I haven't but it actually looks fascinating. You actually sold the book lol.

How have the last five months gone? Any luck finding more success as a boss? Have companies like Uber/Amazon had a major impact?

When you have freight that is Hazmat; how do you confirm the carrier has appropriate hazmat insurance?

Bored:

I've come to this thread late. I don't know how I managed to miss it, but I find this discussion absolutely fascinating.

I live fairly close to Memphis so I occasionally travel over to Tunica to play poker. While eating in a restaurant close to the airport, I had the opportunity to talk with a FedEx employee. I think your comment that the logistics industry employs a lot of military and ex-military is correct. (This man I spoke with had served in the military.) I believe Mr. Fred Smith, FedEx's long time Chairman and CEO, was a helicopter pilot in the Vietnam war before he left the service to start Fed-Ex.

I know next-to-nothing about how your business works. As a [very smallish] retail customer, I do a considerable amount of business with booksellers such as Amazon.com, Barnes & Noble, and a smattering of smaller [independent] booksellers. (I currently have two orders - for a total of ten books - in the pipeline right now. I average buying approximately 100 books a year.)

I've always wondered about the sellers (like Amazon) who claim to offer "free shipping" - which is not really "free" at all. Do these businesses put a lot of pressure on your industry to either lower your costs [to them] or hold the line on price increases? When Amazon announces that they are in the process of buying their own fleet of long haul freight airplanes, are they posing a not-so-subtle threat to FedEx and the USPS - or are they "sending a message" to firms like yours to hold the line on costs? (Does your company compete in this space or is shipping books too low profit to bother messing with?)

Final question: I don't recall who, but somebody wrote a book with a title that began something like "44 Percent of Everything …" about the shipping and logistics industry. (It was one of those books claiming to share "inside secrets" as to what really goes on in the shipping business - including rampant fraud, deception and shady business practices.) I don't recall the exact title of that book (or the author's name), but I was hoping you (or someone else in this thread) would know the book to which I refer.

Thanks for starting this really interesting thread. You're in an industry we all take for granted, but an industry that is absolutely vital to the day-to-day functioning of our society.

Is Amazon Killing Fed-Ex?

I thought about starting a new thread on this, but decided it would be more appropriate to stick it in here …

https://www.wbur.org/hereandnow/2020...delivery-fedex

So 2019 was the worst year I've ever seen market wise, and I was off almost 50% from 2018. That being said this was kind of encouraging, because it showed pretty clearly that even in the worst case scenario I'm still profitable enough to be cash flow positive with a middle class lifestyle.

Amazon and Uber have had exactly no impact on my business. Amazon is still basically a glorified in house freight brokerage, and Uber is losing 6-7k a DAY per employee in sourcing covering loads for F500 customers with the same trucking companies that used to haul for other brokerages. Uber does not have a sustainable business model in freight brokerage, and have less than no edge on anyone else. A customer portal attached to a load board isn't super revolutionary in 2020. There's also plenty of nasty comments out there from shippers about Uber having terrible service levels because of weak tracking and absolutely awful problem solving skills. This might be because logistics specialists like me are more than glorified check out boxes on Amazon. Who knew.

Free shipping is made possible by including shipping cost in the price full stop. The shipping isn't free and it never has been. Amazon has put a ton of pressure on parcel shipping rates in attempt to get those costs down as low as possible, and when the large parcel vendors told them 'yeah we're not going any lower this is what it costs' they started turning parcel delivery into a shitty gig job and enrolling random middle class hustler types into debt slavery reminiscent of chicken farmers. It is what it is and the world keeps on turning. If you do any research into what happens to third party vendors on Jeff Bezos's platforms and then decide to climb into bed with Amazon you've got what happens next coming IMO.

We check every carriers insurance. It either has Hazmat coverage on it or it doesn't. I'm actually not sure about whether extra insurance is even required for Hazmat since the last time I did anything Hazmat it was a one time shipment of fireworks in 2015 that didn't even end up going (that's 20 hours of my life I'll never get back... I made a real good faith effort to figure out how it worked back then lol).

I'm still an utter failure as a boss, mainly because I laid everyone off during 2020. There wasn't enough work for me to be busy full time, so having extra humans working for me was pretty unnecessary. It's also a natural part of freight brokerage dynamics that prospecting is something you do when the market is hot NOT something you do when it's in the middle of a 'worst year in a decade' type of situation. Any shipper worth having was being serviced, very enthusiastically, by their existing brokerage base and had zero interest in adding additional mouths to feed. My major shippers added a grand total of zero new brokers last year, and I managed to get a healthy % of the competition fired . So the wombo combo of prospecting being a waste of time (doesn't mean I didn't do some, it just didn't bear much fruit besides a few small/profitable accounts that had never in their lives been serviced well who normally I wouldn't even bother working with) and there not being enough coverage work to go around made employees kind of a moot point.

This year is looking up already thankfully. Prospecting is working out better and my existing customers seem to be shipping more stuff. No impacts from the Coronavirus yet, although that could be because I'm fortunate that my customers have very little to do with China. Running good there most likely. I know quite a few LA port people who are bracing for impact as I type this.

This might not exactly be your area, but I'm hoping you might have some advice for me anyway.

I buy/sell vintage furniture on the side, and I'm in the process of ramping up my output. One of the biggest challenges so far has been finding reliable shippers to get things where they need to go.

Do you have a resource you would use for something like this other than what I've been doing and going to Uship.com, and finding the most competitive offers?

The more I do this, the more I realize this is a logistics game, and some of the other ancillary stuff I had worried about before isn't as important as shipping.

Again, might not be your wheelhouse, but I thought I'd ask anyway.

Thanks.

It absolutely is my wheelhouse actually . I'll PM you.

Are the drivers mostly full time employees or independent contractors?

I've been following this thread since inception and what would you know, I am now dealing with freight brokers/automated freight marketplaces. My fleet operates out of the NJ area and we are currently looking for LTL/local freight for some of our drivers. Is this something you deal with as well? We specialize is last mile/white glove service but also have OTR drivers.

I've been following this thread since inception and what would you know, I am now dealing with freight brokers/automated freight marketplaces. My fleet operates out of the NJ area and we are currently looking for LTL/local freight for some of our drivers. Is this something you deal with as well? We specialize is last mile/white glove service but also have OTR drivers.

There are two types of truck drivers, owner operators and company drivers. The key distinction is who owns the truck (and thus gets the lions share of the revenue). Owner operators own the truck and are independent contractors, and company drivers are usually full time employees. This isn't to say that there aren't plenty of trucking companies (particularly small ones) that aren't illegally 1099'ing their company drivers, but I like to hope that most aren't. It's a pretty major problem if they get caught doing that.

If I had any freight coming out of NJ the answer would be absolutely. Most brokers are more focused on moving particular types of commodities (for instance I do a lot of produce, building materials, and machinery) rather than geographical areas.

how much more hectic are things right now in the states?

shipping things out of china is a nightmare right now

The market for trucking has absolutely collapsed. I'm anticipating that some large (25%+) percentage of trucking companies of all sizes will pack it in. 2019 was a terrible year for the industry, but it's becoming increasingly obvious that 2020 is going to be the worst year probably ever. Even if things go 'back to normal' at some point in the near future the damage is already done and supply chains are a scrambled mess... but I have zero confidence that things will go back to normal until we have a vaccine.

Interestingly the carnage in trucking is going to create a major headwind when we finally do attempt to reopen the economy... this demand shock is going to destroy an unbelievable amount of demand in the trucking market. Everyone who survives is going to be broke and operating on a shoe string. Any attempt to return to normal will create a situation where demand is significantly higher than available supply, and the 2018 experience suggests that trucking company rates will just absolutely explode upwards.

I suspect that in 2020 I'm going to see the lowest rates ever (happening now) and the highest rates ever by November-December assuming we are trying to reopen stuff in a major way by then. It's going to be a really sad/shitty year.

On a more ghoulish note I'm doing fine business wise. My PPP loan funded, and business is only off somewhat. It's a little bit worse than 2019, but not by that much. I'm also going to return to produce, because that is almost guaranteed to be busy and I've discovered that 'good in a bad market' is an extremely important trait in a customer. I genuinely thought I could quit produce, but it's looking more and more like I'm going to be doing at least some of it for the rest of my career.

Reefer seems to be doing mostly fine right now (or it was until plants like Smithfield started closing), but I can't imagine what dry van companies are going through. This is such a mess.

Rates in April were down and rates continue to plummet. Bored, what have you seen/experiences over the last month?

From being on the carrier side of things, we had to pull out of hauling freight for the time being since the rates are so low. They have been under $1 a mile so it would cost us money hauling anything.

Yeah that's what I've been seeing. If I were a trucking company I would be shut down right now if I could be. On the brokerage side it's the freaking hunger games too. Everyone is fighting for every scrap of freight available because not everyone is going to make it.

So rates are still cratered except for a few isolated markets (CA outbound is actually kind of high for the time of year which is weird). Things are getting better overall a very little bit. No impact from riots seen so far.

I figured I might as well come in and drop an update. I'm still very much doing the same thing. When I last posted we were in what turned out to be the biggest up market since deregulation. It ran from roughly the beginning of Q2 2020 through roughly the end of Q2 2022. During that two years I saw rates paid out to trucking companies that were honestly straight up eye popping. If you owned a semi truck during that time period and you generated less than 5 grand in free cash flow *per week* fleet wide for any reason other than a breakdown you could not source parts for I have absolutely no sympathy.

Since more or less as soon as interest rates started going up the freight market has been in some degree of decline. We're at a point now where we passed the longest (not the deepest this is important) down market since deregulation six months ago. The summer children of the boom are long gone and all that's left are real trucking people and still there isn't enough work to go around. It's a cyclical business and half the reason I made this post was a superstitious hope that posting 'there's no end in sight' on 2p2 summons some wind.

If you're worried about me at this point in the post don't be lol. I've been doing this so long now that some of my established accounts I've been their freight guy for a decade. So while the market being down is boring and turns my job into what feels like 99% fraud prevention most days I'm still doing well enough that younger me would literally kill for how things are now. I would just like to make even more money please

Bored,

Hang on to your established accounts any way you can, even the tiniest ones. On my end of things we closed out consideration of ANY new brokers some time ago, and prior to that would only consider asset-based, and just for a couple difficult areas (Florida). Volume is good for us but it's just too easy to cover everything.

And next hot market--and I mean normal-hot not the insanity of a couple years back--make sure you leave room cover your bread and butter accounts. Many of the ones who did that for us are still with us, while the ones who cut back or otherwise burned us are basically reduced to email spamming me to get a meeting or some volume, which they'll never get.

In general what I'm seeing is pretty full inventory built up in prep for a prolonged port strike that didn't happen, with (our) import volume across several major clients looking on the low side the next 45 days or so. I'm not projecting anything long-term or nationally, but I imagine other large companies did the same. If so, it might get worse before it gets better. Hang in there.

Yeah my main anchor account I've had for ten years and I just went back to being the only person they bother quoting. It's fairly touchy work and at this point I have so much general experience, institutional knowledge, and honestly control over the local carrier base that competing with me is basically impossible.

The reality is that freight brokerage is a bipolar business. Even in warm years I'm generally absolutely slammed. So slammed that adding a new customer is often happening because I'm trying to replace an old one... but then you get multi year periods like 2015-2016, 2019-2020, and 2022-202? where honestly I view being open to dealing with new people as kind of a red flag. You're getting the best service you've ever gotten at the best inflation adjusted cost you've ever gotten and you've had this vendor for years and now, when the market for his business has clearly bottomed out you shop around?

Seems pretty scummy to me. I'm telling my regular trucks what I'll pay them and it's generally 50-100 bucks higher than spot. I'm not trying to see if I can get it cheaper than (I can) and putting them out of business I know I'm going to need them when the shoe is inevitably on the other foot.