Ep. #23: Harman Cheema

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But for the first time ever I'm having to re-record part of the episode because of a technical difficulty with our guest . We recorded an hour-plus long episode yesterday and I sent it to my man Fraser , my editor , and he let me know that the first 10 minutes did not exist on the recording . So I am back this morning doing it solo .

Harman Chima , my wonderful guest , is not even here , but I am going to make this work . So I am joined today by Harman Chima , the CEO of Chima Freight Lines , a company that started with one sole truck in 2006 . Harman's dad started the company . Harman was a 16-year-old kid in high school , just like I was when my dad started Coyote .

So kind of cool connection there for us both kind of growing up in our businesses . But Harman helped really take this thing to the next level . Today the company has 500 trucks , 2,000 trailers and is doing a lot of business . They're making a big impact out on the West Coast , so it's hard for me to introduce him .

He's not here sitting with me , but it's going to apparently seem seamless or come out seamless because of the great editing , and so here we go . So , harman , I'm going to skip the first few questions I asked and go right to the one that actually was recorded correctly . Few questions I asked and go right to the one that actually was recorded correctly .

Did you always want to ? Did you know you'd always be in trucking ? Or you know , was this a career that you always wanted ? Or what were your kind of dreams when you were a 16 year old kid and your dad was starting this company ?

And so that's just kind of what I grew up , right , just knowing that , hey , I should probably be a doctor because that's what my dad wants me to be . And then later on , in high school and stuff , I was like in high school and stuff , I'm screw this , I'm not gonna be a doctor . And so I wanted to do some kind of business .

Didn't really know what that was . And then , with this kind of opportunity that just kind of got thrown in , you know , randomly around trucks , something that I've learned to love as I grew up I was like , hey , this is pretty cool if we can make some money doing this and , you know , kind of have our name out there , good branding .

I was like , hey , why not ? Right , I love doing this . So , um , as a kid I would like draw , draw trucks and cars and random stuff like that .

So I just kind of fit right in and and I knew there was an opportunity for just good truckers out there , right , because there's a lot of big guys and a lot of small guys and I was like there wasn't a lot of medium and so I was like , hey , I want to be a big guy , but if we start small and act big , right , uh , that's kind of how I started yeah

, just try to grow the business brick by brick , day by day .

But it was tough , right , fuel was high , everything . And it's kind of funny because a lot of this we feel , a lot of the same characteristics going on in today's market that I kind of vaguely remember from those early days so you're saying you know that 2008 recession that we felt like was it was easier because the company didn't have a ton of overhead .

We're a lot more mature and you know , back then it was good because I mean I was , was , it was just me and my dad were kind of the company right Putting it together . So we were fine from an overhead standpoint .

When do you decide , like okay , we need to hire an HR person , we need to hire operational staff ? Like how do you think about that as you're growing a business , because I feel like it could creep up on you overnight . We're like , all of a sudden you've added 50 more trucks . And then it's like , whoa , how do we support all this ?

And then you get people who actually know what they're doing and you're like wow , why didn't I have you day one ?

So we don't want to be , you know , we don't want to be on the the bleeding end , right and so , um , and then we started pushing more and more of it , hired a real safety guy and those things , and then you would weed out a percentage of your drivers because they don't want that .

You knew , you know , you're kind of looking the other way in the beginning and just covering freight , booking , freight , delivering it on time , no matter how . I got there . And then you know , bill it and get paid and do it all over again , right , hr and accounting and safety , all those things were like an afterthought .

But I sat down and talked and I was like , man , if we want to do this thing , we got to do it right

. So 2012 was a big year for us . We're up to like 50 or 60 trucks and I was like we're going to pause , we're going to put the brakes on and get safety dialed in . So that's what we did .

We literally took like three years of just building and , you know , up to 2015 and just getting safety dialed in , getting the right drivers in there , upgrading our fleet to a more modern fleet , newer trucks , because maintenance was also . The other thing is , you know , back in the day the trucks were a lot different and less emissions and all that .

You kind of run them for a million miles . So we just we had a couple of good mechanics and we just fixed them up and we'd run the heck out of them . We're already buying used trucks at the beginning , right . So all that stuff came way later and just kind of as I was growing up , the company was kind of growing up at the same time .

It sounds like that's when you kind of took a pause and took inventory of the company and said , okay , if we really want to scale this thing long-term , we have to put our big point , big boy pants on and act like a legitimate sized trucking company . And I feel like that's kind of what young adults do .

You know , they graduate college and they're like , okay , I'm going to , I have to be an adult now , like I'm going to start going to work every day , and like I'm curious , as you think about that period , when you said , hey , we got to scale up , we got to focus on safety , um , focus on maintenance , things like that .

What would you say are the most important lessons that you learned in ? You know that that people who haven't run a truck company or don't own a trucking company wouldn't know when you started focusing on safety and kind of evolving the company , what were the things that you had to really focus on to get it right .

I said I've got 20 trucks . And he's like you have good drivers . I was good drivers . I said yeah , and I said , cool , you know they're safe and they're good . Because I mean , at that point he's gonna have to pick 20 guys , right . And so later , when he got to 50 , 60 trucks , I was like , hey , I gotta go buy some more desks .

So I went over to the guy and he's like hey , you know , I see a few more trucks out there . How many trucks you guys up to ? It's all like 50 trucks . And he's like he's like how many good drivers do you have ? And I said 50 or 60 goes good drivers . I said , uh , he goes , you probably still have 20 good drivers . And I'm like , dang , you're right .

So I was like , wow , we gotta this guy's on to something , right ? So , even though we're still got 20 good drivers right , and so that's what I was like okay , we got to get good at our hiring practices , we got to get dialed in on our safety and actually watch it and , and you know , have good stuff there .

But I think that's the biggest thing is a lot of companies , when they're small , they don't realize you know , they just keep , you know , just let's deliver a freight , well , and then figure out how to , you know , put it all together later and don't really realize that the cost of safety , the cost of , you know , running trucks properly , is a lot different than

just you know , the cost of running trucks properly is a lot different than just the wild , wild west a little bit right . And that's why I think a lot of those guys struggle , because they're already kind of operating out those thin margins and they don't really realize what their real cost is .

And then when they start trying to put it together or become legit , they're like , wow , I'm not making any money anymore or I'm losing this much money . Right , but truly that was their cost in the beginning , if they had done it right . But they don't know what doing it right is at that point , right . So as they learn , so that's .

That's something that was a big wake up call for us , like , wow , we're not making money anymore .

So it was , hey , this guy's friend , or hey , I'm doing really well , here , I'm going to bring my friend over , and literally that's how we seeded the first , probably a hundred or 150 trucks . But now I mean , as we got much bigger , we're bringing in drivers every week . We've got two orientation classes at two different locations .

The beast has definitely changed , right . We've got ads running , we've got social media presence , we've got good branding on our equipment , so , but when they come in , you got to really we got one person just vetting through applications and working with recruiting , and then we got safety on top of that , checking to make sure you know they meet our criteria .

So we've got several different checks before we get there , Because the liability and what's more at risk Is a lot more now than it ever was , Right , so it's a beast .

Okay , that's fine , we can kind of talk through that . But if it's been jump , jump , jump , jump everywhere , it's like okay , cool .

We probably hired I don't know a thousand plus drivers because they're not all good fits , they're not all good safety fits , or their culture doesn't vibe , or you know our lanes don't vibe or whatnot . So that happens and you gotta , you gotta keep building a core right and the core gets bigger .

We went through the same thing at Molo and and that's one of the things that's the most most challenging is , even if you have great processes and you have great people , great hiring team , um , great interview skills , all that stuff If you're a fast growing organization like you adding 300 drivers in a few years for us we were adding three 400 employees over a

few years no matter what , there's no chance you're going to be a hundred percent right . You're not going to get a hundred percent good drivers . I'm not going to get a hundred percent good brokers . It's just , it's just not possible .

I mean whether it's people who you know sell themselves better in an interview than they actually are willing to be , or people who masquerade as saying , hey , I have all these great values and I will . In your case it's I'll deliver your loads on time . In my case it's I will treat drivers and shippers well , whatever it may be .

Then they get in the business and they start cutting corners , they start lying to your dispatchers or they start , you know , maybe screwing over carriers . Whatever it is . It's like it's hard to manage that perfectly . What I think about in one of the challenges is like this is where it comes back to culture .

And if you have a strong culture , where you have a team of people that are really bought into the business and really invested in what the business is doing , they're good at weeding out some of the bad apples , so the ones that slip through the cracks like if you have a bunch of good drivers and then there's a crappy one who's comes in and delivers an order

for you or who knows what the example is . But my point is that , like , the good people see the bad one and they want to weed them out . Like , if you notice that and you're like , how do you think about culture in your business ? Does that ? Is that important with respect to this stuff ?

So at your company , when you had 300 , 400 people they're probably over a few offices or an office , right , right , potentially so at least you could talk to them and and be face to face with drivers . Imagine having four or five hundred drivers out there all over the west coast or all over the nation . How do you communicate all the way down to them ? Right ?

So you got to use multiple modes of communication and some drivers are like I don't even want to talk to you , like I do , I drive truck because I don't want to talk to people , I want to just try it , right , and so , uh , which ? Some of those guys are the best guys .

They rock out 13 , 14 000 miles every month and um , so that's tough , that's tough , that's been , you know , and just like yourself , we've had to grow office people with the amount of drivers we're growing as well . So across multiple offices , and that's always a challenge as well .

So I think people in any business , it's always a challenge , it's just , you got to know . You know you're working with drivers or you're working with what kind of people are you working with , right , college students or whatever , and kind of speak their language and then get them bought into . You know , every 15 , I don't know bought into .

You know every 15 , I don't know correct me if I'm wrong , but every 10 , 15 , 20 people you hire , they kind of bring in a different culture and you're trying to mesh them into your culture . But then , at the end of the day , your culture is changing , right , it's all coming together so it's changing .

It's the same thing for drivers , it's the same thing for office people . And I think one thing we had , um , we had to overcome . Um , you know I was talking about being Indian , right ? So , being Indian , there's a lot of stereotypes and guess what Drivers are your most wild , wild west stereotypical guys out there and uh , and gals and so .

But for me , I was like I'll take on any challenge , let's do this thing . And so it was . It was a challenge getting a bunch of good guys that have been working for a bunch of american good companies forever , you know , to give us a , give us a , an opportunity , right , and and they're like I'm not gonna work for them .

They're so and so or they're , you know , they're camel jockeys or whatever . That's my favorite one , and uh . So it took a while to get over that . But once they start saying how long did that truck , I see another one . Then they , oh , maybe I'll check it out and now believe it or not .

The other way around , the indian guys are like I don't want to go work for them , maybe they're too strict because they have a bunch of white dudes , their truck and their fleet , right so . But that was a big thing , right .

And it's all goes back to culture and safety and that safety culture , right so , because stereotypes are , you know , where there's smoke , there's fire , right , it's usually true , some some of it's usually true I actually you just jogged my memory of a customer who you know .

They're not the most accepting people necessarily , but what I remember and this was only like a year ago or I don't know sorry , I've been fired for longer than a year , so this was two years ago Um , but there was a customer that was dealing with theft and it was at one facility , I think in Texas , which I guess is not surprising with what I'm about to

say . But they were trying to solve this theft ring they were dealing with and they ended up creating a very blanket and racist policy . That was anybody with the last name Singh isn't allowed on property .

But to just blanket policy , say no sings allowed , is BS . And we ended up having to fire the customer Cause we were like we're going to put our line in the sand here where it's like I'm not putting on my rate cons , no sings allowed . Like that's just that's . That's a step beyond where I'm comfortable because I don't agree . I just it's , it's not right .

the topic . Let me ask you this what ? What have you noticed are the most common themes within , within drivers ? I'm going to stay on drivers for a bit here . Again , you're representing all carriers here , so I need you to do it well . What are the things that drivers are most looking for ?

When a driver's interested in coming to work for Chima , what is it that he's really wanting , or she ? A couple things .

Um , or they feel like there's a connection to leadership . There is a purpose , there's a why do we do this ? Are we purpose ? There's a why do we do this ? Are we just another number ? Right ? You know that , hey , we're just another number . There's a lot of truth to that . Truth is , I don't know all 500 of my drivers anymore .

It's a damn shame , but it's not possible . But at the same time , if I do meet somebody , I want to be able to shake their hand and ask them what their name is , what are they , who their driver manager is , how do they , where do they run those kind of things . So I think that's important right for the drivers . They want to .

So if they're the drivers that just want to go trucking in which there's not that many of those guys left anymore and just want to , you know , make that their lifestyle , I think a lot of the new generation coming in it's not .

You know , we got a lot of drive managers and and operations folks from bigger trucking companies that work for us today and sometimes they're like , hey , find us the guy that wants to stay out two , three weeks at a time . I said not gonna happen , there's , you know , I always call them . Hey , you guys got big carrier syndrome .

You can't just say , you know , find me these generic guys and they'll do any loads you want , right , right , how about we start working on ? How about we start working on weekly home time ?

Or how do we get them on a routine run so they can actually show up and go home every Saturday afternoon or Friday or Thursday or whatever you set up so they can have a life outside of the truck right .

So that's extremely important for those carriers that don't get with the program on that and just kind of want that stereo blanket type to where they can just send anybody anywhere in the nation and they're several days out away from their home . It's going to keep going away , so it's going to be . I think drivers are looking for predictive home time .

That's our models predictive home time , predictive pay , predictive I don't know what the last one is , I can't remember right now , but just being predictive . Predictive , know , I don't know what the last one is , I can't remember right now , but just being predictive , like you know . Predictive pay Consistency .

So there's a couple of things I want to touch on here . Let's start with your first point you made , which is about people wanting to feel valued , people wanting to feel like they know the guy whose name is on their trailer , or the CEO , whatever it may be .

This is something that I picked up on at Molo and one that is a lot easier to support than I think people realize , and so my point here is we would do , as part of our new hire orientation I think , one of the things that we did really well .

So , you know , the new hires would come in and they would have training for several weeks where they're not booking any loads they don't book loads for two to three months until once they've joined the company , because we really wanted them to understand the business in and out , and so we would put them through a pretty intense training .

Now , as part of the training , they would have leaders who would come in and speak to them . Maybe they'd have one a day for the first two weeks , and that included several executives like myself .

So every time there was a new training class , the trainers would reach out to me and they'd set up on my calendar for 60 to 90 minutes for me to go meet with the trainees and I would just sit in the room with them . I'd start and I'd just ask everybody to introduce themselves .

This was actually intended to be virtual the last few years , but we'd sit in the Zoom room with them and each one person would go , individual by individual , and say hey , I'm Harmon , I live in Seattle , I just joined the company , this is where I came from , this is what I'm looking forward to .

Maybe I'd ask them a question to answer about themselves , whatever it was , and they each would go and I would engage them , ask them questions , whatever , and then I'd spend an hour talking about the business , really trying to hit on the things that I thought were most important and this is the culture stuff and then I would take their questions .

So the two pieces to that one are saying this is what's important from the CEO's mouth , this is what I care about , this is what we care about , and I think that sets such a strong tone for an individual's journey in your company that within their first week or two , they're sitting directly with the CEO of the business and that person is telling them exactly

how they can be . Successful is to say , hey , if you do these three , four things , then you're winning in my book , you're winning our book . Like , your boss , your manager is going to be happy with you , your teammates are going to be happy with you . Like , this is how we went , and especially tying our success to those actions .

Um , helping people understand that , listen , if you actually take really good care of the carriers and what I mean by that is you're extremely honest with them , you don't BS about appointment times or detention . If you commit a load to them , you don't take it back because you find someone cheaper .

If you agree on a longer term rate , for three months or six months , you hold it , regardless of what happens in the market . So you point out these very specific things and then you tie our success to that and say we've grown so much over the last few years because look at the percentage of loads that are booked on repeat carriers .

Those are carriers that appreciate our business . And so my point in saying all of this is like you want to make people feel important as the CEO of the business . Sit down with them as soon as you have an opportunity to and have a conversation with them and tell them what matters to you , what matters to the business .

And then the second piece of this was taking Q&A and I was always very direct and said ask me whatever you want and I will answer it as honestly as I can . We have nothing to hide here . There's nothing to be uncomfortable about asking . You might not love the answer .

You might ask me if you can be remote for the rest of your life and I might say no , we're going to go back to days in office soon , but we're going to be honest with one another about't know . I just wanted to hit on that . Does that strike true with you as you think about kind of how you've sat in your role and how you communicate with your team ?

So we really need our people , whether it's our drivers or people in the office , to be hitting it all on all the cylinders and rocking and rolling and really winning for us , and then the customer automatically wins .

But it's clear that there's an important science to this , because for you to keep your drivers happy , you have to give them consistency . You have to get them home when they need to be home and that consistency allows them to schedule their life the way they want to .

So it's not as simple as one might think to just go to shipper A or shipper B and say , hey , I need loads from Dallas to Seattle every Monday to Thursday and that'll get my driver home

. I'm curious how do you manage building a network of freight , Like how do you get the right loads into the system so that you can keep your drivers happy ? What kind of tools are you using , what ? How does the strategy work ? Can you talk on that for a little bit ?

You got to sit on it and you're going to live and load at some lumper grocery DC the next night . That might pay you three $400 more , but versus another load that you can just take in , drop the trailer as soon as you get there and the driver can be on the way and already , you know , headed back somewhere else .

So we look at those drop and hook opportunities as much as possible . We run a pretty good trailer ratio . We run close to you know , three , eight , three , nine for each truck , so we can keep our drivers moving at all times . Now , it's a big piece , right , we call it . We call it playing chess with marbles every day , cause you're , you know .

We just say we just got 5,500 loads of water from this customer . It's . They're like hey , what's the weekly commitment ? Well , do we just divide that with 52 ? Is that really really realistic ? Is that a beverage customer ? Are they going to move most of it during the summer ? All those things come into play , right ?

So when they say it's just a truck and a load , it really isn't right . There's a lot more science that goes into it and trying to balance it right , so do we . Is there a booked market over here that all your shippers are all shipping beverage ? Well , guess what ? They're all going to peak at the same time , right ? So we look at those things .

That's super important . We're really being put to the test now . I've got the most amount of trucks I've ever had in my life . I work very closely . I was the only sales guy forever . I've got a sales team , now no-transcript . So you got to kind of prove yourself and then you can get the gravy stuff .

So all that I mean I know it's not a bunch , but really that's . You bring it all into the kitchen and you got to depend on the cooks to kind of sort it out and put it together . And then guess what ? This new freight you just picked up . That's 15 loads a week out of this area and you're like sweet , this is going to solve it .

They want to move everything Monday through Wednesday , right , it's like cool , what do I do at the end of the month , at the end of the week , right ? So all those things , you've been there , right .

But on the truck side , the other component is it's like how do we keep the drivers productive that's the efficiency and keep them on their engineered schedules or whatever , right ?

It almost feels like you're trying to put a puzzle together , but and this just has me thinking about bid season you might have 10 customers who do their bids in January and then another 10 who do it in April , but you have 500 drivers in January and in April .

So it's almost like in January , 10 customers are going to give you 50 of the puzzle pieces and you're going to start trying to put it together , and then in April you're going to get another 50 puzzle pieces and you have no idea if the puzzle pieces that you got in January and April fit together Right . Like that's what I'm curious .

How do you keep a really efficient network where your drivers are always on the optimal loads ?

If you're cause your customers don't give a crap about your network , if , we're being perfectly honest , not that they don't give a crap , but they're not going to change their ordering patterns from Monday to Wednesday to Monday , wednesday , friday , to ensure that Chima's puzzle fits nicely .

So I'm curious are there tools or is there technology that you guys are using that makes this easier , or is it just really freakingicking hard and you need people who understand it ? Well , like , help me understand how you think about creating , like , the optimal network for your trucks .

So we just you got to have really experienced people that really know the network well . But the key is don't have 500 trucks and send them all over the country . Focus on your core lanes , so that way you can build your density . Right . So we got really good on the I-5 .

Now we're running on the 15 and the Salt Lake and into Idaho , we're on the 10 into Phoenix and a little bit into Dallas . But just that density is huge . It's super important because you don't want to have 500 trucks everywhere . You want to have 40 , 50 trucks in every market every day , right . So that's the key .

And you got to try to bring those customers on too . So you have choices and you got to know and who's the most advantaged carrier or broker on a bid and who's the most disadvantaged , the incumbent ? Right , because they know the characteristics of the freight , they know that , oh , this stakes , I really need this much money to make it work .

Or this is really good , I really need this for my network , right . And so typically the one that really stinks that you worked so hard all year to service the heck out of , and then it's all sunk . You're like we lost it . What the heck happened ?

Well , it was a big rate issue , right , and something you've learned to figure out over the time and got your rate to where it needs to be . All of a sudden you can lose it . And then 90 days , customer was like , hey , you think you could still do this .

It's like , okay , well , we figured it might come back because the carrier who took it on had no idea what they were taking on , right . So there's a lot of that goes on . That's more disruption . So it's not January and June , it's January and June and maybe August too because of the stuff that starts coming back .

So for us it was just keep the density going and have enough in there to where you've got your appointment freight and you've got your drop-and-hook flexible freight and you've got to have your filler freight and I hate to use that word because no customer wants to be that filler , but it's true , you've got to have that stuff where , like , I can kind of move

this tomorrow if I don't need it today , right ?

It sounds like you've sought out simplicity where you can to make it a little easier , and that's what you mean by finding your core lanes is you know , the puzzle pieces tend to fit better when they're all picking up in Seattle and delivering in in LA or or NorCal or something like that .

It's like , well , it might not be the exact same puzzle piece from the bottle the the water , the bottled water company , and it is . It is the canned dog food . If it's both shipping from the seattle area to la , I can generally figure out how to make it work , because I've got density on the lane yep , that's the key .

So , being quick on that , having those open communication with your customers because your customers aren't just your customers . At some point they become a real partner , they become friends and you can have a open conversation like yeah , you're right , we're jacked up here . Do the best you can on this , and I'll try to figure this out for you over here .

I've had great relationships with shippers , but I'm just curious if it's different , if you're an asset , if they just look at you with a little happier or something . So will you talk to me a little bit about the nature of those relationships you have with shippers ?

And you know , let's start with the incumbent piece , because you just talked about that and this is going to be maybe generalize the answer , because I know everybody's not the same , but in your experience , do you feel like shippers tend to really prioritize incumbency ? If you've owned a lane , do they try to let you keep that lane often ?

Or do you feel like you know what percentage of shippers do you feel like really respect incumbency versus are like I'm just taking the lowest provided rate to me on this lane every bit ?

But then in today's market and maybe there's good customers that got hosed and their budgets went crazy during the crazy time last few years they're being forced by the upper brass to just go find savings at all costs or ask Harman to

come back later . And you know truckers , we will , and brokers too . So there's a lot of that , I feel like . So we have a brokerage as well . We move probably 2,000 loads to 3,000 loads , close to 2,500 loads a month right now , and so they're their own true brokerage .

They started out as kind of an overflow and I feel like carriers and I feel like brokers think if I just get a few trucks , I can come in and sell my trucks and cover it on brokerage . We all know that game . They try to play that game , but I think as we've gotten bigger I've just learned to be open with them .

Like , hey , do you want me to give you an asset price and a brokerage price at the same time ? Do you want it to be the same ? Do you care if it's what it's moved on . Right now the conversation is like asset only , asset only , right , especially if it's customers that new customers are going into .

Right , and we've got a great relationship with some customers on our brokerage side and they do a hell of a job , sometimes even better than our truck line does on some lanes for some customers , right . And so we've got great customers there where they're more open to it .

But the rates when the market was crazy , our brokerage was getting more money on some of the same lanes than our assets were , and we're just like yourself , we were honoring if we commit to it , we're going to , not we're going to honor it Right .

And on the brokerage side , as they were growing , you know , they were able to get a little bit more money on lanes they were not committed to and find that solved right . And so I think what good customers do is they cover 60 , 70% of their freight on assets and that other , you know , 30 , 40% . They kind of roll the dice to get some of those savings .

So then they , you know , balance out that network or balance out those lanes from a cost standpoint , because brokers can buy better right now , there's no doubt , and just you know , depending on the lane Right . So it just depends on your customer .

I've had some customers that honored , honored those and , you know , stuck with us and you know they can't give us increases right now , but they're sticking to flat and no decreases or very minimal decreases .

And some are like , hey , I'm sorry , I've got some crazy requests Six months ago , by the way , a lot of six month bids now , right , so I know your rate was this from here to here .

Six months ago , I know we asked you to lower four or five or 6% , maybe I did because I really needed that for my network , right , and I was like , okay , it's still going to be cheaper than trying to go book a load from a broker if my truck is sitting here , right , and so I did .

And now I've had some ridiculous requests from on the same lanes , because they're this is the second six month bait asking for another decrease and the decreases were anywhere from 21 to 27% and I'm like , with all due respect , there's no more decreases .

So there's those customers , and I guess there's all kinds of customers , and the word shipper of choice is going to start coming back as soon as things start changing again real quick , and then they're going to be like oh man , we really need you and we'll honor this and this .

And right now , some of them , you know they're good people , some of them are good people , but at the end of the day they're being forced to say you know , price , price , price or budget , or roll the dice on this much X percentage of your business and try to go get change behavior through the bid cycles or through the market cycles is by changing their bid

structure .

Or if you see rates that are at the floor and they they think they might go up , you'll see them say , hey , give me you rates for the next two years , I want to hold these rates for two years . And it's like , okay , sure thing , sir or ma'am Like's this game that people play and I don't mean to pick on shippers , because it's not just , it's .

Everybody is capable of playing a game , everybody is capable of being short-sighted .

And what I was going to ask you about is how you kind of navigate shippers who act short-sighted , because I think , at the end of the day , all you can control as a provider or shipper are your own actions and you have to learn from everyone else's , but your business is contingent on other players' actions .

So if you're the broker , your business is contingent on the actions of assets and of shippers . If you're an asset , your actions are contingent on the actions of brokers and shippers , and so forth , so on and so forth .

At the end of the day , though , you can't control how the other people act , so the way I always thought about this was like let's give trust first .

Let's be the ones who say , okay , we're going to try to do things the right way , we're going to honor our rates on both sides , and if you take advantage of that , because the market's in your favor and you can then by all means take advantage of it , I can't stop you from taking advantage of it , but I can certainly learn from that .

I can certainly put you on a list of carriers that have burned me , or shippers that have burned me , and know that , in the future , I won't make that mistake again .

I always like to and this is not a perfect system or a perfect solution , but I always like to think of our network as like this ever-improving network , and every day , the network is getting a little bit smarter than it was the day before , because we either forge stronger relationships with our carriers and customers based on how we performed and they performed

that day . Or we performed or there were weaker relationships and , like , you just take the weaker ones and get rid of them and you keep building on the strong ones . So I'm curious , from your perspective , how do you think about that with respect to shippers that you're partnering with ?

Have you had to turn over shippers because they weren't acting the way that you would like and then said , hey , I'm going to , I'm going to get rid of these guys and go add a new one on this lane ? Like , how do you think about that ? What are some things that would qualify in your mind as a reason to get rid of a shipper ?

Talk about that for a little bit , yeah .

Right , but our brokerage , they're playing this . They're playing the same game as you just described , right , on both sides , hoping that their carrier partners are going to be there for them . And some of these guys are 510 truck guys . What can they do if the rate's three times more ? Right , I mean so . And some of the big guys too .

I mean you hear the big guys on their earning reports or whatnot . They're . You know , 15% of their trucks are in the spot market . Right , because they're kind of trying to balance out their risk as well . Right For us , we play majority contract as much as we can , just because we need that stability for our drivers long-term .

You know it's cheaper than driver turnover in my opinion . But we just keep a good list of the customers that we know that we can't trust and the customers , and sometimes you just need to haul their freight . But you can put them on the other list and and just know that . Be aware of that , right , and .

But it is disruptive because now it's like how are you going to go replace that um at the end of a bid cycle potentially right , and at the end when all the other bids are done right , you were counting on this . So it's tough , right .

I think shippers don't realize how tough it is for carriers and brokers when we're going through RFPs , because we're kind of banking on our incumbent lands , we're banking on trying to win this new business here with some relationships .

Even though you're like , cool , we're getting there , everything's awesome , You're really good about this , at the end they're like , oh , I'm sorry , I tried , I just couldn't get you in Dang and they're like oh , I'm sorry , I tried , I just couldn't get you in Dang right . Or I'm sorry , we had to make a tough decision .

Huge cost savings or whatever , and it's like , dang well , there goes 50 loads out of Seattle a week , right , how am I going to go replace that now , at the end of a bid cycle , potentially ? So it's tough . It's definitely tough .

What piece of advice would Harman Chima give them ?

If you're going to make a change , but be open , let your incumbent have the opportunity to sharpen their pencil or do whatever it takes to kind of capture that or and and as quickly as possible , right , so that way they can make other decisions if they need to , and be a true partner on that and on for new , new customers that you know that we're working on

or others are working on trying to break into , be open and transparent to them as well , because they're banking on getting this late here and talking to other customers , like I are working on trying to break into , be open and transparent to them as well , because they're baking on getting this late here and talking to other customers they go I'm working on X

amount into here . I really need your help out at the same time , right . So I guess , just be open . Cut these six-month bids . I guess I don't know . I kind of . There's a customer of mine that does a great job . They do six-month bids now .

They're a beverage shipper , but it actually works out good because the seasonality of that freight is important , right , and so you're able to adjust your rate here and there , but they're very open .

Every bid we go and I go sit down with them face-to-face and we'll go run through lanes and we'll say , all right , what am I looking at , like , oh well , this one you're way off these , you're way off these , you're looking good . Or hey , you're looking good on 80 of these , these 20 we need to work on . What can you do ?

And then you can decide what you want to do , right , so I think that's okay . If you're going to do six months seasonal beds , fine , do it that way , right , just be open , because the end of the day , equipment's not cheap . You know we're spending 180 000 bucks on truck , a lot less than I was 250 just a few years ago .

We're buying trailers at 35 , 40 grand still , and so that's big investments and we got to keep those guys productive and those units and those assets .

And that's why there's so many carriers shutting down right now , because they didn't have those relationships potentially , or they did , but somebody in New York up in corporate traffic said hey , I'm sorry , but somebody in New York you know , up in corporate traffic , said hey , I'm sorry we got to make this change or that too many apples in that , you know , in

that shipper's basket , right . So be diverse . Know your commodities , know what you're shipping . Provide a solution , right . If you're providing a solution to that customer , then it's harder for them to replace you . At the same time , right . And if the customer is going to replace you , then be open with your carrier and tell them hey , this is what's going on .

Give them the opportunity to to uh , to change or fix things Right . And if they can't , then I guess you've got to make your decision Right . We get that . So that's how we grew Right their lanes , but that's what it takes . That's the one advice .

I think , and I don't know how , if we can just cut this up and down rollercoaster of the back and forth , I don't know , maybe that's where the brokers make their money , right , or that's where their value is . I guess that's where their value is . Their value is in volatility , that's for sure . I just don't think it's possible , no-transcript .

I think the shipper has a hard time because they do , you know , a lot of times they care about the 20 Chimas , that 20 like Chimas that they work with . But you all have your own puzzle and network to put together and it's hard to do that .

And the more honest and transparent we can be with each other , the easier it is for us to pass pieces to one another and say , hey , you take this one , I'll take this one . So I appreciate that and I think that's good advice .

Well , I kind of have a few extra trucks here today , but it's kind of every day , but it's not really on on the on the regular right . But if you have something that works , it's tough at our size now , because probably a similar customer you're working with and I'm already working with them . But as we were smaller , that's how we built the whole thing right .

It's just stuck to our word and did a good job for them , and so we can be on the good list , right , cause then you'll take care of us and the shipper will take care of you , right , potentially . So exactly , yep , that's that's how it's built , cause it's not a it's not a short game , it's definitely a long game .

And so , and now we're at the second six month bid cycle of of for us at least , that we're really feeling in this bit cycle was the toughest , I would say . And so there's no more cost to give CFO is like you got to make X amount of mile more to break even . It's like , oh , okay . And the customer was like there's no increases .

It's like how are you going ?

But so I was like we've got to figure out fuel quickly . Let's put our resources there . That's because we can control that . We're pumping , you know , 5 million gallons right a year , so it's quite a bit right if we could save a few . So look at those cost-saving things .

Look at , you know , just overall cost of technology and softwares and you know what are we ? Just because it's easy to like , oh , look at that shiny thing , it's going to do all these great things for us . Like , did it really work ? If not , let's get it out of here , right ? So start cutting some of those costs . I , I'm very proud of this .

We we didn't pay 70 cents and 75 cents a mile to drivers , like some of the crazy carriers did . We paid them well and , you know , bumped up their rates accordingly . But we're not going backwards .

And so there's carriers out here , especially in our market on the west , that have cut five cents or ten cents a mile or whatever , and cutting the driver pay instead of cutting their lavish expenses or whatever , right , and so we're not going to go backwards , or we're making sure , you know we don't go backwards , on on on driver pay , because at the end of

the day , not just driver but staff pay too , because everybody's costs are up . Groceries cost more , so that's one thing . On labor costs , I'm going to make sure we don't go backwards because you just negative morale right , all this work that you've done to get to this culture piece that we've been talking about , or get half there to where we want to be .

Now you can really just lose it all real quick by taking payback . So I'm a big believer of that . But it's just cost , cost , cost . Figure out what you can do . Talk to your customers . Tighten up your lanes . Maybe there's lanes that don't work . Good time to get out of those now , right , and just find more in the lanes that work and efficiencies .

So , uh , it's , it's tough , it's definitely tough . Uh , we've lost some people there . Uh , we didn't cut anybody , but we lost a few , just because there's not enough to go around right now , right , or or they're feeling like they can do it better with by themselves or somewhere else , or whatever .

So , you know , wish everybody the best , for sure , but just hunker down . But one thing I told everybody is it ? Most of the broker guys are usually young , right , you know that . And so they're coming in . I was like guys don't get used to this and hopefully someone will listen to me and did that because I was like this is not .

This is like broker have adult even think two years ago , three years ago , for sure .

So that's when the real blinders came off in the growth game is , once we got a good CFO , they got their feet in and they figured out okay , these are the things we really need to do from a strategic standpoint . And now we can figure out your cost per mile . That's huge .

So it doesn't mean you're going to get that from every shipper , but at least you know what it is .

But if you're not really paying close attention to the money coming in the door , especially as a broker , that's a problem because your customers will take as long as you allow them to pay you . In a lot of cases .

you're building a truckload carrier or a brokerage , any business , right , it's a people's game , right ? And sometimes I'm being mad against the wall and saying to my wife the next time I start another , another company , it's going to be me , my assistant and I right , and that's it . Because it's like hey , how do we get you know all these people ?

And one thing I don't know about I mean , you sounded like at your previous company you had a pretty good training program

. Truckers , we don't do a very good job at that and we kind of brag about it's a sacred swim and i'm'm like we got to quit doing that . We got to have a good training program . So you know , transparently , that's something we didn't do very well and we're trying to figure it out now , our 500 trucks as well , 18 years later .

So if I ever do this again , I'll make sure training , accounting , you know , and safety those are the things that we dial in in the beginning because it's going to be very hard to replicate the training and all that at . You know 600 employees that we are today right 100 office and 500 non-drivers . So get that dialed in .

Um , he's got plenty , plenty more insight I'm sure he'd be happy to share . So , thanks so much . Have a good one , thank you .