Issue link: https://read.dmtmag.com/i/715755
NEWS & NOTES 24 // OWNER OPERATOR // SEPTEMBER 2016 they take their commission from what is left over. So if the average rate in a lane is $1.50 they add the commission they want, plus the fuel surcharge, to determine their bid. Drivers who know this, and know the lane rate aver- ages, can often negotiate better rates and boost their bottom end. However, with competition as it is, there is not always a lot of wiggle room for the bro- ker depending upon the week they are having and how much they bid on the loads. A savvy owner-operator can, however, build relation- ships that will often pay off in the long run if they understand this and are willing to provide a service above and beyond what others are willing to do. Still, of course, you will always get the best rates by hauling direct and bypass- ing the broker or middleman altogether. I am explaining all this to set up how I be- lieve we can get to better rates all around, rates that reflect the current cost of business operations and the current cost of living. Because of their size and capacity, larger carriers have an advantage and can cause the average rate per mile to be lower in any given lane due to their ability to move it at a lower rate. Which is just good business for them, the manufacturer and, ultimately, brokers. However, we can still have rates improved by simply allowing the Department of Labor to prescribe a cost of living wage increase for company drivers. Say they determine that driver pay is 30 percent too low, and dictate companies must increase driver wages to that point. Companies would have no choice but to increase their rate bid to offset it, and thereby increasing the average per-mile rate. If they would in turn dictate an hourly wage for sitting at the dock, that amount would be worked into a rate increase as well. This could not be done all at once, of course, with- out throwing our economy into a tailspin, but it would be feasible spread out over several years. This is just an idea, but it's the only sensible way I can see to eventually get rates where they need to be. Of course, that means the De- partment of Labor would have to be involved in the trucking industry, and they have been near completely hands off when it comes to fair labor practices and trucking given inter- state truckers' longtime exemption from over- time/wage protections. And yes, in time this will cause the price of goods to rise, but that is how an economy grows instead of languishing and faltering. At the same time, as an owner-operator who dreams of building a small fleet (once I go beyond a one-truck operation), it would cause my cost of operations to increase as well, but I can live with that if it allows me to offer my drivers a better living and improve my own at the same time. –Clifford Petersen OO 0916 newsandnotes oo.indd 2 8/10/16 2:08 PM