The 12% Carrier Fee Trap: What Owner-Operators Need to Know. — Transcript

Full transcript

1. 0:00$14,000 check with 6,000 mi.
2. 0:03Amazing deal. Go sign up with us. You'll
3. 0:06make a lot of money. And then all of a
4. 0:07sudden you look at your statement and we
5. 0:09have a problem. There's so much hidden
6. 0:12in carrier statements. Not only their
7. 0:14statements are really bad and and messy,
8. 0:18but they create confusion on purpose.
9. 0:20And that's what I want to talk to you
10. 0:21about in this video today. So, let's dig
11. 0:24into it right now.
12. 0:31So, a lot [music] of the calls that I've
13. 0:32I've had with owners when we analyze
14. 0:34their cost per mile and look at their
15. 0:36settlements, it's just highly highly
16. 0:39confusing.
17. 0:40They create a ton of deductions. They
18. 0:42create a ton of lines that really don't
19. 0:45explain what was the charge for or
20. 0:47simply just confuse the hell out of the
21. 0:50owner-operator. And there's patterns
22. 0:52that you can recognize ahead of time
23. 0:54that this will happen to you. So, I want
24. 0:55to talk about those patterns because a
25. 0:57decent amount of owners in my group are
26. 1:00complaining about the same thing and
27. 1:01which is
28. 1:02I feel like I'm making money. The gross
29. 1:03is there, but I don't see the net. And a
30. 1:05lot of carriers will just hook you
31. 1:08because they give you good numbers. They
32. 1:09will give you not only inflated numbers.
33. 1:11A lot of carriers will over-promise and
34. 1:12under-deliver. And then the
35. 1:14disappointment is it's too late because
36. 1:16you're already hooked and it's hard to
37. 1:17leave. So, let me talk about few things
38. 1:19that one, you should prepare when you
39. 1:22sign on to a carrier so you're not held
40. 1:25hostage and two, how to recognize some
41. 1:28of those early signs before you even
42. 1:30sign on to a carrier. So, let's dive
43. 1:31right into it. Let me tell you about
44. 1:33some of the things you can do ahead of
45. 1:34signing on to an carrier that will make
46. 1:37it easier for you to leave the company.
47. 1:40Number one is plate. Often times the
48. 1:42$2,000 to $2,500 per plate annually,
49. 1:46owners will will have their own truck,
50. 1:48but they don't have a plate. I always
51. 1:50say get your own plate. Carriers put
52. 1:53fees on top of those those plates. They
53. 1:55make it more expensive. They put admin
54. 1:57fees. If you have a plate and and
55. 1:59somebody doesn't want to take you,
56. 2:01that's a red flag. They should be
57. 2:02welcoming you with your own plate as an
58. 2:04asset to their company, as a part of
59. 2:06their capacity. They shouldn't care
60. 2:07about uh them giving you your own plate.
61. 2:10A lot of companies uh will tell you,
62. 2:12"Well, we have a plate program and it's
63. 2:14easier on you and it's very attractive
64. 2:15because you don't have to pay the $2,000
65. 2:17right off the bat." But what happens is
66. 2:19when you get that plate from the
67. 2:20carrier, the play with plate states with
68. 2:22the carrier. You cannot leave with it.
69. 2:24That's one one hook that's holding you
70. 2:26down in case they mess with your money.
71. 2:29So then, number two would be, do I have
72. 2:32my physical damage and my bobtail
73. 2:34insurance, my truck non-trucking
74. 2:35liability? And that is
75. 2:37another one of those where, "Well, you
76. 2:40can go through us, we'll give you a
77. 2:41physical damage, we'll give you
78. 2:42non-trucking liability." And that is
79. 2:44that much harder for you to leave that
80. 2:46company. And on and on, you will see
81. 2:48different things that, "Yeah, we will
82. 2:50provide for you, but this is just an
83. 2:51excuse for them to get a lot of fee on
84. 2:53top of it. They A lot of those carriers
85. 2:56do it, but it's really not legal to have
86. 2:59fees on top of fees for services that
87. 3:01they provide. If somebody does a plate
88. 3:04charge for you, they should charge you
89. 3:05for the plate, the amount that the plate
90. 3:08was actually costing them, and then they
91. 3:09can use a separate admin fee saying,
92. 3:13"Hey, this is our admin fee. This is on
93. 3:15top of it." They cannot add margin or
94. 3:17add fees to the cost of the plate and
95. 3:20the cost of the insurance as well. And
96. 3:22number three is the percentage, the cut
97. 3:24the carrier takes from you. Everybody
98. 3:27does fall for the 12% BS. Stop. No
99. 3:31carrier can make 12% and will agree to
100. 3:34make only 12% on the revenue you're
101. 3:36generating. There's going to be a ton of
102. 3:38fees behind it, and that's exactly
103. 3:40settlement by settlement that I look at.
104. 3:4212%, but then you have massive fees and
105. 3:46and charges that you don't you can even
106. 3:47explain. All of a sudden you're landing
107. 3:49at 60, 60/40. So make sure that when you
108. 3:53look at the percentage fee, the
109. 3:55the percentage that the carrier gets,
110. 3:58that it tells you straight up, this is
111. 4:00the percentage and this is the rest of
112. 4:02the things that you're going to have to
113. 4:03pay for and that better be on the
114. 4:05settlement.
115. 4:06And yes, a lot of times it changes
116. 4:09because you can opt into different
117. 4:10programs like plate program, which I do
118. 4:12not recommend, or you can opt into a
119. 4:14rental over the trailer, which is
120. 4:16totally fine. So, the trailer rental fee
121. 4:18should be what the market pays. So, if
122. 4:21you look at their trailer rental, you
123. 4:22can ask them, what do you guys charge
124. 4:24for this charge for this specific
125. 4:26trailer? And then compare it what's on
126. 4:29the market. Some carriers tack Some
127. 4:31carriers make it easy for you to get the
128. 4:33trailer and then you end up with fees
129. 4:34that are almost double than what the
130. 4:36market actually rents the trailer for.
131. 4:38So, you can go outside, go to
132. 4:40independent provider, rent your own
133. 4:42trailer and sign onto a carrier that
134. 4:44will take you with the trailer. All
135. 4:46right, so we talked about the insurance,
136. 4:48the plate, the percentage. Cash flow is
137. 4:51another one of those. I've had some
138. 4:52cases recently that owners would not get
139. 4:55paid because the carrier small carriers
140. 4:57and usually small carriers tend to do
141. 4:58that, will tell you, well, factoring is
142. 5:00late or we haven't gotten paid. That's
143. 5:02usually right away a red flag. That
144. 5:04should never be a problem for a carrier
145. 5:08to make an excuse not to pay you. You
146. 5:10have to get paid on the agreed on
147. 5:12schedule, which means if it's Friday,
148. 5:14you get paid on Friday. If your check
149. 5:16bounces once and you're not getting paid
150. 5:18on the day that they promised, that's
151. 5:20already a red flag and you have to start
152. 5:22thinking about getting out of it. A lot
153. 5:24of the fees and a lot of the points I
154. 5:25already addressed here is just to keep
155. 5:28you locked in with the carrier.
156. 5:31And then what that means is now you're
157. 5:33going to lose more money leaving or
158. 5:35they're going to mess with your money
159. 5:36that they owe you because now you have
160. 5:38to wait two to three weeks, sometimes 45
161. 5:40days to get your escrow to get up money.
162. 5:44Escrow is one of them. So, if you If the
163. 5:46carrier has an escrow, and they usually
164. 5:48do, just make sure you have the terms in
165. 5:51the contract highlighted and you
166. 5:52understand what it is. Usually, by law,
167. 5:54you have 45 days to do it. Some carriers
168. 5:57pay it faster, some carriers pay it
169. 5:58later. Legally, they have to pay it
170. 6:00within 45 days after you're leaving. And
171. 6:02the reason being, I always explain to
172. 6:03owner-operators, escrow is still your
173. 6:05money. It's just held by the carrier.
174. 6:07And yes, carriers make bogus excuses
175. 6:10about what happened to charge you and
176. 6:12keep the money. But, what you want is
177. 6:14specific items that say when what which
178. 6:18scenarios or what violations or what
179. 6:21circumstances will trigger the escrow
180. 6:24not to be paid.
181. 6:26So, remember about the escrow. And
182. 6:28again, 45 days for escrow is maximum
183. 6:30that they can hold it.
184. 6:32Okay, so we talked about multiple
185. 6:33things. To put a bow on the entire
186. 6:36topic, is if you see a carrier that is
187. 6:40offering you 12%, it's most likely BS.
188. 6:43They will try to find a way to make more
189. 6:45money. The unethical behavior of
190. 6:47carriers happens more often than you
191. 6:50think. From a lot of the owners that I
192. 6:53talked to in my group, in our trucking
193. 6:55business group, a lot of owners deal
194. 6:57with the same problem. They don't know
195. 6:58where the money's going. And some of the
196. 7:00carriers are big carriers, and they will
197. 7:01still come up with ways to scam an
198. 7:03owner-operator. So, make sure you do the
199. 7:06due diligence and make sure you read
200. 7:08through the contract. Pull it into AI.
201. 7:11Have the AI explain to you what the
202. 7:13contract is saying and where are the red
203. 7:15flags. Or join our free community. We
204. 7:19help I help owner-operators there all
205. 7:21the time. And we can not only look at
206. 7:23the contract, we can look at your
207. 7:24settlement and find [music] out what the
208. 7:27hell is the problem. Why is your money
209. 7:30not what it's supposed to be. So,
210. 7:32[music] thank you guys for tuning in. I
211. 7:34appreciate you. Be safe. I'll talk to
212. 7:36you soon.
213. 7:40>> [music]