 |
| ARTICLES & LETTERS |
 |
 |
Freight Management Services
|
900 Dudley Avenue
Cherry Hill, NJ 08002
Phone: (856) 317-9600
team@tuckerco.com
|
Letter to the Editor
By Dan Yoest, President, Crossroad Carriers
April 4, 2005
Don't Threaten Smaller Brokers (response to Jeff Tucker's 3/2005 TW commentary)
I read with great interest the letter by Jeffrey Tucker, CEO of Tucker Co. (“Don’t Raise Broker Bond”) in the March 7 Traffic World addressing the issue of broker bonds being increased to $300,000-$500,000.
My company is on both sides of this issue. On the one hand, we provide intermodal services to 3PLs and brokers, and on the other we are involved in brokering a distinct niche market of freight. Mr. Tucker’s statement that only 14 percent of carriers check credit bears out what we all in the real world know to be true. In the world of low cost Internet credit checks and automated accounting systems, there is little excuse for carriers accepting loads and getting stung.
Some simple credit policies and procedures would lead these carriers to 3PLs and brokers who understand that the proper carrier payment is the backbone of their business.
Let’s say, for example, that FMCSA requires brokers and 3PLs to maintain this exorbitant bond. Presently, 70 percent of the broker community is comprised of businesses with annual revenue less than $5 million dollars. These brokers would quickly be put out of business and OOIDA members would lose the local sales forces that keep many of them rolling with backhauls that fill their empty lanes. The smaller to midsize broker is the sales force that the owner-operator can’t afford to maintain.
A recent survey concluded that less than 1 percent of broker/carrier transactions have any financial difficulties. This means that once again we are trying to interject government regulation into an area that truly operates efficiently when the parties involved adhere to sound and proven business principles. It is an attempt to re-regulate transportation.OOIDA would be better served by not destroying a sales force that costs its members nothing to maintain but rather provides an immediate low cost credit service for their members or some basic education and guidance in establishing credit policies and business procedures that avoids the temptation of getting the load now and worrying about collections later.
00IDA ought to take a “slida” on this one.
|
 |
|
Call Toll Free
800-229-7780
|
|
|
|
|
|
