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Home » Truckstop and BI Survey Shows Higher Contract Rates Surpass Lower Demand for Brokers
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Truckstop and BI Survey Shows Higher Contract Rates Surpass Lower Demand for Brokers

August 31, 2022
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BOISE, Idaho, Aug. 31, 2022 - Earnings expectations for freight brokers may move higher according to the latest Bloomberg | Truckstop survey, which polled brokerage and truckload companies.

"Freight brokers are well-positioned to deliver wider gross margins for the rest of 2022, given their outlook for flat or down spot rates coupled with higher contractual rates," said Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence. "Expanding margins could help mitigate lower volume from difficult comparisons and moderating economic activity."

The Bloomberg | Truckstop Truckload 1H-22 survey shows Broker sentiment hits a new low:
• Fewer brokers experience volume growth: About 47% of survey respondents said volume rose in 1H from a year earlier. About 45% of those surveyed expect demand growth over the next six months, vs. 76% in 2H21.
• Flat spot rates may provide margin stability: The majority of brokers (52%) expect spot rates to remain flat or move down over the next six months. About 48% of brokers expect spot rates to rise over the next 3-6 months, below the previous read of 62% in 2H21.
• Contract rate sentiment is still strong but moderating: About 36% of brokers polled expect to see contract rates go up, 20 percentage points below the last polling in 2H21.
• Brokers' gross margin poised to expand in 2H: About 45% of freight-broker respondents had a higher gross margin in 1H than a year earlier. Brokers are more optimistic about gross-margin expansion over the next six months, with 54% expecting widening.
• Rates for brokers catching up with spot surge: Though less-than-truckload freight appears to be an area of growth for brokers, as about 34% expect to tender more of it in 2022, this is down from the previous survey results of 47%.
• Tighter capacity may be on the horizon: About 38% of those surveyed said they expect more available loads than trucks, indicating tighter conditions. That compares with 66% in the previous survey given the change in spot-market supply dynamics. About 44% of non-asset brokers said they believe tighter conditions are on the horizon, followed by broker agents (40%) and asset-based brokers (31%).
•
"Stable spot rates, coupled with rising contractual rates, will help drive gross-margin expansion for brokers," said Kendra Tucker, chief executive officer, Truckstop. "The mission-critical software solutions we provide brokers help ensure they stay competitive in the market and continue to drive growth, even in a market that is normalizing."

The Bloomberg | Truckstop survey of freight brokers provides timely channel checks into the market's health. The most recent sample size was 103, consisting of freight forwarders, third-party logistics providers and broker agents, as well as asset- and non-asset-based brokers. Most respondents (80%) have 1-50 employees. The majority of those surveyed (38%) were non-asset-based brokers.
The complete survey is available to Bloomberg Terminal subscribers via BI.

About Truckstop
Truckstop is a trusted partner for carriers, brokers and shippers – empowering the freight community through a platform of innovative solutions for the entire freight lifecycle to increase efficiency, automate processes, and accelerate growth. As one of the industry's largest neutral freight marketplaces, Truckstop provides the customer service as well as scale of quality loads and trucks to give customers of all sizes, whether on the road or in the office, the transparency and freedom to build lasting relationships and grow their businesses. To learn how Truckstop is helping move the freight community forward, visit www.truckstop.com.

https://truckstop.com/
Submit your logistics, material handling, or supply chain related company news in DC VELOCITY's Industry Press Room section or New Products section
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KEYWORDS Truckstop
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