The Harsh Realities of the Trucking Industry

September 7, 2020

By
Smarthop

Manny and Eddy have been working together in the trucking industry for over a decade. Everyone has their own story of how they got into the industry, so we asked them to share theirs. Through starting a small carrier company, they have experienced the ins and outs of the business. We sat down with Manny and Eddy to explain their industry experience and unique relationship with SmartHop.


SmartHop:

How did you get started? What are some essential parts of the industry that you had to learn?

Manny:

I got introduced into trucking by working for my brother's car carrier company loading and shipping cars across the US. After a few years, Eddy and I teamed up to start our own carrier company. We started by buying three to five trucks. All old equipment that we can buy off of Craigslist or through word of mouth. We started with a reefer and dry van. We quickly learned how important it is to have good equipment. About two years into it, we sold all the old trucks, and we bought our first brand new truck from the dealership.

That truck was pretty much the segue into us buying more dealer trucks because we saw now that we had fewer breakdowns, we had less downtime. The trucks performed better because they had better fuel mileage. We started to see profits instead of losses with that new truck. That led to us buying another seven trucks from dealers in that first year, and then we started leasing trucks. We grew our fleet to 30+ trucks by leasing through Penske and Ryder. It's been a long journey.

Eddy:

For me, I started with this person running reefers. One day she just put me in front of a computer and said, "book a load." That forced me to learn the hard way. I didn't know anything. I didn't know what DAT was; I didn't know how to research the market. So I started doing my research. I learned that brokers are always competing with each other—see who can pay the cheapest. It's a power struggle between brokers and carriers: brokers want to pay the least amount of money possible, and carriers want to be paid the most to make more profit. It's like the stock market: it's up and down.

This business takes research. It takes a lot of making connections with brokers and shippers. It takes more than opening up a load board and saying, "Hey, I'm in Florida, what's available today?" And not caring where you're going or how long it will take. The business is leaning more and more towards research and technology to be able to survive.

Manny:

Once we started learning how to calculate the profit of each load, our horizon started opening up, and then we began to use hot market maps. This is a tool that was always available, but it's something so misunderstood. You have to study it and really, really master those hot market maps and markets to find profitable loads before booking. You have to know how to use those tools. We started using more tech, and then we met the SmartHop founders who were also using tech to run their trucking business. We were trying to solve the same problems, so it was a perfect match.

Smarthop:

There's this constant tension between the brokers, the drivers, small fleets, large fleets, shippers. There can be friction and distrust between the groups. Do you feel it can get better, or is it just something that will never change? How can we get there if it's possible, and how can a Trucking Support Network (TSN) like SmartHop help the industry get there?

Manny:

In the trucking industry, the mega carriers have it figured out that they have the buying power; their bottom line is very low. So, small carriers and independent owner-operators can't compete.

I wish we could be somewhere in the middle where everyone's profitable, and it's all fair across the board. But I don't think the trucking industry will ever be a fair, "everyone-makes-money" type of deal.

This is where a Trucking Support Network could be helpful—leverage. A TSN could help small carriers have leverage with brokers and make sure everyone is on the same playing field as large carrier companies, no matter the market. Without that network, support, and leverage, the little guy can get crushed when the market goes down. You have no way of thinking outside the box. This business takes research. It takes more than just driving. It takes making connections and building a network with brokers and shippers.

Eddy:

I mean, this industry is hard. You got to know that so many people are trying to make money, book loads, get more trucks. However, a TSN can give these smaller carriers at least a shot to compete with big brokers, so they have a shot of booking the same loads that these guys with big carriers have. On top of that, a service like that can provide trusted connections brokers.

Manny:

The problem is, with brokers, if you're calling and you're a one-truck guy, you're not a big fleet, or you don't have 20-30 trucks, they really could care less if they ever use you again. They're probably going to give you a crappy rate. However, being part of a large carrier network, brokers are less likely to deny you because they will lose 80-100 trucks in one day.

They're now thinking, "Hey, you know what, let me be fair. Let me pay them a good price because they're giving us a lot of business." The more prominent companies like SmartHop grow, the more we will decrease that imbalance of the market.

I think there's going to be a significant change in the future. I think the industry will start to see the effectiveness of Trucking Support Networks, and they're going to begin to follow along.

SmartHop is the full-service Trucking Support Network that Manny and Eddy have been waiting for. It supercharges small carriers and gives them more leverage with brokers and 24/7 support from a tech-powered back office. New to trucking and don't know where to start? With SmartHop's powerful network, you don't have to fend for yourself. You don't have to figure out what the best lanes are. You don't have to figure out what brokers are available. SmartHop takes care of all of that. Sign up today and learn how SmartHop can jumpstart your trucking business!

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