Showing posts with label negotiate. Show all posts
Showing posts with label negotiate. Show all posts

Friday, November 2, 2012

Part III - Drivers - How to Narrow your Job Search


18 Wheels of Justice Home

Welcome to Part III - Drivers - How to Narrow Your Job Search...

6.  Consult with your wife, husband or significant other.(for ease of reading we will refer to this person as your wife)  This is a step that is often overlooked.  You're wife will remember all the issues you complained about or liked at your last job.  Sometimes we only tend to remember the good things or bad things about a company we worked for.  Your Wife is a great sounding board because believe it or not she listens to you and wants to see you happy.  If your happy, she's happy.  It's not just about the money, it's easy to get wrapped up in the money aspect of a job.  Trust me, the a few pennies more per mile will lose its appeal when you are stuck out over the week-end, not getting the miles, or have a dispatcher that doesn't care or is too busy all the time.  FBC(Federal Blog Commission) Warning.  Too much interaction/conversation with your wife can lead to problems.  As you all know, a wife is, pound for pound, the most dangerous animal in the world.  Tread carefully here.  I learned this the hard way when I recently asked my significant other her opinion and ended up in a relationship counseling session.

5. Online Driver Discussion boards.  Check these out!  These can be a good source of real information.  I think every driver should belong to a few of them.  Like anything, there are good ones and bad ones, and some of the people who post on boards are just disgruntled and unhappy.  So use caution here also and don't believe everything you read.  I have gotten a lot of good information from these boards, and the better ones have members who have their profiles published also, so you can see who your talking to,  I find that for the most part, if someone is going to take the time to write and discuss companies etc. on these boards, they are generally sincere.

4.  Respect.  This is a common and rather generic term that is thrown around a lot these days.  Why?  I don't know.  I think respect is a given.  Perhaps what these trucking companies mean is that they are honest about things.  I think Honesty is the best quality a company can have when it communicates with its drivers.  Its just that simple.  This is a key aspect to look for in any potential employer.  When your following these steps, always keep this in mind.   

This seems like a lot of work, doesn't it?  Yes it does!  But, please remember the hours/days of orientation, setting up your truck, paperwork, drug tests and spending a few months at a company you don't like, when you make a knee-jerk decision to work somewhere. There is a lot of time and money you are investing in a new job, make it count.  A few hours of research now will save you tons of headaches later.  I originally tried to do this in 3 parts, but this is an important decision and there is a lot to cover.  Stay tuned, Part IV this weekend! 

What about a career change?  Have you thought about switching to pulling a reefer, van, flatbed, or tanker?  How about a being a car hauler or driving for an Oil Field Services company? Intermodal?  You ask, we deliver.  18 Wheels of Justice investigates and compares apples to apples and breaks it all down for you... Debuts next week!  "Drivers and Operators: Choices within your Driving Career - The Inside Scoop"...Next week will be the long awaited debut of “Ask 18 Wheels of Justice” on our website. We provide opinions, answers and solutions to all things trucking.  If we don't know, we will find the answer! A sincere thank you to all of you who submitted questions, please keep them coming.

© 2012 Michael H. Komadina

18 Wheels of Justice™

"Negotiating with Freight Brokers and 3PL's"  A "must have" in todays freight market, improve your company's profitability by training your staff with this hands on training manual today!


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Friday, October 26, 2012

Treat Brokers as Customers!


18 Wheels of Justice Home

The business of shipping products to customers is ever-evolving into a world in which 3PL’s and Freight Brokers have access to more and more of the truckload market.  Large manufacturer’s want to focus more on their core business, than having entire shipping departments dedicated to rates and setting up carriers, dealing with scheduling appointments and so on. 

So, what does this mean to you?  A brave soul, the lone owner operator who sets out to seek his fortune with his own truck and trailer?  A small carrier with a dozen or so trucks, trying to build a dynasty or family fortune?

Buy Book and CD today at

A truckload carrier whose business is 30% to 40% Broker and 3PL freight and has planners/dispatchers who are not yet masters in the art of negotiation?  Do they hesitate to be aggressive negotiators? 

30% to 40% is a very large portion of your business and where a large portion of potential profit is hiding.  Yes, and it is an art, when done creatively, properly and successfully, negotiating can be one of the most beautiful and rewarding experiences one can have.

Think back to the days of your youth, negotiating with parents to stay up later, only to be told to go to bed.  Or did you return to the negotiating table with your parents armed with opposing arguments?  How about delicately trying to negotiate your first kiss with a blushing, young redhead and getting a hug or handshake?  Or did you steal a kiss and walk away, leaving her wanting more?

Like most of us, you probably have good and bad memories of negotiating.  The important thing to remember is that you walked away from each one with more knowledge, experience and skill every time.


The transportation business has changed over the last ten years.  What does it mean to you? 

No longer are Brokers and 3PL's just a backhaul provider, they are our best customers.  The carriers who treat them as such, win everytime...



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Wednesday, October 17, 2012

The High Cost of Transportation Books

Negotiating, in and of itself is an individual effort. There is no textbook example to follow. Each negotiator has their own style which was typically learned by trial and error through years of experience. Experience gained while negotiating the price of a new car at a dealership, negotiating with a shipper, broker or 3PL for a load, or negotiating with a carrier to get them to haul your customers load at the lowest price.


After I had written, but, before I began publishing and marketing the best selling "18 Wheels of Justice" series, I scoured the Internet for similar books or discussions on negotiating in the transportation marketplace. I was shocked that I found nothing worth purchasing or for that matter, reading.


The many self proclaimed "Experts" in our industry offer nothing on the subject.
(Industry - Trucking arena, not Brokerage. I will address Brokerage "Experts" next week)

The only information available was:

1. Know your cost!!(Fuel, Tires, Insurance, Maint. ad nauseum)
2. Demand your rate!!(Don't haul anything for less than what your costs are plus your profit!!)

This is all I could I find.

Sage advice? Hardly... Educational? I don't see it and I didn't read this and walk away with knowledge to put into practice...

Negotiating is an art form. Individual and unique by nature in each transaction, but it follows a natural basic design and pattern. Good negotiation never involves an auction style bidding process, nor a standoff based on price alone!

First, let's discuss the basic and natural design that every negotiation follows. Every aspect of every single negotiation can be broken down into three phases.

Yes, there are just three. I don't care if you’re negotiating for a new car, a truckload of freight, a first kiss or a first date, everyone single one follows this simple design.

When you take the time to understand these steps you will recognize which phase you're in while you're negotiating. An important thing to know, because the person on the other end of the phone or across the table from you, most likely, doesn't know that the phases of negotiation even exist. That being said, I would also say it's safe to assume they also don't know the phase and purpose of where they are in this process at this particular moment in time.

It is very simple, and if you replay your last negotiation in your minds eye, slowly, you will see how it followed this pattern...

1. Pre-Negotiation, Framing.

2. Arrested Development, Impasse, Stalemate, Deadlock, it's called many names, but it’s all the same concept and a beautiful one at that...

3. Transaction, Settlement, Agreement, is reached and everyone is satisfied. Not necessarily happy, but satisfied.

Now, using the conventional wisdom available on negotiating, which I have read, seen and heard over and over in my many years in the transportation business, I will use that same approach on justifying the cost of my Book and CD. To keep things simple, I will address the price of my book only for this discussion - $49.00. I have received numerous emails asking, "Why the high price?" or "I see books all the time for $9.99?", and my favorite, “I saw a book in a truck stop for $4 once.” Let me break it down and try to sell it to you in an approach used by most owner operators, small fleets & carriers operations departments today.

18 Wheels of Justice - Negotiating with Brokers & 3PL's - "The Book"

My cost per book for each one sold. (I had my accountant break it down over the week-end)

$ 6.94 Actual Cost of Book from Publisher
$ .30 Shipping from Publisher
$ 4.24 Alimony paid to 1st ex-wife
$ 9.87 Alimony paid to 2nd ex-wife
$21.40 Cost of romance for much younger, soon to be third wife
$ .32 Private Chef
$ 1.88 Bar Tab
$ 2.30 Bookie (it varies weekly, I took a 52 week average, plus "I'll Have Another"
                       was scratched at Belmont, skewed my average)
$ 3.10 Cowboy Hats
$ 1.80 Horse Feed
$ 1.80 Marker at Bellagio
$ 5.05 Citation III (includes two pilots on salary, plus fuel surcharge,
                             always get your fuel surcharge)

$49.00 Total - there you have it... Buy "The Book" today at 18wheelsofjustice.com

The point of this little exercise is that nobody will negotiate a higher rate because of personal financial problems or poor business decisions, no matter how likable a person may be...

Now, please don't take offense at these statements, but the reality is:

Nobody wants to hear about a son’s college tuition costs or how tough it is now in the trucking business.

Nobody cares if someone paid too much for a truck, and now they're stuck with a high payment, nobody cares about someone’s alimony, the new tires someone needs, etc. Nobody cares except, of course, you and me, and this is precisely why you should work to improve your negotiating skills. And, yes, I do care.

There is a fortune to be made in this business with some extra effort on improving your negotiating skills. It's no different that investing in a newer, more efficient tractor or researching fuel savings and better tires. This is an area where the majority of Owner operators, Small fleets & Carriers leave a lot of money on the table. If you think business is good now and demand for freight is up, imagine increasing your income by another 30-40%. It's right here for you.

What is the value of a book? What is the value of a carrier or an owner operator? A Broker and 3PL for that matter? The value of a customer?

The value of a customer is only what they themselves value. Do they value service or price? Or a reasonable consideration of both. Are they constantly shopping rates and only call you as a last resort?

The value of a Broker or 3PL is only what they themselves value. Do they value integrity & honesty? Will they book a load with you and then pull it when it "cancels" 30 minutes later because another carrier agreed to haul for $100 less? There are a lot of "pretenders" out there, but for every "pretender" there are 10 excellent Brokers & 3PL's who have high values, standards and integrity.

What is the value of an owner operator, small fleet or carrier to a Broker & 3PL? All of these values ring true and bring abundant rewards. Do you book a load with a Broker or 3PL and place it in your back pocket while searching for a better load? Or can they depend on you, place you on one of their best customer’s loads and always pay you a premium? How do you get to this elevated status with them? 18 Wheels of Justice shows you how.

The value of a Book? The value of education, self improvement, improving your business & bottom line? Continually educating yourself is the key to success in this business.



BOOK & CD Package


Wednesday, October 10, 2012

Spot Market Negotiating Strategy #12... High Fuel Cost Is Your Friend

Spot Market Negotiating Strategy #12... High Fuel Cost Is Your Friend - From "Negotiating with Freight Brokers & 3PL's"

STRATEGY 12 – HIGH FUEL COST IS YOUR FRIEND

Brokers/3PL’s have held onto fuel surcharges for years and not passed them along proportionally to carriers.  Do not make a general statement or complaint about the price of diesel. Do not go on about how hard it is to make a living now, be specific, and use a real example. “I hauled a similar load a month ago that paid more per mile, and fuel has gone up 5% in the last month. The higher rate you get shouldn’t be directly proportionate to what your actual higher cost of fuel is on the load, in fact, it should be much higher.

You have had to cash flow this meteoric rise in fuel the past few years. It would take a rocket scientist or two to figure out how much the rise in fuel prices have actually cost you. You are just “framing” and letting him know the price will be higher based on that fact alone, not including all of the other strategies/facts you have already brought up. If the Broker/3PL wants to get scientific and explain that it only will cost you “x” more at 6 MPG, etc. Go into detail about the higher fuel costs in states you have to go through and the load weighs 44,000lbs so your fuel will drop to 4 MPG between the weight and the hills… Remain calm, likeable, specific and unemotional, in your conversation.

Remember C.L.A.S.S. in all your conversations. Explain your reasons calmly, especially if he or she gets insulted. Try and calm them down, i.e. “I am not trying to be greedy or unrealistic; this is just the reality of hauling this load. If they won’t or can’t see the reality, simply thank them for calling and offering the load to you, but maybe it’s just not the right fit right now.

BOOK & CD Package

Monday, October 8, 2012

Drivers!


Owner Operator & Driver Retention and Recruiting.  It's the 8th Wonder of the World.  Where did they all go?  What happened to them?  I just talked to him yesterday... I thought he liked it here...   

It's like Mark Twain said about the weather, "Everybody likes to complain about it, but nobody does anything about it."

Believe it or not, there are a lot of trucking companies who excel at recruiting and retention. Who? Why? How? I'm glad you asked, please join me on a journey that will take us through some basics of successful recruiting and retention.

Let's begin with some careful self-examination.  Honesty is key here, know yourself and your organization.

Do you really want to solve this issue?  Or do you want to throw more and more money at broad advertising and hire more recruiters and hope it works out?  (That Beck song "I'm a Loser, Baby" comes to mind, "Things are gonna change, I can feel it...")

You didn't get to where you are today by hoping things work out. 

You are a Person of Action, a Leader, a Mover and Shaker, a Winner.  I'm serious...(How do I know? You are taking time out of your hectic day to read this, to learn how to improve your company.)

Turnover at the majority of trucking companies is sadly well over 100%, at some it reaches alarming heights of 200%-400%.  Don't get energized in the problem!  Let's focus on fixing the issue.  The hardest part of any job is getting started.

Think of your procedure when a new driver or operator joins your trucking company, I'll bet this sounds familiar...

The recruiter or safety department initiates the process.  Why it always seems to fall on safety is beyond me. I think everybody thinks they have nothing to do until an accident happens or auditor shows up.  I assure you this is not the case, especially in this current regulation environment.  Anyway, they go to great length and expense to advertise, spend hours on phone, email applications, run MVR's, meeting with potential drivers and operators, and finally one out of the five, perhaps one out of ten, they have been talking to shows up for orientation.

It is a moment of great triumph!  Everybody is happy, he gets introduced to his new dispatcher, perhaps an operations manager,  if he is lucky the owner comes out of his office to say hello and welcome him.  The owner operator or driver feels good about his decision to sign on with your company and everybody is smiling and shaking hands...

Then what happens?  Join me back here on Friday and we will explore how everything goes south, sometimes quickly, sometimes slowly... 

Please try this exercise before Friday, call each your dispatchers into your office and ask him to name from memory each of his drivers and owner ops, and keep track of how many they can name(15 out 25 etc.). 

Don't forget to sign up for email subscription so you don't miss it, it's free...

Tomorrow on the Bleater.  Conversations with Marge (TA Waitress extraordinaire, Driver and Owner Operator Ambassador) continues with a driver's personal story of struggle and triumph...


BOOK & CD Package


Tuesday, September 25, 2012

Know When to Hold 'Em - Strategy #6 from Negotiating with Freight Brokers

18 Wheels of Justice Home

"Know When to Hold 'Em" - Strategy #6 From Negotiating with Freight Brokers and 3PL's


So, here you sit, at your desk talking with a broker about a load. Meanwhile, you still have lots of trucks to cover, phones ringing, one driver late and going to miss an important customer pick up, another driver MIA, customer keeps calling about load, lots of pressure, trying to increase revenue per mile and margins, and keep drivers... Lots to do. Sweat is starten to moisten your forehead, your beautiful, blonde secretary notices and stops what she is doing to wipe your brow. Well, Ladies and Gentlemen, there is an invention that helps in negotiating while increasing productivity at the same time. The most effective tool in your negotiating arsenal - "The Hold Button".


Keep the broker on "ice"... Put them on hold while you are deciding what to do. Patience is a virtue and revenue increaser. Patience, Patience, Patience. Are you already at a higher rate than expected? How much more money will turn this from a good load into a great load? Another $200,$300 or more? All the additional revenue you can get now is sweet, sweet, profit. Have your reasons prepared before you come back and tell them another $200 and let's wrap it up. The longer they remain on hold the better. Don't let them stay on hold for longer than a few minutes without picking up the phone and letting them know you're interested in this load and trying to get it worked out while you have them on hold, and thank them for their patience. The longer they are on hold, the more time and effort they have invested in selling this load to you, the more they want to wrap it up and move onto the next load. An extra ten minutes of "hold" time with each load will generate a lot of extra $$ every time.



BOOK & CD Package

Tuesday, September 4, 2012

Trucking & Negotiating

Negotiating, in and of itself is an individual effort.  There is no textbook example to follow.  Each negotiator has his or her own style which was typically learned by trial and error through years of experience.  Experience gained while negotiating the price of a new car at a dealership, negotiating with a shipper, broker or 3PL for a load, or negotiating with a carrier to get them to haul your customers load at the lowest price.

After I had written, but, before I began publishing and marketing the best selling "18 Wheels of Justice" series,  I scoured the Internet for similar books or discussions on negotiating in the transportation marketplace.  I was shocked that I found nothing worth purchasing or for that matter, reading.

The many self proclaimed "Experts" in our industry offer nothing on the subject.
(Industry - Trucking arena, not Brokerage. I will address Brokerage "Experts" in next weeks Bleater) 

The only information available was:

1. Know your cost!!(Fuel,Tires,Insurance,Maint., ad nauseum)

2. Demand your rate!!(Don't haul anything for less than what your costs are plus your profit!!)

This is all I could I find.

Sage advice? hardly...  Educational? I don't see it and I didn't read this and walk away with knowledge to put into practice...

Negotiating is an art form.  Individual and unique by nature in each transaction, but it follows a natural basic design and pattern.  Good negotiation never involves an auction style bidding process, nor a standoff based on price alone!

Please join me over the next three business days(Friday,Monday and Tuesday) on the Bleater where I will compare and contrast the good and bad strategies of negotiation used on a specific transaction.  Stay tuned...


18 Wheels of Justice Series available only at 18 Wheels of Justice Home

Friday, August 24, 2012

Company Driver Top Ten Check List


Company Drivers. Are you happy with the company you are driving for? How and why did you pick the one you're at? Was it an ad? A reference? Did you just need the job and go with the first place you could find?


     Here at 18 Wheels of Justice office, we hear a lot of complaints about lack of pay in the OTR trucking industry. Why do trucking companies spend so much on advertising and recruiting? It seems to me that if they spent more money paying drivers, instead of advertising, they would have all the drivers they needed. Not neccessarily true...

     Think back through your driving career. Where were you employed at the longest? Do you tend to work for a company for less than a year and leave for something that seems better? Pays better? Were you promised something that never happened? This happens way too often.

     The recruiter promises you the world on a silver platter. You can't wait to get started and then guess what? The first week on the job you realize that this was a big mistake. So, you contact the recruiter to ask, "why am I sitting so much? Why can't dispatch seem to get me home?" He says he will look into and address with dispatch, but nothing changes. You stay a month, maybe three, hoping it will work out, and it never does...

     Are all recruiter's dishonest? Of course not! Are all trucking companies dishonest? No! There is often a disconnect between recruiters and operations. Read on and I will show you how to find out before you start...

This is part 1 of 3 of the "18 Wheels of Justice Top Ten Driver Checklist". This list will cover how to negotiate the best pay, find the best company and what to look for in a company. I will keep it simple and to the point. It's in three parts, because blogs are supposed to be short, according to my editor. Anyway, back to the point...

Print, email or just find a pen and notepad and keep this list, so you will have it with you. Forward to your wife or significant other, so they can help you. This is a major life decision, it is important to get a second opinion. You will be thanking me a year from now, when you are no longer chasing rainbows and will have found a happy home and a serious career. If you're not serious about your career and making money, and most importantly, being happy where you work, stop reading here. This article is not meant for you. You spend the majority of your adult life working, why not enjoy it?

Now, without further ado,(drum roll, please!)the Top Ten List!

10. Make a list of no more than 5 potential Trucking companies you want to work for. Big, Small it doesn't matter, there are many different benefits with both. This seems like a lot of work? Yes it is, but do once every 10 years, instead of once every 3-6 months and enjoy your success. Approach driving like a career, and you will find your way.

9. Ask them for a random list of Ten drivers phone numbers, that currently work there. This is your first step, do not skip this one. The Drivers who work there and like it, are more than happy to tell you about the company. Driver's who work there and don't like it, are even happier to talk to you about the company. If the recruiter tell you he/she doesn't have a random list, but a list they give out to new drivers, that's fine, they are honest. Ask him for five from that list and ask him if he can pull up five more at random. Take an hour, call all ten, if you only reach 5 right away, that's fine, leave a voicemail, the others will call you back before you make your decision. Keep track of who you have talked to. If the recruiter balks or refuses to give you a list of ten drivers, while you are on the phone with him/her the first time(this is important), run, don't walk, but run away from this company. If they can't produce on the spot, don't work there, you will regret it later.

8. Pay! - Don't ask, Don't ask, Don't ask. Should I say it again? Don't ask yet! This is for later in this new realtionship, Ladies and Gentlemen. If they mention pay, don't acknowledge it, just mention you are on "the market" and are looking for a home.


This is part 2 of 3 of the "18 Wheels of Justice Top Ten Driver Checklist".


The entire Top Ten list will cover how to negotiate the best pay, find the best company and what to look for in a company. I will keep it simple and to the point. It's in three parts, because blogs are supposed to be short, according to my editor. Anyway, back to the point...

     Print, email or just find a pen and notepad and keep this list, so you will have it with you. Forward to your wife or significant other, so they can help you. This is a major life decision, it is important to get a second opinion. You will be thanking me a year from now, when you are no longer chasing rainbows and will have found a happy home and a serious career. If you're not serious about your career and making money, and most importantly, being happy where you work, stop reading here. This article is not meant for you. You spend the majority of your adult life working, why not enjoy it?

Presenting The Top Ten List Continued...

7. Talk to your prospective dispatcher before you fill out an application! This is a very important step! This will be your entire means of communication with the company. This is the person you will be dealing with for a long time and when you have a suggestion or a problem. Not getting miles? Not getting revenue? Not getting home? Do you want to have to go there, have a meeting with the operations manager, recruter etc. when these things aren't happening? I wouldn't. I would want to talk to my dispatcher and address all your concerns with him. See if they has any authority or control over you earning or not earning a living! Make sure the company let's you speak with your prospective dispatcher first! If they say they don't assign a dispatcher until you start, politely tell them, this is a requirement of yours. If they refuse or don't guarantee who your dispatcher will be, thank them for their time and move on to the next company. This will build a personal relationship with your dispatcher, they will have more respect for you and will remember your conversation. Trust me, you will be on the top of their list to make sure these things happen.

6. Talk to the Operations Manager or Your Dispatchers Supervisor. Even more important. Make sure you do this, and that this person is readily available. If you don't hear back from him/her for a few days, then expect that to be an acceptable standard for this particular trucking company. This is not an acceptable standard for you, however, and move down the list. What happens if your pay is not correct and it's a Friday afternoon, you have bills to pay? Who can you talk to and get a response? It is important to be able to have someone else within the company that you can address your concerns with.


This is part 3 of 3 of the "18 Wheels of Justice Top Ten Driver Checklist".


The Top Ten list covers how to find the best company and what to look for in a company. I will keep it simple and to the point. It's in three parts, because blogs are supposed to be short, according to my editor. Anyway, back to the list... Print, email or just find a pen and notepad and keep this list, so you will have it with you. Forward to your wife or significant other, so they can help you. This is a major life decision, it is important to get a second opinion. You will be thanking me a year from now, when you are no longer chasing rainbows and will have found a happy home and a serious career. If you're not serious about your career and making money, and most importantly, being happy where you work, stop reading here. This article is not meant for you. You spend the majority of your adult life working, why not enjoy it?


Presenting The Final Five of the Top Ten List Continued(see previous blogs for parts 10-5)

5. Equipment - Take your time and look around the Terminal. What does the equipment look like? Are trailers well maintained & washed? Tractors - late model or well maintained? Owner Operator's trucks. Are they newer/older in good shape? Make sure you see and inspect the actual truck you are going in.

4. Spend time at the potential employers office in or near operations department and get a feel. Is it organized? Is it chaos? Take a few hours and listen to what is going on, meet some of the drivers, are most of them happy? Is operations begging them to stay? Apologizing for lack of miles?

3. Your work history - your resume, your references, it tells your story. Have one! This is very important, there are many easy templates on word,etc to type out a simple resume. It should have work history, years experience and references. Awards you have received, community involvement. It is your story, things you are proud of and show you to be a good citizen. It may sound unnecessary, but, again, it tells your story. References don't have to be prior employers, but people who will vouch for your character, etc. If your not good at that type of thing, ask your wife or a family member to prepare it for you.

2. Is more money per mile worth it? Changing a job for another $.05, even $.10 a mile is not always worth it. What kind of miles will you get? Will you be home when you need to be? Most importantly, will you like the company?

1. Cost of quitting and finding another Job. Assuming the next driving job you get will produce roughly the same amount of miles, you will lose two to three weeks of pay, between:

-finding a job

-actually starting your new job

-waiting for your first paycheck(sometimes two weeks)

-trying to get paid from your last company, and all the deductions they will take out(they always do)


If you find a job paying you an extra $.05 per mile, it will take you 6 months to make up for what you lost just switching companies, again assuming(big assumtion) your getting the same miles.

Take your time!  It is a major life decision, your happiness and future depends on making the right choice.



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Wednesday, August 8, 2012

Strategy #2 from "Negotiating with Freight Brokers & 3PL's"

Welcome -  Strategy #2 out of 15 from "Negotiating with Freight Brokers & 3PL's"

 STRATEGY 2 – NEVER BRING UP PRICE; ALWAYS HAVE BROKER/3PL GIVE PRICE FIRST

    Let the Broker/3PL bring up price! Never give a rate first. You don’t know what the load pays! There are many times when you will be surprised that it is higher than you would have asked for. Let him throw his rate out there. Often, it will be in the context of “I usually move these for “X”.

If it is really low, then dismiss it as not for you and attempt to get off the phone.

    Remain polite and likeable, comments such as,” that’s a garbage load, I don’t haul cheap freight” are not appropriate. Remember C.L.A.S.S. Remember he is calling you, if he states he usually moves it for that price then politely advise him to call some of his regular carriers.

    More than likely he will ask you what you need. Again, never bring up a price. Be non-committal and ask him what he thinks the best rate is that he can do on the load. When he gives you his “best rate” this should become your “anchor” or starting point for negotiating.

    Typically, with sophisticated Brokers/3PL’s, his best rate is the maximum rate they want to pay while holding onto their minimum profit target for this particular load.




 Popular reading for both Brokers and Trucking Companies -

Negotiating with Freight Brokers

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Tuesday, August 7, 2012

The Joy of Negotiating - Part 3 of 3...

Welcome

 Stage Three of the Process, the Art.
(For Stage Two, please see Saturday's Post)


1. Pre-Negotiation.  "Framing and Setting the Stage"

2. Deadlock, Stalemate and Arrested Development

         We are going to stay on Stage Two for a little bit and and discuss some more negotiation strategy before we conclude with Stage Three.  Honesty is key in negotiation, your word while you're negotiating is like your credit.  You are agreeing to do this load, never book a load without every intention of doing it, never give a load back to any broker unless there is no other reasonable option.  If you have to give it back, do it as quickly as you can, giving the broker as much chance as possible to cover with another carrier.  These are words to live by, this is someone you want to do business with again. 

There are 15 strategies in "Negotiating with Freight Brokers & 3PL's"  They are most effective if you follow the "rules of engagement" so to speak, which basically means treating a broker like you would your best customer.  So when we talk about introducing a third party into the negotiation,  I mean actually consult with a third party.  Feel free to introduce this third party at any time during the load booking process.  I find it most effective to introduce midway throughout the negotiation.  It's your call, in the beginning or middle, but I advise against doing it near the end.  If introduced early it can ease the tension with booking the load.  Use statements like, "my boss probably won't let me do it for that, but I will ask him" or "we pay these operators percentage and I don't think he will do it for that".  You want to create a camaraderie here between you and the broker.  You are working together to get this transaction done and convince this third party.  You are building a relationship.  Introducing the third party late in the negotiation can be seen as a cheap ploy.



Stage  - 3.  Acceptance and Settlement.  A Transaction is Born!


Once you read my book and employed these strategies, you will see your rates climb and climb.  It is very important to get your load confirmation while you are on the phone with the broker.  I always have them email the rate confirmation while we are on the phone.  We hold ourselves to high standards of honesty and we expect the same from the broker we are dealing with.  Most brokers in this industry are honest and have high standards, but there are pretenders.  Especially when faced with the fact that he or she is paying you more for this load than they have ever paid before.  This rate you have achieved by superior negotiating may be followed by a phone call from the brokers boss, trying to explain that the person made a mistake etc.  Do not waiver, the broker was authorized to negotiate this load with you, and that is that.  You have the rate confirmation, end of story.  Sometimes as soon as you hang up with the broker another carrier(who hasn't bought my book) will call and haul it for $100, $200 less than the rate you just negotiated for, and the temptation to rob you of your hard fought gain is too great.  Feel free to scoff at this comment, but those who employ these strategies know.  It has happened to me thousands of times.  You must back up this rate with the service or it is only a one time rate.  Give the broker his or her moneys worth.  Call him when your truck arrives at the shipper.  Call/email him when he is loaded, don't wait for the broker to call you.  Email him the next morning when the truck arrives to unload and again when he is empty.  This leaves a lasting impression and will build a solid relationship.  Don't ever gloat, you are getting paid a premium rate for you premium service.  You are getting paid for the service you offered and you walked the broker through the reasons while you were booking the load.


Why is negotiating and haggling such an unpopular concept and dreaded process in this great nation of ours? The term "haggling" alone brings to mind nefarious individuals in the back room of a used car lot. Why does it only exist in certain industries? It has almost disappeared altogether in the retail industry, is rapidly losing popularity on new and used car lots, one of the last bastions and havens of the skilled negotiator. "Boy, I say Boy", it is alive and well in our industry! Our profits are defined by it more and more everyday. How do you train your planners, dispatchers, brokers?


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Negotiating with Freight Brokers

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Friday, August 3, 2012

The Joy of Negotiating

Good Morning and Welcome.

Joy can be found in every endeavor with an understanding of the process.  I think if there was a way to divide our country into two types of people, the most effective and decisive way would be to divide them into the two categories.  Those who enjoy to negotiate and those who don't.  I don't think there is anyone on the fence.  People either like it or they don't.  I think the best sales people tend to be "people pleaser's" and are easily offended and uneasy when a relationship they have developed with a customer or broker turns to a negotiation over a specific load, lane or contract.  They tend to view it as something they may have done wrong in the relationship.  It becomes uneasy very quickly.  Do your best make the other person comfortable with the negotiating process. 


 The best negotiators and sales people tend to be the best communicators.  They know what they want the end result of the conversation to be and they know how to get there in an easy manner.  The conversation begins and ends with a purpose.  The higher rate is not slipped in near the end of the conversation, it is addressed and debated during the entire conversation in a polite and consistent manner.  In the spot market, the last thing you want is an auction or bidding type of process where numbers are simply thrown back and forth, it's ineffective and makes you seem greedy and doesn't promote a relationship. 

This is true from a carrier, broker or customer standpoint.  If you have a customer who is constantly beating you down on your prices, you eventually lose interest, knowing another a cheaper carrier will ultimately get the business.  Let them have it, eventually they will learn the true cost.  The most important thing to remember is the design of every negotiation.  All of them follow this pattern:

1. Pre-Negotiation.  "Framing and Setting the Stage"

Know what rate you want before you discuss the load, this stage is not about the rate,  you want to ask many questions and listen for items about this particular load that will merit a higher rate.  This is "Framing".  You are bringing up the value of your truck for this particular for this particular transaction at this moment in time.  Does the load have to pick up by noon, and your truck is empty, 50 miles away at 8am.?  What are his chances of finding someone else more suitable? and so on.  Have your list in front of you.  This will all become very fluid and fast with a little practice.  If he asks what rate you need, don't answer,  if he offers a rate, don't acknowledge it!  You don't have all of the information you need yet.  Each load you haul is sacred, you only have ONE load you can put on your $100,000+ asset(and don't forget the $200,000 you have spent to find and keep a driver for this asset).  Most of all, take your time.

Saturday's Blog - 2. Deadlock, Stalemate and Arrested Development

Sunday's Blog - 3.  Acceptance and Settlement.  A Transaction is Born!

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Thursday, June 14, 2012

Prevailing Notion - Broker's & 3PL's


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The business of shipping products to customers is ever-evolving into a world in which 3PL’s and Freight Brokers have access to more and more of the truckload market.  Large manufacturer’s want to focus more on their core business, than having entire shipping departments dedicated to rates and setting up carriers, dealing with scheduling appointments and so on. 

So, what does this mean to you?  A brave soul, the lone owner operator who sets out to seek his fortune with his own truck and trailer?  A small carrier with a dozen or so trucks, trying to build a dynasty or family fortune?

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A truckload carrier whose business is 30% to 40% Broker and 3PL freight and has planners/dispatchers who are not yet masters in the art of negotiation?  Do they hesitate to be aggressive negotiators? 

30% to 40% is a very large portion of your business and where a large portion of potential profit is hiding.  Yes, and it is an art, when done creatively, properly and successfully, negotiating can be one of the most beautiful and rewarding experiences one can have.

Think back to the days of your youth, negotiating with parents to stay up later, only to be told to go to bed.  Or did you return to the negotiating table with your parents armed with opposing arguments?  How about delicately trying to negotiate your first kiss with a blushing, young redhead and getting a hug or handshake?  Or did you steal a kiss and walk away, leaving her wanting more?

Like most of us, you probably have good and bad memories of negotiating.  The important thing to remember is that you walked away from each one with more knowledge, experience and skill every time.


The transportation business has changed over the last ten years.  What does it mean to you? 

No longer are Brokers and 3PL's just a backhaul provider, they are our best customers.  The carriers who treat them as such, win everytime...



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