A few weeks ago I wrote a blog on brokerage unit economics to demonstrate the strain brokers are currently under. Now, I want to focus more on what they can do about it.
Brokers aren’t losing based on volume, they’re getting squeezed on margin and losing because of lane selection and prioritization mistakes.
This is especially important in current market conditions where we see tender rejections and spot rates rising quickly. Our customers tend to focus on using data to inform and drive the actions of their carrier reps. To gauge the market and make sure they’re negotiating the best rates when they’re covering freight. I’d argue, the other side of the equation is more important. Its imperative to know which freight to avoid before it costs you margin.
Don’t let your brokers waste time chasing bad freight, bidding too low on high-risk lanes or booking loads where capacity is tightening. Make sure you have forward looking capacity and market insights incorporated into your tender accept process.
This is why I think SONAR is incredibly valuable. Lane-level difficulty scoring, risk management and margin volatility flags help mitigate these risks and inform your staff so they can have educated conversations and make better decisions. Other tools can give you rates, SONAR tells you whether you should take the lane and if you’ll be able to cover it.
Learn more about SONAR Indices, Coverage Guide and Sales Guide (all in SONAR’s Broker Tool Kit) by requesting a demo.
