What does “Load Lifecycle” mean?

When we think about the “load lifecycle”, we’re talking about the end to end process that starts from finding the right load to getting fully paid on the load. In between, the required administrative tasks bog down a driver’s ability to just drive. What came as a surprise to us is how intensive the tasks are for owner operators. 

When it comes to a single load, we can break down the load lifecycle into:

1. Finding a Load
2. Booking a Load
3. Submitting Load Documents
4. Getting Paid
5. Repeat steps #1-4 for the next load

To compound the complexity, separate loads tend to overlap at different stages. For example, if a driver is in the middle of Step #3 for Load A, then they might also be trying to do steps #1 and #2 for Load B. If the driver waits until Load A is complete before thinking about Load B, then there may be money losing gaps between loads. 

Ideally, the driver starts the week with multiple loads planned out, meaning steps #1 and #2 are complete for multiple loads before step #3 has even started for one load. This allows drivers to focus on steps #3 and 4 for the rest of the week. This is the model we’ve seen work best when working with a dispatcher.

1. Finding a Load

When we talk to owner operators using our services, it is clear to us that finding a load is a core competency to succeeding as a carrier. “More loads” on our loadboard is one of the most common requests our product team receives. 

However, more loads does not equate to better loads. When finding a load, we’re really talking about finding the right load for the driver’s business needs. Based on our experience, the core criteria for finding a load are:

• Will I make enough money on the load?
• Can I get my next load wherever I’m dropping off?
• Will this broker pay me what is stated on the Rate Confirmation?

Will I make enough money on the load?

In current market conditions, making enough money on a load can be challenging. Simple considerations, such as fuel, are commonly factored in by carriers. Take the load rate per mile and subtract the cost of fuel per mile to get an estimated margin on the load.

load rate per mile - fuel rate per mile = margin per mile before fixed costs

However, there are an extensive number of fixed costs that owner operators have to consider which range from monthly truck payments, days driving in a month, and insurance costs. These monthly fixed costs are more challenging to factor in as part of a rate per mile profitability estimate. 

load rate per mile - fuel rate per mile - estimated fixed costs per mile = profit margin

TrueNorth’s app has a “TrueRate” feature which will automatically calculate on each load displayed on the load board whether a carrier will be profitable or not on a load based on the owner operators’ personal inputs. Download the app and try “TrueRate” now.

Can I get my next load wherever I’m dropping off?

Driving back empty is a costly mistake for truckers. When assessing a load for profitability, an important consideration is if the trucker can get a load back after delivering. Ideally truckers have enough information to plan a multi-leg trip that overall makes money, even if some stops may be unprofitable. For example, a trucker can consider taking a money-losing load that gets them to a hot market. The load from the hot market can then make higher profits that offsets the first load.

One way to plan multiple trips quickly is to leverage TrueNorth’s backhaul recommendations. For each load going out, plan also for a load coming back. Combining the TrueRate and Backhaul Recommendations features allow truckers to both plan loads going out and back as well as assess for their profitability with all-in costs.

Try TrueNorth’s Backhaul Recommendations in the TrueNorth app.

Will this broker pay me what is stated on the Rate Confirmation?

Avoiding scams is a big part of staying alive in trucking. The higher the rate per mile on the rate confirmation, the more cautious the carrier should be. Double brokers are common, and brokers who try to skirt corners in paying are even more common.

First, before taking a load, do a quick check on the broker on the Freight Broker Alert website. This is a third party website that neither provides credit reporting nor is associated with any governing trucking organization. However, we ourselves have used this site as part of our collections service. The crowdsourcing of data on Freight Broker Alert has made it one of the more reliable up-to-date sources of information for resource limited carriers.

If working with a factoring company, then it’s a good idea to check with them before signing up with a new broker. Factoring companies (that know what they are doing) tend to have stringent requirements to accept a load from brokers. Relying on their criteria can help avoid payment problems later on.

Secondly, review the terms of the rate confirmation once you’ve received it for any odd conditions. The fine print is usually a good tell-tale of whether or not the broker will be easy to work with for collections. Challenging brokers will have text in tiny font outlining extensive reasons for carrier’s pay to get deducted from mundane things like missing a lumper receipt to more obscure requirements like deducting payment for invoices submitted late or in incorrect formats.

At the time of payment, the broker exercises extensive control as to whether or not a carrier gets paid. Vetting the broker ahead of time is an important diligence exercise. Read more on how to spot bad freight brokers.

TrueNorth’s Take on Finding the Right Load

TrueNorth Solution: A Free Load Board

Free load boards have been a game changer for small carriers. Previously, owner-operators only had DAT and some lackluster alternatives. The rush of venture funding into the logistics industry during the pandemic has dramatically changed the landscape. Even four years later during a low point in the market, there are still many free load board options available. 

TrueNorth’s app alone has a load board that boasts over 100,000 loads a day. The TrueNorth app is currently free and available for download.

Other Solutions: Go Dedicated or Local

The spot market isn’t always a suitable solution for an owner-operator. If searching for loads from a myriad of brokers across multiple load boards, then there are other options available.

Go Dedicated. During a downturn, a locked in dedicated route may be the way to go. Dedicated routes allow the carrier or owner-operator to lock in a rate for a recurring route that covers a specific period of time, such as over 6 months or a year. During hot spot markets, dedicated routes can pay less in exchange for regular, guaranteed work. During downturns, dedicated routes can pay more to help weather the market. Read more about the tradeoffs between the spot market and dedicated lanes.

Recurring Work with a Handful of Brokers. Some small carriers find success by operating with a small number of brokers that they work with over a long period of time. These brokers neither have the best loads nor do they have all of the glitz and glam from big name brokers. What they offer is the equivalent of the mom and pop shops that work locally. 

2. Booking a Load

Finding and booking loads are often treated as one in the same since the two processes are highly related. However, finding the right load requires snap decisions, quick math, and fast responses. Finding the right load is about intuitively analyzing whether or not the load will make me money. Booking the load is about jumping through the administrative hoops to get the load before someone else does. 

Here’s what the administrative tasks entail:

1. Bidding for the load quickly
2. Negotiate rate and terms
3. Finish the Broker Set-up (Done once per broker.)

The administrative tasks require speed and accuracy. This is immensely important while also challenging, because these are also legal documents that are being signed with lots of fine print.

Bidding for the load quickly

The best loads go fast. Jumping between multiple apps before bidding can potentially mean losing the load entirely. There’s usually a lot of competition and no time for diligence. Bid first and deal with the consequences later can be tempting, but this is how double brokers can take advantage of the market. Knowing how to quickly spot scams becomes a skill.

Negotiate a rate

Once a bid has been submitted, staying in communication with the broker contact until a rate is landed upon is critical. Once the response time starts to slow, it’s less likely that the carrier will get the load. Having a dedicated broker agent to work with on a recurring basis, can help carriers beat the competition. 

The process can be cumbersome as it’s done over a combination of email, sms text, and phone calls. There are usually a number of back and forth to iron out the details. Sometimes final rates don’t get updated on the rate confirmation, so any agreed upon changes should be done in writing whether email or sms text. Keeping good records during the negotiation process is critical to resolve any payment disputes during collections.

In addition to the rate itself, there are some common negotiation points.

Fuel surcharge: Motor carriers (who don’t offer their own fuel surcharge) don’t typically take a percent cut of the fuel surcharge when paying out to owner operators. Therefore, owner operators who get the fuel surcharge as a line item on the rate confirmation automatically make more money. 

Fuel advance: If the carrier does not have a fuel card or is tight on cash, then requesting a fuel advance can make sense. The broker then deducts the cost of the fuel advance at the time of payment. This is a good method to match expenses to revenue payment, so owner-operators are not floating cash on behalf of brokers.

Get through the Broker Set-up

During this process, the broker gets the carrier set-up on the brokers’ internal systems so they can haul loads and complete a broker-carrier agreement, which is the overarching legal contract between the two entities. 

We’ve actually seen carriers complete this required step without actually knowing really what the process is about. This is all about compliance, and ensuring that the broker has done their due diligence from a legal and safety standpoint before assigning a load to any carrier. Set-ups are only done once between each carrier and broker unless there’s a systematic overhaul on the broker side or an updated agreement is required.

The typical process is more cumbersome with bigger brokers and less so for medium to small brokers. You can read more about the broker set-up process on our post From Carrier Packets to Broker Setups: What to Know.

TrueNorth’s Take on Booking a Load

Front and center in TrueNorth’s product offering is enabling carriers to easily book loads. TrueNorth approaches this problem from multiple perspectives. 

Instant Bookings

From a product perspective, the TrueNorth team is experimenting with different solutions for automated booking. One available feature on our app is LoadCentral’s Book Now feature. With this feature, carriers can skip the negotiation process and choose “Book Now” instead. 

There are a few requirements in order to access this neat feature in the TrueNorth app. First, this feature is currently only available with C.H. Robinson. Secondly, the carrier must have been properly set-up with C.H. Robinson. Lastly, the carrier’s t-code must be provided to TrueNorth, so that it can be included during the booking process. 

Partner Solutions

When helping carriers and owner-operators access loads, our experience has shown that carriers can position themselves as the best option for brokers through being up to date on all compliance and insurance requirements. This helps to streamline broker compliance approvals needed to work with new carriers. Tap into TrueNorth’s partnership network for vetted solutions for carrier compliance and insurance.

Digging deeper into the topic of insurance. Brokers’ insurance requirements can trip up new carriers. There two common issues that TrueNorth has seen where brokers reject new carriers related to an insurance issue:

• Insufficient coverage: Large brokers can require up to $1,000,000 in coverage for general liability and auto liability. Some carriers only have up to $750,000 in coverage
• Upcoming insurance renewal event: Brokers with stricter compliance requirements may not work with carriers whose insurance is soon up for renewal. If there is a lapse in coverage, the broker can be liable if an issue arises with a carrier during that time. 

These are just two examples among an entire suite of potential issues. Making sure carrier insurance is up to date with coverage information readily available will help with compliance approvals.

3. Submitting Load Documents

After all that preparation, now comes the driving! This is where drivers can finally do their job of delivering the load. The important administrative task during and after delivering the load is to master the load paperwork. At TrueNorth, we’ve collected tens of millions of dollars, and know how critical the task of getting paperwork right is to getting paid.

When delivering the load, here are the load paperwork requirements:

• Rate Confirmation (RC) – This is considered the contract for the load and needs to be signed by a legally authorized representative from both the carrier and the broker
• Bill of Lading (BOL) – This document outlines all relevant information about the load such as unique identification number, pick-up and delivery location, along with any required parcel information.
• Proof of Delivery (POD) – This document contains all of the required signatures to show that the load has been delivered. More often than not, the POD is a signed version of the BOL, which is why the two are often used interchangeably. The key thing here is to ensure ALL signatures are legible and appropriately accounted for.
• Accessorial Documentation – There is a wide range of additional documentation that varies by load. The common ones are: lumper receipt, scale ticket, and detention times with signature (typically on the POD/BOL).
• Meeting Tracking and Check-in Requirements – These are typically no longer document requirements, but rather electronically logged. Carriers will need to use a broker approved tracking software to ensure they check-in at required intervals to ensure their pay doesn’t get deducted on the load.

Best Practices on Document Management

When uploading documentation, adhere to these best practice principles for load documents: do not cover any part of the page (like with a receipt), ensure perfect legibility (with good lighting and no blurriness), press the document flat, and show all four corners.

Ensure anything that happens during and at delivery is documented with signatures and comments as needed on the BOL/POD. Receiver signatures should be completed on all required spots as well as next to any accessorials.

If there are accessorial documents, then make sure to upload them as well. Commonly needed accessorial documents are lumper receipts and scale tickets.

Lastly, upload documents to the broker in a timely manner. Keep a paper or digital trail for all document submission in case a dispute arises. Refer to the rate confirmation for the time requirements of document submission. Many brokers have clauses that will deduct payment for late paperwork submissions, even if they are complete and legible.

Common Paperwork Mistakes

Having submitted over thousands of documents and disputing collections with brokers, the TrueNorth team has extensive knowledge as to what are some of the most common paperwork mistakes that causes carriers to lose out on payment:

• Missing Lumper Receipts – Whether paid by the broker or the carrier, missing a lumper receipt usually means a deduction on the payment.
• Missing Signatures – Payment departments are sticklers for signatures on PODs and BOLs. We’ve had consignees explicitly state that no signature is required at the time of delivery, just to have the payment department withhold payment because no signature was provided. Always get a signature, and circle it.
• Missing Pages on POD/BOLs – This commonly happens with multi-stop trips. Be careful of the page number labeling and the number of stops. Doing a quick check to ensure the paperwork is complete at each stop can ensure no payment is missed. In these scenarios, we’ve requested partial payment for the PODs that are available. Brokers won’t pay out for missing PODs.
• Missing Detention Times – Detention is one of the most common accessorials we see aside from lumpers. The issue with detention is that it’s often just a few handwritten scribbles added onto the POD or BOL. Make sure the times in and out are clearly stated with an additional signature next to the detention information for the best chance of payment.
• Wrong Paperwork for the Load – Surprisingly, submitting the wrong POD/BOL for a Rate Confirmation is common. One of the main reasons for this issue is that the load number on the rate confirmation doesn’t always match the number on the POD/BOL. There could be a number of reasons for this such as the broker assigned number is different from the shipper’s number on the BOL. This can cause a lot of confusion, so in these cases confirm the appropriate load number to use that is written on all of the documents. If no such number exists, properly match the ship from and to fields along with dates between Rate Cons and BOL/PODs.

TrueNorth’s Take on Load Documents

TrueNorth’s Solutions

Load document management is probably the most cumbersome administrative work that owner-operators have to deal with on a daily basis. The attention to detail needed and the finagling required of the appropriate personnel to ensure all the i’s are dotted and t’s are crossed, takes an immense amount of time and patience, a luxury not many can afford. Knowing this, one of TrueNorth’s core offerings is our app’s load document management system. TrueNorth’s free tier offers digital scans and invoicing. At each step, the app provides reminders for documentation best practices along with requests for easily forgotten accessorial documents. 

Partner Solutions

Factoring. For carriers not ready to take on the end to end document management and collections efforts, factoring is a common solution. Factoring allows carriers to rely on having a professional team accountable for the documentation verification. Once documents are accepted by the factoring company, the company takes on the responsibility of collections with the brokers. If issues arise, the factoring company takes on the legwork with the brokers’ payment team. Read more on our pick of the top 6 freight factoring companies. When considering factoring, also weigh your options between factoring and quickpay solutions.

Tracking. Another consideration for carriers is to leverage modern ELD software solutions. Many brokers now require tracking software in a goal to gain more visibility into carrier operations during load delivery. Software like FourKites are the recommended tracking software that technologically forward brokers would expect. Carriers should ensure they have up to date tracking, so they don’t get deductions from missing tracking requirements. Even if truckers have perfect paperwork, brokers will deduct for not providing timely check-ins and tracking.

4. Getting Paid

Most of the time getting paid is about taking the preventative measures to ensure there is no fault from the carrier from the beginning to the end of the load lifecycle. A complete, error-free load lifecycle is the best way to ensure the carrier gets paid for each load. TrueNorth’s focus on the load lifecycle to ensure truckers get paid every time.

Follow Best Practices Throughout the Load Lifecycle

As a recap, at each stage of the life cycle, there are key steps to help ensure the carrier gets paid at the final stop:

• Finding a load – Plan out loads to ensure the carrier makes money. Do the due diligence on the brokers to ensure they will pay.
• Booking a load – Properly complete the broker set-up and document any agreed upon terms and conditions.
• Submitting load documents – Submit complete paperwork package without flaws or misses in a timely manner.

Leverage TrueNorth and Our Partners

From there, getting paid is about keeping track of every load hauled to the bank account of payments received. Work with a factoring company, such as TrueNorth’s partner, BasicBlock, to outsource the collections management process. 

Use a digital load management app like TrueNorth’s document management system or alternative carrier TMS. Keeping track of all of your loads in one place will help with reconciliation purposes; and ensure if there’s any issues with the broker, carriers have their own independent set of records for any dispute resolution.

Profits to Truckers

At the end of the day, carriers are in the business of trucking to earn a living. TrueNorth’s mission is to help truckers take home profits. By focusing on the load lifecycle and the administrative tasks along the way, TrueNorth helps truckers get back to driving.

Download TrueNorth today