Top 3 reasons why a shipper sticks with their broker

Posted by Kevin Hill on

Why do shippers stick with a broker?  Especially when they can find cheaper alternatives elsewhere?    

Whether you are the incumbent broker, or you’re trying to take business away from the incumbent, it’s important to understand why shippers continue to pay a premium to work with their current freight broker.  

It revolves around trust.  Everyone says freight brokerage is a relationship based business …and it’s true. 

So how do you build trust?  You could probably pick hundreds of ways, but I’ve tried to narrow it down to the top three.

Finds and delivers the trucks

The ability to consistently find reliable carriers who show up and deliver on time.  Without this, then you aren’t moving loads, and there’s no reason to worry about any other  is the first step in building trust with a shipper.   I

Shippers have enough worries, they don’t want to worry about whether their loads will get covered.  That’s why loads will always go to the freight brokers who have the carrier contacts to cover loads. 

Without the carrier network to cover loads it doesn’t matter what you offer based on effort, rates, tracking, communication, payment terms, or your hip Christmas cards. 

But if you’re covering loads, you will see your new quotes creep higher and higher.  

Communication

Things are going to go wrong.  This is trucking and logistics after all. 

When things do go wrong, you must pick up the phone.  You must let your shipper know what went wrong.  You must let them know what you are doing right now to fix the issue.  As fast as possible.  

If you hide from your shipper and try to ignore the issue, then you are only tearing down the trust you’ve worked so hard to build.   If you pick up the phone though you continue to build trust.

Shippers forgive mistakes, late trucks, claims, and saying I don’t know. What shippers don’t forgive is not calling or answering your phone.   Shippers have their own set of people they answer to as well.  You can’t afford to let them look bad in the eyes of their customers and colleagues. 

The freight broker who picks up the phone and communicates the fastest, is the one who earns the most trust…and the highest margins.

Shipper’s best interest

Freight brokers, like financial brokers, should always have a fiduciary duty to their clients. 

Simply put, freight brokers who put the best interests of their shippers before their own will always build more trust, and earn higher margins than those who don’t. 

This doesn’t mean you should leave money on the table.  You should always ask for the premium you deserve for your services. 

Your services as an expert though should always be to find the best option for your shipper.  Sometimes this means finding more efficient ways to ship, or warning of possible problems, even though it may mean some loads disappear. 

The time and money put into acquiring, developing, and maintaining new shippers is just too much to put it at risk for a quick buck here or there.  Shippers will catch on to your game.  Once that happens you’ll be lucky to get any loads, and you will be back on the phone struggling to find a new customer to replace your old one. 

 

No matter what shippers tell you trust is much more valuable to them than price. If you can identify where the incumbent broker lands on the trust scale you can develop a strategy to attack where the shippers trust is the weakest. 

And if you are the incumbent, then you can use the same trust scale to work on your weaknesses. 

Because as we all know your competitors are calling your clients everyday trying to take your business away…

 

 

 

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