What can you do to successfully negotiate higher pay? That’s the million-dollar question. You’ve been in the scenario of negotiating with a broker and it is not going your way. We’ve talked to leaders in the industry and put together a list to boost your chances of getting higher pay and becoming a preferred carrier for any broker you work with. Let’s take a look at four tips that can help you get paid more for your loads.
1. Establish Your Brand
Before you can negotiate with a broker, you need to consider the other carriers competing for the same load and why the broker should choose you over anyone else. First impressions are everything, and for a broker, the No. 1 concern is the safe and on-time delivery of their customer’s freight. Here are a few things that can help you stand out and show the broker you are the most reliable option:
- Create a company website.
- Communicate with a branded email domain.
- Offer reputable references.
- Focus on building relationships.
- Submit your invoices quickly and efficiently.
Now that you’ve identified your company as a safe, reliable and professional option, you can lean on the value your service provides. People are much more likely to negotiate when they know what they are paying for.
2. Know the Current Market
Building trust with a broker is vital, but what else can you do to stand out from the rest? Let’s break down your negotiation tactics. What rate per mile do you generally ask for? Are the loads you’re looking at already posted at a premium? We live in a data-driven world, and it is safe to assume the broker is looking at the same data you are. Make sure you have used every resource in your toolbelt before accepting a less than desirable rate. The key to navigating the ever-evolving freight market is to have a firm understanding of the below:
- Keeping tabs on daily/weekly rate per mile numbers;
- The current carrier capacity in your area or the area you are running to; and
- Seasonal factors such as produce, holiday freight, and hurricane season (FEMA).
3. Leverage Technology in the Industry
Automation is revolutionizing the industry, but how can you tap into new tech to make your business more efficient and profitable? Use your bottom line to show brokers their rate is barely breaking even, and if they want the service your brand has established, they will have to work with you on the rate. Here are some options that can make a positive impact on your operation:
- Market trend analysis with DAT’s Freight Analytics;
- OTR Capital’s Rate Negotiator Tool; and
- Time Management Solutions (TMS).
4. Stay On Top of Your Financials
The last thing you want a broker to think is that you are financially unstable. Contrary to popular belief a decade ago, freight factoring has become a prominent and largely preferred service in the transportation industry. Partnering with a trusted factoring company like OTR Capital lets the broker know that your back-office will be handled correctly and promptly after delivery. Many people think that factoring is purely a cash flow solution, but they forget the valuable benefits it brings to your back office. Some of the benefits include:
- Timely and correct invoicing;
- Professional accounts-receivable processes; and
- Efficient issue and conflict resolution.
Think about it: You have to submit an invoice to get paid. It’s no different for brokers. Brokers need your invoice before they can bill their customers for payment. Carriers or factoring companies that are known for unorganized and slow billing can be risky for brokers who rely on timely and correct invoicing after delivery for their own cash flow needs.
If you were a broker, what would you look for in a carrier attempting to negotiate for a higher rate? Establishing a reliable brand, understanding the current market, leveraging available technologies, and reinforcing your company with a widely trusted factor are some of the keys to book higher-paying freight. It’s time to start negotiating smarter for the rates you deserve.
Courtesy of OTR Capital
The Trucker News Staff produces engaging content for not only TheTrucker.com, but also The Trucker Newspaper, which has been serving the trucking industry for more than 30 years. With a focus on drivers, the Trucker News Staff aims to provide relevant, objective content pertaining to the trucking segment of the transportation industry. The Trucker News Staff is based in Little Rock, Arkansas.