Читать книгу Freight Brokerage Business - The Staff of Entrepreneur Media Inc. - Страница 19
ОглавлениеBy now, you should know how to get started and have a good idea of what to do—and not do—in your own freight brokerage. But nothing teaches as well as the voice of experience. This chapter features quotes from established freight brokers discussing what has contributed to their success and what they think causes companies to fail.
Use Advertising and Marketing Techniques that Work
Track your marketing efforts so you can concentrate on the techniques that work and eliminate the ones that don’t.
Smyrna, Tennessee freight broker Cathy Davis said small giveaway items, such as pens, notepads, caps, and T-shirts, work well. Company newsletters (or a blog) with personal and industry information also get a good response. She said donations to fundraising events may be helpful (depending on the event and the degree to which it’s promoted), but the impact of website sponsorships is questionable. She recommended developing a three-panel printed brochure that is easy to include with letters, invoices, and checks.
Chuck Andrews, an Indianapolis freight broker, builds name recognition by placing periodic ads in association newsletters, as well as in annual association and industry directories.
It’s understandable that at this point your primary focus is getting started, but you also need to think about the future. Develop a succession plan that is reviewed and revised annually. Know how leadership will be transferred when it becomes necessary—either through voluntary or involuntary departures.
Look around for good ideas and good products that people are already using that you can incorporate into your operation. Everything you do doesn’t have to be original; get ideas from other brokers, carriers, shippers, and even totally unrelated businesses.
Bloomingdale, Illinois freight broker Ron Williamson learned this the hard way when he hired someone to develop a proprietary computer system. “That was a mistake because it was not a totally integrated system that would save us time and make us more efficient,” he recalled. “Later on, we found a packaged program that had all the bells and whistles we needed.”
Get Rid of Carriers That Don’t Perform
Every trucking company will have an occasional service problem, but when the service failures become chronic, drop the carrier from your roster. “You won’t keep your customers very long if you’re having constant problems with your carriers,” said Williamson. Of course, he acknowledged that in the beginning, you probably won’t know who all the good and bad carriers are. While it’s one thing to be understanding and give a carrier a second chance, you need to draw the line before the problems affect your own business.
Maintain a Broad and Diverse Customer Base
You need enough customers so that losing one—or even several—is not devastating. One of the biggest mistakes Cathy Davis ever made when she ran her freight brokerage was allowing one customer to control too much of her company’s revenue. When that customer pulled away with very little notice, she was left scrambling to replace that business.
Because the freight industry is such a strongly relationship- and reputation-based business, it helps to put yourself in the public eye in a positive way as often as you can. Cathy Davis saw a favorable impact on her business from being the recipient of awards and by getting bylined articles published in trade publications. An even easier approach is to contribute content to online publications or well-trafficked blogs that cater to your industry or the shippers you are targeting as your perspective clients.
Though a freight brokerage is extremely lucrative on its own, it’s also a business that can lead to the development of other transportation-related operations, from consulting to buying trucks and being a carrier. Cherry Hill, New Jersey, freight broker Bill Tucker, for example, offers a wide range of logistics services.
Andrews started as a broker, and then created his own separate trucking company to handle moves where the carriers he was using were short on equipment. Williamson also started as a broker and has since created two trucking operations.
“Focus on building the highest-quality reputation you possibly can,” advised Tucker. “When a shortcut presents itself, but it’s a little on the shady side, have the fortitude to pass it by, no matter how big the opportunity may seem. There are so many people in this industry who need good, solid, honest, reputable service—and long term, that’s where the big money is. You survive, and you won’t have a lot of doors closing to you because some bad story got out.”
Tucker compares the industry to a small village. “Everybody knows everybody else’s business. It’s amazing how fast word travels. Nothing will put you out of business or limit your success faster than the story of one bad transaction or one nasty court loss because of bad practices getting out into the marketplace. You’re going to have to sweat for a while, pull your belt in once in a while, and [endure] some tough times. But do it the right way every time, don’t take any shortcuts, provide high-quality service, and maintain your integrity, and you’ll always have customers willing to pay a fair price and good carriers that want to work with you.”
An Industry Veteran Puts the Pieces Together
This book has provided a lot of information, originating from a wide range of credible sources, to help you develop a realistic understanding of what it takes to be successful operating a freight brokerage business.
Angela Eliacostas is the president and founder of Illinois’ AGT Global Logistics (http://agt3pl.com), a successful freight broker that’s been in existence since 2005. Eliacostas herself has worked in the transportation industry for more than 25 years. In this interview, she shares some valuable insight and advice to people first entering this industry.
Eliacostas literally grew up working in the transportation and trucking industry. “From the time I was born, my father worked in the trucking industry. From the time I was a young girl, I would go to work with him and help him in his business,” she explained. “When I graduated from high school, I got married and had four children. I never went to college, but when I needed to go back to work, what I knew was the trucking industry. I wound up landing a job working part-time for a local trucking company.”
As time went on, Eliacostas learned all aspects of the business she was working for and wound up being promoted to hold a wide range of job titles and responsibilities. When her boss retired, she was groomed to become the business and operations manager of the company she was working for.
In 2005, she decided to open her own freight brokerage business. “I was petrified to start my own business because I was a single mother raising four kids. I knew I was a survivor and a hard worker, and that no matter what happened, I would make operating my own business work,” explained Eliacostas.
Over the years, AGT Global Logistics has experienced steady growth, despite the unsteady economy. “We have maintained the mentality of a small, hands-on freight brokerage business, which focuses extremely heavily on customer service. As the years have gone on, we have grown into a midsize company but have maintained our small company values, which I know our customers appreciate,” said Eliacostas.
As of early 2017, AGT Global Logistics had 21 employees, and generated more than $10 million in annual revenues. “Years ago, freight brokerage companies had developed a very bad name in the transportation industry. They were considered untrustworthy, often fly-by-night operations. All a freight broker needed was a computer, a desk, and a phone, and they could operate from anywhere. If something went wrong, they’d close the business and reopen somewhere else under a different name.
“This has all changed, however. Over the years, the industry has evolved a lot, and the overall reputation of freight brokerage companies as a whole has improved. This is in part because of better regulation and the need for brokers to acquire higher value surety bonds, which help to ensure that everyone gets paid,” said Eliacostas. “Today, all freight brokers are held to a much higher standard. These companies offer a specialized expertise that shippers in virtually all industries now rely heavily upon. It’s important to understand that this is a relationship-based business in which offering the highest level of customer service is essential.”
Eliacostas emphasizes that strong and long-term relationships must be established with carriers, who need to know that they will be paid on time. Similar and equally important relationships need to be created with shippers, who need to be able to trust your company. She explained, “By building up strong relationships with carriers, they are often willing to offer more competitive rates versus rates offered to a broker who doesn’t have a close and long-term relationship. These lower rates get passed to our shippers, who rely on us to offer them the most competitive rates possible.”
For someone looking to break into this industry, Eliacostas believes that the most important thing they can do is go out and work for a freight broker or logistics company and gain real-world experience. “Prior to launching AGT Global Logistics, I had worked in many different positions within the transportation industry, and I knew the industry very well. This experience proved to be extremely valuable. There is no job responsibility within my current business that I have not done personally,” added Eliacostas. “It would be a huge disservice to enter into this industry without having a working knowledge of it. The best thing to do is to work for another company and take on different positions and responsibilities before setting up your own business.”
Whenever Eliacostas goes about hiring a new employee for AGT Global Logistics, what she looks at most is someone’s personality and how well they will fit into her organization. “I can train someone to do any job within my business. I consider my business to be a niche-oriented freight brokerage so having expertise about the industries we work with is essential. I bring applicants in for an interview, have them tell me about themselves, and then I look at their personality, and what I believe they can offer to my company,” said Eliacostas.
Instead of focusing on education, Eliacostas looks at an applicant’s past work experience. Her goal is to hire people who will fit into her established, dedicated, and loyal team. “We spend more time with each other than we do with our own families, so everyone working for AGT Global Logistics needs to fit in perfectly. I am very hands-on within my company. I have an open-door policy, and my employees see me working right alongside them. We are a united group working toward a single goal, which is to make the company successful,” added Eliacostas.
Having good communication and follow-up skills is important, according to Eliacostas. She added, “As far as an applicant’s education, I don’t put a lot of emphasis on that. I don’t require someone to be a college or tech school graduate. I look at someone’s job history. What appeals to me is someone who has stayed with past employers for extended periods of time and who has demonstrated loyalty to past employers. Some of the most successful people I have ever met do not have a college degree. I believe education is important and have children who have pursued college, but most of my own education has come from life experience.”
Over the years, Eliacostas has noticed more and more specialized freight broker training programs and certification programs being offered. She has mixed feelings about these programs. “People graduating from some of these programs are sometimes receiving incorrect or outdated training, which actually works against their chances of success. I have hired applicants who have completed freight broker training programs, but then wind up going around and around with them because they believe that everything they learned is correct, and what they already learned is by default the best way to do things within my company. These people have showed little flexibility to learn or adjust to how we do things, or to accept the more customized training that we provided. I have had my best luck hiring high school graduates who are willing to accept our training and pursue the training that we deem appropriate. These people are much more open to learning,” said Eliacostas.
For people looking to gain real-world experience, Eliacostas recommends finding a job with a small to midsize freight brokerage business, as opposed to a larger company. This is because the smaller companies are less stringent and more open to exposing employees to a wider range of responsibilities. The pay might be lower, but the limitations put on employees are typically fewer.
Today’s freight brokers need to be computer savvy. “We use computers for virtually everything we do. It’s very important to be able to work the computer but also be able to communicate with carriers and shippers and maintain those personalized business relationships. AGT Global Logistics uses 3PL Systems, Inc.’s software [www.3plsystems.com], which is designed specifically for freight brokers,” added Eliacostas.
Although there are many well-established small-, medium-, and large-size freight brokerage businesses already out there, Eliacostas believes there’s always a way for new businesses to successfully enter the industry. “For someone coming into this as a newbie, find your niche. Find that specialized area where you believe you can make a difference. Be very defined in what you offer and the types of businesses you offer your services to. Do your research about the niche market, and then research each potential carrier and shipper you’ll be working with,” said Eliacostas. “Having a niche gives you a stronger focus and allows you to develop a specific area of expertise.”
To find new clients (shippers), AGT Global Logistics continues to take a multifaceted approach. The company relies on attending tradeshows, making cold calls, and scheduling in-person sales meetings with perspective clients. However, they also focus on using technology, including their website and social media, to pinpoint and generate new business.
She explained, “We believe in face-to-face communication. I believe in being persistent, without being obnoxious. Sometimes, it’s a matter of being in the right place at the right time when it comes to landing a new client. It’s not uncommon for us to touch base with a prospect every month, for two years or longer, before they give us any business. Persistence is essential.”
Finally, Eliacostas believes that building a positive reputation for honesty is important. “When we’re handling someone’s business and something goes wrong, the shipper knows that we might not have good news, but we’ll always provide the truth. They also know that we’ll have a plan in place to fix or address the problem, and handle things correctly. Our clients know we’re always out in front of every situation, not hiding behind it. Our shippers know us and trust us, and much of that is because we maintain face-to-face, one-on-one contact with them. Plus, we have done our research and understand their needs and concerns,” she concluded.
