Lightning like Steve McQueen? I'm in a fast lane when the light turns green? And I built tough Find nothing but grit? Cause I made rugged blood, sweat and spit? Yeah, like a horse I fly for a bumpy ride? I like to play hard but I work harder And I weather the storm Because I'm building stronger.
What is up? Ladies and gentlemen, we are back. We are live. It is the Frick Coach Podcast, the top podcast in transportation coming to you guys every single weekday, 8:30am Pacific, 10:30 Central, to break down some industry headlines. But most importantly, you guys provide some actual insight into what you can do with all of this information. You guys know the rest of that, but you know, subscribe, share, get it out there. You're going to see value in this one because we're talking about a topic that does not get enough attention out there that is extremely important to your operation and that is, you know, deciphering all of your data, all the rates and everything out there. What do you do with all of this information then?
How do you utilize that to grow your book of business, grow your customers and leverage that to get new customers and everything else? So with that being said, I have my good friend Dan Hellman on the show today to break all of this stuff down. So, Dan, thank you so much for joining me.
Thanks for having me, man. It's always good to be here.
No, man, I'm looking forward to this. You know, like were talking before we started on the show is, you know, breaking like with all of the data that's out there, it's like, how are you leveraging? And, and I think like that's a major component of a lot of organizations that you don't think about until it might be too late. And then it's like, hey, we have all of this rate history, we have all of this internal data. How do we actually leverage it? But then most importantly, like how do we make it all make sense to where we have a story to tell with it?
I mean there's so much great data out there that companies either are collecting or could be collecting. I mean some still hard to collect in super manual and everyone wants to use it. They just don't know how to, or what to look at or the systems are clunky and you get an Excel doc of just data points. Now you have to try and decipher it.
Yeah. So how are you guys going in there and working with your guys as customers? Are you essentially like, hey, we need access to your tms. We're going to start pulling all of this out or are you guys you leveraging all of their rating and everything that they use and kind of coming up with a plan? What does that look like?
Yes, we kind of have two aspects on using the data. One is collecting their so they can improve their quoting process. And the secondary is all the data we're collecting from rate information lanes, all of that and helping them. How can they start actually applying it into the organization? So when they're collecting their data it could be from their tms directly. They're you know, historical lanes, historical data connecting to green screens, dat, truck stop, any of those other rate engines and then working with them to put their logic together. But what we're really focusing on as a company because historically we've all still focused on automated rating. Huge advantage. That's going to be table stakes here in two years. You're just going to have to do it. It's just where the industry is going.
And so we're really focusing more on the data piece, how we enable the users to use their data and turning tabby more from automated ratings like a rate management system. And so we're collecting and reporting back every single spot quote that hits so they'll know complete network for their shippers. How the math all math out all these different aspects of it. One thing we have seen is that typically brokers aren't great at using their data not because they don't have the know halt but they're just busy. Like they don't have time to dig in. Most brokerages don't unless you have like analytics team. And so we have like our dashboards reporting all this. You gotta know where you go. And so we just added a new feature that we're beta testing out with five clients where it's a generative VI within tabby.
So instead of having to go and search for the data you can just ask Tabby a question. How many loads? I went from Kraft Foods Q3 last year and it auto generates your ports, spits it out. So it's much more interactive for allowing people to start using that data more.
What's bi, what do you mean by that?
Business intelligence. So basically they don't have to go through reports, they just can. There's actually a field they can just ask a question, free form text question, whatever you want to know. And it automatically generates reports, presents the executive summary. So it just makes it much more user friendly so it's more actionable.
So are you working with you know because like if, when you're onboarding customers, for example. You know, in the real world of freight, it's going to be a ton of cold calling. Then you're going to get an opportunity. It's going to be last minute. It is very, it's not doable. But it's very rare that you get into an RFP right away with a customer and you get published rates and you know what you're going to pay, you know what you're going to quote and all of that for, you know, the next 12 months. It's very rare that that happens. And even if it is an RFP style customer, realistically you're going to get access to their spot board first before you even get invited in.
So this, what I'm about to say is very applicable to pretty much any scenario when you're onboarding a customer is this one thing that I really want to pay attention to when I'm going in there is it's the consistent pricing, right. Still to this day, my customers are more concerned about the price, right? Like they want to make sure it's staying the same because they're bidding out on their future jobs and everything else based on the rates that we're providing them. So but it's like ultimately though, I want to see how do I make sure I am collecting that data, how do I make sure I'm actually quoting the exact same. Because you know, real time rating today might say one price, but like I'm trying to keep that same rate out there because I'm trying to win that business consistently.
And you know, hypothetical example, you say you've been bidding $1,000 on a lane, well now if something else out there points to where it's 1100 that you need to quote on that the customer might push back and be like, well hey, you've bid $1,000 on this. Why, why do you need more money now? And it might be early enough in that relationship where you can't have that conversation that the, like the market's changed. Right. Like you don't have that credibility yet.
Yeah, yeah. And once you can start capturing of how all these aspects add up and to get that final rate, you know, not just with rating set or margin, but that's, it's going to CNS, you need an extra 250 bucks because that's what the carrier is going to require. Just all those, you know, historically you've always just done that in your head because you just know that, well now you can start documenting each, you know, essentially upcharge that goes into it or down charge or anything like that. You can start presenting to the shipper of like this is where the rate comes from. You know, it's not. And it's actually using like hard numbers. There's going to help that help the conversation and really just change the dialogue you're having that other brokerages just aren't having.
Yeah, and that was actually, I was talking about this with Mitch from Ty on Monday. Yeah, it was Monday. And you know, because were talking about, you know, like leveraging technology to build up like customer profiles. Right. Because it's like I'm looking at like how do I do more with less? Right. Like as Bootstrap founder, I need to turn every dollar of revenue into like $15 of return. Right. I got to do this. And you know, a lot of it boil. You know, you brought up that customer who, hey, they have a lumper and everything else. It's like having all of that data that's, you know, quickly accessible to your team because you know, and especially in a smaller organization or even in a mature organization, how many times have people forgot or they didn't know to quote certain things?
Because you know, the person who normally does that was at lunch. They were in a meeting, they were on a flight. It does what? Like whatever, throw anything at it. Now this is a way to help capture that. This is something that keeps you consistent across the board. Because I think ultimately yes, I have relationships with customers, you know, but like my business partner, he replies, sometimes they just need a response. Right. Like they need that information so they can go on with their day as well.
Yeah. And so they have to know how you quote. They have to know. And it's like because you have that you have some deep industry knowledge obviously and it's stored in your head. And so when you're out, if someone else quotes for you, rides that like it could disrupt the relationship a little bit just because it's not exactly what they expect, it's not gonna be as accurate. All that one aspect I think of that's often missed by brokerages and pushing us really heavy to our customers is that you know, you're doing so much quoting that you remember some of the high volume spotlights, but you can't remember every single thing out there.
Yep.
Well, with like utilizing a tool or technology like RMS or whatever it is, you can now capture all that. And so you can actually get a complete oversight of what your customer, your entire customer base network is. You'll know all the lanes are shipping because they don't share that information or it is possible to get. And so you'll know the frequency, the dates just because of all the historical lanes they've done. And then you can start doing these like network overlays. Shipper A, shipper B. Where can I start doing some round trips between them? You know, where can you start doing multi trips? How can you start directing your carrier sales team to start prospecting new capacity? Because you see this one RAM spotlights popping up every other week and you can start lining up.
So you kind of can use this data, really direct your organization to how to grow. Like, you know, load count, loads moved is extremely important for current operations. But it doesn't show opportunities for growth. Yeah, it's, you know, swings at bat. It's spot quotes. That's how you uncover opportunities for growth and forward protection.
And I also look at it as like, you know, imagine, you know, whenever your customer has multiple facilities, right. You're wanting to pull that data. Which one is the actual busiest shipper? Do we have that prime location? Or you know, here's another thing too. It's like the seasonality of the market, you know, like is this, does this lane happen to pop off when a seasonal freight push is pushing out of that region and everything else? And again, it's about telling a story. But most importantly, and this is probably one thing that I get the most on out of all the stuff that I say. Freight markets don't change as much as people think over a 12 month period. They, they really don't. They are very consistent overall. And I mean I just showed it on the show last week.
We pulled Atlanta to Dallas, I believe the lane was. And over a 12 month period, yeah, there were some spikes. But like overall, man, a hundred bucks is what it changed. So these people that are out there saying like, oh, I don't know what to bid. You do know what to bid. It's all out there. You just need to pay attention to the patterns. I've been doing this a long time. Dan, you've been doing this a long time too. It's not as drastic as people think. We are too reactionary in our approach to everything where it's like, oh shit, we got to get a truck right now. What are we going to pay? There's no, like nobody pays attention to any of the historical aspects of the way that their customers are performing, the lanes are performing or anything.
Yeah, because like you can uncover these trends and they do stay consistent. Yes. If there's a Massive disruption. Covid. It does throw things out in the air, but historically the trends will continue to fall. I remember back when I got first started in this industry is back in 07, I started TQL. TQL. For seven years they had this produce calendar. And this is way before people are really using data heavily at that time. TQL was like a $400 million brokerage when I joined and it was scary how accurate this calendar was. I give them a lot of props to where when seasonality is changing, when certain crops start moving. And it was the point of like a. Trucks are loose in the morning by 1:00, it's going to tighten up. So book for that time.
It was like accurate down to like some of those like the hours of when the markets would shift with produce because you such a heavy produce company at that time and they didn't know their stuff with, with produce. And so even back then, like you can start uncover these trends of us when things are going to tighten up if you can start tracking it and you can start digging into it.
Yeah. And that's the thing is they knew that at the company level back then in the produce market. Everybody out there knows, you know, like let's use LA on Friday, for example. The truck does not get cheaper. All right. As the day progresses. Right. So it's like that's tribal knowledge. Everybody knows that. But. Or you know, air quotes. Everybody should know that. But is everybody actually taking that approach? Right. Because it's like, yeah, I understand. I'm a capitalist. I love making money. But ultimately I don't like rolling the dice, man. I like to, I like to, you know, not do that as much. The, you know, the fact that I kind of control my own destiny now, I really don't like waiting on stuff. It's like, hey, let's take a couple of phone calls. Where's the market at?
Oh, boom, you got the one that's super low. But then like four trucks are at 2000. Book the next, book them at 2000, move on with your day. I know you wanted to pay 1800, but that's just not going to work on this. And again, it's about helping you become more decisive because so much time is wasted out there on a brokerage floor holding out for 50 bucks. And what you don't realize is all of your salaries, counting against that 50, you're actually costing your company way more money than to just pull the trigger and move on 100%.
And like you have all that deep inside knowledge for, you know, LA is getting tight on Fridays, only going up. But also we see is that sometimes you just get busy and the things you know, you forget about just because you're distracted, because you're putting out this fire, deal with a claim, you're dealing with a fallout. Like, we all know rates go up for blitz week. We know rates go up. You've been City fest, like all of these things that aren't holidays affect the industry. But I also know when I was in the floor, I would forget that blitz week's next week or in two weeks, just because you're getting distracted.
And so while you're trying to process everything in your mind, the mind can only do so much, can only focus on so many things, and so think that's what things start slipping through. And that's where to start really developing a process on how you use the data, how you're quoting, because it's going to protect you from those burns in the long run. And also standardize your quoting process with that and just how you process shipments.
And I think also this is another thing with capacity as well, right? Because ironically, a lot of capacity constraints that are out there are caused by people playing the spot market to a tee and not really focusing on, hey, what does the carrier actually need for this load? Because again, no matter what, contrary to what's all out there on social media, it's not as drastic of a difference as what it's made out to be. You know, if you pay that market rate or, you know, you've quoted it properly, you have the cost, you know, the carrier who's like, hey, I want 900 bucks or a thousand bucks or whatever, pay them every single time. Right. Ironically, a lot of your problems start to go away when you take that approach.
But where they start to increase is when you keep pushing back and, oh, I got to lower the rate because my boss says we got to get it for cheaper, we got to increase our margins. But again, you got to look at it on the life cycle of these shipments. And that's another very important data piece that I do not think is looked at a deep level. Again, I don't know the insights of every company that's out there. But, you know, if you're on social media for more than five minutes, you can see exactly how the majority of people are performing.
Yeah. And a lot of times, like a lot of, and I was guilty of it, a lot of brokerages operate load by load. How much margin I'm Making excuse that extra 20 bucks, 15 bucks, which it is a dollars game and cents game. You know, it's a maximized margins. Margins are getting thinner 100%. But my last brokerage I was at, we started changing our thinking a little bit just to try and get a little more big picture. We could have done, we still could have done better at it. But making those steps to be more big picture is we actually are like almost making a P L for every single shipper we had the drop shippers.
And so you can kind of look at the whole scope of like all right, how much resource can put into this, what's the claims now, what's our tracking cost, our technology costs, all of that and start having an idea of like all right, it actually just makes more sense just to process these loads quickly and not worry about the extra 15, 20 bucks and just lock in current carry capacity, try and get a year round rate from them and may overpay a little bit just to boost that profitability for that exact account.
So say you're back on the brokerage floor, right? Like you know, how are you like deploying this coming into what could happen here in the next 12 months? I'm of the camp that it's not going to be as drastic of a rate increase as everybody I think is hoping for. Like I don't think it's going to be that way at all. I think next year might be very similar to this year. Rates are rates going to go up? I think that's yet to be seen. I don't know. But I don't think all of a sudden just due to the snap of the fingers, everything's going to be all gravy again and everybody's going to just be making all this money. I don't, I don't feel that way.
So like if you were in my position Dan, how would I take this tool and like leverage it inside of my business to kind of help with pricing for 2025.
So how I would do it is we so semiconductor rate management system also. Yes, you can fully automate some shippers but we also have other inputs just to capture the data and focus more on analytics. So I would create, put it in place and create an overall quoting strategy. Like those one off customers that you're not really dipping into if you just quote them all the same way you can create logic for just those. And so it's just getting the quote requests moving through it so you can just start capturing that data because the data comes really Useful six, nine months down the road. And that's where you're really setting yourself up so you can start seeing the trends as the industry's picking back up. Start seeing the trends and volumes from particular customers and start adjusting your message.
And when you start pushing more for carrier prospecting is gonna give you a little more insight on when you're gonna have to pull the trigger to try to lock in some trucks. Because if you're seeing certain lanes pop up consistently in that volume increasing, you can be more proactive. We're trying to lock in capacity for the future for that customer and have that different dialogue. So really it's just start collecting that data, start looking at those trends because you're preparing for the future when things really, hopefully really start popping off. And you're not going to be reactionary at that time. You're not going to be just trying to hustle loads. You can be more strategic with your customer base and working together to plan for that future.
Do you think with the rise in data that is out there and data that's available to shippers, for example, how do you think that will affect pricing in 2025 or do you think it's not as widespread yet to the shipper community? Because again, you know, some shippers are very data focused, some are not. But like, I also think it's way more accessible now and there's way more information and access to information than there ever has been. How do you feel like that is going to affect pricing going into next year?
Into next year? I don't think it's gonna have much effect at all. Yes, there are tools out there for shippers to get more pricing insights. You know, if I had to shoot from the hip, the technology providers that offer those Tula shippers, they probably have a couple hundred customers, a few hundred customers. I think sometimes people don't realize just how big the shipper market is. I mean, yeah, there's what, 10, 12,000 active broker MC numbers going to TIA roughly right around there's you know, 200,000 shippers. The market's so wide, it's just still so fragmented. And a lot of shippers are very low tech. They're just, you know, they didn't come from, you know, the larger shippers, 100% did. But the majority of the small mid size shippers didn't come from analytics background.
They, you know, the transportation manager might have worked their way up into that position or they didn't go to school for it, those things. So it's like they still really have to be educated on those. In my opinion, that's the job of the broker, to educate them, be more consultative approach. So I think majority of the shipper community is not embracing it. They just don't know. So it's not really affect much next year now as it becomes more widespread, more technology. It will. But my opinion, it's going to be a decade down the road. It's just still so fragmented.
I mean, I don't disagree with anything that you're saying right now, but these are just questions that randomly pop into my head when I'm talking to people. So I like to ask the experts on this stuff. And you know, I'm also trying to think here, Dan, how would I maybe leverage my technology to tell a better story to my customers, my shippers as a brokerage leader, how am I going to do that? Because, you know, you're right, man. I mean, I, out of all the customers that I work with, don't, please, I hope not, because I know that they listen to this show. Actually, I think there's one or two of them that actually have a TMS that they utilize. Granted, there's not a ton of volume that runs through a lot of them, so it's easy. They have their systems and processes down.
But how would I get ahead of that as a brokerage leader if I have a customer that, hey, we're starting to use this technology now, we're starting to use a shipper tms. How do I help tell that story and kind of bridge that gap from our data inside of my organization as a transportation provider for them?
So the best way to start off with, you know, I'm sure you probably hold some of these or you do some customers like, you know, just overall qbr you do with your shippers, your customer base. I know as broker, I did QBRs and they were pointless almost kind of. I mean, it was talking about like, hey, these are lanes you've done. This is our growth, this is our own time percentage. This is where we screwed up, this is how we're fixing it. What else are you working on? It's very like just a flat conversation. It wasn't really getting value to them. It was just, what am I going to get out of this? And so I start collecting this data, you start breaking it down. You can provide a lot more insights.
You know, it's not just, hey, this particular place is the rate I'm giving you is more expensive because of holiday week or because it's a nighttime receiver you actually say, all right, this is what is normally the one one with my baseline. Now it's an extra 3% because dot blitz weeks is coming up. It's an extra like line IDing them all the extra increases. And yeah, you can start breaking these down mentally, but actually putting hard numbers with it is going to be significantly different than any other conversation they're having. So you're going to be able to give them more insight into their own supply chain that they probably don't have. So either showing them how they can reduce their spending by increasing their lead time, like, and actually putting hard numbers with it, or at least like, hey, this is your spend.
So now you have some ammo take to your boss of why things are the way they are. Yeah. But then also having showing some insight because, believe it or not, last shippers, like, they don't know all the fluctuations, you know, in their volumes. They have an idea, but they're just kind of living day to day. And so they don't know that. So you can provide some insight onto really their supply chain of when things are picking up, what areas. Hey, historically, you know, this type of lane picks up which coincides with produce season. And so let's start planning ahead with it. So it's kind of just that's we get that more consultative approach with them.
Yeah, no, and I think that's very, very accurate. I do quarterly calls with my customers to kind of talk performance and you know, they ultimately kind of boil down to this. Listen, man, we wouldn't be talking to you right now if we didn't like what you were doing for us. So, you know, I'm glad you called, but like, kind of unnecessary. And, you know, I've also heard from a lot of my customers over the years, listen, we're not a transportation company. We're a manufacturer. Like, all of this information, yeah, we see what our overall spend is. We get that. But like, at the end of the day, if our shit is on our docks, it's not making us any money. So it reaches a point of irrelevancy that's out there.
But I also think now with again, data and being as easily accessible as it is out there, I think the next big brokerage that's going to come out is going to be the one that masters being the cheapest and servicing them the best. I think that there is going to be that fine line that is out there. And cheap freight is relative, ladies and gentlemen, and drivers who listen to my show. I am not saying a dollar A mile here. But I am just say, relatively speaking, you will be held to a different standard.
And I think that's where the next brokerage, the next big one that's going to come through is going to be the ones who are like, you know, they're able to sit at 12% margin, hypothetical or 15% margin, and they still have a 99% acceptance rate, a 99% on time. Like it's going to happen. Somebody is going to come in here and do it. And it is really going to ruffle some feathers that are out there because of all of this information that is now as accessible as ever. And when I say like brokerage, I think is becoming less competitive in the sense, Dan, of like everybody kind of has their own tech stack now. Right. Like everybody has their own tools that they're just like they're deploying out there into the market.
Nobody's got a leg up from a tech perspective that like makes them hands and feet above everybody else. Because you know, like again, you can, anybody can disagree with me, but ultimately I talk to enough people I actually cold call shippers every single day, ladies and gentlemen. I know what the pulse is out there and there has never been a greater time for growth than there is right now.
Yeah, because there's great technology out there that you can buy something off the shelf that's going to pretty much compete against the $8 billion brokerage that dropped a billion dollars into their research, development and developed their own. It's going to be pretty much just because you get these tech companies that are hyper focused on a certain process and you focus on a certain process, you do it really well. They can move much faster, it's more affordable, all of that. And so technology, yes, you need to embrace it because you're 100% right. The next broker is going to be the one that could be extremely efficient. Like there's always be freight that's just white glove, high margin. As things get, you know, supply chains get smarter, more dialed in. It's going to have to be pure efficiency. And so the tech's going to help that.
But then really what's going to separate the company is not the tech stack because it's so easily accessible. Now it's going to be the data and who can actually dive into it and really trim off pennies where they need to.
Yep. And that's going to be exactly it. Are you. It's going to be having somebody come in with an absolutely scalpel to shed anything you don't possibly need. And to run as lean, I'm talking 3% body fat, lean as possible to go out there. Because I feel like it's, you know, the redundancies inside of organizations are very evident with technology now where it's like, yeah, I don't ever. And again, I'm speaking from the heart here. I don't ever want to not hire somebody if I have them to be able to hire them. But I think the days of hey, let's hire two are done. I don't see that there's. There's too much that is out there now. And this is where the benefit of tech comes into an organization where it's like, I view it like this.
I want to hire as many people as possible and make them as successful as possible. I will never have cap commissions inside of my organization because I want my people to make money and as much money as they possibly can. But I also want to hire five people because I need five people, not hire five. Hoping one works out.
Yeah, yeah. And that's going to be the big change. And that's kind of like the revolution going on the industry right now. Because historically it's been so bodies heavy and so now comes our triads, like, how can we shift being more focused on efficiency, which means streamline some process, takes some process away from the team, all of those. And like, really diving into like, what's the ROI for every single hire, every single dollar we spend, what's the return we're getting on it? Because I want to be clear, like, I'm not saying digital brokerage is the way to go.
Yeah, of course.
I am still a firm believer. Brokerage is a human game. It's a, it's a person game. But it's more like, how can you enable your people just to do more? Like what every load that a person can push out.
I'm right there with you, Dan, because I think that 90% of my day, maybe 95% of my day could be automated. Right? When I'm talking about quoting building loads, requesting pods, processing document, all of that could be automated. But what will never be automated inside of my organization is the customer experience and the carrier experience. A real human being will always answer the phone, okay? Mark my words, you can save this little clip out there right now. A real person will be doing it. Because when shit hits the fan, a customer does not want a bot. They want Chris Jolly on the phone saying, listen, I know this is what's going on. This is how we're going to fix it. I will be back to you and we're going to walk through that process together. Not your 88 in the queue.
Somebody might get back to you, yada yada. That's not, that's what I mean where it's like it's never going to be a full digital experience at least inside of my organization. And I truly feel like that's going to be my differentiator as I grow and scale my business. Dan is I can't compete with Amazon. All right? I can't from a financial standpoint, but where can I compete with Amazon? And I look at that as you know, in the pure brokerage market as well. I can't compete with the C.H. Robinson on a pricing perspective or whatever else that they have. But where can I beat them at? And that's where I got to look at it. And I'm going to deploy that out there and grow and scale my company out 100%.
Yeah. Find out where your niches, where you fit in. Like probably Anheuser Busch isn't a great customer for you just because it's, then it's high volume. It could really kind of push this volume out. That's just not where you fit. But the nice beauty thing about it is like the shipping market's so large and so still extremely old school that those niche clients that would work well for you and majority of the brokers out there would be really white glove. The market's massive. It's just not going to possibly be a big name like an hush bush.
I feel you there, my man. Well, hey Dan, as always, I appreciate you joining me. How does anybody reach out to you? Find out more about what you guys got going on.
Easiest is LinkedIn. Shoot me a message or you can email me my work address. It's Dan H.
Perfect. That works. And if for some reason you guys cannot find Dan or as Steve Setka said, the best looking guest I've ever had on the show, I'm gonna take that because I am the best looking person on this show. But anyways, that'll be it for today, ladies and gentlemen. We got a guest coming on tomorrow. As always, if you guys got value in what you heard, subscribe to the show, you guys share it out there to your network because if you see value, your network's going to see value as well. I appreciate you guys. I love you guys and we'll be talking to you soon. There we go. And.