Definition: Double Brokering
Lets review the definition of double brokering. Double brokering is the practice of having two agents involved on brokering a shipment. The first one gives it to the second one, and the second to an end carrier.
This practice in and of itself is not illegal or unethical, as long as all parties are aware what is going on. Just like normal, there is nothing wrong with honest and ethical business practices.
More often than not though, companies do not allow double brokering. What is done is a carrier takes a shipment under the pretense that it is their own equipment. Then a series of lies occur and the company that booked the load will try to have the company they subbed it out to pick it up.
The reason this is a problem is because freight intermediaries need to have the documentation on the companies that are going to pick up the freight, i.e. the authority and insurance. When a company takes a shipment under the pretense it is their equipment and subs it back out, the freight intermediary has no clue who is holding the insurance liability.
One thing that has popped up left and right, through so many different parts of the country, is companies thinking they have “leased” a driver on. Even though the person who they have “leased” on runs under their own authority, own insurance, and has no other connection with the company other than it is cut a check.
The only way a driver is leased on with a company is if that companies signs and MC # on the door of the truck, and that truck is listed on the insurance policy. If push comes to shove, call the insurance company and ask if that driver is under their policy.
Other than that, you are taking a big risk loading a company that you do not have authority or insurance on. Just be warned.
Protect Yourself: 10 Tips to Avoid Double Brokering, Loads Held Hostage, and More
There are a lot of practices going on right now that you need to avoid like the plague. Double brokering, loads held hostage, advance scam, so on and so forth. As bad as that freight needs moved, it’s going to end up even worse if it gets put in a warehouse and someone demands 10k from you. Or if you take a load from someone that has stolen the identity of another company, you’re in for even worse trouble. So here are some tips for NOT having a very bad day, week, or maybe even a month.
- Make sure you have caller ID, and do not deal with anyone that calls from a private number. We are in business, there is no need for private numbers. Simply ask the company to hang up and dial *82, which will disable their private feature. If they refuse to do so, you did not want to deal with them anyway.
- Make sure the phone and fax number match the authority. If the authority says they are out of PA and the numbers are Miami number, question them, if they say they are an agent, call the home office to make sure. Its better to take the extra minute in the long run!
- DO NOT give out advances. I’m sorry, I know that may sound like a hard stance, but just dont do it, especially if you have never used the company before! If you do, you are just asking for trouble.
- I know it has become popular for people to give out the dispatch info on confirmations, but really, what are you thinking? If you are a broker, you should be the point of contact with your customer, you need to service them rather than given out the info to every single person. Get directions for the carriers, they are your customers as well. This will also make sure they you speak to the driver personally and get to ask him everything you need to (like what it says on the doors of his truck, and so on and so forth)
- Do not give dispatch info to the dispatchers. I dont care if they say the driver doesnt speak English. I have heard that again and again countless times. 60% of the time it has been from a company double brokering the load. and of that probably 80% of the time the driver spoke English.
- If the driver calls in for dispatch, look at the caller ID. Is the call coming in from his terminal? Guess what? Its not the driver, its a dispatcher pulling the wool over your eyes… bad news right away! Or is the “trucker” on the phone inside an office with the phones ringing? Another bad sign!
- Insurance certs. Only accept them from the insurance company. If the phone number doesnt match the area, again, look in to it.
- If you have a good working relationship with your shipper, ask them to verify the name on the truck each time, this is an easy way to stop a lot of problems.
- Use www.safersys.org Check and see how many trucks they run, not only that, but check and see how many inspections they have had. If the carrier says they run 40 trucks and show no inspection in the last 24 months, you know something is bad wrong.
- And last but not least, we have… Dont threaten the carrier! I dont care how upset you get, sometimes you can turn a bad situation worse by getting upset. Dont threaten the carrier and try to work things out reasonably!
Do business ethically and honestly and stay safe!
Bad Business: Unpaid Freight Bills
One reason that Transportation Industry Reports is here is for unpaid freight bills, or unpaid freight charges.
When a company contracts with another company and refuses to pay monies due in a timely manner, it affects everyone in the chain, messing up cash flow for everyone involved. There does need to be a balance though. Everyone is falling in to similar situations now with the economy, I believe we are experiencing trickle down crapping. Yes, you heard it here first folks. Trickle down crapping. For a long time now, bigger companies have been paying in 45 or 60 days. If you wanted the business you had to become a slave to whatever terms or conditions they wanted, but now it is even worse, everyone seems to be running behind in paying freight invoices.
But let’s be clear, they must be paid, they need to be priority! Yes, there is a lot of competition in the transportation industry, which causes shippers to think that, they can not pay one carrier, and then move on to the next and so on and so on. But it needs to stop. There have been enough companies out there go under in the last couple years. Lets do what we can to stop it!
If you know of a shipper that is not paying freight invoices, or that is not paying charges and you’re fed up, post a report here.
If you know a broker whose bond has been canceled, dont let 5 minutes go by, get it up here so other people will know! We have many convenient options for posting, so, lets get the word out together!
