Jeremy Robison is the president of Tetra Capital, an independent company offering freight bill factoring services to trucking companies of all sizes. He’s dealt with a variety of trucking fiscal issues over his career, including equipment financing, equipment purchasing, lease operator programs, driver recruiting, plus payroll and equipment maintenance. He draws from that experience here to provide owner-operators with some advice regarding interactions with shippers and brokers.
If you conduct a Google search for shippers and freight brokers, you’ll find an overwhelming amount of information. And while much of the information is good, you will find a range of horror stories from owner- operators and trucking companies – stories that encompass things such as miscommunication about detention time pay, receivers who won’t accept the product, and brokers that won’t answer the phone or return calls.
What all of this lends itself to is the need to make sure you don’t blindly haul a load for a new shipper or broker without getting proper information about them. Sometimes, experience can be more valuable than gold.
To protect yourself and your trucking company, and ensure you get paid for the loads you haul, here are a few things you should consider finding out about a new shipper or broker.
How long they have been in business: In my experience, it is not uncommon to find fly-by-night brokers who end up being just a guy and his computer in his basement. It is important to the success of your trucking business to find established, reliable and trustworthy shippers and brokers as your money lies in their hands. It has been our experience that the good ones have more longevity than the bad ones. A good way to obtain this information is by doing a credit check before you haul the load. There are financial partners available, such as freight factoring companies, who can pull free credit checks for you on potential shippers and brokers.
What is their reputation? How have they treated other owner operators? Google and other search engines are your friends. It only takes a few minutes to complete a broad search for the company or person to find out if anyone has given them negative reviews and why. Those reviews could – and should – impact your decision to work with them.
What are their expectations? How often do you have to check-in? Maintaining expectations is the key to having a good relationship with your shippers and brokers. And you must have a good relationship if you wish to keep hauling loads for them. It can be helpful to ask them up-front what their expectations are and how often you should check-in to ensure everyone is on the same page and satisfied.
How do you submit your paperwork for payment? Do they require original copies? It is always better to be prepared and ensure you are doing everything possible to get paid in a timely manner. To ensure you are doing what you need to receive prompt payment, asking in advance about how you need to submit your paperwork and what is needed can put you a step ahead. For example, some brokers may require original paperwork, while others may accept faxed or scanned copies. Knowing what is required will save you time and money in the long run.
How long do they normally take to pay? What are their payment terms? Your cash flow is dependent on how long it takes your brokers and shippers to pay you. Why leave it up to chance when you can use the past experience of others to help predict the future? You may be wondering how you could do that; luckily the answer is fairly simple. By conducting a credit check on your potential shipper or broker, you will get a glimpse at their payment history to see how long they take to pay and what payments they have outstanding.
The bottom line in all of this is you need to ask questions and perform a little research to ensure you are hauling for trustworthy brokers and shippers.
This will help ensure a good working relationship with both shippers and brokers that will lead to more money in your pocket while hopefully avoiding the horror stories in the process.