Unmasking Double Brokering in Automotive Transport: A Quick Guide

Unmasking Double Brokering in Automotive Transport: A Quick Guide

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By: David Sperau, Co-Founder of Autosled

This article was featured on Auto Success and can be found here.

The auto transport & logistics industry has been undergoing significant disruption over the last several years. Supply chain issues have impacted both the retail automotive industry as well as transport and logistics. As the industry transforms, so does the use of not only helpful, but hurtful practices. Transport and Logistics, like other industries, is not immune to fraudulent practices. One such practice that has gained attention over the last several months is double brokering. This article delves into what double brokering is, its legality, consequences for car carriers and brokers, and how to not only spot it, but avoid it.

What is Double Brokering?

Double brokering is a practice where a motor carrier accepts a load with the intention of booking another carrier for the shipment, often posing as a third-party logistics brokerage (3PL). This practice puts all other parties at risk. Shippers lose control of their vehicles and are exposed to liabilities that were never agreed to, transporters don’t get paid, and the broker has to contend with the resulting mess.

In a double brokering scenario, the fraudulent company or individual will apply for a motor carrier (MC) number, use that MC number to book a load with a reputable 3PL, and then, using the documents provided by the 3PL, pose as a different reputable 3PL to pass that load onto a different carrier that will actually haul the freight. 

The outcome of this is that the fraudulent individual will either steal the shipment or have the carrier deliver it as promised, only to collect payment from the brokerage and disappear.

Is Double Brokering Legal?

The legality of double brokering is complex. To draw some clear lines around this issue, MAP-21 Laws were enacted in 2012.  These laws made it illegal for motor carriers without a proper broker authority from the FMCSA (Federal Motor Carrier Safety Administration) to broker shipments.  It is also considered illegal for motor carriers with authority to double-broker loads without the knowledge and consent of all parties involved.   

However, there is a legal practice called “co-brokering” where a shipment is passed onto another carrier, but the shipper has first given consent and agreed to the liabilities involved. Co-brokering works if a carrier has more loads than it can effectively manage but only if that carrier also has the proper brokerage authority to re-broker the freight to a different carrier company.

The main difference between co-brokering and double-brokering is that, in the former, the practice is done with the shipper’s knowledge and consent, while the latter is done secretly to exploit money. Double-brokering a shipment is always considered illegal.

What are the Consequences of Double Brokering?

Double-brokering scams, including fraudulent fuel advances, are estimated to cost the transportation industry more than $100 million per year.

For carriers, the consequences of double brokering can be financially devastating. When a carrier unknowingly participates in a double-brokered deal, payment ends up not being received for services rendered. All of their time, labor, and resources that have been invested, including fuel and maintenance costs, go uncompensated. Brokers, on the other hand, must handle both disgruntled shippers and carriers, while spending considerable time resolving disputes. Additionally, both carriers and brokers face damaged reputations by being associated with failed or problematic deliveries, even if they had no knowledge of the double brokering.

Auto dealers are also at risk. When a vehicle is double brokered, the dealer loses control and visibility over the transportation process, leading to uncertain delivery times and vehicle conditions. This can disrupt a dealership’s operations significantly. Stores could have customers waiting for those specific vehicles. Even if they don’t, all dealerships plan their inventory management based on estimated delivery schedules. In the worst-case scenario where a vehicle becomes stolen or totaled during transport, the dealer could potentially face financial loss of that unit.  

How to Spot and Avoid Double Brokering

Preventing double brokering requires diligence and attention to detail on behalf of all parties involved. The transportation industry is a complex web where drivers, dispatchers, and everyone in between frequently move from one company to another. Individuals with malicious intent can take advantage of the chaos that’s created by these changes, in order to sneak into even the most robust of networks.

Dealers can mitigate their risk exposure by choosing reputable shipping partners that verify all of their carriers’ information and certifications. Not only will this help avoid double brokering scenarios, but dealers gain an extra level of support if a situation ever does arise.

Staying clear of double brokering is a difficult task for carriers that are trying to move as many loads as possible. Because of that, we’ve included some tips for carriers to ensure that their companies are not engaging with someone that’s impersonating a brokerage firm:

  1. If you’re using a new broker for the first time, there are tools provided by the DOT like SAFER that provide company snapshots to verify information.
  2. Ask yourself, “is the rate too good to be true”? Is it consistent with the lane, or does it seem too high? Scammers will often post loads with inflated prices to secure a carrier, without any intention of paying for it.
  3. If a contract or other documentation has been provided, does it look like it has been altered?
  4. When agreeing to take a shipment, did you speak with an actual person, or was the communication strictly through email or text messages?  Have you repeatedly attempted phone calls without success?
  5. Do the email address and web address match (e.g., @ExampleTransport.com and www.ExampleTransport.com)?
  6. If a broker communicates through a free email service like Yahoo! or Gmail instead of a company domain, that is a red flag. 

Conducting your due diligence can prevent major headaches as well as thousands of dollars in thefts and claims. Double brokering can be avoided with the right knowledge and vigilance. By understanding what double brokering is and how to spot it, carriers and brokers alike can protect themselves and maintain the industry’s integrity.

Autosled has been changing automotive logistics by combining load brokering with digital tools, allowing verified transporters to safely and securely claim loads with the push of a button. Autosled has a zero-tolerance policy for double brokering and is always on the lookout for ways to improve the industry for transporters and shippers alike.  If you need to ship cars or if you’re in the car-hauling business, register for free to start moving your cars safely today!

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Autosled Experiences Exponential Growth Heading Into The Remainder of 2023

Autosled Experiences Exponential Growth Heading Into The Remainder of 2023

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Vehicle Moves, Transporter Network, and Staff All Increased Despite Industry Changes

ROCKVILLE, MD – June 26, 2023– Autosled, a leading provider of digital technology for vehicle logistics, announced that it has experienced remarkable growth across all areas of the business- its transporter network, staff, retail automotive dealer signups, and vehicle moves. In the face of supply chain constraints hitting retail automotive and an accelerated rate of change impacting the transportation industry, Autosled has emerged as a disruptive mobility and digital logistics service provider with a proven track record of excellence.

Founded by brothers Dan and David Sperau, the company began serving dealers just over two years ago and has increased its vehicle moves by 10X- now partnering with over 1,000 retail automotive dealerships nationwide. This is a direct result of Autosled’s intentional focus on excellent customer service, feedback-driven product improvements, and unwavering business integrity. 

“Our commitment to continuous improvement is rooted in actively listening to our clients, as they serve as the primary catalyst for innovation within Autosled,” noted Dan Sperau, Autosled’s co-founder and chief executive officer. “We’re excited about the technology we have on our road map that will shift this industry into the future. Autosled’s overarching objective is to become the largest global automotive logistics platform. While this may seem ambitious, David and I are resolute in our pursuit of a frictionless, all-encompassing solution that addresses the problems faced by our clients and the entire transport ecosystem.”

To accommodate the increase in retail dealership demand and vehicle moves, Autosled has expanded its transporter network substantially. With a current nationwide network of over 11,000 transporters and growing, the company has quickly refined its business operations accordingly. 

We have made a commitment to excellence for our dealer groups, transporters and direct customers”, noted Marlena Jasso, vice president of operations for Autosled. “Our team makes sure we incorporate customer feedback into tangible actions that continue to provide value and savings to our customer base. We look forward to the continued partnerships and growth.” 

In order to support the increase in both vehicle moves and transporter demands, Autosled more than doubled its full-time staff. Autosled now employs individuals worldwide that speak multiple languages including: English, French, Portuguese, Russian, Spanish, Ukrainian, and Russian. Coinciding with its team’s expansion, Autosled has begun partnering with automotive manufacturers (OEMs) to provide vehicle shipment efficiency for both rail yards and ports, while continuing to refine its core products and services. 

About Autosled

Autosled provides seamless digital vehicle shipment options for dealers, transporters, auctioneers, brokers, and individuals. As a tech first company, Autosled’s web and phone platforms create a marketplace between shippers and transporters that are faster, cheaper and more reliable. Services include custom price quotes, secure online payments, electronic accounting and invoicing, online vehicle shipment scheduling, verified transporter insurance and a vetted network. Vehicles delivered through Autosled are trackable, with real-time GPS and communication with transporters throughout the process. For more information, visit: www.autosled.com.

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For Media Inquiries, contact:

Peyton Hoffman

CP Consulting Group

(757) 748-4533 (cell)

peyton.hoffman@autosled.com

10 Easy Ways to Elevate Customer Service In Your Business

10 Easy Ways to Elevate Customer Service In Your Business

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By: Marlena Jasso, VP of Operations

1) Communicate Often and Honestly.

This is true for both internal and external interactions. Whether you’re providing updates to your staff, partners, or customers, don’t wait to communicate. Establishing regular dates and times for updates reassures both internal and external teams that their ideas, concerns, or accounts are treated as utmost priorities. It’s far less stressful for everyone when you communicate in smaller, more frequent intervals. Waiting until you have one large resolution (or all of the answers) not only makes the customer wait longer for information, but increases his or her frustration.  

2) Mistakes – Ownership and Resolution

All companies are made up of humans and humans have a 100% chance of making a mistake at some point. The good news is that customers know this, so that isn’t the real problem. The problem occurs when companies don’t take accountability for their actions. The same also goes for anyone who is an extension of your company. For example, at Autosled, there are over 11,000 drivers who are not Autosled employees, but represent Autosled to our customers. If one of them makes a mistake, Autosled takes accountability for it – whether it’s a simple typo or a driver running late. Mistakes happen, own them quickly and do your best to rectify them. Nothing is more infuriating to a customer than an employee who won’t acknowledge that the company has failed to meet expectations. 

3) Be Human 

Empathy is not the same thing as sympathy. You don’t have to sympathize with everyone in order to understand what they are dealing with. Using Autosled as an example, let’s say a vehicle was being shipped as a surprise birthday gift, but the driver gets stuck in a snowstorm in the Midwest. You can’t control the weather, but you can seek to empathize with that customer’s disappointment and frustration. Acknowledging a customer’s feelings can go a long way, even when nothing can be done. 

4) Be Professional

This should be the default for every customer conversation but it still warrants saying. Always be professional! If a customer is expressing heightened emotions, maintaining an attitude of professionalism throughout the conversation helps to de-escalate the situation.

5) Listen More Than You Talk

Customers want to be heard. This isn’t possible if they’re spending the entire conversation listening to your staff talk. Ask questions- both for context and clarity. Help paraphrase what they’re saying. Example: “So, if I’m understanding you correctly, your biggest concern is ______. Is that right?” Customers want their point of view to be validated. 

6) Under Promise and Over Deliver

Setting expectations upfront is key to customer satisfaction. Always tell people what you can do, and never what you can’t. If you need to double check with a manager or different team at your company regarding an issue, do that before giving an update to the customer.  At Autosled, we often check in with drivers personally for status updates.  It’s more important to be accurate with your information, than to simply tell the customer what they want to hear.

7) Understanding Various Needs

For the team here at Autosled, this means understanding the needs of both our dealers and our transporters in detail. It’s only from that basis of knowledge that we can work to accommodate both sets of customers. For example, many transporters speak Russian or Ukrainian, which isn’t something we’ve found as common among our retail dealership customers. In order to support our growing transporter network, we hired full-time staff that are fluent in Russian and Ukrainian, amongst other languages. This met a need that was expressed from that part of our customer base.

8) Tailored Solutions

Take the time to understand their individual needs and preferences. Remember, what might work for a large customer may not necessarily be the ideal solution for a smaller business. It’s important to customize your approach and offer solutions that align with their specific circumstances. By focusing on personalization and attentiveness, you can ensure that your clients receive the most suitable care for their operations. 

9) Give Knowledge Freely

Embrace a culture of knowledge sharing and collaboration. Recognize that sharing a solution, even if it’s not perfect, can lead to collaborative problem-solving and ultimately provide the best outcome for your customers. It fosters trust, strengthens the relationship, and demonstrates your commitment to their success. Remember, perfection is not always attainable, but through collaboration and transparency, you can work together with your customers to find the most suitable and effective solutions.

10) Be Present 

This is just sound advice for all interpersonal relationships and interactions, but it can become the difference between a win or a loss for your business. When interacting with people, answering phone calls or emails needs to wait. True emergencies are an exception, but most phone calls and emails do not fall into that category. Respect the people you are meeting with and the time they’ve chosen to give to you. This applies to internal and external staff, customers and partners. Be present and available so that you both can gain the most out of every interaction.

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Sit Down with a Founder

Sit Down with a Founder

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Q and A: Featuring Dan Sperau

Mike Buerger

Dan Sperau is a 3rd generation automotive enthusiast.  His grandfather was an employee of Henry Ford, while his father owned a Ford Dealership in Alabama.  Following his college education, Dan swiftly immersed himself into the retail automotive industry.  After his time in retail, he spent 12 years financially consulting dealership groups, specifically around incentive and recovery audits. He co-founded Autosled in 2018, along with his brother David.  We asked him a few questions about his experiences, and here is what he had to say:

Your automotive background is finance-centric.  Did you ever think you would get involved in the transportation and logistics side of the business?  How has your background influenced your approach to Autosled’s operations?

“No, I never thought I would get involved in the logistics side of things.  However, the concept of Autosled just made too much sense to ignore.  Micromanaging vehicle transportation creates so much paperwork behind the scenes for every dealership. Auto groups that deal with hundreds of transporters, 1099’s, and thousands of checks a year have to hire a small team just to handle it.  Autosled evolved as a solution to these challenges, offering efficiency that individuals with backgrounds similar to mine can genuinely value.”

What was the deciding factor in your commitment to co-founding Autosled?

“My brother, David – who spent 25 years in retail, was the driving force.  The frontline dealers who are actually handling the shipments, run into their own host of problems.  All of the dealer and financial pain points are interconnected.  The opportunity to create a uniform experience that could handle everything all at once was exciting.”  

Starting a new company is a tremendous risk, and there are always doubts.  Do you remember a single moment when you realized that it was going to work?

“Yes, it was in December of 2020.  We had built the MVP software (minimum viable product) and had been moving cars since July of that year.  But that December, the first self-dispatched load occurred.  Seeing it go through the system without any prompting or manual intervention was almost surreal.  I looked at Dave and said, “Did that just happen?”  That was the “ah-ha moment” when we knew it was going to work.  Self-dispatching is a force multiplier for us.  It allows our small team to be able to handle a large amount of work.  Just over two years later, over 85% of our loads are self-dispatched, so that’s been a huge win for us.”

You mentioned the self-dispatching capability.  Autosled’s carrier network has over 11,000 transporters.  How do you tackle communicating with so many transporters across the country?  

“It all starts with our operations team.  Autosled’s app evolved to make life easier for transporters, and our team is here to support them.  From the start of the onboarding process, we educate our transporters on the capabilities of Autosled’s technology.  Things like self-dispatch and 2-day quick pay are huge competitive advantages when used effectively.  It helps that our staff speaks six different languages as well. Having a staff that is fluent in the same languages as our transporters removes as many barriers as possible. We’re just trying to make everything smoother and better for them, period.”    

What future challenges will the car-hauling and retail vehicle logistics side of the industry face and how can Autosled help address those issues?

“The increase of online sales to meet customer expectations is going to continue.  Traditional hub and spoke style models will become more fractured than they already are.  While this makes it harder for small transport businesses, it is especially challenging for companies running large fleets.  The role that Autosled can play is to provide the tools, such as a self-dispatching load board and digital bills of lading, for these companies to be more flexible in order to navigate the changing markets.”    

Autosled went from two brothers with an idea to a company with over 50 employees in a relatively short time.  What advice would you give to other Entrepreneurs who may be following a similar path?

“Without risk, there is no reward.  Your company is your baby and it’s scary to put it in other people’s hands, because you think you always know best.  That is why it is so important to surround yourself with the right people.  It’s what they do that brings our vision to life. It’s not just David and I.  Trust me, I’ve learned more from my people than they have from me.  Our company culture is built like a family; we care about everyone.  As a founder, without good people to support you and strong company culture, you’re toast.”     

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