June 10, 2025 • 30 mins
Whether you’re an aspiring or experienced freight broker, listen to this episode with our returning guest from Rocket Shipping, Gabe Pankonin, as he shares his expert insights on upcoming NMFC code changes!
Gabe explains how the NMFC changes could represent a significant shift in transportation, the opportunities for brokers to provide proactive analysis, and more about cold calling success, resolving operational challenges, and understanding the impact of class changes!
About Gabe Pankonin
Gabe Pankonin has always had a knack for sales and relationships - a skillset that has led him to run a successful, fast-growing freight startup in the industry.
After several years servicing E-comm companies moving big and bulky freight, one painful reality set in: Brands had the marketing skills to grow quickly, but they were NO match for outdated LTL shipping solutions.
Gabe saw this issue plaguing the LTL space...that as shippers get bigger and start to handle more shipments, half of their business turns into the logistics of just getting things to people's homes
Which is why he started Rocket Shipping; Mid-Market Managed Transportation!
Rocket's Core Values are an extension of Gabe's deeply held beliefs. Faith, Family, Joy, Grit, and Integrity. Ultimately, the goal Gabe set for Rocket has and always will be to build predictable and repeatable revenue and to impact the people who work with and at Rocket Shipping for many years to come!
📊📉 Don’t miss out on the latest market trends by subscribing to your TOP Transportation Morning Show! 🌎
🎬🎯 #TheFreightCoach Morning Show is LIVE every weekday at 10:30 AM CST to break down transportation industry headlines! Mark your calendars!
🤝 Shoutout to my sponsors!👇
- Denim | https://info.denim.com/chrisjolly
- SPI Logistics | https://spi3pl.com/
- Greenscreens | https://brokers.greenscreens.ai/partnership/chris-jolly
- Revenova | https://revenova.com/freightcoach/
- NMFTA | https://nmfta.org/
🚚 Ditch your carrier packet, drive more carrier sales, and get better load coverage with seamless digital onboarding, TMS integration, and smart load coverage by visiting https://brokercarrier.com/.
To donate and contribute to the Have a Heart’s purpose, visit https://www.haveaheartinc.org/donate.
🚀🔥 To sign up for my Newsletter, go to http://eepurl.com/iNoHco, get in touch with me through the social media channels below, and subscribe to my YouTube Channel!👇
▶️ https://www.youtube.com/channel/UCjrL70IEnCfDkNaiYMar3jw
📷 https://www.instagram.com/thefreightcoach/
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:03):
Came back with a bank window down yelling now money anything hey oh got the foot on the gas pedal to the metal when I'm get to the back hey Got the foot on the gas pedal to the metal when the lane moving fast hey Let them all cross if they hate then let them hate them make a bigger balls.
Speaker 2 (00:24):
Hey what is up, ladies and gentlemen? We are back. We are live. It is the Freight Coach Podcast, the top podcast in transportation coming to you guys every single weekday, 8:30am Pacific, 10:30 Central, to break down some industry headlines. But most importantly, you guys provide some actual insight into what you can do with all of this information. If this is your first time tuning in, welcome. This is the real side of freight, ladies and gentlemen. And I do say that before every single show. And what I mean by that is I only speak with transportation professionals. And today's guest is nothing short of a transportation professional. He is pretty much primarily my resident LTL expert out there.
(00:59):
And he's agreed to jump on the show today, you guys, to bring a broker's perspective and a provider's perspective on all of the NMFC code changes are out there. And with that being said, I have Mr. Rocketman, aka Gabe Pinken, and back on the show. Gabe, thank you so much for joining me.
Speaker 3 (01:15):
Always a pleasure to see you. Jolly. How you doing, dude?
Speaker 2 (01:18):
I'm doing well. Man, I wish we could get together more often, but, you know, I guess screw us for both being busy and having that we're doing all the time businesses.
Speaker 3 (01:26):
Geez.
Speaker 2 (01:27):
Yeah, I know. Who would have thought, right? Oh, man, dude, I wanted to pull up. I saw a couple of your team jumped in back there. I wanted just like to psych them out and pull them up on the live stream here just to freak them out a little bit.
Speaker 3 (01:38):
And I would love that, I'm sure.
Speaker 2 (01:42):
So, dude, what's new, man? How's everything going out in beautiful new North Dakota on this Tuesday morning?
Speaker 3 (01:48):
You know, it wasn't so beautiful this last weekend. It was like 45 degrees, which is strange for June. We had a little cold weather baseball. But it is summer now. It's like 80 degrees today. We're back. Fargo's beautiful. It's the best time of year to be here. Probably the only time of year that I like to be here is June, July, August, September. So I'm in a good mood.
Speaker 2 (02:07):
Dude, I love it. Oh, man. So I. Dude, how's things going this year so far? You know, like, again, I always like to have guys like yourself on the show who can actually breathe reality into it as opposed to a bunch of headlines by people who aren't actually running businesses or talking to manufacturers from a provider level like you are. So how are things going on your end right now?
Speaker 3 (02:28):
I mean, it's. Rocket is having a good year, but we had some interesting hiccups or I guess I would call them interruptions. The tariffs were particularly, were particularly exposed to those. We service the e commerce industry really heavily. So any company that's shipping stuff online, that's big and bulky, going to a residence, that's kind of our pitch. Well, most of those products don't come from the USA and almost all of them come from China. So we had some interesting calls with the founders and CEOs of those companies. It was kind of fun. It was nerve wracking. A little bit fun because they're like, hey, what do you think's gonna happen here? And I was like, well, I don't have a playbook for this one.
(03:07):
But generally speaking, we saw a dip in volume and then a pretty big increase in volume and that's kind of leveled off. It is difficult to run your business when volume goes up and down and you don't know what's coming next. But I think that the impact there is probably minimal. Normally like 2020, when it was 2021, when there's a huge boom in E commerce, it was consumer driven. This was actually not consumer driven demand or supply. It was all about is there a tariff? What's the tariff going to be? Should we stop ordering containers? Should we order all of them now in bond warehouses? So it's been a fun spring, let's put it that way. But the numbers have been good. So.
Speaker 2 (03:46):
Yeah, no, no. And I'm glad you brought that up. Right. Because I feel like everything you see is just over sensationalized in whether it's the media or social media, content creators. Regardless, everybody's trying to like push a narrative to get clicks, right? Because this might come as a harsh reality for some, but you guys, most people are literally compensated solely on the amount of clicks that they can get. So the more outlandish they talk, the more clicks they get. And then you can package that up and sell it to advertisers and monetize that. Right? So you got to take that with a grain of salt when you see some of this data.
(04:22):
But you know, again, this is why I like talking to real business owners who are actually having these conversations with these manufacturers, CPG companies who are directly affected by this and the strategies that you guys have to come up with, right? Because again, I feel like there's a. A false sense of, oh, you're a transportation provider, they're a manufacturer. You guys should just have all this shit figured out and it should just be seamless, right? There is more, hey, what should we do here? Than I've seen in the past, right? Like, I was just having a conversation this morning about this exact topic with somebody with a prospect of ours, and they're like, yeah, man, we're. We're just trying to figure it out.
(04:59):
And I'm like, hey, we're literally here to help in any way we possibly can to ensure this is as smooth of a transition as possible, regardless of what the percent tariff is applied to specific commodities out there. Like, we have to find a solution, right? And especially individuals like ourselves who are founders who are actively selling. Like, we can't just put our feet up and be like, well, guess we're going to set this one out, you guys.
Speaker 3 (05:23):
Yeah, no option on that. I think too part of it was there's all this turbulence on what might happen. But it is kind of interesting. The only time that, like, more than one or two of my customers all at once will be like, hey, what do we do here? In my recent memory at Rocket was when we started it, and it was during COVID And they're like, what do we do here? Are we in essential business? I remember that question. And I was like, well, I have no authority here. I don't. I was just researching. I didn't have AI either. So I was like, well, you ship desks that go to somebody's house, I think they have to work. That seems essential to me. And they were calling themselves essential. Right? That's how that worked.
(06:01):
And now it's, hey, what do you think is going to happen with these tariffs? And I'm like, well, again, I have no idea. I don't think anybody does except for a select few. But it did kind of. There was a lot of pandemonium for very little fervor, I guess I would say it ended up being okay. Now there's a tariff, everybody adjusts and things are business as usual. Relatively speaking. If I was an E Commerce importer, it's not business as usual. There is a difference. But for the freight folks, it's, hey, that didn't fix. There wasn't a huge boom. And I know that people are talking about it. There was a lot of containers that are coming in this week actually, but that's not going to Be a continued volume. In my opinion, it's going to be a return to the mean.
Speaker 2 (06:44):
I think most people, Gabe, and this is very hard in today's society, you need to wait 60 days. Like, I think you literally need to wait 60 days worth of data to say something has changed or not. Right? Because again, people like to focus on the peak. They're like, you know, whether it's this, right? Like, oh, hey, there's a bunch of containers coming in. Is the market recovered? Wait two weeks, right? Wait for all of that stuff to be processed and dispersed and put out there into the distribution network and then come and talk, right. It's just like all of these people that I've seen out there regarding the. The full truckload space. For example, it was dot inspection week, then Memorial Day, and then it's the summer and they're like, oh my God, the market's back. I'm like, no, it's not.
(07:23):
Wait, wait a little bit, you guys.
Speaker 3 (07:26):
Wait till July.
Speaker 2 (07:27):
Exactly. You know, and again, if people pay any attention at all, which they don't, they only pay attention to the moment. Wait until after the 4th of July. All right? That, that is a very real indicator on if prices are going to remain elevated or not. Because again, what happens this time of year? Most people go on vacation, kids are out of school, you know, so again, there's going to be natural dips and stuff that come along with it. But I haven't seen any drop in capacity out there at all. And you know, with that being said, I think we people need to prepare that the freight market might look the literal exact same in 12 months from now that it does right now.
Speaker 3 (08:03):
Yeah. What is it like? Just like the Fed interest rates, we thought those would be lower too, and they just kind of are staying the same. I think that no one can predict it, but nobody was right about the fact that the market's in the same spot it was for interest rates for truckload market. The LTO market's the same, although I think that LTL carriers are probably hurting more than they have in the past. But they don't give price decreases in ltl. They just have what they call pricing discipline. And so that's not gonna. Although I do think the NMFTA changes coming up might shift some LTL pricing around.
Speaker 2 (08:38):
Again, I'm glad you brought that up because to me, I think that the NMFC code changes that are coming down I think might go down as the greatest market grab ever inside of transportation. Right. Because I've been talking to a Lot of people. And I mean I just had Scooter Sayers on the show last week with Cuba Stand and he was telling me, he was like, yeah, were at this really big show earlier this year and 50%, literally 50% of the shippers there had no idea there was a change coming. That was 60 days ago.
Speaker 3 (09:14):
Yeah, it doesn't matter if anybody knows it's coming because there's no clarity on exactly what's going to change until it happens. And so now even if you know it's coming, there isn't a real resource out there that says if my item is X is it affected? They're just basically their blanket saying and there is some documents but it's impossible to figure it out. It's like, hey, there's 5,000 total NMFC items and 2,000 of them will be affected in some way. How will they be affected? And like in ltl, your freight class changes your price drastically. One freight class change. That's why everybody, like the buzzword is a reclass, right? You don't want to reclass because it costs you money.
(09:53):
If you have let's say wooden desks and you ship wooden desks but you ship them knock down or KD is what the NMFC code will say. KD for knock down. There's three density based classes inside of that and it has to be nested if they're chairs, things like that. Now all of that's going to shift to a 13 provisioned density based codes or classes. If you were on the upper end of 125 class you might end up at 150 now because they're bringing that back and that's going to change your pricing without you doing anything different. So a lot of these companies don't know if they're going to end up at 92.5 or class 100 or if they're going to bet 150 instead. 125 because they were just in that third tier, that's going to change a lot.
(10:39):
And if they're not getting good weight and dims and scooter would say this and I'm a big fan of good weight and dims on the bol. I think it's less important than people realize but you need to at least do it. If you don't even do that because you have an NMFC code that's just class 77.5 agricultural tractor parts, it's just one class and now there's 13 options and every agricultural implement part is going to be a different density based class. It's a huge change.
Speaker 2 (11:05):
Yeah. I mean, so like speaking of that and in the gravity of that, how are you preparing your customers though, right? Like how are you getting out there and getting ahead of this? Because I feel like everybody's so reactive. Right. Like I've had the NMFTA on the show at least three times now and they've put everything together. They have a ton of free resources that are out there for people to utilize. Right. Like the NMFTA has invested a lot of time and resources and technology to help this. And you know, they have class IT plus out there as well for people to sign up for and become a part of. But you know it's gonna be huge. Yeah, yeah.
Speaker 3 (11:38):
But it's tough because. And I think NMFTA did as good as they could. It's a change. But there isn't a classic out there right now that you can look up your item and know what your freight class will be. And so they put out resources and it's hard to like it's documents and excels and it's useful. But for the average shipper, like they either already know their freight class and if they want to know what it is now they're going to ask their broker or their carrier and their carrier doesn't have like a way to look up what it will be in the future. Now they can do density based and if they assume it's going to go to a density based and there's 13 classes instead of 11. So like normally if you're shipping furniture, it's already density based. Nothing's changing. You'd think.
(12:18):
But actually it is because now there's a class 150 again. And I don't know the other one. I think it goes down to class 50 instead of 55. Maybe. But they added two classes back. So you might have been a class 150, but you got bumped to class 175. And if you're a furniture shipper, this helps you because you can't get to that PCF of 6 to 8 to get to 125. But if you were 8.5, you're class 175. That's a big jump. And now you'll be class 150. There just isn't a way besides density to look it up right now. So you kind of prepare. But July 19th is when classic goes live. That's when you can actually look it up.
Speaker 2 (12:53):
No, and, but like from my perspective though, Gabe, like, I mean you get this as well as a broker, as a service provider, like, there's not a lot of competitive advantages that we necessarily get to utilize in our careers. Right. Except for when situations like this happen. And you just. The fact that all of the details that you just broke down right now tells me. And again, maybe I'm just blindly assuming that you've already had this conversation with the majority of your customers. They very aware that there could very well be changes coming to their product. Not all of them, but again, but you're preparing them for them. And that's the point. Right? And to me, I feel like most people don't. Right. Like most people don't even have this.
(13:32):
They're like, they maybe have just passively mentioned like, oh, hey, sometime in July things might change. Just pay attention to that. But you've broken this down on a granular level. And that's just like, that's the opportunity that I'm talking about. Because again, man, as you know, we don't have a lot of opportunities as brokers to come in.
Speaker 3 (13:51):
Differentiate.
Speaker 2 (13:52):
Yeah, yeah. To differentiate ourselves.
Speaker 3 (13:54):
Yeah. We've had conversations with our shippers, but what we've been doing mostly internally is figuring out which items are going to be affected, which is a chore. And then once we figure it out, we already know what items are our customers are sending. And then it's like, hey, is it positive or negative? Because it's going to affect people differently. Some people are going to get a win on this because that class 150 I've. I brought up, some people are going to take a loss on this. Auto parts, engines, things like that you kind of ship at a class 85 or a class 70, a core return, things like that. And I haven't confirmed this, so don't take this as fact, if you guys are listening to this, but this is my assumption based on the items moving to density base.
(14:31):
There's a lot of items that ship LTL that have a specific NMFC code and one freight class. And if that item's affected, that's going to be really difficult for you to go to your shipper and say, hey, now you need to enter in the weight and dims and the everything and choose a class with our little calculator. And they're like, what? I've never done that in my history. And they might have been doing it for 20 years. They've never done that. They just put Class 70, no, wait, in dims. So this is an opportunity. But also it's an opportunity. This is How I look at it, I go, well, I know there's brokers out there that won't be prepared for this. There's shippers and carriers that aren't doing a good job of this.
(15:07):
And if I call these shippers up with the script of hey, I know that your item is this and it's going to be this freight class and here's how it's going to be affected. Would you give me a shot to do a rate study? Because I provided that. That's a much better cold call than hey, do you want to quote a shipment?
Speaker 2 (15:25):
Yeah.
Speaker 3 (15:25):
And in fact, this is funny jolly. I just remembered this. Our biggest customer at Rocket won't name the name, but our biggest client I cold called in 2016, 2017 because their item was changing out of the NMFC docket. I, I researched the docket and I cold called their CFO and I said, hey, your items shipping at class 250 right now you're going to be at class 125 because it's an, it's a density based. And then you guys are now getting a specific code. He didn't know that. And unit shippers did. Unishippers submitted it on their behalf to the NMFC and they named the client, they said on behalf of this client in 2017. So I cold called the client, unit shippers did the work, they helped the client, but they didn't tell the client what they were doing.
(16:12):
And so in my opinion, they didn't do the work. And so I called the client and they switched over to us and they send several hundred shipments a day with us over the last eight years now they've been working with us because of an NMFC change. So it's a real thing, dude. It is.
Speaker 2 (16:26):
And I feel like as somebody like myself who does full truckload, partial truckload, it is going to open up the door that a lot of people are now. It is going to be just as cost effective, if not more cost effective to explore partially in it out. Especially if they had higher pallet count or higher density count ltl shipments. Right? Because you can't use that LTL discount code anymore on some of this stuff. Right? So it's like, yeah, as a full truckload broker, I'm looking at it from that perspective, man. I'm like, damn, dude. How many of these shipments that come across my desk that are 8 to 10 pallets are now going to be more expensive to ship at LTL than they would be on a standard partial truckload? And Getting that in there as a box truck rate.
(17:05):
So I think that this could, and I truly feel this way, man. This will have a very positive effect on the market from a sales and opportunities perspective. What Gabe's talking about right there and what I'm talking about when I'm going out there and talking to customers now, man, I'm letting them know, like, because I tell everybody we don't do ltl. Right? Like I literally say that in my opening line on a sales pitch. Everything, hey, we're full truckload. If you do a lot of ltl, I'm not your guy. Like, I essentially break it down just like that. And now it's like, hey, have you guys explored shipping partial truckloads with the potential NMFC coach or not the potential, but with the NMFC code changes that.
Speaker 3 (17:40):
Are coming July 19th? Yeah. So yeah, I like your tactic on that because there's going to be a lot of people that were shipping LTL volume or like a 6 to 7 pallet order and they're getting those linear foot rules and they might have an FA K. And so if I'm a sales rep out there and my team will be doing this, we're going to be looking for clients and we're going to be asking the question, do you have an FA K? And I won't explain all the nuances of that, but I don't think FA KS will stay around. And so if they have an FA K, I'll just be patient until their next contract renewal.
(18:08):
Because the LTL carriers, when they're pricing an FA K unless they priced in all the risk and they're just inflated margins, they're going to see how this operates with the new density based classes and they're going to see that they can get better revenue and they're gonna say, we want all of our customers on that 13 code density based. Because especially if they were getting an fa k of class 70 now they want to actually true class rating. That's kind of where the market's going. If they have an FA K, they're not even remotely aware of how to do weight dims and freight class by density. And then we're a resource instead of just a broker.
Speaker 2 (18:42):
Yeah, no, and that's exactly it. Right? Like we're literally going through this right now with a prospect of ours. Right? Like we have, thank God I have a business partner who is cool in Microsoft Excel because I'm not. We broke a lot of that down, man. And we're finding, hey, how do we create milk runs for our customer that's going to save them money on that. Right? Where now it's multi pick one drop and everything. And you know, I feel like this is one of those things where again this is why I always tell people to start in a niche, right. This is why you don't blindly just go out there and move shit. Fortunately, I've been doing this for a long time and I know how to handle a lot of these situations.
(19:15):
But again, like this is one of those times where if you're an LTL broker or if you're a truckload broker and you have a customer who has LTL freight, maybe it is up in that volume and you're starting to see 6, 8, 10 pallets that come across on their LTL orders. You gotta pounce on that, you guys, you really do. Because where the truckload market is right now in its current status, there will be a lot of exploring of hey, is it cheaper now just to ship this out as a partial truckload or a 2 or a 1 pick 2 drop style run?
Speaker 3 (19:45):
Yep, for sure. Especially if the market stays where it's at, which I don't anticipate it. I know that a lot of people are talking about a huge recovery. I don't think it'll be like a fast recovery. It'll continue to get better over time because it has to. That's how things work. But it's not as quick as most would think.
Speaker 2 (20:01):
Dude, there's this morning show host, orange shirt guy who's been saying that for about 18 months now.
Speaker 3 (20:08):
I haven't heard of this orange shirt guy.
Speaker 2 (20:10):
Yeah, I don't know but there's been somebody out there who's been saying it's a slow and steady thing and you know, you're going to look back over an eight to a 12 month period and people are gonna be like, holy. Rates are up 35 cents a mile. Look at this massive drastic change. But it's been a ratchet up approach.
Speaker 3 (20:24):
It doesn't feel massive.
Speaker 2 (20:25):
Yeah dude, but that's how it's going to be, right? And I feel like it almost has to at this point because outside of any Black Swan event that comes in complete completely rattles the industry. It, it's just how it's going to be. I think it's proven that even the.
Speaker 3 (20:42):
Tariffs didn't rattle it enough. I don't think all that capacity, the surge of containers, I don't think that's going to rattle it enough. But I could be wrong. And you know, I kind of, I'm biased because I want it to be a little lower for longer because we're doing well in this market and I'd like to be ready to. I mean we are ready for a recovery and we'll grow, but it's too easy to grow during that. So I kind of like it this way.
Speaker 2 (21:05):
And that's the thing, right? And I, and I want, and I think like, ultimately when you deduce it down, Gabe, you have to look at like, if you've been able to grow over these last like three to four years, like continuously, you're going to do very well when things improve. Right. And because it's like you have to apply the strategies that you're doing right now, right? Like, shit, I just talked about this is put a post out there this morning, man, there's no piece of technology that's going to shave us, save a shitty process. Right. Like all of the gains and stuff that everybody's looking for are literally in the work that they're avoiding. You just need more reps, right? You got to get told no more on the phone, hey, are you still actively cold calling every single day, Gabe?
Speaker 3 (21:43):
I'm not cold calling. I'm still on the sales calls, but my team cold calling every day.
Speaker 2 (21:47):
Exactly. Right.
Speaker 3 (21:48):
I'm cool doing discovery calls. I don't like say, hey, I won't talk to somebody until they're really interested. I like, I still do discovery calls and meet with the client for the first time in person or over a zoom call.
Speaker 2 (21:59):
Dude, I'll say this, man. Our cold calls that we've been having are so much more pleasant than they used to be. So much more. And, and I truly think, Gabe, it's because nobody's actually doing it as everybody will post that they're doing it. But I don't think people are.
Speaker 3 (22:13):
Email.
Speaker 2 (22:14):
Yeah. I think from a quality perspective, if you just go out there and just do basic research on a customer, right. You call somebody just through easy example, they're a food shipper, talk to them about refrigerated freight. I know, fucking shocker. But again, if you are just even slightly prepared for those calls, like, it's amazing this doesn't lead to just an influx in business, but it's at least a positive first step. Because I think a major miss and failure by a lot of people and I'm including myself in this when I say this is. People overestimate where they're actually at in the sales process.
Speaker 3 (22:50):
Right?
Speaker 2 (22:50):
Like just because you Called somebody one time and you're shocked that they told you no. Like, what? Why? Why are you shocked? You're a complete stranger, right? Or you're shocked that they didn't been.
Speaker 3 (23:00):
On this deal didn't go through. Well, you can believe if you look at it, dude.
Speaker 2 (23:05):
And that's exactly it, right? So it's like, how are you out there actively working in this market, right? Because like, from a business development perspective, we are all gas, no bricks when it comes down to it, right? Like, we are calling as much as we possibly can at all times. So how are you guys approaching that?
Speaker 3 (23:23):
All gas, no brakes. Same thing. We're always kind of shifting our strategy to wherever our product roadmap is. And so right now we're selling White Glove more than we ever have. We. Our core offering is curbside delivery and I call it gray gloves. So our carriers do a better job of curbside. They'll bring it to the front door. But now those same carriers are asking us to offer white Glove. We've got a couple of really good, I would say, clients that have proven success with that with nationwide White Glove for ltl. So I'm not talking Final mile agents. It's a different model. But if we are calling a client one, we're constantly refining how we find leads, right? So we work with a company called Practical Prospecting and Jed and Troy Barter over there doing that.
(24:07):
They're always using different tools to find the leads. And then it's just message. Like, if you can get your message out to more shippers, you don't need quotas. You just have to get the message dialed in. And our message is super narrow. Not everybody's gonna like it. Can't just cold call random shippers and say, hey, I offer curbside and white glove delivery for big and bulky items like saunas and cold plunge tubs. And they're like, yeah, but we. We ship steel. But I will say one mistake I made jolly over the last two years is I tried to remove myself more from the sales process because I thought that's what CEOs are supposed to do. Hey, I gotta scale the org. I gotta get removed from that and focus on other stuff. There was no reason to do that.
(24:44):
Like, I'm the best seller on the team still. I know the product the best and that's what drives revenue. And turns out that revenue fixes way more things than me fixing other stuff. If you have revenue and you have good profit, it's not as important to focus on all the other aspects of the business. But if you don't have revenue, you don't have profit, then everything's a problem. So, yeah, I would say revenue heals all wounds almost. And then, you know, overscaling can happen.
Speaker 2 (25:09):
But I, I have another good buddy of mine who owns a company and they do, and he's organically grown into doing over 100 million a year. And he told me pretty much two years ago, he's like, dude, don't hire any sales reps. You lead the sales charge until you're, you're approaching 100 million, then hire people behind you. He's like. Because he told me, I very much the same. What you were just saying there, Gabe, at the end of the day is nobody's going to sell it. Like, you're going to sell it, and you need to sell it that way with that intensity until you reach that point. And then you have the finances to build the team around you. And, you know, again, I think that's what a lot of people overlook, right?
(25:49):
I think a lot of people overlook how long it's going to take. They overlook how hard it actually is to get that high. And again, I think more people are. Because they're like, they're chasing the exit, right? I think that's what a lot of it is. They're chasing an exit.
Speaker 3 (26:02):
And it's the wrong thing to do. Everybody who's ever sold a business for a lot of money was not building it to sell Eve unless they were VC backed, but because that's the only way you can get liquid on those businesses, which I'll say for a different episode. However, if you're building it with only an exit in mind, then you're taking shortcuts always because you're trying to shorten the path to an exit. And if you're trying not to exit, someone offers you a ton of money and you say, yes, that's different than building it the whole time of taking shortcuts. We don't need to develop that feature all the way because the client didn't specifically ask for that, even though you know that's the way to do it. Yeah, I do think too.
(26:40):
You said that when you get the financial resources, then add a sales team. That's what I did. And I have a good sales team. But the mistake I made was then I removed myself from the sales process and I was like, hey, they'll just, there's five of them. They'll just do what I was doing. But that didn't make any Sense because the deal win ratio went down below 50%, then below 30%. And I got back in January and we're back above 60%.
Speaker 1 (27:03):
Close.
Speaker 3 (27:04):
So you got to know your sales numbers and know where you should be working at the company. I shouldn't be doing finance. That's why I have a cfo. I'm good at sales, so I'll do that.
Speaker 2 (27:14):
Dude, I'm right there with you, man. That's like, I like selling. I like building. I don't like any of the stuff behind the scenes. Fortunately, I have a business partner who loves all of that stuff. He likes to do all that stuff, you know, Again, man, like, dude, I'm just. I'm an operator. Like, I'm. I'm just a seller at the end of the day. I just like building and that. That's where my focus is always going to be, is building.
Speaker 3 (27:35):
And you know where your product and your team is at better than the sales reps will. Right? So if the sales reps are selling a certain niche service, maybe it's heavy haul, open deck, right? I don't even know if I said that right, but I've heard it said by you. So maybe it's that they maybe don't know what carriers you have or what lanes you've run. They're just trying to sell the customer, you know, the whole business. So you can really speak to it. Same thing for me, dude.
Speaker 2 (27:56):
I could not agree more, Gabe. But as always, man, these. These episodes always fly by. So, dude, how. How are you guys hiring? How does he need to reach out to you guys to find out more?
Speaker 3 (28:07):
Not hiring. If you want to ship with us, we will. We'll ship your stuff. But I. While I was thinking through this episode, I'm gonna build a tool for the NMWTA thing. I'm gonna figure out how to build a tool. You can look up your item and then figure out if it's affected and what your new freight class will be. So I'll report that back to you.
Speaker 2 (28:22):
Dude, I love it. Gabe, thank you so much. That's going to be it for today, ladies and gentlemen. As always, if you got value in what you heard, subscribe to the show. You guys, if you're feeling really ambitious, rank the show as well on itunes and Spotify because if you saw value, that's how your network's gonna see value as well. I appreciate you guys. I love you guys and we'll be talking to you soon. We have an outro now. Gabe.
Speaker 1 (28:46):
Came back with a bank window down yelling now Money anything Hey oh Got the foot on the g metal when I'm get to the back a Got the foot on the gas pedal to the metal when the lane moves fast Let them all cross if they hate and let them hate them Make a bigger boss a.
Came back with a bank window down yelling now money anything hey oh got the foot on the gas pedal to the metal when I'm get to the back hey Got the foot on the gas pedal to the metal when the lane moving fast hey Let them all cross if they hate then let them hate them make a bigger balls.
Speaker 2 (00:24):
Hey what is up, ladies and gentlemen? We are back. We are live. It is the Freight Coach Podcast, the top podcast in transportation coming to you guys every single weekday, 8:30am Pacific, 10:30 Central, to break down some industry headlines. But most importantly, you guys provide some actual insight into what you can do with all of this information. If this is your first time tuning in, welcome. This is the real side of freight, ladies and gentlemen. And I do say that before every single show. And what I mean by that is I only speak with transportation professionals. And today's guest is nothing short of a transportation professional. He is pretty much primarily my resident LTL expert out there.
(00:59):
And he's agreed to jump on the show today, you guys, to bring a broker's perspective and a provider's perspective on all of the NMFC code changes are out there. And with that being said, I have Mr. Rocketman, aka Gabe Pinken, and back on the show. Gabe, thank you so much for joining me.
Speaker 3 (01:15):
Always a pleasure to see you. Jolly. How you doing, dude?
Speaker 2 (01:18):
I'm doing well. Man, I wish we could get together more often, but, you know, I guess screw us for both being busy and having that we're doing all the time businesses.
Speaker 3 (01:26):
Geez.
Speaker 2 (01:27):
Yeah, I know. Who would have thought, right? Oh, man, dude, I wanted to pull up. I saw a couple of your team jumped in back there. I wanted just like to psych them out and pull them up on the live stream here just to freak them out a little bit.
Speaker 3 (01:38):
And I would love that, I'm sure.
Speaker 2 (01:42):
So, dude, what's new, man? How's everything going out in beautiful new North Dakota on this Tuesday morning?
Speaker 3 (01:48):
You know, it wasn't so beautiful this last weekend. It was like 45 degrees, which is strange for June. We had a little cold weather baseball. But it is summer now. It's like 80 degrees today. We're back. Fargo's beautiful. It's the best time of year to be here. Probably the only time of year that I like to be here is June, July, August, September. So I'm in a good mood.
Speaker 2 (02:07):
Dude, I love it. Oh, man. So I. Dude, how's things going this year so far? You know, like, again, I always like to have guys like yourself on the show who can actually breathe reality into it as opposed to a bunch of headlines by people who aren't actually running businesses or talking to manufacturers from a provider level like you are. So how are things going on your end right now?
Speaker 3 (02:28):
I mean, it's. Rocket is having a good year, but we had some interesting hiccups or I guess I would call them interruptions. The tariffs were particularly, were particularly exposed to those. We service the e commerce industry really heavily. So any company that's shipping stuff online, that's big and bulky, going to a residence, that's kind of our pitch. Well, most of those products don't come from the USA and almost all of them come from China. So we had some interesting calls with the founders and CEOs of those companies. It was kind of fun. It was nerve wracking. A little bit fun because they're like, hey, what do you think's gonna happen here? And I was like, well, I don't have a playbook for this one.
(03:07):
But generally speaking, we saw a dip in volume and then a pretty big increase in volume and that's kind of leveled off. It is difficult to run your business when volume goes up and down and you don't know what's coming next. But I think that the impact there is probably minimal. Normally like 2020, when it was 2021, when there's a huge boom in E commerce, it was consumer driven. This was actually not consumer driven demand or supply. It was all about is there a tariff? What's the tariff going to be? Should we stop ordering containers? Should we order all of them now in bond warehouses? So it's been a fun spring, let's put it that way. But the numbers have been good. So.
Speaker 2 (03:46):
Yeah, no, no. And I'm glad you brought that up. Right. Because I feel like everything you see is just over sensationalized in whether it's the media or social media, content creators. Regardless, everybody's trying to like push a narrative to get clicks, right? Because this might come as a harsh reality for some, but you guys, most people are literally compensated solely on the amount of clicks that they can get. So the more outlandish they talk, the more clicks they get. And then you can package that up and sell it to advertisers and monetize that. Right? So you got to take that with a grain of salt when you see some of this data.
(04:22):
But you know, again, this is why I like talking to real business owners who are actually having these conversations with these manufacturers, CPG companies who are directly affected by this and the strategies that you guys have to come up with, right? Because again, I feel like there's a. A false sense of, oh, you're a transportation provider, they're a manufacturer. You guys should just have all this shit figured out and it should just be seamless, right? There is more, hey, what should we do here? Than I've seen in the past, right? Like, I was just having a conversation this morning about this exact topic with somebody with a prospect of ours, and they're like, yeah, man, we're. We're just trying to figure it out.
(04:59):
And I'm like, hey, we're literally here to help in any way we possibly can to ensure this is as smooth of a transition as possible, regardless of what the percent tariff is applied to specific commodities out there. Like, we have to find a solution, right? And especially individuals like ourselves who are founders who are actively selling. Like, we can't just put our feet up and be like, well, guess we're going to set this one out, you guys.
Speaker 3 (05:23):
Yeah, no option on that. I think too part of it was there's all this turbulence on what might happen. But it is kind of interesting. The only time that, like, more than one or two of my customers all at once will be like, hey, what do we do here? In my recent memory at Rocket was when we started it, and it was during COVID And they're like, what do we do here? Are we in essential business? I remember that question. And I was like, well, I have no authority here. I don't. I was just researching. I didn't have AI either. So I was like, well, you ship desks that go to somebody's house, I think they have to work. That seems essential to me. And they were calling themselves essential. Right? That's how that worked.
(06:01):
And now it's, hey, what do you think is going to happen with these tariffs? And I'm like, well, again, I have no idea. I don't think anybody does except for a select few. But it did kind of. There was a lot of pandemonium for very little fervor, I guess I would say it ended up being okay. Now there's a tariff, everybody adjusts and things are business as usual. Relatively speaking. If I was an E Commerce importer, it's not business as usual. There is a difference. But for the freight folks, it's, hey, that didn't fix. There wasn't a huge boom. And I know that people are talking about it. There was a lot of containers that are coming in this week actually, but that's not going to Be a continued volume. In my opinion, it's going to be a return to the mean.
Speaker 2 (06:44):
I think most people, Gabe, and this is very hard in today's society, you need to wait 60 days. Like, I think you literally need to wait 60 days worth of data to say something has changed or not. Right? Because again, people like to focus on the peak. They're like, you know, whether it's this, right? Like, oh, hey, there's a bunch of containers coming in. Is the market recovered? Wait two weeks, right? Wait for all of that stuff to be processed and dispersed and put out there into the distribution network and then come and talk, right. It's just like all of these people that I've seen out there regarding the. The full truckload space. For example, it was dot inspection week, then Memorial Day, and then it's the summer and they're like, oh my God, the market's back. I'm like, no, it's not.
(07:23):
Wait, wait a little bit, you guys.
Speaker 3 (07:26):
Wait till July.
Speaker 2 (07:27):
Exactly. You know, and again, if people pay any attention at all, which they don't, they only pay attention to the moment. Wait until after the 4th of July. All right? That, that is a very real indicator on if prices are going to remain elevated or not. Because again, what happens this time of year? Most people go on vacation, kids are out of school, you know, so again, there's going to be natural dips and stuff that come along with it. But I haven't seen any drop in capacity out there at all. And you know, with that being said, I think we people need to prepare that the freight market might look the literal exact same in 12 months from now that it does right now.
Speaker 3 (08:03):
Yeah. What is it like? Just like the Fed interest rates, we thought those would be lower too, and they just kind of are staying the same. I think that no one can predict it, but nobody was right about the fact that the market's in the same spot it was for interest rates for truckload market. The LTO market's the same, although I think that LTL carriers are probably hurting more than they have in the past. But they don't give price decreases in ltl. They just have what they call pricing discipline. And so that's not gonna. Although I do think the NMFTA changes coming up might shift some LTL pricing around.
Speaker 2 (08:38):
Again, I'm glad you brought that up because to me, I think that the NMFC code changes that are coming down I think might go down as the greatest market grab ever inside of transportation. Right. Because I've been talking to a Lot of people. And I mean I just had Scooter Sayers on the show last week with Cuba Stand and he was telling me, he was like, yeah, were at this really big show earlier this year and 50%, literally 50% of the shippers there had no idea there was a change coming. That was 60 days ago.
Speaker 3 (09:14):
Yeah, it doesn't matter if anybody knows it's coming because there's no clarity on exactly what's going to change until it happens. And so now even if you know it's coming, there isn't a real resource out there that says if my item is X is it affected? They're just basically their blanket saying and there is some documents but it's impossible to figure it out. It's like, hey, there's 5,000 total NMFC items and 2,000 of them will be affected in some way. How will they be affected? And like in ltl, your freight class changes your price drastically. One freight class change. That's why everybody, like the buzzword is a reclass, right? You don't want to reclass because it costs you money.
(09:53):
If you have let's say wooden desks and you ship wooden desks but you ship them knock down or KD is what the NMFC code will say. KD for knock down. There's three density based classes inside of that and it has to be nested if they're chairs, things like that. Now all of that's going to shift to a 13 provisioned density based codes or classes. If you were on the upper end of 125 class you might end up at 150 now because they're bringing that back and that's going to change your pricing without you doing anything different. So a lot of these companies don't know if they're going to end up at 92.5 or class 100 or if they're going to bet 150 instead. 125 because they were just in that third tier, that's going to change a lot.
(10:39):
And if they're not getting good weight and dims and scooter would say this and I'm a big fan of good weight and dims on the bol. I think it's less important than people realize but you need to at least do it. If you don't even do that because you have an NMFC code that's just class 77.5 agricultural tractor parts, it's just one class and now there's 13 options and every agricultural implement part is going to be a different density based class. It's a huge change.
Speaker 2 (11:05):
Yeah. I mean, so like speaking of that and in the gravity of that, how are you preparing your customers though, right? Like how are you getting out there and getting ahead of this? Because I feel like everybody's so reactive. Right. Like I've had the NMFTA on the show at least three times now and they've put everything together. They have a ton of free resources that are out there for people to utilize. Right. Like the NMFTA has invested a lot of time and resources and technology to help this. And you know, they have class IT plus out there as well for people to sign up for and become a part of. But you know it's gonna be huge. Yeah, yeah.
Speaker 3 (11:38):
But it's tough because. And I think NMFTA did as good as they could. It's a change. But there isn't a classic out there right now that you can look up your item and know what your freight class will be. And so they put out resources and it's hard to like it's documents and excels and it's useful. But for the average shipper, like they either already know their freight class and if they want to know what it is now they're going to ask their broker or their carrier and their carrier doesn't have like a way to look up what it will be in the future. Now they can do density based and if they assume it's going to go to a density based and there's 13 classes instead of 11. So like normally if you're shipping furniture, it's already density based. Nothing's changing. You'd think.
(12:18):
But actually it is because now there's a class 150 again. And I don't know the other one. I think it goes down to class 50 instead of 55. Maybe. But they added two classes back. So you might have been a class 150, but you got bumped to class 175. And if you're a furniture shipper, this helps you because you can't get to that PCF of 6 to 8 to get to 125. But if you were 8.5, you're class 175. That's a big jump. And now you'll be class 150. There just isn't a way besides density to look it up right now. So you kind of prepare. But July 19th is when classic goes live. That's when you can actually look it up.
Speaker 2 (12:53):
No, and, but like from my perspective though, Gabe, like, I mean you get this as well as a broker, as a service provider, like, there's not a lot of competitive advantages that we necessarily get to utilize in our careers. Right. Except for when situations like this happen. And you just. The fact that all of the details that you just broke down right now tells me. And again, maybe I'm just blindly assuming that you've already had this conversation with the majority of your customers. They very aware that there could very well be changes coming to their product. Not all of them, but again, but you're preparing them for them. And that's the point. Right? And to me, I feel like most people don't. Right. Like most people don't even have this.
(13:32):
They're like, they maybe have just passively mentioned like, oh, hey, sometime in July things might change. Just pay attention to that. But you've broken this down on a granular level. And that's just like, that's the opportunity that I'm talking about. Because again, man, as you know, we don't have a lot of opportunities as brokers to come in.
Speaker 3 (13:51):
Differentiate.
Speaker 2 (13:52):
Yeah, yeah. To differentiate ourselves.
Speaker 3 (13:54):
Yeah. We've had conversations with our shippers, but what we've been doing mostly internally is figuring out which items are going to be affected, which is a chore. And then once we figure it out, we already know what items are our customers are sending. And then it's like, hey, is it positive or negative? Because it's going to affect people differently. Some people are going to get a win on this because that class 150 I've. I brought up, some people are going to take a loss on this. Auto parts, engines, things like that you kind of ship at a class 85 or a class 70, a core return, things like that. And I haven't confirmed this, so don't take this as fact, if you guys are listening to this, but this is my assumption based on the items moving to density base.
(14:31):
There's a lot of items that ship LTL that have a specific NMFC code and one freight class. And if that item's affected, that's going to be really difficult for you to go to your shipper and say, hey, now you need to enter in the weight and dims and the everything and choose a class with our little calculator. And they're like, what? I've never done that in my history. And they might have been doing it for 20 years. They've never done that. They just put Class 70, no, wait, in dims. So this is an opportunity. But also it's an opportunity. This is How I look at it, I go, well, I know there's brokers out there that won't be prepared for this. There's shippers and carriers that aren't doing a good job of this.
(15:07):
And if I call these shippers up with the script of hey, I know that your item is this and it's going to be this freight class and here's how it's going to be affected. Would you give me a shot to do a rate study? Because I provided that. That's a much better cold call than hey, do you want to quote a shipment?
Speaker 2 (15:25):
Yeah.
Speaker 3 (15:25):
And in fact, this is funny jolly. I just remembered this. Our biggest customer at Rocket won't name the name, but our biggest client I cold called in 2016, 2017 because their item was changing out of the NMFC docket. I, I researched the docket and I cold called their CFO and I said, hey, your items shipping at class 250 right now you're going to be at class 125 because it's an, it's a density based. And then you guys are now getting a specific code. He didn't know that. And unit shippers did. Unishippers submitted it on their behalf to the NMFC and they named the client, they said on behalf of this client in 2017. So I cold called the client, unit shippers did the work, they helped the client, but they didn't tell the client what they were doing.
(16:12):
And so in my opinion, they didn't do the work. And so I called the client and they switched over to us and they send several hundred shipments a day with us over the last eight years now they've been working with us because of an NMFC change. So it's a real thing, dude. It is.
Speaker 2 (16:26):
And I feel like as somebody like myself who does full truckload, partial truckload, it is going to open up the door that a lot of people are now. It is going to be just as cost effective, if not more cost effective to explore partially in it out. Especially if they had higher pallet count or higher density count ltl shipments. Right? Because you can't use that LTL discount code anymore on some of this stuff. Right? So it's like, yeah, as a full truckload broker, I'm looking at it from that perspective, man. I'm like, damn, dude. How many of these shipments that come across my desk that are 8 to 10 pallets are now going to be more expensive to ship at LTL than they would be on a standard partial truckload? And Getting that in there as a box truck rate.
(17:05):
So I think that this could, and I truly feel this way, man. This will have a very positive effect on the market from a sales and opportunities perspective. What Gabe's talking about right there and what I'm talking about when I'm going out there and talking to customers now, man, I'm letting them know, like, because I tell everybody we don't do ltl. Right? Like I literally say that in my opening line on a sales pitch. Everything, hey, we're full truckload. If you do a lot of ltl, I'm not your guy. Like, I essentially break it down just like that. And now it's like, hey, have you guys explored shipping partial truckloads with the potential NMFC coach or not the potential, but with the NMFC code changes that.
Speaker 3 (17:40):
Are coming July 19th? Yeah. So yeah, I like your tactic on that because there's going to be a lot of people that were shipping LTL volume or like a 6 to 7 pallet order and they're getting those linear foot rules and they might have an FA K. And so if I'm a sales rep out there and my team will be doing this, we're going to be looking for clients and we're going to be asking the question, do you have an FA K? And I won't explain all the nuances of that, but I don't think FA KS will stay around. And so if they have an FA K, I'll just be patient until their next contract renewal.
(18:08):
Because the LTL carriers, when they're pricing an FA K unless they priced in all the risk and they're just inflated margins, they're going to see how this operates with the new density based classes and they're going to see that they can get better revenue and they're gonna say, we want all of our customers on that 13 code density based. Because especially if they were getting an fa k of class 70 now they want to actually true class rating. That's kind of where the market's going. If they have an FA K, they're not even remotely aware of how to do weight dims and freight class by density. And then we're a resource instead of just a broker.
Speaker 2 (18:42):
Yeah, no, and that's exactly it. Right? Like we're literally going through this right now with a prospect of ours. Right? Like we have, thank God I have a business partner who is cool in Microsoft Excel because I'm not. We broke a lot of that down, man. And we're finding, hey, how do we create milk runs for our customer that's going to save them money on that. Right? Where now it's multi pick one drop and everything. And you know, I feel like this is one of those things where again this is why I always tell people to start in a niche, right. This is why you don't blindly just go out there and move shit. Fortunately, I've been doing this for a long time and I know how to handle a lot of these situations.
(19:15):
But again, like this is one of those times where if you're an LTL broker or if you're a truckload broker and you have a customer who has LTL freight, maybe it is up in that volume and you're starting to see 6, 8, 10 pallets that come across on their LTL orders. You gotta pounce on that, you guys, you really do. Because where the truckload market is right now in its current status, there will be a lot of exploring of hey, is it cheaper now just to ship this out as a partial truckload or a 2 or a 1 pick 2 drop style run?
Speaker 3 (19:45):
Yep, for sure. Especially if the market stays where it's at, which I don't anticipate it. I know that a lot of people are talking about a huge recovery. I don't think it'll be like a fast recovery. It'll continue to get better over time because it has to. That's how things work. But it's not as quick as most would think.
Speaker 2 (20:01):
Dude, there's this morning show host, orange shirt guy who's been saying that for about 18 months now.
Speaker 3 (20:08):
I haven't heard of this orange shirt guy.
Speaker 2 (20:10):
Yeah, I don't know but there's been somebody out there who's been saying it's a slow and steady thing and you know, you're going to look back over an eight to a 12 month period and people are gonna be like, holy. Rates are up 35 cents a mile. Look at this massive drastic change. But it's been a ratchet up approach.
Speaker 3 (20:24):
It doesn't feel massive.
Speaker 2 (20:25):
Yeah dude, but that's how it's going to be, right? And I feel like it almost has to at this point because outside of any Black Swan event that comes in complete completely rattles the industry. It, it's just how it's going to be. I think it's proven that even the.
Speaker 3 (20:42):
Tariffs didn't rattle it enough. I don't think all that capacity, the surge of containers, I don't think that's going to rattle it enough. But I could be wrong. And you know, I kind of, I'm biased because I want it to be a little lower for longer because we're doing well in this market and I'd like to be ready to. I mean we are ready for a recovery and we'll grow, but it's too easy to grow during that. So I kind of like it this way.
Speaker 2 (21:05):
And that's the thing, right? And I, and I want, and I think like, ultimately when you deduce it down, Gabe, you have to look at like, if you've been able to grow over these last like three to four years, like continuously, you're going to do very well when things improve. Right. And because it's like you have to apply the strategies that you're doing right now, right? Like, shit, I just talked about this is put a post out there this morning, man, there's no piece of technology that's going to shave us, save a shitty process. Right. Like all of the gains and stuff that everybody's looking for are literally in the work that they're avoiding. You just need more reps, right? You got to get told no more on the phone, hey, are you still actively cold calling every single day, Gabe?
Speaker 3 (21:43):
I'm not cold calling. I'm still on the sales calls, but my team cold calling every day.
Speaker 2 (21:47):
Exactly. Right.
Speaker 3 (21:48):
I'm cool doing discovery calls. I don't like say, hey, I won't talk to somebody until they're really interested. I like, I still do discovery calls and meet with the client for the first time in person or over a zoom call.
Speaker 2 (21:59):
Dude, I'll say this, man. Our cold calls that we've been having are so much more pleasant than they used to be. So much more. And, and I truly think, Gabe, it's because nobody's actually doing it as everybody will post that they're doing it. But I don't think people are.
Speaker 3 (22:13):
Email.
Speaker 2 (22:14):
Yeah. I think from a quality perspective, if you just go out there and just do basic research on a customer, right. You call somebody just through easy example, they're a food shipper, talk to them about refrigerated freight. I know, fucking shocker. But again, if you are just even slightly prepared for those calls, like, it's amazing this doesn't lead to just an influx in business, but it's at least a positive first step. Because I think a major miss and failure by a lot of people and I'm including myself in this when I say this is. People overestimate where they're actually at in the sales process.
Speaker 3 (22:50):
Right?
Speaker 2 (22:50):
Like just because you Called somebody one time and you're shocked that they told you no. Like, what? Why? Why are you shocked? You're a complete stranger, right? Or you're shocked that they didn't been.
Speaker 3 (23:00):
On this deal didn't go through. Well, you can believe if you look at it, dude.
Speaker 2 (23:05):
And that's exactly it, right? So it's like, how are you out there actively working in this market, right? Because like, from a business development perspective, we are all gas, no bricks when it comes down to it, right? Like, we are calling as much as we possibly can at all times. So how are you guys approaching that?
Speaker 3 (23:23):
All gas, no brakes. Same thing. We're always kind of shifting our strategy to wherever our product roadmap is. And so right now we're selling White Glove more than we ever have. We. Our core offering is curbside delivery and I call it gray gloves. So our carriers do a better job of curbside. They'll bring it to the front door. But now those same carriers are asking us to offer white Glove. We've got a couple of really good, I would say, clients that have proven success with that with nationwide White Glove for ltl. So I'm not talking Final mile agents. It's a different model. But if we are calling a client one, we're constantly refining how we find leads, right? So we work with a company called Practical Prospecting and Jed and Troy Barter over there doing that.
(24:07):
They're always using different tools to find the leads. And then it's just message. Like, if you can get your message out to more shippers, you don't need quotas. You just have to get the message dialed in. And our message is super narrow. Not everybody's gonna like it. Can't just cold call random shippers and say, hey, I offer curbside and white glove delivery for big and bulky items like saunas and cold plunge tubs. And they're like, yeah, but we. We ship steel. But I will say one mistake I made jolly over the last two years is I tried to remove myself more from the sales process because I thought that's what CEOs are supposed to do. Hey, I gotta scale the org. I gotta get removed from that and focus on other stuff. There was no reason to do that.
(24:44):
Like, I'm the best seller on the team still. I know the product the best and that's what drives revenue. And turns out that revenue fixes way more things than me fixing other stuff. If you have revenue and you have good profit, it's not as important to focus on all the other aspects of the business. But if you don't have revenue, you don't have profit, then everything's a problem. So, yeah, I would say revenue heals all wounds almost. And then, you know, overscaling can happen.
Speaker 2 (25:09):
But I, I have another good buddy of mine who owns a company and they do, and he's organically grown into doing over 100 million a year. And he told me pretty much two years ago, he's like, dude, don't hire any sales reps. You lead the sales charge until you're, you're approaching 100 million, then hire people behind you. He's like. Because he told me, I very much the same. What you were just saying there, Gabe, at the end of the day is nobody's going to sell it. Like, you're going to sell it, and you need to sell it that way with that intensity until you reach that point. And then you have the finances to build the team around you. And, you know, again, I think that's what a lot of people overlook, right?
(25:49):
I think a lot of people overlook how long it's going to take. They overlook how hard it actually is to get that high. And again, I think more people are. Because they're like, they're chasing the exit, right? I think that's what a lot of it is. They're chasing an exit.
Speaker 3 (26:02):
And it's the wrong thing to do. Everybody who's ever sold a business for a lot of money was not building it to sell Eve unless they were VC backed, but because that's the only way you can get liquid on those businesses, which I'll say for a different episode. However, if you're building it with only an exit in mind, then you're taking shortcuts always because you're trying to shorten the path to an exit. And if you're trying not to exit, someone offers you a ton of money and you say, yes, that's different than building it the whole time of taking shortcuts. We don't need to develop that feature all the way because the client didn't specifically ask for that, even though you know that's the way to do it. Yeah, I do think too.
(26:40):
You said that when you get the financial resources, then add a sales team. That's what I did. And I have a good sales team. But the mistake I made was then I removed myself from the sales process and I was like, hey, they'll just, there's five of them. They'll just do what I was doing. But that didn't make any Sense because the deal win ratio went down below 50%, then below 30%. And I got back in January and we're back above 60%.
Speaker 1 (27:03):
Close.
Speaker 3 (27:04):
So you got to know your sales numbers and know where you should be working at the company. I shouldn't be doing finance. That's why I have a cfo. I'm good at sales, so I'll do that.
Speaker 2 (27:14):
Dude, I'm right there with you, man. That's like, I like selling. I like building. I don't like any of the stuff behind the scenes. Fortunately, I have a business partner who loves all of that stuff. He likes to do all that stuff, you know, Again, man, like, dude, I'm just. I'm an operator. Like, I'm. I'm just a seller at the end of the day. I just like building and that. That's where my focus is always going to be, is building.
Speaker 3 (27:35):
And you know where your product and your team is at better than the sales reps will. Right? So if the sales reps are selling a certain niche service, maybe it's heavy haul, open deck, right? I don't even know if I said that right, but I've heard it said by you. So maybe it's that they maybe don't know what carriers you have or what lanes you've run. They're just trying to sell the customer, you know, the whole business. So you can really speak to it. Same thing for me, dude.
Speaker 2 (27:56):
I could not agree more, Gabe. But as always, man, these. These episodes always fly by. So, dude, how. How are you guys hiring? How does he need to reach out to you guys to find out more?
Speaker 3 (28:07):
Not hiring. If you want to ship with us, we will. We'll ship your stuff. But I. While I was thinking through this episode, I'm gonna build a tool for the NMWTA thing. I'm gonna figure out how to build a tool. You can look up your item and then figure out if it's affected and what your new freight class will be. So I'll report that back to you.
Speaker 2 (28:22):
Dude, I love it. Gabe, thank you so much. That's going to be it for today, ladies and gentlemen. As always, if you got value in what you heard, subscribe to the show. You guys, if you're feeling really ambitious, rank the show as well on itunes and Spotify because if you saw value, that's how your network's gonna see value as well. I appreciate you guys. I love you guys and we'll be talking to you soon. We have an outro now. Gabe.
Speaker 1 (28:46):
Came back with a bank window down yelling now Money anything Hey oh Got the foot on the g metal when I'm get to the back a Got the foot on the gas pedal to the metal when the lane moves fast Let them all cross if they hate and let them hate them Make a bigger boss a.
Popular Podcasts
Bookmarked by Reese's Book Club
Welcome to Bookmarked by Reese’s Book Club — the podcast where great stories, bold women, and irresistible conversations collide! Hosted by award-winning journalist Danielle Robay, each week new episodes balance thoughtful literary insight with the fervor of buzzy book trends, pop culture and more. Bookmarked brings together celebrities, tastemakers, influencers and authors from Reese's Book Club and beyond to share stories that transcend the page. Pull up a chair. You’re not just listening — you’re part of the conversation.
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
On Purpose with Jay Shetty
I’m Jay Shetty host of On Purpose the worlds #1 Mental Health podcast and I’m so grateful you found us. I started this podcast 5 years ago to invite you into conversations and workshops that are designed to help make you happier, healthier and more healed. I believe that when you (yes you) feel seen, heard and understood you’re able to deal with relationship struggles, work challenges and life’s ups and downs with more ease and grace. I interview experts, celebrities, thought leaders and athletes so that we can grow our mindset, build better habits and uncover a side of them we’ve never seen before. New episodes every Monday and Friday. Your support means the world to me and I don’t take it for granted — click the follow button and leave a review to help us spread the love with On Purpose. I can’t wait for you to listen to your first or 500th episode!