Finding profitable truck loads is the most important thing an owner-operator can do to succeed. Without regular shippers, you don’t have a business. It’s as simple as that. However, this area is where most owner-operators and small fleet operators fail. This article shows you how to find profitable loads to grow your business. We cover:
(Note: Commercial Capital LLC doesn’t provide loads or contracts. This resource is for information purposes only)
- What types of loads can you pull?
- Where to find loads quickly
- How to find long-term shipping clients
- How to differentiate your business from other trucking companies
- A simple trick to help prospects remember you
- How to finance your growth
1. What types of loads are you moving?
The most common and popular type of freight load is dry van. Many owner-operators and small carriers focus on this type of freight because it has low equipment costs and is the easiest to haul. These loads are flexible – they can be palletized, boxed, or even loose. Their main requirement is protection from the elements.
There is a downside to dry van loads. Competition for loads, especially for popular lanes, is very high. Consequently, they can be the hardest to get and have the lowest profit margins.
Specialized loads, such as reefer or oversized, require specialized equipment and skills. There are fewer specialized loads available. The upside is that these loads usually have less competition and higher profit margins.
2. Where to find loads quickly
New trucking companies that need to find loads quickly to get started can consider using load boards. While using a load board can help you get started, it’s not a good long-term strategy to grow your trucking company. The problem is high competition, especially for dry van loads in popular lanes.
Unfortunately, you can expect razor-thin profit margins. Don’t bid on these loads unless you know your costs well and have a set minimum rate per mile. Otherwise, you may bid for loads with little profit or that generate a loss. Here is a list of free load boards in Canada that will help you get started.
Load boards rarely allow you to develop long-term clients. Instead, you will pull “one-off” loads and then go back to the load board to look for your next load. A better strategy is to use load boards as a stopgap while you develop profitable long-term shipping clients.
3. How to find long-term clients
Finding long-term clients requires hard work. It’s not easy, which is why few carriers do it. However, having long-term shippers is the tried-and-true method of building a profitable trucking company. The best loads come from shippers with whom you have a relationship. They value your services and allow you to charge a fair per-mile rate.
a) Local businesses that need your services
There are probably a number of companies that are local to your business and need freight transportation services. You need to find them and connect with them.
The process is fairly simple. Develop a list of prospective clients and start calling them. Ask for their shipping department and make an appointment to visit the shipping manager. Avoid the critical mistake of launching a sales pitch immediately. Instead, ask questions about their freight needs and current challenges. Listening to their challenges helps you spot opportunities and determine if there is a need for your services. Ideally, you want to find a way to get your company into their approved freight company lists.
b) Industry associations
One clever way to find shippers is to look for local chapters of industry associations of companies that ship the type of freight you want to haul. Many associations meet regularly and have trade shows. Those meetings are a great place to meet potential clients.
Remember that selling freight services on the spot during a meeting or trade show might not work very well. However, these meetings are a great place to make business contacts. Ask for the contact information of the person in charge of shipping at their companies. That is who you want to meet. Now, you have a way to contact the shipping manager and schedule a visit. There are hundreds of associations in Canada. You can find trade associations for many industries here.
4. How are you different?
It’s important to differentiate your company from all the other freight carriers the shipper could use. What makes you different and better? Fortunately, differentiating your carrier is easier to do than most people think. It goes back to basics. Shippers want reliable freight services at a competitive price. While many companies talk about providing ‘”great” services, few actually do it. In our opinion, the best way to differentiate your company is to do a very good job and build a reputation. This includes:
a) Professionalism
Every interaction that your company has with shippers must look and be professional. Be meticulously consistent about professionalism since it creates an excellent impression with clients.
b) Reliability
Shippers want to work with reliable carriers. A reputation of reliability helps you build goodwill and grow your business through referrals. Drivers should arrive on time to pick up a load and bring the right equipment. Deliveries should also arrive on schedule at the destination. Your equipment must be properly maintained to minimize problems or lengthy repairs. Any delays or issues should be communicated to clients promptly and professionally.
5. Simple trick to help prospects remember you
Keeping in front of a potential customer regularly is crucial to making successful sales. However, constant phone calls and emails asking for business can upset potential clients. Instead, we prefer a simple trick that lets you stay in front of prospective clients regularly.
Have a number of promotional items with your logo and contact information made. These include useful office items that businesses use daily, such as pens, post-it notes, and paper pads. Give a few of these to every shipping manager you visit, even if you don’t get into their approved carriers list. It won’t be long before shipping managers start reaching for one of your pens while working at their desk. This is a low-key way to always be in front of potential clients. Sooner or later, they will encounter a shipping problem and may call you to pull a load for them.
6. How to finance your growth
Every carrier would love to grow quickly. However, few consider that growing quickly can get your company into cash flow problems. While some shippers offer quick pays, many pay their invoices in net-30- to net-60-day terms. Your company has to cover the expenses of picking up and delivering the load out of its cash reserves. Then, your company must wait for one to two months to get paid. This delay can create cash flow problems.
It’s easy to see how a company that is growing quickly but with low cash reserves can develop financial problems. All it takes is a few invoices that pay late or taking a load your company could not afford to deliver. The way to solve this problem is to use freight bill factoring.
Freight bill factoring allows you to finance slow-paying invoices from creditworthy shippers. It provides immediate funds you can deploy to pay for fuel or other business expenses. One of its main advantages is that it is available to small and growing carriers. Additionally, lines can be set up quickly and grow as your trucking company grows. To learn more, read “What is Freight Bill Factoring?”
Need more information?
We are a leading factoring company and can provide you with high advances at low rates. For more information, get an online quote or call us toll-free at (877) 300 3258.