Skills for Changing Market Conditions

The consensus seems to be that we’ll finally see some life in the freight market in 2025.  How much life?  That’s still up for debate, but any activity is good news at this point.  It’s been a rough few years, hoping every slight uptick signaled the end of the cycle.

But this is freight, so I also have bad news:

Anyone who entered brokerage in the last couple of years (and that’s A LOT of people) has no idea how to navigate a tight market.  

Looking at these new entrants, all they’ve known is a market where freight effectively covers itself.  There’s been such a surplus of capacity that you can post a load, wait for the phone to ring, and be almost guaranteed that some carrier will take your load at your target rate.

Unfortunately, that’s not the way this typically works.  

Brokering freight is a difficult job with unique challenges associated with different market cycles.  If and when the market tightens up, it will be a rude awakening for anyone who hasn’t experienced it before.

With that in mind, how do you prepare your team for changing market conditions?  What will change and which skills need to be reinforced to make sure they can adapt?  

Let’s hit some highlights:

Tightening Capacity

First and foremost, changing market conditions will bring tightened capacity.  If your team is accustomed to posting loads and waiting for the phone to ring, that’s going to be a big problem when the phone stops ringing.  Make sure your team knows how to find capacity, even when capacity is hard to find.

Tips to prepare:

• Have a consistent Carrier Prospecting Strategy.  Make sure your reps have an effective way of sourcing carriers that doesn’t rely on carriers calling on posted loads.
• Focus on building better Carrier Relationships right now, before it becomes a problem.
• You’ll build better carrier relationships by Selling Long-Term Opportunities, rather than transactional loads.

Rate Volatility

Next up, price increases!  Gone will be the days of paying dirt cheap rates to carriers on every lane.  With tightening capacity, carriers will have the power to increase their rates and you, the broker, will likely have to raise prices on your customers.

Tips to prepare:

• Educate your team on Negotiation Tactics.  Rates will increase, but make sure your team knows how to negotiate more favorable pricing for your company.
• Effective Soft Skills will ensure your team can manage difficult conversations with both customers and carriers.
• Make sure your team knows how Pricing works!  I see a lot of brokers basically making up numbers.

Customer Acquisition

If there’s good news, it’s that customer acquisition tends to become easier in a tighter market.  As rates and service failures increase, customers look for other brokers to replace the ones who drop the ball.  As long as you’re prepared, it’s the perfect opportunity for you to swoop in.

Tips to prepare:

• Just because your competition couldn’t find an option doesn’t mean an option doesn’t exist.  The better you are at Generating Options, the more business you’ll win.
• Make sure your team Internally Communicates Your Capacity!  If a customer needs help on Atlanta to Kansas City and you have great resources on Atlanta to Kansas City, your customer facing reps need to know about those resources.  They can’t sell capacity they don’t know about!
• For those of you who just threw your reps on the phones without any basic Sales Training, now might be the time to rethink that.

Declining Service Levels

We’ve talked about how “other brokers” will have declining service levels in a tighter market.  Those poor brokers can’t find capacity, can’t service their customers and ultimately lose a ton of business as the market changes.  But, how do you avoid becoming one of those “other brokers”?

Tips to prepare:

• Carrier Reutilization is your friend.  Nothing hurts service levels like one-and-done carriers.
• You can’t blame a carrier for not meeting an expectation they didn’t know about.  Set Expectations with Carriers upfront and avoid problems later.
• Don’t put all of your eggs in one basket.  One carrier on a lane is nice, but increase your Network Depth by adding several carriers into your rotation.

Customer Retention

Shifting market conditions create a host of difficult situations and how you handle them will have a defining impact on your customer relationships.  Handle them well and you’ll have a customer for life.  Handle them poorly and get ready to lose some business.

Tips to prepare:

• Avoid common Short-Sighted Pitfalls.  You might find yourself making high margins on certain lanes, but your customer will find out eventually.  Keep in mind the old saying – pigs get fat and hogs get slaughtered.
• Focus on Providing Solutions for your customers.  As their other brokers struggle with service, you’ll stand out if you’re able to provide creative solutions for their problems.
• Use Long Term Thinking when you approach your accounts.  You might not want to lose money to avoid a service failure, but think about the lifetime value of that account.

Final Thoughts

The theme of this blog post is about skills brokers need to navigate a changing market, but what if the market doesn’t see an uptick?  What if brokers are just trying to speak a tighter market into existence and 2025 remains flat?

Well, if that’s the case, don’t bother training anyone…just kidding.  While some of these topics are more relevant in a tighter market, everything mentioned is a skill a broker should be familiar with and have had training on.  The best brokerages make training a priority and so should you.

Shameless self-promotion: Anything in italics is a topic specifically covered in Sync Logistics Training.