How Pre-Paid Shipping Works and How It Can Affect Your Shipment
In auto transportation there are generally two types of payment options when it comes to paying the driver: either pre-paid or cash-on-delivery, with the latter easily being the most acceptable form thereof. Auto transport brokers are responsible for finding loads for carriers and carriers for customers, and they make their money by charging a deposit to the customer. Some companies offer pre-paid services: you pay the entire cost, broker fee + carrier cost, up-front, and the broker does everything. As auto transportation drivers live basically load-to-load, trying to get as many as they can and to move them as fast as possible, and with so much money tied up in overhead costs, particularly fuel, having cash-on-hand at all times is a life-saver for an owner-operator in the car shipping industry…and pre-paid shipments don’t give them that particular luxury. In fact, pre-paid shipments are a real hassle for carriers because of the stipulations that come along with it, and for that reason alone only the largest carrier companies with several trucks and a central dispatch office are going to take pre-paid shipments.
This puts both customers and dispatchers at brokerages in an awkward position. The customer has to shell out quite a sum of money then simply wait; the dispatcher is now under pressure to find a carrier that will take a pre-paid load when probably 80% of the companies that dispatcher uses regularly do not take pre-paid orders. Pre-paid shipping makes it all the more difficult, more often than not, and tends to result in extended pickup windows and a longer dispatch time. It’s frustrating for everyone, basically, and unless you’re shipping with a company that has made its living off of pre-paid shipments since it was founded, it’s likely going to backfire on you, especially if you’re in a hurry. Try to look at it from a carrier’s point of view: they need their money pretty much right away, but with a billing they won’t see it for days or weeks or maybe even a month, depending on the brokers’ terms for the billing time.
If you get any quotes that say pay up front, pre-pay, or anything else like that, take it with a grain of salt. We’re not trying to say that pre-paid shipments are inherently bad or anything, they’re just a different breed of payment method from the industry norm, and not all carriers take pre-paid orders. This is why pre-paid shipments tend to have longer pickup windows, as finding a reputable carrier willing to take a pre-paid order can take more time than a standard carrier. Talk to your representative about your payment options and how the method of payment will factor into your auto transport experience. If you’re looking for someone to ship your vehicle still, or just want to compare some different prices, you can fill out our free online quote request form and get multiple free quotes e-mailed to you from reliable and reputable shipping companies within about an hour. If you have questions or concerns, you can always call our toll-free telephone number at 800-930-7417.