How I Negotiate Load Rates With Brokers (DO THIS!)

truth is most of you watching this video right now are probably leaving hundreds and maybe even thousands of dollars on the table every time you book a load i know for a fact i was when i first started dispatching however over time i've picked up some tricks that have allowed me to gross five thousand dollars every single week from just one truck and in this video i'm going to show you how you can do that too [Music] all right guys it's actually much easier to negotiate than you think it is but it's only easy if you fully prepared for the call and the very first thing you need to do before you call is figure out your cpm or cost per mile now i'm sure you've heard a bunch of people on youtube tell you to figure out your cpm however they forget to tell you some key things but before i get into that let me just quickly explain what a cpm is for those of you that don't know so your cpm or cost per mile is just a total of all your fixed and variable costs on a per mile basis essentially your cpm will tell you your business's break-even point and it tells you the bare minimum to charge for your loads if you don't know your cpm i've made an excel sheet that you can download and keep to plug numbers into and figure out your cpm within five minutes and if you're interested you can go to guild22.com and find it under templates or just look in the description of this video and i'll make sure to leave a link now when you know your cpm most people will just tell you to charge 50 cents more or something arbitrary like that and call it a day but that's the lazy way of doing things and again you're losing money because of it so what should you do well when you're figuring out your cpm make sure you put an amount under driver pay that you want to pay yourself most of the time when owner operators want to calculate their cpm they don't put anything under driver pay because they assume it's for carriers with drivers no even if you don't have a driver this is where you get to decide how much you want to pay yourself first if you're having trouble coming up with a number try answering this question as an owner operator what is the least amount of money i would be willing to make every single year for me personally this would be about fifty thousand dollars and since i only want to drive about seven thousand miles a month i can work backwards from there and calculate my driver pay to be about 60 cents per mile now obviously when i put this number in my new cpm will be much higher however whenever i book loads i won't really have to wonder um how much money i'm gonna make this year because as long as i keep booking loads over this new cpm i know i'll end up making more than fifty thousand dollars every single year but don't just get lazy now because you have to treat this new cpm as your breakeven point and just forget that you're paying yourself fifty thousand dollars every year this cpm will now be your new baseline and now from here we can build on that now that you know your real cpm the next step is to figure out what routes you want to run so start off by picking three to five routes that you would like to run and ignore every other market so for example if i'm based in atlanta georgia i would pick three to five routes going out of atlanta let's just say i want to be back home every other day i would pick three to five routes that end up in medium to large size cities that are 400 to 500 miles away such as st louis louisville and cincinnati you may be asking yourself well what if one day i'm not able to find any loads for these routes what do i do well i have some good news for you because you don't really have to worry about that the reason i'm telling you to pick medium to large size cities as your destination is so we can set a 50 mile destination deadhead and find a whole bunch of loads around these bigger cities that typically run for the same rate so again you won't ever be in a shortage of loads the goal is to pick three to five routes that you can become an expert in and just hyper focus on them owner operators that follow the hype and start running loads all over the country are usually clueless on what the actual rates are and they heavily depend on the mercy of brokers don't become one of these owner operators you know pick a few lanes three to five lanes and become an expert in them so you know how the rates change and when they will change and why they're changing this brings me to my next point which is research your market now that you've picked a market it's time to do some research and there are two ways that i like to do this the first method is what almost everyone uses which is the broker to carrier spot rate if you use a d8t load board you probably already know about the broker to carrier spot rate but if you don't and you want to find it just log into your load board go to the top right hand side click on the toolbox icon and when you click on it a drop down menu will pop up and when it does just scroll down to where it says quick rate search and click on that you can use this feature to quickly check spot rates and get a historical 15 day estimate of the average spot rate just remember the broker to carrier spot rate is historical data it doesn't represent current market conditions go back five seconds and listen to that again because many owner operators will just ask for that rate from brokers and call it a day don't get me wrong it's a good start but again it's the lazy way of booking loads and if you're watching this video you're probably not the lazy type if you want to make the most money possible like we all do then you have to take into account historical data and current data we already know the 15 day historical data from the broker to carrier spot rate but to find the current data we have to look at another dat feature called market conditions under market conditions you're able to see how hot your market is and how much negotiation power you have when calling brokers basically if your market is red it means it's a hot market and you can definitely charge higher than the broker to carry a spot rate but if it's blue it means it's a cool market and you might not have that much negotiation power even if your market is blue it doesn't mean that you can't charge higher than the broker to carry your spot rate it just means that it's going to be harder to negotiate that rate and you may have to settle for something less if you want to learn more about this feature you can check out my last video i go a little more in detail in there anyways combining the historical and current market data will give you a really good idea of what to charge brokers when you call them here's another pro tip for you guys instead of calling the brokers that you want to call right away you can test out the market by calling for loads under the similar matches section you can do this by setting up filters for all three to five of your lanes and high balling brokers from the similar search results section the reason i'm telling you to do this for loads under the similar search results section is because there'll be a bunch of loads there that you won't want to pick up for whatever reason maybe the load is too heavy or the deadhead miles are too high who knows regardless of what the reason is call these brokers and highball them by doing this you'll get an idea of how high a broker is willing to negotiate with you before they just laugh at you and end the call obviously if the broker to carry your spot rate is two dollars per mile don't waste their time by calling them and asking for five dollars per mile if the market is hot for the first few calls ask for 250 per mile then 275 per mile then three dollars per mile do this until you hit a cap and you'll find out pretty quick where that is just to make it clear step one is to calculate your cpm step two is to figure out three to five routes that you want to run step three is to do some market research based on historical and current data and finally step four is to just call the brokers that you want to call and negotiate with them now that you have a really good idea of what your break-even point is your base market spot rate is and your max market spot rate is it's time to just pick up the phone and call you've already done all the hard work and research but there's still a few more questions you'll have to ask when you call when you call remember to make a note of the commodity the pickup time delivery time uh the name of the receiver company and the load's weight to most people these are just common low details that you would ask for and truthfully they are but i like to think of these items as negotiation pieces if for example the weight was 42 000 pounds for this hypothetical load i know that's a heavy load that many people won't pick up because of the extra fuel expense it will take so i'll use that to my advantage later in the call to charge a higher rate likewise if the delivery is at 1 pm i know a lot of carriers will stay away from this load because they're going to have trouble finding a return load that picks up that late again i purposely like to seek out loads like this because then i have an easier time negotiating higher rates with brokers speaking of which when i call a broker i like to throw out my rate first i do this because the first rate that i'm gonna throw out is my max rate that i figured out in step three by calling other brokers i know the broker is not going to give me a load at that rate but i throw this number out first to set an anchor price now every dollar that i come down from my anchor price the broker will think that he's getting a good deal because i'm making a sacrifice also just to add on after you throw out your anchor price all you need to do is be quiet i'm not trying to be rude but many people have a bad habit of throwing out their anchor price and then trying to justify it immediately and explain the rate that they're charging don't do that instead throw your max rate out um let's just say it's a thousand three hundred dollars the broker will obviously come back and say no i can't do that the max i can do on this load is a thousand dollars and that's when you come back and say well the load is really heavy at 42 000 pounds and the delivery time is really late so i might not be able to find a load back in time let's just meet at 1 200 and i'll deliver this load for you obviously there might be more back and forth than that you know it's not just going to be that easy but the point i'm trying to make is don't try to justify yourself right away and bring your price down slowly don't jump from a thousand three hundred dollars to a thousand fifty you know the broker will know right away that you really have no idea what the spot rate is and that you're just guessing at the end of the day guys you can only really get better at negotiating through practice you know i didn't start making five thousand dollars overnight you know it took years of learning the hard way to be able to do this on a consistent basis and now hopefully you're able to do it too if you still feel uncomfortable contacting brokers and you don't really want to deal with that whole process i do offer a dispatching service for carriers and owner operators that you can apply for if you're interested you can go to guild20.com careers or just click the link in the description so yeah i hope you guys found this video useful if you did make sure you scroll down and like the video subscribe to the channel and turn on post notifications also while you're down there leave a comment and let me know what advice would you give others when negotiating rates and yeah with that being said thank you so much for watching guys and i'll see you in the next video [Music] you

Channel: Gill22

Views: 254,438

Keywords: gill, gill22, gill22 trucking, gill22 trucking llc, trucking, transportation, business, logistics, success, negotiate, negotiation, freight, loads, freight rates, load rates, how to negotiate, how to negotiate rates for freight, how to negotiate rates for freight loads, how to negotiate rates for loads, how I negotiate rates, how I negotiate freight rates, how I negotiate load rates, successfully negotiate, negotiation success, how I negotiate, Broker, brokers

Id: Noj7DyG28mw

Length: 11min 32sec (692 seconds)

Published: Wed Feb 24 2021