RFX Blog

Six Carrier Incentive Programs for Freight Brokers

July 25th, 2014

Photo credit:  Bob Jagendorf, Flickr Creative Commons

Photo credit: Bob Jagendorf, Flickr Creative Commons

We’ve said it before:  The transportation industry has a capacity problem.  Trucks are tight, but the demand to move freight is only growing as our economy steadily improves.  This puts freight brokers in a tough position.  We look for new and innovative ways to give ourselves an edge above the competition.  We have always said that the most successful freight brokers are those that take the time to build relationships with motor carriers and establish a strong network.  There are a number of incentive programs that freight brokers can offer to their carrier-base to assist in carrier retention.  Here are just some of those programs:

Quickpay –  Establish a program that gets your carriers paid fast.  It may take some extra resources, and hard work from your administrative staff, but quickpay programs offer somewhat of a guarantee that if a carrier pulls a load today, they will be paid within a week.  If you have the financial means to do so, in terms of your cash availability or credit line, taking advantage of a quickpay program is a way to keep your carriers coming back.  It is also a surefire way to stay competitive and build a strong carrier-base for those smaller carriers with less than twenty-five or so trucks. After all, small independent fleets make up a large chunk of our industry, and attracting those fleets can make a big impact on your ability to service specific lanes for your customer.

Direct Deposit – Take advantage of the technology at your disposal and use it to get your carriers paid faster and more conveniently.  RFX simply requires a voided check from a motor carrier and 24 hours notice to establish a direct deposit relationship.  Owner-operators who are not home often (and let’s face it, that’s almost everybody) need a way to get their cash without having the check in front of them.  Allowing carriers to do direct deposit is just another tool that will keep good motor carriers coming back for more business.

Fuel Advances –  Allowing your motor carriers to take a certain percentage of their paycheck up front is not without some risk.  Over the last few years, fraud in our industry has been a big problem, to the extent that TIA has formed a task force to fight fraud.  Much of the fraud in our industry stems from crooks taking advantage of fuel and lumper advances via Comchek or wire.  RFX has taken internal steps to fight fraud and prevent large losses from scams.  However, if you’re willing to accept some level of risk for the sake of offering a good service to your carrier-base, fuel advances are another great incentive motor for carriers, particularly smaller fleets with limited resources.

Electronic Invoicing –  One of the fastest growing technology companies in the transportation industry is Pegasus Transtech.  RFX is a customer of Pegasus Transtech.  We have partnered with them on their Transflo Velocity product, which allows motor carriers to submit their invoices electronically via truck-stop scanning or a mobile device.  On our end, we receive the carrier’s invoice and supporting shipment documents, such as the bill of lading or lumper receipts, electronically.  Our administrative staff is notified that the freight bills are in-house and we can begin the process of billing our customer and getting the carrier paid faster.  Of course this is a large benefit to motor carriers because they don’t have to wait for their freight invoice to go through the mail.  It is also a benefit for brokers because they can expedite the billing process to the shipper.

If you don’t have the means to adopt a service such as Translfo, you can also set up an email or electronic faxing service, or both!  For example, RFX has an eFax service that gets forwarded to our billing email group, so any time someone faxes that particular number, our entire billing department receives an email with those faxed documents, which can then be processed that same day.  MetroFax and eFax are just a few companies that offer this service.

Electronic OnBoarding –  It seems like every year, there is a new Electronic Onboarding service that pops up for brokers and carriers to take advantage of.  We previously wrote about some of the ways that brokers can improve upon the carrier onboarding process – that is, the act of actually qualifying carriers based on an internal safety standard, verifying licensing and insurance and executing a contract.  This can be one of the largest bottlenecks in our industry and can put a halt to operations if not executed efficiently.  If you have the ability to take advantage of an electronic onboarding system, it can be a big incentive for carriers to work with you.  Currently, the biggest providers of electronic onboarding are Registry Monitoring Service (RMIS), Internet Truckstop, DAT and Carrier Performance Check (CPC).

Private Network Notification – Whether you are utilizing an advanced TMS such as McLeod or TMW, or perhaps you just have your own home-grown application for managing your freight orders, utilizing some type of Private Network Notification will be helpful in maintaining a core carrier-base.  Private Network Notification is a system built into the major Transportation Management Systems that allows brokers to send available loads out to a private network of pre-selected motor carriers on a specified schedule.  The purpose of a PNN system is not to blast out an email to 10,000 carriers, but rather, say 50 of your closest carriers regarding loads that haven’t been posted to load boards yet.  This gives your private network of carriers first pick from any loads you have available.  It also gives the broker some stability in knowing they won’t have to always rely on load boards.  Instead, the broker can send their list of available loads out via fax or email, perhaps daily or even twice per day.  This not only helps you retain a small network of motor carriers, it also creates some stability in both capacity and pricing.

Almost certainly, with new advances in technology, there will be more incentives for carriers to take advantage of.  We would like to see more advances in mobile technology, in particular.  After all, this is a mobile industry… we should be pioneers in mobile technology for business.  For now, we hope you’ll be able to take advantage of some of these carrier incentive programs to help grow your business.

 

Posted on July 25th, 2014 in business strategy, freight agent, Freight Agent Broker, motor carrier