Load boards are an excellent way for carriers and freight brokers to find suitable loads to haul. While bidding on these loads is an essential part of the process, it can be challenging and competitive. Transportation companies should research market rates, negotiate effectively and maintain open communication. Learn the steps brokers and carriers need to take to bid on loads, including strategies to help you succeed in this competitive marketplace.
Why do freight brokers and carriers bid on shipping loads?
Many freight brokers and carriers use load boards to find lucrative loads to haul. This technique is called freight bidding and is a great way to secure trucking contracts that fit within a carrier’s capacity and requirements.
Freight brokers act as intermediaries between shippers and carriers, matching suitable loads with carriers. They want to find the most competitive rates and shortest delivery times to meet the needs of their shippers. One common way they do this is by bidding on shipping loads on load boards.
Carriers use freight bidding to select shipments that match the necessary criteria to optimize routes and capacity, reduce downtime and maximize profits.
8 tips for successfully bidding on shipping loads
Ready to bid on shipping loads? Discover how to bid on loads with these eight tips, and learn how to find the best hauling contracts.
Research shippers and loads
Researching the shipper and load is an essential step in the freight bidding process. It helps carriers and brokers understand what they’re bidding on and what to expect when transporting the load. Armed with key information like the type of goods, delivery location and shipper’s reputation, they can make informed decisions about whether to bid on the load.
Carefully review load details
The next step in load bidding is to review load details to determine whether the job makes sense from a logistical and financial perspective. Some points to be aware of include the following:
- Payment and terms
- Delivery schedule
- Origin and destination
- Special freight considerations, such as reefer or hazmat
By analyzing load details and market rates for comparable loads, you can better determine whether a load is a good fit for your business.
Consider the cost of the load
When bidding on a load, carriers and brokers consider the costs to determine whether they can handle the load and still make a profit. To do this, they analyze the costs associated with transporting the load, such as fuel costs, maintenance and repairs, driver salaries, insurance and other expenses.
Carriers should understand their costs per mile and compare them with how much each load pays. Market conditions and competition can also play a role. If a particular type of load is in high demand, carriers may gain long-term benefits by accepting jobs at low margins if they lead to new shipper relationships.
Determine the right bid amount
After searching the load board, you finally find a load to bid on, but how much should you bid? In this crucial step in the freight bidding process, brokers and carriers analyze the type of load, market conditions and carrying costs to determine a competitive and profitable bid.
The bid amount should be reasonable and reflect current market rates, load-specific details, carrier capacity and operating costs, competition and the shipper’s expectations. Before submitting your bid, compare the load with similar postings to check if your bid is within a sensible range.
Know your limits
No transportation company can haul every load. It’s important to understand your limits, which loads you can accommodate and your business costs.
Limits on loads include the maximum weight and size of the load that your truck can haul safely and legally. By knowing these limits, you can avoid bidding on loads that are too heavy or large for your truck, which can result in accidents, fines or vehicle damage.
It’s also important to know the types of loads you can haul. Some freight requires specialized equipment, such as refrigerated trailers for perishable goods or flatbed trailers for oversized loads. Understanding your capabilities and limitations helps you avoid wasting time on bids you won’t win.
Understanding your business costs is critical for making informed bidding decisions. Expenses such as fuel, maintenance, insurance and taxes should all be factored into the cost. This information enables you to determine a fair bid price that covers expenses and generates a profit.
Don’t be afraid to negotiate
Negotiating shipping bids ensures mutually beneficial shipping agreements and trucking contracts. Negotiation allows you to maximize profits; improve relationships between carriers, shippers and brokers; and boost service quality for a competitive edge. Bidding on shipping loads is about negotiating the best hauling contract for both parties.
Be realistic about your bid
Of course, you want to get paid as much as possible for every load, but your bids should be realistic. Understanding market rates helps to ensure you aren’t overcharging for your transportation services.
If a carrier bids too high, it will likely lose the load to someone who offers a fair and competitive bid price. Similarly, if a broker offers a carrier too low of a rate, they may decline the load, resulting in delays or missed shipments. It’s also important for carriers not to bid too low on a load. If the carrier’s compensation cannot cover expenses, it will lead to a financial loss.
Consistently offering realistic bids ensures proper compensation and builds a carrier or broker’s reputation for offering competitive and fair rates for their services.
Be honest and transparent
Being honest and transparent with your network is vital for creating the strong relationships necessary for securing the best loads. Stay truthful about your pricing and limitations, and practice good communication throughout each step in the bidding and shipping processes. By prioritizing trust, you can build a positive reputation and long-term partnerships that will help your business thrive.
Using load boards to bid on shipping loads
Whether you’re a freight broker or carrier, load boards can be an excellent resource for securing profitable loads. By following these steps to bid on shipping loads effectively, you can compete for the best hauling contracts to help you grow your business.
Trucking rates are calculated per mile with the total rate divided by a shipment’s total travel distance.
Load boards are a great place to find high-paying loads that meet your criteria.
You can use two main ways to secure loads on load boards: bidding and instant booking.
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