Accepting a load, buying a truck, working with customers—these are just a few instances where effective negotiation skills can pay dividends in your business.
But good negotiation is not about getting all you can at the expense of the other party. Instead, negotiation should be more like collaboration to arrive at an outcome that both sides can feel good about.
At least that’s the perspective of successful team expediters like Bob and Linda Caffee and Jason and Heather Hutchens. Here are three tips they recommend for win-win negotiations.
Tip #1. Be fair.
Sure, you want to get the best deal, but not at the risk of damaging long-term relationships with brokers or vendors who you’ll need to work with down the road. Otherwise, you may “win” the negotiation that day, but you’ll lose in the long run.
The idea here is to think: “How can I get what I want in this situation while also helping the other person get what they want?”
“My goal when negotiating a load with a broker or dispatch is to be fair because I want that person to use me again,” says Linda Caffee. “If the load is offered too low or I have to deadhead too far to get to it, I’ll propose something along the lines of, ‘I want this much money to run it, and I’ll do it all,’ or I’ll ask, ‘What can you give me?’ And then we’ll talk from there. This way, I can see if they even have the money to pay me to do it. And if they don’t, maybe we get creative. I might take this load for you if you have something that will back it up—if I can get my income back up where it needs to be. Then you’re both in a win-win situation.”
In other words, negotiate with the long-term relationship in mind. “I think my philosophy in negotiation is being fair, knowing you have to use this person later down the road. So you really don’t want to burn them,” says Caffee.
Tip #2. Be a professional.
If you don’t like a proposal presented to you, don’t be offended and take it personally. Simply be a professional and ask for what you want. If you can’t strike a win-win deal, that’s okay. You can walk away—no harm, no foul.
What’s an example?
Jason Hutchens, who you might know, along with his wife Heather, from their popular Youtube Channel “The Crafty Trucker,” offers this scenario.
“A lot of times you have a dispatcher or agent who will call you up and say, ‘Hey, I really need your help to get this load covered. This is what it pays.’ It’s then up to us to figure out if what they’re offering is enough. And a lot of times it’s not enough,” says Hutchens. “That’s when you really have to know your operating expenses—what it costs you to run in order to be able to negotiate a fair rate for you. So you’ve got to know your operating costs and what moves you’ll have to make once deliveries are complete to be able to negotiate that fair rate for yourself.”
If you need a higher rate to accept the load, how do you negotiate that? What approach should you take?
You could tell them, “Look. This is what I’m willing to do it for. Take it or leave it!”
But a more effective approach would be to act in a professional manner, clearly communicating what you need to make the deal acceptable to you, while also keeping the other party’s interests in mind.
“I really just explain the situation to the agent or the broker,” says Hutchens. “I tell them, ‘Well, after I deliver that load to Seattle, I’m not going to get anything out of there, and I’m going to have to get to California. In order for me to be able to help you with this, I will need enough money to be able to cover those expenses. Here’s what I would need.”
If you can get what you ask for, great. If not, that’s okay, too. At least you asked in a professional way to try to make a deal happen. And more often than not, you’ll get it.
Tip #3. Be proactive.
Suppose you’re held up at the customer’s site, delaying you from getting to your next load. You can sit there and fume about it. Or, you could be proactive and propose solutions to the problem.
“I would say something like, ‘Hey would it help you at all if I put the freight on the dock for you? I’ll use my pallet jack and set it on the dock,’” says Caffee.
And don’t merely accept a bad deal out of fear of rejection. Know what you want and be proactive about asking for it.
How? Hutchens offers this example.
“Let’s say I have to wait four hours to get offloaded. Typically there’s going to be a contracted rate with that customer in order to get that kind of business from those bigger customers. And, usually, that’s not negotiable,” says Hutchens. “But if I’m told ahead of time that, ‘Hey, this delivery is going to require you to break down all the pallets, dolly all the pallets inside, and stack them in a particular place for the customer,’ that’s when I know that the job will be labor intensive, and we should get paid for that extra time.”
So, how do you ask for the money?
“I’ll ask them, ‘What is your typical contractor rate for that?’ If it’s a number too low for me to make it worth doing, I will tell them, ‘Well, I’m going to need this much to do it.’ And we come to an agreement ahead of time.”
The Bottom Line
As an expediter, you’ll need to negotiate with a wide range of people to help you get what you want and need for your business to succeed. But as you negotiate, also think about how you can help the other person get what they want. Otherwise, as Caffee puts it, “You could win that one time, and get one hell of a great load or deal, but in the long run, you’re the loser because they won’t work with you again.”