What is the difference of a volume carrier, vs a small fleet of—– say —–25 Truck with 37 Trailers. I going to demystify this question for you in this article. Just remember, every business is the same. Just a matter of which bullshit you can deal with best. They have the same functions mandated, a Volume carrier is, typically self insured, while another can have a $800,000 Insurance bill annually, if not more. They both need drivers to operate, They both need great management, and skillful, determined leadership.
The only differences is the amount of money they move in and out, how they can earn less but more, and things the smaller fleets cannot often afford…….hence when you build with Owner Operators—-and bring more than 3 up—and they are similar — they can create a larger fleet and merge to create one…………You want to build a fleet and join others like you———Go here on MadmotherTrucker to learn more on how you can bring your small fleets together to earn more, bringing solid principles and foundations of growth for those that build and continue to grow by understand and acknowledge that your Drivers Built It only because they believed in you, and that is the only way it should be understood, find others and learn more………
The Volume Carrier can move to an area to keep the rates really low, during their contract with a major customer like WalMart, Kroger, Costco, it does not matter, the Volume Carrier can control so much freight, that they can dictate what the smaller fleets earn—giving noone an idea unless they pay attention what the freight actually pays to the broker carrier. Excess freight goes to the Broker side of Carrier and Average 25% returns over the year, most will earn profit margins of 30% minimum or more on those lanes. If you think that you earning $2.25 per mile on a dryvan load, from a major producer—-ie WALMART, KROGER—the ones that are shipping —-not the Carrier brokering to outside service providers——then you might not understand what the Brokers are not or even are telling you.
Volume Carriers can utilize Self-Insured Status–and the opening of doors that other wise would be locked to the small guys……………Money is usually needed, until you become a volume carrier, with easy access —then you do not really need the ease of money ——they wish to pursue you with!! Where were they before is my question?!?
Volume Carriers use a system, I call “Same for the Same”. Same Truck for all, simplifies any truck need through direct partnership with the manufacturers typically—Giving these Powerhouses, a “FREE” Income stream to the ones who own the Dealership that sell to the Volume Carrier. Sell the trucks to yourself—guaranteed Volume sales—because the Carrier will need more and more trucks as time goes into growth. Same Truck to the Same Drivers—–Yep, I have actually heard an executive at a Carrier say that shit!!
Dispatch is done by 1 person for every 75-150 drivers through technology integration. Why do you think Qualcomm has stayed around all these years since their FAIL in the cellular phone industry?? Volume Carriers have been using Qualcomm for ELD–since early 2000’s, actually a bit longer but exact timeline I am unsure…….Qualcomm can probably answer that one best. They have been the pivotal ELD developer for tracking and customer integrations with the computer technology for a long time…………..
Volume Carriers have done the best job at lowering rates, by saying— a driver is a driver—when you and I both know!— that is not the case by a very long shot………by making it so that no one would compete, because they cannot handle that low set rate where they make a mere $5 per truck per day, this gives the customer no wiggle room to leave —even when they have issues covering to set standards of the contract, because no one can touch it, saving the customer way too much money, to even complain or cancel the contract——Like my Dad always said, “The small guys cannot compete with a Carrier that has 100k trucks on their fleet, if they earn $5 per day per truck; no matter which way you cut it—they still make $500,000 per day.”
I remember when Walmart– would pay Carrier $1.25 per mile to move their overage for their in-house transportation carrier. They set their rate, because they commanded so much volume movement. Getting the Long term Contract with Walmart, could almost guarantee the Carrier a VOLUME STATUS– of factored funds through the contract to buy equipment, fuel, maintenance, and driver pay…….what was left at the end was your profit direct pay to the Carrier’s NEW FOUND Balance sheet——while the rates were set at a rate where most could not touch the loads, those that ran the volume soon found themselves, earning below the industry average of 16% margins—-but the Volume more than made up for the minimal profits——-16% margins are standard—–
The difference of the numbers:
Standard industry- 16% margins- for 10 trucks at average of $4000 gross per truck per week at $2 per mile, and 2000 miles each
$40,000 Gross Which is around $6400 to the Carrier after expenses before taxes (EBITDA, What like you are surprised that us operators understand such acronyms)……(Careful, we may surprise you with what we do know, but choose to remain silent and thought of as fools……)
Volume Carriers- with a 20,000 truck fleet—–using $2 per mile standard, 2000 miles per truck, and 75% of fleet billing daily—–
(75% of fleet) 15k trucks billing— daily —-30,000,000 miles per day is $60,000,000 Gross
Rough earnings— of only 5% margin—-Which if these Volume Guys say they are making under 16% they are ignorant and do not understand what they are doing—-or The accounting department may need to look at either a) which customers are not paying, customers who are not being billed, or the house is pencil whipping the shit, on that new challenger jet for the big guy who runs the show—-cause they got to be able to handle their Volume Customer demands and Meetings with Upper—lightning fast—cause money does n0t sleep………..
Now think about that for a bit!!
What else is in store for those numbers:
Here is some of the known — incentives you do not realize-
International Banking—-Those number can and do allow for the Mega Banks to finance and factor- Investments and Insurances to the needs of the ownership, decrease in fees, streamline management reps dedicated.
Self Insurance— My choice would be to open a International Insurance and Finance Company to Insure through new company —-Self Insurance is and can be the act of Insuring one company yourself through another Company you own—-Direct—-Causing the Carrier to fund the same premiums formerly paid to the Insurance Giants–Investing back into Factoring Costs formerly paid to the private and public finance industry…..–Yes, I would give my carrier a small discount to fund the chosen accounts as a factoring company——$60,000,000 per day at 1.5% is another $900,000 gross to the finance and insurance company—that is in place by the owners—just saying
Truck Dealerships– via manufacturer set up for using their product for a minimal annual purchase and a minimal annual volume of Sales and Leasing—to Carrier—and any outside sales they Sale at the Sales Department, plus let us not forget the Service—–
All I am going to say is this——-I personally, know of a Shop–that has been with a certain manufacturer——since the 80’s= This shop is one of only 3 shops I have seen—forgive me I know there may be more—but I only know for sure–without hesitation 3 across this country——-This particular shop is not a full scale dealer—-due to the requirements——I am sure—–however, they would do nothing but benefit from being named and granted an Navistar Dealership authorization—-Navistar — want to see for yourself—-email me—-I will give you the owners information-and even copy him in to your email to me—–Don’t worry your pocketbook can thank me later——Yes I like long term payments on % of sales——-**Cough ** Cough**—Both Parties– 😉
Savings for Self-Finance or Factoring—-
5% charge to the company wanting the immediate payment– 5% Fee to the Brokering Carrier charged to the typical small fleet carrier needing loads in areas. This fee is earnings to the Carrier because this service is a fee outside the Carrier, why not charge them for their money——
5% or more increase of revenue set minimum fees of 30% or more—-I see JBHUNT done changed the website—-Slick fuckers—-Saw my articles, and Pop no more open acknowledgement—-cause you can see it can go bad—–damn bet you had some pissed off MadMotherTruckers——That is funny, right there……..which gives the house 5% increase in revenue they pay or paid to the Owner Operators of their fleet—In House—-Build the fleet they said—–I can hear that conversation now–“let’s see if they even notice-let’s charge the Brokerage Carrier- who pays their own insurance, and separate liability coverage—and includes their Carrier as additionally Insured……Yep that is right that means your insurance covers their liability at the point of acceptance——So not only do they get you but they get you again and require you to cover their liability—–and they still earn more off you the Owner Operators that are Independent Carriers—-guess that means those ReInsurance Policies just got cheaper—-Cause it creates a coverage—-and Insures against losses—–Guaranteeing a Contract, without liability—hence why the lawsuits always target the Carriers for top dollar——Increasing liability costs that are under contracting obligation — With that being said———I would say this—-Many times Carriers lose on one side, yet prevail on the other side of the defendant suits faced by Carriers.