Price-Gouging by truckload freight brokers has suddenly become a mainstream topic advancing with considerable urgency. The economic devastation is all around us so any topic related to an entity potentially taking advantage of this devastation is sure to be broadcast to the world. Finger-pointing now appears to be our new "sport".
But - are all "brokers" alike? Not at all, and while there may be a few bad apples in the group like there are everywhere else, the overwhelming majority of brokerages are simply moving along with the supply/demand equation right now. What IS clear is that freight volumes are down dramatically so there is more than enough capacity to move freight. High Supply and Low Demand equals what? We don't need an MBA to figure that one out.
Shippers would expect rates to fall with lower demand right? Shippers are already facing an enormous amount of cost pressures from plenty of other sources! And carriers certainly have the right to be upset about crashing prices especially if the bad apples out there are "price-gouging" and lining their own pockets at the expense of them. We couldn't agree more!
But let's be careful to distinguish between a Lead Logistics Solutions Provider, like Recon, and a "broker" as that is a major difference in value creation.
So what is the real issue? The real problem is a lack of transparency in the industry and a lack of REAL VALUE being provided by freight service providers. Brokers who offer little more than matching a freight movement with a truck one transaction at a time are in a poor position to provide true value. As this topic, and the topic of broker margins in general, catches up with them, many will find it hard to compete. Perhaps a few of them actually are desperate right now and are creating these headlines (shame on you - like my Mom says).
That's why you partner with Recon Logistics! For 15 years now we have hammered home the concept of TRANSPARENCY and DIRECT relationships between you, the shipper, and the carrier. Recon isn't making our money on TL brokered margins - we make our money by providing true value in technology, meaningful data and key analytics, direct connections to carrier partners, truly transparent rates, and exceptional customer service with daily operational support. This value and the focus on technology and transparency enables Recon to be a low-cost, high-value provider driving maximum returns to your bottom line.
Recon has hoped true transparency would be mainstream by now for many years - perhaps the time has actually come?
So, as you hear more and more about this topic of brokers price-gouging carriers, please rest assured that, once again, Recon is managing freight the right way - the honest way.
ONE REQUEST! Please! - If you know of a shipper who may not be getting the value that Recon is providing from their current broker, "partner", etc - refer them to us. We would greatly appreciate it and would hope to spread our message that there is a better way to as many shippers as possible.
Thank you!
Hank Newman
CEO / Founder
