• Avoiding the 'ditch-to-ditch' mentality on freight rates

    Executives with three larger fleets came to TIA to interact with brokers on how to better work together and create more long-term rate stability.
    April 11, 2018
    2 min read
    Photo: Neil Abt/Fleet Owner
    TIA

    PALM DESERT, CA. Derek Leathers, president and CEO of truckload carrier Werner Enterprises, has advice for fleets that chase high freight rates on any given day, instead of focusing on the “longer-term view.”
     
    “There is nothing as powerful as building sustainable networks,” said Leathers, who joined with two other carrier executives to speak with brokers on building better relationships at the annual meeting of the Transportation Intermediaries Association

    Leathers also said on third-party logistics firms to be more willing to be a “representative” for asset-based carriers. This is about “more than matching capacity with demand,” he added.

    Pointing out his company had spent in excess of $2 billion in capital investments in recent years, Leathers called on brokers to “value that investment and take it seriously.”

    He expressed frustration when he hears that shippers have strict terms, and a broker appears unwilling to engage in what appears to be a fair negotiation. At the same time, he said brokers and logistics firms have a role to “keep it rational” when fleets may be too aggressive.

    Darren Hawkins, president and chief operating officer of YRC Worldwide, addressed the desire to lesson freight rate volatility.

    He called for an end of the “ditch-to-ditch” model, where one side demands huge concessions, based on market conditions. Instead, a “middle of the road perspective” can benefit the entire supply chain over the long time, he said.

    “There is margin there for you and us,” he told the brokers in attendance.

    Much of the panel discussion centered on ways technologies could help – or hamper – the relationship between carriers, brokers, and shippers.

    John Smith, senior vice president of operations at FedEx Freight said while technologies can create efficiencies, it has to enhance the overall customer experience in order for it to truly be successful.

    Similarly, Hawkins said brokers could assist by educating customers on how carriers operate and what shippers should expect. That includes proper handling of a bill of lading and what to expect in the event of a claim.

    Likewise, brokers need to assist in making sure freight is ready when truckers arrive to pick up a shipment.

    “It’s a game of minutes now,” said Hawkins.

    About the Author

    Neil Abt

    Neil Abt is a former FleetOwner editor who wrote for the publication from 2017 to 2020. He was editorial director from 2018 to 2020.

    Voice your opinion!

    To join the conversation, and become an exclusive member of FleetOwner, create an account today!

    Sign up for our free eNewsletters

    Latest from Operations

    Brakebush Transportation
    Brakebush Transportation was awarded the 2025 FleetOwner Private Fleet of the Year Award, sponsored by Descartes, for midsize operations.
    Members Only
    Leaders of Brakebush Transportation, a century-old family business, share some of their innovative strategies and deep commitments to drivers that earned their operation FleetOwner...
    Schneider
    schneider 90th anniversary
    Schneider hosted an anniversary event, honoring a legacy that began in 1935 and grew to 12,500 trucks today.
    346047 | Aaron Kohr | Dreamstime.com
    extending asset lifecycles
    By extending asset life cycles strategically, organizations can mitigate financial risks associated with fleet management while maintaining operational efficiency.