + pages of detail at loadtraining.com.

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Brokers and Appointments for Pick and Delivery

September 10, 2007 – 12:17 pm

As a broker, I have dispatched over 95,000 loads to truckers.  I require the trucker to make their own appointments for pick and delivery. Brokers who make appointments for motor carriers are creating liability by controlling a drivers actions.  I can’t imagine why a broker would willing make themselves 100% liable for only a15% commission. The motor carrier should remain in control of his own employees or o/o.  Brokers expose themselves because they don’t know any better or lazy trucking dispatchers make the Broker do their work. Broker Licenses does not permit a cargo interest for the broker, yet most brokers gleefully put their name on the Bill of Lading (BOL) and make appointments and thus are liable for the consequences.

As a trucker, I always made an appointment for delivery, before picking up the load, especially if the cargo is groceries, because shippers wantonly turn truckers into warehouses; In other words load the truck and then the trucker finds out he can’t get the freight off for 10 days.  Brokers exposes themselves to the liability of paying the trucker for detention and demurrage in such instances, when in fact they should be the “travel agent” for freight.  Note: Trucking companies who take possession of freight, then broker the load to another trucker (subhauler) can do so without a Brokers license. Both truckers are 100% liable for loss. In this instance, the originating Trucker must control the pick and delivery appointments. Those who use Broker’s license  should not control appointments.

The Broker who commits to a pick appointment, before finding and booking the truck is not profitable. They make 50 extra phone calls for their $50 commission.  Motor Carriers should control their loadings, set the terms of the haul, and control offloading without interference from a broker.

Truckers whose appointments are made by the broker, have recourse against the broker if they are required to layover after meeting an appointment time, or are detained by a lack of broker originated appointment. Truckers may have a valid contract claim and may make it against the Broker’s Surety Bond. Not all Brokers are created equal, Master Brokers, graduates from loadtraining.com would not make appointment mistakes as most brokers do.

Our next Ask Mr Broker installment (# 5 ) “Trucking Authority”  how to get Authority free @ (fmcsa.dot.gov). Installments 1 thru 48 are available for purchase as a set.

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What do you do When a Broker Doesn’t Pay

July 10, 2007 – 12:11 pm

Untrained Brokers come to think of trucking companies as their employees, when in actuality, the positions are reversed. The Broker works for the trucker. I have always known that the Trucking Company butters my bread. The number of my students who report Broker non payment has risen 80% in the last 2 years. Here is what I advise you do as a Motor Carrier.

Give the overdue Broker - 15 days of “grace” beyond the promised pay day, before you send certified mail of your FIRST NOTICE accompanied by a copy of your Invoice to the Broker and Proof Of Delivery. In your letter, make a DEMAND for payment, and give Notice with something like this “Failure to Pay within the next 10 days from the Date of this Demand Letter, will result in NOTICE OF DELINQUENCY being forwarded to the following Regulatory and Collection Agencies: 1. Our Collection Agent, 2. FMCSA (www.fmcsa.dot.gov) and Safestat, 3. Your FMCSA registered Surety Bond Company”.  Fax a copy to the broker on the same day you mail, then call the Broker and discuss your Demand for Payment.

If no response, in another 10 days send your SECOND NOTICE to the Broker via certified mail.  Here are some suggested language for your second letter; “ This Notice is your last NOTICE OF DELINQUENCY and we have not received satisfaction of your PAST DUE invoice # ____________________ . All Agencies listed in our First Demand NOTIFICATION letter will be notified by registered mail Seven ( 7) days from this Notice Date______________________, unless we received a Certified check from your company for the balance including accrued interest. In the amount of $_______________________________”
This is the Action I would take against a Broker who fails to pay.
Our Next installment is “SL&C - a valid Motor Carrier defense on a Bill of Lading”

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