Lightning like Steve McQueen I make a fast lane when the light turns green and I built tough find nothing but grit because 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 under the storm because I'm.
Built stronger what is up, ladies and gentlemen, we are back. We are live. It is the prey coach morning show. The top morning show in transportation coming to you guys every single weekday, 830 in Pacific, 1030 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. If this is your first time tuning in, welcome. This is the real side of freight, ladies and gentlemen, and I say that before every single show. And what I mean by that is I only speak with transportation professionals, you guys, because at the end of the day I want to talk to individuals who have done what you're looking to do or who are currently doing what you're trying to achieve.
So you can take all of that, apply it, utilize it and see a meaningful difference in your business and your life. Jamie Sp freight over on YouTube good morning to you, thank you for tuning in. If you guys are listening to this on the audio only replay at some point I'm trying to get everybody to migrate over to YouTube, you guys, because it's just been confirmed by literally everybody who switched from LinkedIn over to YouTube that the stream quality is exponentially better over on YouTube. So just look for the freight coach over there. And if you're over there, you guys hit subscribe, you guys do, your boy is solid. Cory Buchan, happy hump day to you as well. But I got a very special guest for you guys here today. We're going to talk about automation, you guys.
That's what we're going to talk about. We're going to talk about automating every possible aspect of your business and some other stuff too. But with that being said, I got Mister Ken Apple on the show today from Project Apollo. So Ken, thank you so much for joining me.
Hey, thanks for having me.
Good to know, I'm looking forward to it. Automation is one of those things that I think it's kind of a stigma out there in the market and you know, it's always about there. Yeah, I always think of the old South park episode about their they took our jobs and I don't necessarily buy into to all of that because I'm, you know, from that old school mentality where, you know, utilize the phone. But I'm also about automating everything I possibly can inside of my operation to drive efficiencies. And you know, like we're, we move a lot of stuff out of the port, for example. You know, so it's like we got multiple different parties that are involved in this, trying to keep everybody on the same page, invoicing properly, all of that stuff. There's some stuff that can kind of fall between the cracks.
So it's like, that's where like automation and stuff comes in because humans make errors and you know, mistakes happen, but like we need to minimize that stuff.
Correct? Yeah. And you know, I think that some of the implementations of automation we've seen up to this point deserve the stigma. A lot of the automation tools that have hit the market have tried to apply a technology with, with going around the people that make the process great, ignore what the real problems are and just try to create a blanket solve and they haven't worked and they've created a lot of bad tastes and a lot of people mouths. If you talk to a lot of brokers who've been more on the cutting edge of this, they're going man I've got some scar tissue around automation.
It's really kind of affected how we've kind of gone to market and talked about what we're doing because they're going oh, I've seen this before, I know this story and I don't really want any part of what I've experienced in the past. So you're right and I think it takes a lot more thoughtful approach and a deeper understanding of the world that brokers live in and things like going and getting freight from the port and understanding the impacts of maybe having somebody who has a twit card or doesn't have a twit card and how they get brought in and you know, do they need an escort? And just all the complexity that comes with what people in the brokerage industry understand all day long. And if automation isn't doing that, then it's kind of useless.
Yeah. So what is Project Apollo then? Ken?
Project Apollo basically tries to do three things for a three Pl. The, what we try to do is make your power lanes easy. If you've got a lot of good high density freight with known carriers, we try to make sure that those, that freight goes to the right people with the right kinds of volumes the way that you know how to do it today. The second one is we also try to take your existing carrier network. If you kind of think about a broker's world, they onboard lots and lots of carriers and it's just capacity that often isn't fully understood by the broker. They used them in a spot load once and there's just a lot of potential there for brokers.
So the other thing we try to do is to augment those existing carrier profiles so that the broker understands more about the people that are onboarded and within their network. And that creates a lot more power lanes for the broker. And that helps you in the RFP cycles, that helps you cover more freight day in and day out. And then thirdly, we try to create some introductions to carriers where you're, the freight coverage is a little bit weaker. And we three think the three things, those three value adds just make a carrier salesperson's life a lot better. I think if you're kind of a manager of a broker, you'd see lots of carriers being onboarded every day. You see your carrier sales team spending 70% of their life covering spot freight all day and you're going where does this add up to something more?
Where do I start growing my business? Where's my revenue per head? And that's kind of where the punchline is for what we're doing at Project Apollo is we try to integrate into these tms and create that revenue growth for mid market three pl or broker.
Yeah, I think that from an operations standpoint that's out there, the most success you're ever going to find as a freight broker, and I know that a lot of people can roll their eyes with this statement because they only want to play the spot market. But the most success you're ever going to find is when you work with a handful of core carriers repeatedly, time and time again, you know, they get to know the operations because every, you know, like, it'd be different to me, Ken, if every customer had a set way of billing, if everything was the same, then yeah, you know what, go out, use the spot market, do whatever you want to do. But there are a lot of complexities that are in there. There are a lot of different requirements for every single shipper, receiver, wherever you're going into.
And it's like for me, when you find that group of providers, you got to double down on them and you just got to reuse them time and time again because that's how you can run a lean operation, you know, I mean, I think that there's a lot of people who get fat and happy in business. And again, like there's I want to be abundantly clear. There's no playbook to entrepreneurship. Right. Like, you will never have it all figured out where you hire the right amount of people, you have all adequately staffed. That's, that's never the case. You know, contrary to what the Internet likes to talk about, it's very challenging to hire the right amount of people then to keep them employed, and then you hire them based on pre existing revenues or future revenues, and then that revenue doesn't stick around.
So then you got to make some challenging decisions at that time and, you know, so it's like, I think that, you know, from my perspective, I want to grow in scale in, you know, with automation because I want to give my team the tools to extensively increase their output. But I say that with the caveat of everybody knowing that I will never have cap commissions inside of my organization. So I'm not implementing automation for me to make more money, it's for everybody to make more money and to grow, but most importantly, deliver top tier value to my customers and then their customers. Because ultimately I think a massive oversight by a lot of freight brokers is, yeah, ABC shipper might be my customer, but my real customer is the receiver, where that rate is going to.
And that's where my end result has to be on. Because if I can't keep my customers customer happy, guess what? You're not going to have any customers.
That's right. Yeah. I mean, ultimately it's your neck on the line on every shipment. It's your reputation. If the carrier is late, that's on you as a broker. And one of the things that we think requires a lot of focus in order to do this right is if you ever chat with a highly productive carrier salesperson, they just have this deep working knowledge from being in the trenches day in and day out on how, where the carriers are going and what they're moving and what they want to see. And it just becomes like this working knowledge so that as soon as you see this load coming, you're like, oh, I know that's coming out of the southeast. I know that there's a lot of trucks running down there to pick up produce. Right now.
I'm, you know, I know who to pick up the phone and call that would make sense and be a good fit for this load. And what makes that a successful engagement ultimately for the shipper is that you have a deep working understanding of the carrier itself and what the carrier is also looking for and making sure that's a good fit every single time. So where we've spent probably the most time right now is focusing on the carrier itself and trying to get that understanding of what the carrier wants to do and who they are and where they want to be as exact as possible. And I think we're the only other people who consider the actual shippers SLA's and what we do, too. So we have a SLA engine where you can define with the automation.
Look, there's certain requirements that shipper has or the consignee has about how this load is delivered. They need a certain set of equipment. Maybe they need roll up doors. They need a, to be able to drive a forklift on it, so a certain kind of trailer won't work or, you know, just those kinds of requirements that need to be thought of carefully before you go and pick the right kind of carrier. And that lets us kind of act a little bit more like the carrier sales rep when we do this automated kind of re outreach to these carriers saying, do you want to cover this load?
Yeah, I think that, you know, the carrier sales, the carrier sales role, I think is probably the most overlooked and under trained position inside of most brokerages. Right. Because most people's, you know, like, capacity solution is just to post it up on a load board and, you know, and find the cheapest truck and everything else. And, you know, again, I think that, you know, I do, I just, I look at it a lot differently because I was a carrier rep for the first four years that I did that. I worked as a broker and, dude, we couldn't even take an inbound call for the first. I think it was like three months, you know, like, you had to make outbound calls to cover trucks. Like, that's what you had to do.
That was the methodology behind it, because we needed to develop an actual carrier based on the lanes that they run, not the lanes that I want them to run. Because I think when you have that post and prey methodology, you might, you know, you might find great, and you do find great carriers out there. Right? So I want to put that caveat that is a very efficient way to find somebody who wants to pick up a load in Enid, Oklahoma, and go to Dallas, Texas. All right. It's very efficient. But what about the next one? You know, what about the next one? Because it's not the power lanes that people need to be worried about, right? There's always going to be somebody to do a load from Atlanta to Chicago or Atlanta to Dallas, there will always be a truck for that.
But what about the most obscure lanes where the overwhelming majority of us get our start with a customer? Because there is only a finite group of carriers who do run that consistently. And you need to find them and you need to keep working with them time and time again because that long term is predicated on are you going to grow with the customer or are they going to shut you off if you can't pull through for them?
Yeah, Beaumont, Texas, the Tupelo, Mississippi. I mean, figure that one out. And you're right. Like if you have multiple loads that are going to be on that lane, you shouldn't take a second inbound phone call. You want that same carrier to become somebody that you develop that relationship with. And when they prove themselves on that first one, that they want to be used on that. When they go and take a load off the load board too, are they solving a temporary problem yet? But they also are using that as an opportunity to do the same thing themselves to you. Like, let's build a relationship here. And I only want to deal with three to five brokers myself. And are you one of those people that I can rely on?
So that second phone calls, I think where the real value starts playing in, we're, we are trying to reduce for companies the number of loads they post on a load board, but not because the load board itself is something evil. As much as we want to see your engagements with the load board add up to something more and it's those relationships you're calling out. And we feel like that's how you grow a business.
So when you're out there talking to brokers right now or your guys target market and they're saying, oh, we've heard all of this before. What's the main resistance that it is? They've just been oversold on what people's capabilities currently are on what they are offering? Or is it like, hey, we've tried that, but we want to just stick with just posting and covering one off carriers?
Well, you know, I think the attitudes around this actually are changing a lot, especially with the rise of fraud too. Is that a message where you're saying, hey, it's a good way to grow your business by trying to measure posting to load boards less? That's starting to make a lot more sense to people. Because there's real value and fraud avoidance and risk mitigation that comes with doing that. So that's kind of increased attraction that I think we're seeing, but I think one of the main resistances is also if you're, if you've ever kind of sat with a brokerage, you realize these carrier salespeople have like seven screens everywhere, right? And they're like, cool, a new tool. I don't want to have an 8th screen and yet an 8th way of doing something that is, you know, because that would just be an optional thing.
It's just more of a distraction to the team than allowing them to actually get focused and drive this the way that we want it to be driven. So while that software seemed, you know, I might believe what you're saying to me, Ken, but if it means another screen, I'm kind of not interested in that. So we found that it's super important to show an integrated experience. We want to actually put our tool where the carrier sales person is working and make it smooth. Well, we want it to be part of their workflow in a natural way. So, you know, I'd like to hear from Chad what kind of TMS is out there or programs out there would you like to see Apollo engaged with too?
And see, you know, we already are engaged with a number of tmss, but want to see what out there matters because we don't want to add another screen to the mix.
Yeah, I think that there is, you know, from like a workflow. I mean, because I, dude, I only have two screens here. Obviously what you guys can see out there and that's all I need. But you know, we do have multiple programs that are open, you know, but it is mainly just my email and my TMS. That's, that's mainly what I'm operating out of every single day because like I have adopted that methodology of, hey, we've established regular carriers. Let's just reach out to them. Let's reach out to them because like, I mean, I think most brokers, you got to ask yourself when's the last time you had a capacity planning call with your carrier network? You know, when's the last time you sat down and said, hey man, we got like 30 orders that we just got tendered over.
What can you commit to? How many days can you, like, what's, what's the lead time that you need stuff like that? Because when you're, it's zero. I mean, I look at it like this, man, because, you know, again, to always, I got to put this caveat here. Take this from a guy who's actually cold, called onboarded customers and built a broker. So, you know, there's little value in that compared to the social media world of the people sitting on the sidelines. I'm being completely sarcastic, but here's how it goes, you guys, you're going to onboard a customer, all right, you're going to cold call them for six months, email them, try and do whatever it is to get in the door and then you're going to get your first load from them. It might be a couple more weeks.
You're going to get your second load, maybe, you know, a little bit more. Because some people, you know, you can always say, oh, we got, you know, a lot of freight right away. But eventually after you service them well enough, they're going to come to you and say, I have 55 shipments coming in the next week. How many can you do? And you're like, holy shit, where did all this volume come from? Then what are you going to do? Are you going to take them all? And then is your plan going to be, I'll take them all and then I'll just post them all out there? Or are you going to use this build up approach to find a couple of core carriers?
And then you have a capacity planning call with them and you're like, hey, my customers coming to me right now and they said we got 55 of these moves coming in, landing on, you know, the 7 August. How many can you commit to? How many days do you need? What kind of heads up? What are, what does that capacity commitment look like? And if you aren't doing that, I want to challenge every broker out there to start, all right, start talking to these trucking companies because guess what? They're a business too. All right? It's weird how, you know, they're actual human beings behind the wheels and they're not bots that you can just hang up on like a lot of people like to do.
I truly feel like you have to create that synergy between your carrier network as a broker because you really need to focus on two things. You need to become a broker of choice to your customers. Yes. But most importantly, your carriers. Because again, I ask people, present me a business plan as a freight broker where you make money without trucking. Without trucking companies. I'm still waiting for, I've been asking for it for four years. A lot of you guys think trucking companies are, you can just recycle them and find new ones. It might work for a little bit, you guys, but there's this thing called a market shift that's happening right now. I'm already starting to see the needle start to twit, to turn a little bit. And guess what, brokers, it's not in your favor, all right?
All of these little fees that you like to plug into your rate cons, all of them are going to be irrelevant here. Coming up. All right? And a lot of you who are chest bumping right now about how great you are going to fucking struggle. You don't have to, all right, I've been saying that for a while. You don't have to struggle, but it's going to be a rude awakening for a lot of people.
And the market margins have tightened up. I mean, we all have experienced the glut of 21 and 2021, 22, and we go, wow, that was great. You know, that was definitely a time of feast and now it's a time of famine in terms of where margins are for brokerages and when are the good times coming back and something happened. I think this is what you're also calling out is there was a shift, a technology shift that created a lot of pricing transparency for the industry. So can you as a broker, go back and try to charge those hefty margins that you used to? I think those days are done. I think you've got to learn how as a brokerage, you're going to just do more with less. And automation has to play a role in that.
When you think about it, like, you can't just manually be covering all these loads the way you used to.
I think of it like this, Ken, the days, there's going to be certain freight that, yes, you're going to be able to pull out, you know, maybe 18, 20% margin on and it's. But it's going to be specialized freight. It's going to be not dock to dock drive in freight. All right. I realistically think I. That a healthy margin for some of these loads moving forward is going to be that twelve to 14% for dry vans and I think maybe 13% to 15% for reefers and legal flatbeds. I think that's where it's probably going to get to. The more transparent pricing gets out there in the market and the more and more data that comes out there, I truly think that's where the things are going to gravitate towards and I think that they're going to sit there.
I think that there's going to be more of an even keel pricing approach that's coming on and there's going to be market shifts. Right. There's going to be natural disasters. There's going to be last minute shit that happens where people are going to pay more. But I think that those days of, you know, sometimes you can pull out some of those big ripper margin loads on legal drive and standard drive in. I think those days are done. I really do, man.
Yeah, I think, and we've seen this, too, on some of the places where we've seen brokers go and bid is, oh, I put the bid. I always like to win, you know, I know when they're going to do the awards. I know it's, you know, gonna be a Monday morning at 10:00 a.m. Or whatever it is for that shipper. It's when all the awarding come in. So I'm gonna come in there and I'm gonna bid at 950. That doesn't work because the bots gonna undercut you by a couple cents at 951. And playing these games this way just don't work. Now, you kind of said where you saw driving going to end, where you thought the percentages would end up. I'm more skeptical.
I think that the margins are probably going to tighten up, you know, with where we see bots and freight automation driving the spot market, that I think if you're getting eight to 10% off of a drive and load on the spotboard, you're doing great.
I think that might work right now, but I don't think that's sustainable. I think that there are certain markets that are out there that, yeah, you know what? You're going to sit in that. You know, if it's. If it's the highly commoditized lanes, Ken, that, you know, like, again, Atlanta to Chicago, one of the busiest lanes out there. Dallas to Chicago, I could see that there. Right? Like, I could see 10% for a drive in load. But I just look at, you know, anything outside of that's not first come, first serve, you know, eight to three or eight to four. Shipper receiver, 26 pallets, 20,000 pounds. That might fly with that freight. But I think that any time that doesn't align where there's appointment times, there's going to be enough charge for that.
When there's, if it's 40,000 pounds, there's going to be an upcharge for that. So that's where I see the, that's why I go with a little bit of a higher average on that because I think there's way more freight out there that is going to, you know, kind of derive that stuff because man, there are so many facilities that are across the United States, if you talk to anybody who hauls reefer freight into some of these food large retail distribution centers, if there are certain ones out there, we're like, oh, it's going there. That fucking, I need 300 more dollars, you know, that will always come into play.
Well here's the challenge, Chris, and we'll have to see how much this affects the market overall. But, but big brokerages are investing in more and more bid automation around all this and they are bidding on literally everything regardless of the risks of, oh, as their appointment times. And they're basically trying to win up so much spot freight through those bid tools that they just absorb all that risk into a giant snowball. We're so big. It's going to be okay. We'll cover most of it at a profit, we'll take a loss on some of those things, but overall we're going to make a bunch of money. And if you're a small to medium sized brokerage, you just can't play that way.
So that creates a little tough market for you where I think that's going to put pressure on some of the smaller guys that if I am going to try to go and just not slurp up with a fire hose every single spot load out there and absorb all that risk, then I need to be really thoughtful about how I'm going to try to probably play in a lower margin way to try to win the loads that make sense just for me.
Yeah, I think that there's, you know, there's a lot of different strategies that are in play right now. I mean if you pay attention to any of the earnings calls that are out there from a lot of the large publicly traded companies, I said this earlier in the year, a lot of these guys, their brokerages, they will choose a business unit from. Again, this is just pure speculation. This is just based on what I've seen out there, they choose a business unit to absorb all the losses because some of them are, you know, like, oh, this one's, you know, at this margin, oh, logistics lost $4 million this quarter. Oh, I wonder why. Because like you said, they're going out there and gobbling up excess freight to control revenue.
But naturally what has happened over these years is they do that in down markets and then when the markets flip, then they're like, oh, we got to raise our rates. And like this, to me, this theory of mine, I know it's more than a theory, because I worked for a large company and I know the meetings that we had back in the day, but what happens is this, man, I don't. I think that there's nobody changed over these last couple of years. Cause if you pay attention to the top 100, you can just go to transport topics. Top 100. Back in 2019, where they're at in 2021, 22, record revenues. Record revenues. But where are they all at right now? They're all back down to where they were in 2019.
So that tells me nobody did anything different that showed their customers, hey, we are better than our competition. Nobody did anything different during that time. Not one. And again, correct me if I'm wrong, but not one. There was a couple of companies who jumped up the list, but nobody took over a market and stayed on top.
That's.
So they all sat back, they cashed their checks, they didn't do anything different. And now they're all like, how the fuck? What happened? The problem is nobody does anything different. That's why I think somebody in the small to mid sized market, I'm just going to throw myself in the mix because I think it's going to be us in the next ten years. We'll be in the top ten. And they're going to be like, how the fuck did this happen? And it's going to, because they do the opposite of what everybody is doing out there. The spraying pray methodology, the that's done. It's going to be strategy. Re rinse and repeat with the same carriers. You know, like my friends Micah who comes in are, they have an art RGN out there.
So if anybody has any RGN freight for Micah and Dallas, hit her up. But we're going to reuse them repeatedly time and time again and then customers and be like, damn, yeah, you're pretty much in line with everybody else, but you services so much more. Can you take on more volume? Yes, I can, but let me find another mica. All right. Oh, got another mica now. Boom. And then you build it up on a lane by lane basis. That's how it's going to be out there. And I think that's where it's going to really help you separate yourself.
I agree with what you're saying. That makes a bunch of sense. So one of the things that we try to do too is offer our customers, because this tool is beginning to understand what a carrier network looks like for that broker is we also try to, we give them a load bidding tool by which they can go and kind of play with the big boys on that same playing field with automation, but with the loads that make sense for their network. So as we kind of discover where their power lines are, where they're strong, where they can cover loads, well, that's where you want to bid your spot. You do want to use it as a growth opportunity, too, but you also want to try to win volume across your power lines where, you know, you're strong too, because that's where your margins are.
So that's the second offering that we're trying to do over here, too.
Yeah, no, I think that, you know, again, you need to get your pricing dialed in. You need to be quick. I think that, you know, for anybody out there that's in the small to medium market, and, you know, they're like, what do we do? You know, where do we start? I really think a lot of it is focus on your speed to reply. You know, how are you attacking these? Because I know that some people, you know, again, for whatever reason, I'm not here to judge anybody. They take their time on stuff. But, like, right now, it's speed, speed, because I'm replying to some of my customers within three minutes with the price, and it's gone, hey, we already found somebody. We already found somebody. So I think it's doing that. But it's also pay attention to averages, you guys. I do not subscribe.
I do not subscribe to the fact that there are massive market shifts that sustain outside of holidays and everything else. Yeah, there might be a bump, okay? But if you pull a 90 day average or a six month average on a lane, you're going to see ten cents, fifteen cents out there. So you're looking at anywhere from $50 to $65 in difference of rates, depending on the miles and everything. That's really, that's not enough to where you have to blow up your entire pricing strategy and go to your customer. You can hit them with the same rate. And that's where. Yeah, some days you're gonna make 14%. Some days you're gonna make 11% on a load. So be it. As long as you're keeping your customers customer happy, that's all. Should be that. That should be your top priority in those moments, but.
That's. Right.
Yeah.
Man in email quotings, you have to be on it. You can't wait 30 minutes? Try it out. Freight quotes at Projectapollo IO. This is something we can light up for brokers if they're interested, but we can make the automated email responses work for brokers as well. That's part of what we do. Perfect.
But hey, dude, that's already at 30 minutes. We got, we got to get back at it, man. We're, we're a business.
Cover that freight.
Yeah, we got to get out there and cover that freight and get back at it. But how does anybody reach out to you though, to ken to find out more?
I'm on LinkedIn. Ken Apple. The BIOS linked to this recording and Kenroject Apollo IO. I'd love to hear an email from anybody.
Perfect, man. That works. And as always, you guys, we're going to have guests on tomorrow, guests on Friday. But if you guys got. And we actually also, one more thing. I've been kind of busy and I forgot to mention, we got a really special announcement coming out tomorrow as well. I think everybody's going to really like that about what we're going to be doing here moving forward on stuff. But as always, you guys, 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.
Bye.
I'm going to get flamed.