Friday, December 5, 2014

Freight Broker Myth #2

Myth  #2 Non Asset Based Freight Broker Are Not Cost Effective 
It makes sense that if you remove the middle man (the broker) from the transaction it will result in lower prices for the shipper.  When actually a broker may very well get you the best price.   There is power in numbers.  As a result of a freight broker's volume in a given lane, within a given market or with a group of carriers, they are able to leverage that volume to negotiate better pricing.  Equally important is the fact that freight brokers routinely re-­position assets resulting in less empty miles and more profit retention for their asset-based carrier partners.  Because no carrier wants to run empty, back hauls are typically done at a discounted rate, which allows brokers to offer competitive rates to the shippers while earning a small profit for these return trips.  

FACT:  Smart freight brokers are able to leverage back hauls and volume to decrease their cost basis, which allows them to make a small profit while maintaining competitive prices.  

We train our freight brokers to negotiate the optimum deals because we know a well serviced customer will keep using that broker.  It is a mutually beneficial relationship.

Moving forward

Jeff Roach

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