Is that Low Rate Really Saving You Money? Call a Freight Broker
4 minute read
Freight Brokers and the Supply Chain
Are you looking for the lowest shipping rates? We get it. Here at AM Transport Services, we’ve been in the logistics industry for 30 years. We understand that too often, manufacturers, distributors, and even carriers don’t really understand the value a freight broker brings to the table. We’re talking about the freight broker’s indispensable role in the supply chain.
Take, for instance a manufacturer we do business with. We’ll call them JWG because their deliveries are jobsite and white glove. JWG was using a primary carrier from the midwest that hauled 90% of their loads. The biggest advantage this carrier offered was their ability to drop trailers. The manufacturer had limited dock space, so these drop trailers were a big bonus.
JWG’s shipments are complex due to load configurations and require multiple touches and personnel to correctly get on trailers. Because of the limited dock space and the complexity of the loading process, drivers were regularly being held up, and this is always a problem for carriers.
Benefits of working with a Freight Broker
We were called in because JWG’s primary carrier often gave loads back, sometimes at the last minute. And they were picky too–they liked early delivery appointments, and if they couldn’t get one, they didn’t want the load. You know what this means–the low rate JWG was promised immediately skyrocketed due to the last minute nature of getting these loads delivered. This is a big problem that manufacturers and distributors do not always consider– the hidden cost of no-show trucks, returned loads, damaged freight.
At AM Transport, our job isn’t to replace the carrier or the shipper–we add value between the two. A good freight broker introduces shippers to carriers they would never have had access to before. At the same time, acting as a sales arm for carriers by introducing them to shippers they would not otherwise have access to.
If you’re a shipper and you work with one or two carriers, you’re in big trouble when they can’t handle your freight, when they shut down for whatever reason.
Here’s what AM Transport Services did for JWG:
- We took loads with a no-give back mentality. This saved JWG the time they were spending to recover the load at the last minute and the cost of a premium rate.
- Because JWG still needed those drop trailers, we provided access to a pool of regional carriers that could supply the drop trailers desired, and we continued to maintain our no-give back policy. Not one time, did we give a load back. A freight broker’s access to small, service-oriented carriers is a big bonus here.
- After a year of negotiations, JWG gave AMT 100% of their truckload shipments with the caveat that we continue to use their incumbent carrier on primary lanes. We met with the carrier and worked with them to haul more shipments. Because we believe in strong relationships with our carriers, we pay more quickly than the industry average, and we communicate efficiently and quickly. This was good news for the carrier.
- We provide JWG with an online portal through which they can manage their shipments. Gone are the days where they have to call or email for an ETA on a truck. Our carrier reps input that information into our TMS and JWG can pull that info if and when they need it.
- At the same time, we provide JWG with the data their system couldn’t provide. This offers them a deeper look into their supply chain and helps them make informed decisions without printing out reams and reams of paperwork.
- We negotiated a multi-year warehouse agreement with a regional carrier in order to provide short-term storage for loads when the job site is not ready for delivery. This warehouse is close to JWG and is saving them thousands of dollars in transportation and warehousing costs.
Freight Brokers save shippers money and time.
Most shippers think they save money when they book loads for the lowest rate, not taking into account the service failures, dropped or damaged loads, and late deliveries that often accompany that low rate. Here at AM Transport Services, we have long-term relationships with a core group of small, service-oriented carriers with low driver turnover, long business histories, and excellent reputations, so our customers are never surprised by those extra, budget-busting costs.
If you’re ready to up your logistics game, schedule a call with the team at AM Transport today. In the meantime, check out our white paper, Our Secret Sauce: Small Carriers to find out how small carriers make a big difference in your bottom line. Now’s the time to stop chasing low rates with big hidden costs and get rid of your logistics headaches.