I am not sure how many parts this series on my outsourcing experience in Ukraine will have just yet. It may be 10, 30, or maybe even 50. But, it is a topic I enjoy. I fell in love with Ukraine, my time there, and my experiences. Therefore, I would like to share my experiences with those who follow me. I understand that this topic may not be interesting to some people, but to some of you, it will be. So right now, I would like to talk about the beginning days of my life in Ukraine. To do so, we must go back to November of 2017.
I had just moved to Kyiv, the capital of Ukraine, a 24-year-old, ambitious young man, ready to build a team and make some money. It was November – therefore, it was cloudy, rainy, and cold. Kyiv had a very depressing Soviet feeling. Many of the apartment buildings were from the Soviet era. They were falling apart. But I loved it. I just fucking loved it. Everything about it.
Before arriving in Kyiv, I had been to just over 40 countries. I traveled to many places in the world, from Amsterdam to the slums of Mumbai. Therefore, I had experienced rich countries and countries that were impoverished. However, Kyiv felt different. Kyiv didn’t feel like a third-world country. The restaurants I ate at and the cars I saw made it feel like a rich country, and it is a rich country – however, the oligarchs hoard the wealth.
The apartment I was renting out felt like a palace. The interior design was of the highest level. The block was relatively new but surrounded by apartment blocks that were LITERALLY falling apart. The worn-down parking lot had cars ranging from a Porsche to a Lada. I could see the Russian Embassy from my window. Everything felt unique, different, and a lot more real than back in Chicago.
Anyway, getting back to the outsourcing a freight brokerage story. At that time, I was a young kid with about $7,000 in my bank account. My apartment and Ubers were expensed; therefore, I set a goal to have $100K saved a year from that date (I got close). So it was time to start working hard.
Since Ukraine is 8 hours ahead of Chicago, I didn’t start work until 15:00 (07:00 CST), finishing around midnight (16:00 CST). I could sleep in every day. I would wake up around nine or ten in the morning, read a book, go to the gym, and shower before heading off to work. Then, when I got into work at 15:00, I was ready to start booking some freight. In the beginning, we had five people in the office: two carrier sales reps, one tracker, and one account manager.
If anyone reading this worked as a freight broker back in November of 2017, you probably remember how busy of a time it was, it was HOT. Our largest customer at the time (Anheuser-Busch) supplied us with enough freight and profit to continuously hire in Kyiv. The company I worked for paid freight brokers $700 per month plus a 2% commission. Trackers and Account Managers made $750 (if I am not mistaken) without commission (at the beginning).
Imagine hiring one or two people for every load you booked (those were the margins we were making at the time). Therefore, it was a no-brainer to outsource. Now it seems like everyone is doing it, but back in November of 2017, not many freight brokerages were outsourcing. So we kept on hiring. Our first office got filled up very quickly. By April of 2018, I think we had around 20 people. So we ended up getting a larger office.
Part 3: coming soon. Make sure to subscribe to my newsletter on FreightCaviar.net. Thank you for liking, sharing, and supporting FreightCaviar.
Yesterday, while I was tucked away in a cabin in the Polish mountains near the border of Ukraine and Slovakia, I took out my laptop and just started writing. Writing was never really part of my routine. I did keep a journal to jot down ideas, events, and quotes from books that I enjoyed. However, I had never written a story on my past and shared it with a larger audience. I received a lot of positive feedback on what I wrote, so I figured it would be best to continue this topic.
Before I continue on the topic, I want to share with you two quotes that I read recently and enjoyed:
“If you would not be forgotten as soon as you are dead and rotten, either write things worth reading or do things worth writing.” – Benjamin Franklin
“Anyone who isn’t embarrassed of who they were last year probably isn’t learning enough.” – Alain de Botton
Part Three of My Adventure in Ukraine:
In Part Two, I left off how rapidly the freight brokerage was growing in Kyiv. From the time I arrived in November to April, we went from 5 to nearly 20 employees. So the first office we had was cramped. Luckily, we moved into an office space, about twice the size of the original one.
When we moved into the new office space, it was right around the beginning of April. I finally started to enjoy the weather in Kyiv – as the fall and winter months are cloudy, cold, and gloomy. Kyiv in the spring and summer months is absolutely beautiful. It is covered in trees. Charles de Gaulle, during his visit to Kyiv, said: “I saw many parks in cities, but I have never seen a city in a park.” Therefore, if any of you are considering visiting Kyiv or Ukraine, the best times are the end of April till the end of September.
At the freight brokerage, I conducted around one or two interviews per day. During this time, Carrier Sales, Account Manager, and Tracking were the positions we had outsourced. There was not a single Carrier Sales Rep or Tracker in the US; everyone was in Ukraine. So we were continuously hiring for all positions.
It was pretty amusing to me to be conducting these interviews at the age of 24. Before arriving in Ukraine, I had never interviewed anyone for a position. Then, all of a sudden, I am interviewing people sometimes that were twice my age. Since we had a lot of freight on the board, the interviews were quick and to the point.
Once, I had a young woman studying logistics at a university in Kyiv sit beside my desk and tell me she wanted to be a tracker. I replied, “You want to become a tracker?” she replied, “yes.” I saw immense excitement in her for the opportunity, and I immediately hired her.
Another time, I was on Tinder and saw a pretty girl who spoke English. So, I asked her if she wanted a job in logistics. She came by for the interview, and I think she was a bit shy about the fact that I had found her using Tinder. After the talk, we hadn’t heard from her for about a month, and then, suddenly, she messaged us, asking if the position was still available. Her previous employer hadn’t paid her in a couple of months (a prevalent problem in Ukraine). So we brought her on the team and gave her the name Nancy-Ann Jackson. Amazingly enough, she is still with the company and is an excellent Carrier Sales Rep.
If you have any specific questions about my days in Kyiv, Ukraine, you could write to me at freightcaviar@gmail.com. Make sure to subscribe to my email newsletter for the best FreightCaviar updates on FreightCaviar.net. Thanks for reading this and supporting FreightCaviar. Part Four is coming soon!
April 1, 2018: a photo of me in Kyiv, UA, overlooking the Dnieper River.Below is a photo taken at the beginning of May 2018, as you can see, Kyiv is covered in trees.
Last month, I received a video from a follower on Instagram of 2 owner operators scolding the owner of a trucking company in Chicago after they found out their rates have been getting cut. As most of us know, owner-operators typically pay a percentage of their rates to the carrier they drive for to have their MC & insurance. Usually, these fees range between 10 and 20 percent of the load. However, trucking companies – predominantly from Chicago and predominantly of Eastern European descent, have been cutting these rates significantly. For example, they will tell the owner-operator that the load pays $3000, but it actually pays $3500. Then the owner-operator still has to pay fees to the trucking company and ends up with around $2500.
Before these past couple of weeks, I wasn’t aware of how widespread this behavior was in the trucking communities. I received another message – this time on LinkedIn – from a former employee of a large trucking company in Chicago. He wrote to me about all his former employer’s unethical tactics to make obscene amounts of cash off of owner-operators. After talking to him, I reshared a story on Instagram about how I have learned recently about these companies in Chicago ripping off their owner-operators. I got bombarded with people messaging and have learned a lot since.
Here are some of the things I have learned:
1. It is not just in Chicago & not only Eastern European carriers, but it is much more common in this circle.
2. Many dispatchers justified their behavior. They said it doesn’t matter how much they cut, as long as the owner-operator is happy with the rate.
3. Cutting rates is how trucking company owners & dispatchers “can afford their S-classes and Series 7 cars.”
4. Trucking companies offer cheap leases to owner-operators to entice them to come on board and become “owner-operators.”
Here is a quote from a follower: “they offer them 2023 Cascadia for $135,000, while a brand new one is $175,000, knowing they’ll make five times that on stolen rates.”
Another follower wrote this about a large trucking company in Chicago: “My big mistake was purchasing my first truck from them. I worked my ass off to pay off that truck. Right after I paid off my truck and quit, they changed their policy for owner-operators: no early payoff. So if you want an early payoff, there will be a 15k penalty. They book a load for you and force you to take that load; otherwise, they will make you regret refusing to take a load.”
I recorded this video to talk more in-depth about the subject and the shadiness of the industry. I would love to create some dialogue and a conversation about the topic. Please comment and share.
