"Your competitor is paying more for the same load" or "your competitor will haul that load for less money" are common phrases used for negotiating freight rates in the trucking industry. Being prepared by knowing the marketplace and building a good rapport with your customer are the keys to getting good loads and negotiating good rates. With great customer relationships and market knowledge, you can rest easy knowing good loads are obtainable.

The first step to getting the best load at the best rate is to be prepared! I cannot emphasize this strongly enough. Information is power and the person with the most information usually is more successful. Below is a list of ways to be prepared before choosing a load.

  • Know the load/truck ratio. Use a tool, such as Pintac from Internet Truckstop, that illustrates the current ratio for the lane being chosen.
  • Know the market. If the load is Christmas trees three weeks before Christmas, you know this load is in high demand and you can probably negotiate a higher rate for this freight. You should also know the market for common freight in your region.
  • Talk to drivers who have dealt with this company before. If it is a new customer you have not hauled for before, talk to other drivers who have hauled for them. This will determine their general rate, the frequency of their loads and their expectations. If their general rate is much lower than you would accept, don’t waste your time trying to negotiate a much higher rate. Utilizing the forums on Team Run Smart is a great place to post your questions about a customer and get quick responses from a community of business-minded truckers.
  • Know your break-even point. This is the most important number to know in order to determine if the rate they are offering will lead to a good profit. Look at your fixed and variable expenses to determine your break-even point.
  • Know your customer. If you take any load from any customer, you probably have not worked with them before and do not have a relationship established with them. Knowing your customer and having good rapport means they will come to you first when they have loads to be delivered.

So how do you start building that lasting relationship with your customer? Below are some tips to build a lasting partnership with your customer.

  • Make it personal. Refer to folks by their first name. Call them on the phone to provide updates. Always use the word "we" and not "I." The goal is to demonstrate that you are not a hired gun but a partner who will stay for the long haul.
  • Meet your customer’s goals. A partnership is about meeting each side’s goals. If you are meeting their goals, driving safely, and on time to deliver a load, they are going to be a happy customer. This gives you some room for negotiating a higher rate because customers will usually pay a higher rate to have someone they trust and who is reliable.
  • Ask questions. Most folks like to talk about their company and even their personal life. Making small talk shows you care about them and their business.

Trust me, at the end of the day, being prepared and having good partnerships with your customers will pay off. 
 

Comments (3)

Patrick Dickard

With over 25 years of experience in the transportation field, Pat Dickard brings a wealth of knowledge and application to the position of Corporate Trainer for Internet Truckstop. Transportation became a way of life as General Manager for a potato and onion packing and shipping facility in Oregon. He has experience shipping from Mexico to points throughout the US. Later years found Pat in the seat of a big rig traveling the highways of the country. By joining the staff at Internet Truckstop Pat is able to bring his experience as a business manager, business owner, truck driver, broker agent, and a shipper to the forefront to assist other folks in being more successful. Host of the ITS Business Development Webinar Series – Mr. Dickard covers subjects such as How to find new shipper clients, How to sell yourself and conduct a business meeting; Identity theft, theft of loads, fraud in the industry, How to qualify carriers faster with less risk, Insurance issues, tips and tricks of using the load board for best results, and negotiating rates.

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People will perform better if they are treated as an individual instead of a commodity.

April 05, 2013 14:43:51 PM

Good advice Patrick. I've been told that trucking has almost become a commodity; there isn't much difference between truck A and truck B when it comes to service. Your comments about "making it personal" and using the word "we" when talking about the partnership is right on target. It's little things like that, that will seperate a successful owner-operator from the pack.

April 04, 2013 15:10:49 PM

Very sound advise Patrick. Thank you for putting this together.

April 04, 2013 13:33:10 PM