Is Your Brokerage Next? Double-Brokering and Negligent Hiring Lawsuits Explode

0:27This podcast is brought to you by Megan Gabriel and Brock Kowalchuk.

0:30Brock Kowalchuk: Ladies and gentlemen, welcome to a Monday edition of What The Truck. I'm your host, Malcolm Harris. A fully loaded Monday for you guys. And I'm, of course, joined by my partner in crime, Mr. Michael Vincent. Mike, what's up, sir? How you doing? Out of sight. Looking groovy today. What up, dog? What up? What's up? Hey, it's a beautiful Monday, man. It's Mamba Day. It's 824 for Kobe Bean Bryant. What? Yeah. Mamba day. Oh, okay.

1:05Veronica Va...: All right. Okay. All right. The guy who, yeah, I got you, brother. I got you. You got me. How you doing? How was your week? He was fantastic, man. I mean, when I used to play basketball with my son, who probably never saw him play, they still would go, Kobe, when they'd take a three and nail it. Kobe. You know, kids today. And I'd always say cheese. And he'd say, Dad, you're such a dad. It's not Colby Cheese.

1:36Brock Kowalchuk: What's up, brother? How was your weekend, man? It was great, man. I really didn't do much. I went to brunch, hung out with some friends. I mean, it was just overall, it was a great weekend. I did not do anything what the truck related. So this is, it was good. What about yourself?

1:51Veronica Va...: I got you, bro. I got you. I was very graciously hosted to a lunch yesterday by a Carlos, very, very good friend of mine at a place called hard eight, hard eight barbecue and barbecue out of Roanoke,

2:07Brock Kowalchuk: Texas. What did you eat?

2:10Veronica Va...: Everything, everything. Look, this place is as Texas as it gets. You come out of there. Like, he's like, dude, you guys want to go after church? He's like me and my family coach. Look, I'm going to take you guys to, to, to lunch. He said, you don't mind like, smelling like barbecue after lunch and just go home and, you know, take a shower, jump in a pool, whatever this place, dude. I mean, everything. They just got the whole big barrel barbecue pits going and you, you go by, by your plate and go, I'll take some of that brisket. I'll take some, uh, some of those beef ribs. I'll take some pork ribs.

2:40Veronica Va...: I'll take some of the sausage. I'll take the jalapeno sausage. Can you throw a ribeye on there for me too? Yeah. Okay, great. I'll think, do you want that? They make it two inches, medium rare. Great. Unbelievable, dude. I mean, it's like, if like the Rhodesio grill was good.

2:56Brock Kowalchuk: Okay, if the Rhodesio grill was good. That's kind of what I was getting the vibes. It's like a limited. Yeah.

3:03Veronica Va...: It was crazy, man. Such good barbecue, man. Meat sweats, the whole thing.

3:08Brock Kowalchuk: Listen, well. Yeah, yeah, yeah. We're going to have, you know, with a good barbecue day yesterday, we're going to have a good show day today because we've got three.

3:16Veronica Va...: Yeah, yeah, yeah. Maybe we'll have to do the Texas show from there. We'll have to sit there. You know what I mean?

3:21Brock Kowalchuk: No, 100%. Who's on deck today? That's the questions that we need answers to. And on deck... Oh, you don't know? Brock, Megan, Veronica. Oh, there they are. Of course, coming up with us first, Brock Cowichuk. All right. I tried that name and hopefully I got it right. Is he nodding in approval? Maybe so. We're going to see. He's the co-founder of Buy Wonder. Billions of dollars, of course, are returned to merch and get liquidated or destroyed every single year. Brock's building an auction marketplace that helps retailers recover real value. from it all instead. So we're going to talk to Brock about that.

3:56Brock Kowalchuk: And then the ladies are officially in the building. The change makers, we have Megan Gabriel and Veronica Van Loon. All right. These two are the ones that companies call when it comes to the worst times in their careers. I'm not being dramatic. I'm talking about the crisis and the communications when it comes to the first 48 hours after some major stuff. All right. I'm teasing that on purpose. I'm not giving you guys all the details because this is going to be one of the best interviews we've had in quite some time. All right, so between Veronica and Megan, as well as Brock, we got to go. We got stuff to do.

4:27Brock Kowalchuk: But before we get to it, all right, we got to get to it. Let's talk about who is bringing us the show today. You like what I did there, Mike? Come on, man. I'm feeling good. I'm on it today.

4:37Veronica Va...: I'm on it.

4:37Brock Kowalchuk: Dude, you are on it, bro. I'm impressed. This is no coffee. This is just willpower, all right? And this is Gnosis Freight that is bringing us the show today. You guys don't know how great they are, But if you don't remember, I'm going to tell you, because if you're still checking carrier websites, copying container data into spreadsheets, chasing updates through email chains, you got to get Gnosis. It's an AI operating system for global logistics, one platform to track every single container, automate execution, and protect your margins across the full container lifecycle. I'm talking Gnosis Freight.

5:09Brock Kowalchuk: If you guys want more information about them, check them out right now, gnosisfreight.com. Book a demo with them. We had Jake Hoffman on the show about two weeks ago. He was fantastic. make sure you tell them that Malcolm and Michael sent you. Yeah, that's right. That's right. That's right.

5:25Veronica Va...: And you know there's somebody out there still uses spreadsheets too, bro. There's more than one of you.

5:30Brock Kowalchuk: There's more than one of you out there.

5:31Veronica Va...: I know you there.

5:32Brock Kowalchuk: Somebody in Chattanooga, Tennessee probably uses these spreadsheets. And if you're in Chattanooga, we need to talk to you about that. And I cannot think of a better place to talk to you about it than F3, the Future of Freight Festival, which is going to be on October 27th and the 28th live at The Signal. Guys, this is going to be amazing. I just talked to Craig Fuller a couple minutes ago prior to the show. He is going to be in the building, and he has some stuff planned. All right. When I tell you our keynote speakers are going to be fantastic, our fireside chats are going to be off the chain.

6:02Brock Kowalchuk: Of course, the booths that you guys see from different vendors that are coming to connect, you would be not smart if you were not at the Future of Freight Festival. Jen Wiggins, she and the rest of the events team are pulling out all the stops for this. All right, we're going to have Charles Gracie. He's going to be in the building. Matthew Leffler is going to be in the building. We're going to have Adam Wingfield from the playbook. We're going to have Michael Vincent, myself. This is just what you need to do right now. Tickets on sale. You can use the promo code right now. Take a 20. We're going to have the lizard in the building as well.

6:34Brock Kowalchuk: It's going to be fantastic. So take 20 is the promo code. take 20 % off of your ticket of admission into, of course, the Future of Freight Festival. Hopefully, Dale Prax is in the building. I just saw me and Dale there. Of course, yeah, you see Charles. He's going to be in the building. It's going to be fantastic. Of course, October 27th and the 28th. Get your tickets right now for the Future of Freight Festival. Thank you guys so much for putting that call up. It feels like Dale's in every building. Bro, there's like three Dales. I'm convinced. He doesn't. Yeah, he's like in every building, isn't he?

7:09Brock Kowalchuk: he's crazy man i i genuinely don't know how he does it i don't know how he does it but he's

7:13Veronica Va...: awesome talking about car are we gonna unveil that lizard when we're there or what we're gonna

7:18Brock Kowalchuk: unveil that lizard we need to unveil your theory that all right like hey we've never seen craig fuller and the lizard in the same room at the same time never seen him in the same room ever i

7:28Veronica Va...: have never happened i've i've never seen it you brought it up and i was like you know what come

7:33Brock Kowalchuk: to think about it i think you might be right i've never seen them both in the same room at the same

7:37Veronica Va...: time no no i think there's something i think there's something there there there's some there

7:43Brock Kowalchuk: there no um so news articles we have four total we do we definitely do this first one guys is a bit interesting um what type of laundry detergent do you use mike uh my wife uses it and she's got

8:03Veronica Va...: I don't know. Tell you the truth. I'm not sure. I don't know the brand. I mean, I know what you use, but I don't know the brand, right? It's one of these ones that just comes in the sheets. It's not even in a bottle. It's like in a, you know what I mean?

8:14Brock Kowalchuk: Okay. Okay.

8:15Veronica Va...: It's laundry detergent that, yeah, it's totally, totally, you know, environmentally safe, all that kind of stuff.

8:21Brock Kowalchuk: Well, I use Tide. I use Tide. I'm a Tide guy. Sometimes it's like - And is there a reason for that?

8:27Veronica Va...: Is there a reason you use Tide?

8:29Brock Kowalchuk: No, no. I mean, it's sport. It's like the sport because like I sweat a lot and I want my clothes to, you know, smell I try to be the best smelling brother in freight. I just try to. You are. You are. Stop it. Thank you. With that being said, you know, I pride myself on using Tide. I will say somebody's not using Tide, but somebody's probably getting tied up into jail. And I'm saying. Oh, wow. Let's talk about this article because U.S. Customs and Border Patrol have found more than 9.5 million in suspected methamphetamine inside a commercial detergent shipment entering into Texas. This happened a couple of days ago, August 11th at the Roma International Bridge, according to the ZCBP announcement.

9:10Brock Kowalchuk: A 2012 tractor trailer arrived from Mexico carrying the declared load. Officers directed the vehicle to a secondary inspection for additional screening. That's when, of course, they used the dogs and ended up recovering and discovering packages concealed within the detergent load. They found 1 ,071 pounds or 485.78 kilos of suspected methamphetamine. All right. So the narcotics had a street value of, again, a nine point five million. They seized the drugs. And I'm trying to see if we have any suspects or any names that I can give you guys. Don't see anything.

9:46Veronica Va...: I wonder why that is. Gee, I wonder. I wonder why that is. Phil missed the whole story. Here's the thing. Did it say it was tied?

9:58Brock Kowalchuk: No, it didn't say it was tied. I made that up. I don't want to cease and desist from Tide. I love your laundry. You guys had nothing.

10:05Veronica Va...: We've got a graphic that says Tide. It may have been Gain. We might want to say we don't know if it was Tide or not. I don't know.

10:14Brock Kowalchuk: I have no idea if it was Tide or not. I do not want to. We have no freaking idea.

10:19Veronica Va...: We have no idea who it could have been anybody. Yeah, look, you hit it, dude. That was my first thing. First was like, okay, meth is more valuable than Coke right now. Of course, Penn State is trying to change that narrative, right? I mean, they're bringing it back in a big way. They're movers and shakers, right? The retro drug is alive and well in Happy Valley. But we'll get off of that now and just get back to this. Phil missed a story, dude. I mean, it's a story, right? But he missed a story because exactly what you said. It's highly unusual to have no driver name, no carrier name, no brokerage shipper, no destination city, nothing at all, no general information whatsoever.

11:04Brock Kowalchuk: Yeah.

11:05Veronica Va...: No charges have been filed, nothing, and they turned it over to the local police, which never happens. It was very odd. They don't do that. It's federal. It was very odd, which is why. You got meth, almost$10 million worth of meth coming across the border, and they handed it over to the local police department.

11:24Brock Kowalchuk: Yeah.

11:25Veronica Va...: It felt weird. It felt weird. There's something much bigger going on here. There's a sting or something going on here, right?

11:38Brock Kowalchuk: I agree. I think this is like a bigger... Something is diverting this from something. I don't know what it is, but it felt very odd to me.

11:46Veronica Va...: There's a reason they're not keeping it at the federal level. There's a reason. I mean, they never do this on accident, right? The other thing is this. It was an accident.

11:59Veronica Va...: you know what i mean it was secondary inspection that's that's the other thing and i think that's what the angle maybe phil was going towards right which is important there's this shit happens all the time right we got it coming in this you got to come in in cantaloupes you got to come in in avocados you got to come in and all these different types of loads and the cartels are figuring out because it's the cartels you're figuring out the different loads that we're not looking at and you look at it it's secondary there's no dog that's going to sniff a load of detergent and smell coke or meth they're not no you know what i mean it's the reason is the reason you should use coffee right and you wrap it cover yeah something suspicious something lit them up or it was just completely random and they tossed them to the side said hey check this out further and they nailed them on all this kind of stuff and then they turned it over to the local police which never happened so yeah a little bit suspicious about what what's going down there there's more

12:57Brock Kowalchuk: to that story more to that story there is more to it you can read in full and hopefully we'll have a follow-up here with phil in the next couple of days to really dive into that one more because i don't think this is necessarily done but you can check it out right now on freightwaves.com uh i want to talk about some more change and some more sudden moves happening uh this one coming out of the American Trucking Association. All right. On Friday, this happened after the show. It was a bit of a shocker. All right. Chris Spear is officially out as president and CEO, of course, at the ATA. And a letter sent to members on Friday signed by ATA chairman Greg Hodgen.

13:33Brock Kowalchuk: They basically just said, hey, tenure as president and CEO has concluded effective today. All right. Chris Spear informed our executive committee today that he will be departing the American Trucking Association's effective immediately. On behalf of ATA, I thank Chris for more than a decade of service to the association and our industry. During his tenure, ATA secured significant policy victories, strengthened its advocacy operation, and elevated trucking's voice within Washington. All right, Mike. So I thought about you immediately when I saw this and also shout out to Mr. John Kingston. You have a very strong opinion about the ATA.

14:11Brock Kowalchuk: And I want to know your thoughts. Why now? that's one question and two why so sudden why now that's what makes it's really interesting

14:23Veronica Va...: you know i mean his chris's effectiveness and it's not just just me i mean he freight waves in general has reported different things right he's been effective here but not really effective there called out on some things here not called on which every leader is right so i've been i've been critical of chris spears and the ata we know what the motivations are. We know that there's problems in the industry that are caused and narratives that are pushed forward by big industry in order to, you know, remain relevant and keep certain competitors out of the landscape and keep rates down. Like, you know, so, you know, given the landscape that's out there, it's kind of odd that there's, that this occurred and he's out.

15:08Veronica Va...: So, I mean, there's all kinds of conspiracy theories that I can come up with, but I think there's a lot more to this story i don't think he walked in and said hey dude you know i was thinking over thursday night and i decided you know i'm just going to tender my resignation did he or did the executive committee tell him he's leaving and he agreed and they said yeah he informed us he's going to leave or he agreed that we're not going to have him here anymore i i don't know but he's two what's he two years into a three-year extension yeah yeah or five years two years into a five-year

15:38Brock Kowalchuk: extension that is correct i'm so sorry yeah it's five it's not three it's five yeah yeah he's he's

15:43Veronica Va...: good till like 2029 into 2029 or something like that this is correct he was extended in 2024 so

15:49Brock Kowalchuk: he's in the second year and uh it's within 2029 so yeah it's two out of his his five-year term

15:54Veronica Va...: yeah i'm thinking something something happened something significant happened he he he quit under pressure they forced him out there's something there uh a vote of no confidence something but it wasn't oh obviously there was a reason why he quit right you don't just quit for no reason right no um i i don't know maybe i i don't know what it is i i'm i've questioned his effectiveness but i'm i'm i'm cautious about calling out or implying anything that might be nefarious no of course it may it may be just that they they really want somebody who's got a better vision or is stronger with certain things as they navigate what is really kind of a tumultuous or potentially very tumultuous environment for the ATA.

16:40Veronica Va...: And I mean, things are changing quickly in trucking right now. And there's so many things that are out there that, you know, this court decision, that court decision, you know, CDL schools being shut down, all these different things out there. Navigating this takes some political savvy. And maybe he's just like, dudes, I've been doing this so long and I'm tired and this person's better. It could be that.

17:06Brock Kowalchuk: Could not agree more. Could not agree more. You can check this one out, of course, on FreightWaves.com. I want to probably have John Kingston in here because this is not, to our point, I mean, this is major. I cannot understate it enough. I mean, This is a real shift right now, and I'm interested to see how the next decisions are going to be made. What are the shifts that are going to happen within the ACA? So, yeah, definitely probably. Well, I mean, you look at Kingston,

17:32Veronica Va...: man, a guy we really do have to, because I really like to pick this terrain, because the landscape was totally different in 2024 than it is now.

17:39Brock Kowalchuk: Things have changed in the last two years in a major way.

17:43Veronica Va...: Yeah.

17:45Brock Kowalchuk: Well, let's talk about this next one real quick. We got two more articles, And then we're going to get to our first guest, of course. All right. So the states have officially secured a major win. For those that do not know, this was breaking news on Friday from Noe Mahoney. All right. A coalition of states, again, scored another legal victory the end of day Thursday when a federal judge granted a temporary restraining order blocking the Trump administration from obtaining state-owned records containing personal information on millions of commercial driver license holders. All right. So with this, and I kind of broke this down, it's a total of 22 states as well as Pennsylvania.

18:20Brock Kowalchuk: Again, one in temporary restraining order preventing the government from attaining this information. This database involves nearly 17 million CDL drivers, right? This is a lot because, again, names, date of births, social security numbers, licensing records. The judge basically said that showed a likelihood of succeeding on several of these claims, which is why, again, a temporary restraining order is more than just kind of this speed bump. Mike, when you saw this one, were you, is this good? Is this bad? Is this a non-factor? I mean, what were your thoughts?

18:55Veronica Va...: To me, it's a big factor and it's just, it's the landscape we're in right now, right? Look, the federal government instituted all this in 1986, right? Okay, They instituted all of this stuff. The federal government controls interstate commerce. They control CDL qualifications and all of that type of stuff, right? The states started their database in order to comply and provide the necessary structure and framework and training for the federal government, for the FMCSA, right? The F doesn't stand for states. This is defiant political bullshit is what it is. It just is. It just is. Well, yeah, you control CDLs, but we control all the data behind it.

19:55Brock Kowalchuk: All the data behind it, yeah.

19:56Veronica Va...: Come on. Slap them in the face, give them a cookie, and tell them to quit bawling and give over. Because come on, man.

20:03Brock Kowalchuk: No, for sure.

20:05Veronica Va...: It's a federal thing. And everybody who's watching this shouldn't be going, yeah, they should be protecting these guys. are you kidding me are you kidding me right now 25 of the truck should be taken off the road right this second according to data random data right you're speaking you're gonna say in terms of on Canada yeah and we're like oh what what are you protecting these guys drivers and names and girls drivers and names from the federal government they have all your information anyways this is not a privacy acting toy come on man they're like well they're scared they're gonna use it for immigration stuff.

20:41Veronica Va...: Well, no kidding. Really? Get out of here. Trump's just doing stuff in the Middle East because of oil. No shit. Really? Get out of here.

20:54Brock Kowalchuk: Oh, man. You guys can check out one article right now. Get on Freightways.com. I want to transition to our last article. Please note that we are going to be talking about this topic in detail on the last interview that we have on the show today, of course, with the change makers. They are awesome, exciting. Let's talk broker liability real quick. And shout out to this lovely graphic. Cody, my man, you're doing your thing. Let the people see this. He's a killer. This is awesome, man. This is dope. Broker liability, again, is spreading. And it's involving, of course, a major company that you guys are very aware of.

21:29Brock Kowalchuk: This one is with J.B. Hunt. They're now the defendant in the U.S. District Court for Arizona, where plaintiffs are awaiting response on a request by the trucking and intermodal giant for a summary judgment. If granted, this could end J.B. Hunt's role as a defendant. The second battle is in a case as well, which names J.B. Hunt, where the judge earlier this month denied both plaintiff and defendant requests for summary judgment. All right. So with this one, of course, this is a group of plaintiffs who are mostly family members of those killed or injured in October 2023 crash. They sued JB Hunt, the carrier at Borderlands that was transporting the load after being hired by JB Hunt's brokerage arm.

22:13Brock Kowalchuk: And then there was a driver who was driving the truck involved in the crash as well. So the driver was employed by Borderlands. And I guess what the argument is, is JB Hunt liable for a load being double brokered? All right. So JB Hunt is also liable for negligent hiring, supervision, entrustment, and retention of Borderlanders is what the lawsuit says. J.B. Hunt knew or should have known that Borderlanders had a history of hiring and experienced and incompetent drivers that put the motoring public at risk of catastrophic injury or death. Mike, this is something. And broker liability is changing the landscape, and we're going to talk in detail about it, so I want to kind of keep it brief.

22:53Brock Kowalchuk: But your thoughts about this when you saw this one pertaining J.B. Hunt and this broker liability piece?

23:00Veronica Va...: well you know in my notes i wrote down a rather flippant remark which i know is is odd for me

23:09Veronica Va...: but there's a lot of but there's a lot of thought behind those right and i mean i try to bring a little bit of humor to this stuff because you got to right but it's it's incredibly serious um for the industry but my my remark was well i mean if this wasn't new it wouldn't be knew, which really what I mean is, you know, there should have never been a hiding place before.

23:32Brock Kowalchuk: No. Right.

23:33Veronica Va...: No. And all we've done is, is really finally somebody woke up and woke. Why would somebody who's could potentially be, have been negligent and caused something, be able to hide behind a regulation that has nothing to do with it? The spirit of it was not intended to do this in any way. Right. So why, why, why, why wasn't, why weren't they possibly negligent or being able to be brought into a suit in the first place. And we wouldn't be in this situation now where the impact can be massive. And I still contend this is a good thing for everybody involved as it moves forward. But we got to figure out what is due diligence and what isn't.

24:18Veronica Va...: Should J.B. Hunt have known everything about this company? or should the regulatory agency that decides whether they're good enough to be able to run freight and have an MC number and a DOT number be responsible for it? Oh my God, we can talk

24:33Brock Kowalchuk: about this one, Alvar. I mean, I think - I mean, seriously, I mean, hello. Yeah, yeah, for sure.

24:41Veronica Va...: They're conditionally, right? They have conditional authority. What the hell does that mean? What the hell is that supposed to mean? Like, you kind of can practice law.

24:58Brock Kowalchuk: Yeah.

24:59Veronica Va...: Or you kind of can practice medicine. Huh? No. You're either certified or you're not, man. Well, they might or may not be someone you're allowed to use.

25:10Brock Kowalchuk: What? It's a wild, wild west. We're going to talk about that one in detail with Megan and Veronica. But you guys can, of course, check that article out on FreightWaves.com. And that was your headlines roundup. a spicy one for your Monday. A lot happened on Friday, so we really had to, I could not let it go. So I appreciate you guys for your patience as we got through that one. That was a big one for sure. I don't even think we talked about everything. Like, it's crazy, but we'll talk to them a little bit.

25:38Veronica Va...: You picked out four. I was like, holy crap. Yeah, I had no -

25:42Brock Kowalchuk: We got three stars coming up too. I was like, holy mackerel. We had to talk about it for a little bit, but yeah, we're going to get to our stars now. We did. It's coming up. We did. again is a co-founder uh at buy wonder we're going to have a great conversation with him and uh did some research on brock and i'm excited he they say that the smartest men in freight have this haircut all right and i think i have it and uh brock is rocking it as well so now i want to introduce mr cowachuk brock cowachuk welcome sir to what the truck looking good

26:13Veronica Va...: appreciate you for being here hey well thank you for hosting me michael and malcolm yeah glad to be here. Hair's looking great. Yeah. Looking forward to the conversation today. Do you ever have a bad head day?

26:32Veronica Va...: I can't speak for Malcolm, but I'm feeling pretty good about myself. You wake up and just go, man, I just can't do anything with this today. I don't understand what's going on. Yeah, I think. It It doesn't work that way. You know, look, I was doing some research on you, and I could be nothing but more and more impressed of your background. I was looking at where you studied and stuff like that, and I can't find anything that was of any super crazy interest. But I did find it very, very interesting that you were a tour guide at a gold mine. which was like what is that all about um i don't know if that was you had like a break from reality or something like that i don't know what it was but so the el dorado mine in alaska which i looked up which is pretty innocuous in itself but i i found some stuff about el dorado right and and And apparently the chief of the, what is it, Muisca tribe, right?

27:44Veronica Va...: In the high plateaus of the Eastern Andes, which is now Colombia, is where this El Dorado was supposed to, you know, the city of gold, right? Yes. Is what they're looking for. So this dude used to cover himself once a year, the chief, in gold dust and jump into Lake Guadavita as an offering to the gods, right? And I have it under good authority that Brock actually got back into trucking and physics and so on. That is quite the photo. People in Alaska did not appreciate this. That might be a new profile photo. I appreciate it.

28:37Veronica Va...: wow um i mean it was either this or that it was either this or the kepler telescope i thought this was a little better yeah no i i think that was a great place to start uh yeah i grew up in alaska and uh uh the town i grew up in was started from a gold mining find 100 years ago and so there are a lot of mines up there and tourists came up and uh that was what i did through high school and

29:01Brock Kowalchuk: in in the summers in college and then uh and then jumped over and then afterwards got uh i'm an

29:08Veronica Va...: aerospace engineer then got recruited by nasa did that for a couple years and then jumped over to finance you've lived quite a life thanks it's been a lot of fun i think i'm still trying to figure out what i want to do when i grow up and i think the returns industry is really what captured me right now um and so it's been it's been a lot of fun yeah you went from you literally at least partially responsible for discovering like 2900 planets that could be earth and and but you know returns let's do returns that's much more much much more interesting it's also returns is also a vast universe right that we don't have all figured out.

29:52Veronica Va...: So I think there's a lot of that is right there. Yeah, that is true. That is true. Let's jump into it. Malcolm, sorry to take us down these disarmament paths. No, you are fine.

30:01Brock Kowalchuk: I love you. I think it's justified. It's justified right now. I think so.

30:07Veronica Va...: Hey, he's the one who's like was goldfingered jumping into lakes and whatever.

30:12Brock Kowalchuk: We're not just not going to talk about it. We're just not going to talk about it. Totally. Brock, when it comes to returns, all right, We kind of prefaced it earlier. All right. Billions of dollars. All right. When it comes to this, why is the retail industry kind of suffered and struggled so much with what happens after the return? Because it seems just like it's a constant problem.

30:36Veronica Va...: Totally. Yeah. And really it's driven by the consumers. So, you know, four to five customers are taking into account the returns policy of retailers and brands before they actually make that make a decision whether they're going to buy or not. And so when you think about the overall industry, omni-channel returns have grown to about 17.5%, so returns from both online and in-store. So it adds up to about$850 billion. So that's with a B, billion dollars per year that retailers then have to decision. So it's quite a significant challenge when you think about that as a function of the overall GDP of the U.S.

31:17Veronica Va...: So, you know, and this really blew up during COVID, right? I mean, because then you started to get large items that were being home delivered, right? And returned. So it caused a lot of, not just in your inventory and your books, right? Because it screws up your P &L quite badly, right? But you also, or it makes it a lot more complicated. But also in the sustainability realm, it's a bit crazy. And also controlling brand, right? I mean, talk about why is the auction better than like a B stream, right? Like I was in Bolivia and I've seen Minnesota Golden Golfers national champions, right? Sweatshirts.

31:58Veronica Va...: They never won it, but they were there because somebody made them and then they dumped them. You know what I'm saying? You could see these things in third world countries. They go, wait a minute. They never won the World Series. What's that all about? Right? But you got to control that. So talk to that a bit because those are things that are real concerns, right? Getting into a B market, et cetera, that type of thing. Yeah, from a brand perspective, you want to make sure that whoever's using your products or buying your products represents your brand well. And then as a retailer, when you've got returns coming back, you also want to make sure those retail returns may not be ending up back on your marketplace.

32:36Veronica Va...: So when you think about the major retailers like Amazon, Walmart, Target, you know, these folks that have large third party marketplaces, they want to make sure whatever is being returned to them isn't ending up back on those marketplaces. And so there's been a real challenge for retailers is how do you deal with the volume and move it fast enough without potentially diluting your new channels?

32:59Brock Kowalchuk: Brock, question for you. What are some of the biggest logistical challenges involved when it comes to moving this returned inventory? Because I can imagine capacity restrictions. There's a lot that's in my head right now, but I want to see where you land on this.

33:12Veronica Va...: Yeah. So it's really, if you think about like a traditional retailer, like when you're shipping inventory from China, like you've got a container rolling up, you've got, you know, there's 435 baby strollers on this container. And so if you've got 430, you know, you're a short ship. And then you think about what your warehouse does when they receive those. That's a very standardized, simplified SOP for your warehouse to handle that. But when you think about a returns truck coming in, there could be 2000 unique items on that truck and it may not be manifested. And so building the infrastructure requires so you could unload that truck, process those items and decision them whether you're going to process them individually or bundle them and then find a way to sell them scalably.

33:58Veronica Va...: That's a really large challenge. It requires like it's only recently become attainable, I would say with the advent of AI and being able to incorporate that technology to help with the identification and decisioning. And that's really why, you know, I think where Wander is really coming in here is how can we use technology to move these products much more efficiently, regardless of what's coming in the door. There's so many difficulties in this. You know, in the 90s, dealing with large box retailers, yes, they just exist in the 90s as well. Their returns, right? I was running an LTL. And you'd drop your LTL load.

34:37Veronica Va...: They'd unload the products. But then they would load returns. And it was not uncommon. I mean, in fact, it was uncommon not to have the situation where you just had random returns. And it could be across five, six different carriers. I never touched this product before. And now I've got it. And I have no clue if this is one or 10 or one of 50 or what the value was or any of that kind of crap. Talk about that challenge because that's still got to exist, right? Oh, totally. Totally. Yeah. So, you know, in this industry, you know, there's a there's manifested truck. There's an manifested trucks. But the reality is even a manifested truck, it's 50 50 as to whether it's accurate.

35:14And so at best, yeah.

35:18Veronica Va...: And so you've got to build the technology so you can understand what came in on that truck. So you can track how they're selling in that corresponding performance to understand if you're going to continue sourcing from that place again. or is there gold in that dirt that you've got to dig through? And then how are you going to more efficiently decision this? So as you're processing this, like to your point, if you're getting 67 deep skews of 2026 graduation card packets, those are going to be really hard to sell at auction. And so you've got to find a way to promote that scarcity regardless of what you have coming in the door.

35:54Veronica Va...: And that's a challenge and that's where the data comes in to make sure you're both measuring the demand in real time of your customers. And that's what's fascinating about auctions is it's very high. And even if you're losing an auction, you still have a high intent to buy. And that's what's unique about auctions relative to traditional retail is when you're browsing online, you may click that item to buy. But there's a lot of folks that were thinking about it, but you can't really capture that high intent. Whereas on an auction, you can capture that. that person was intending to pay this much for that item they may have lost but you know that there's demand at that level and so that's what's really interesting so finding a way to to build that feedback loop so you can improve your sourcing improving your processing like that's where this this model really starts to sing got you that's that's brilliant go ahead mark no no

36:46Brock Kowalchuk: no i was just gonna say conceptually like what made you really just identify this and just be like, all right, like this is like a major problem. Was there just something that happened? Or I mean, you spent some time obviously like Goldman Sachs, like there's so many things that you've done in your time. Like what, what made you really just be like, Hey, like, this is a major thing that I really want to show my full attention to and really build this thing through.

37:10Veronica Va...: Yeah, no. So after my time at Goldman, I wanted to jump into something a little bit more entrepreneurial, became a CFO of a retailer and ended up walking into a distressed, like a distressed situation. So learned a lot. There's no better way to learn about an industry than to join a distressed company because you're doing everything. You're trying to rebuild the plane as it's flying. And we saw this returns issue coming in. And so we're doing$150 million a year in revenue. The omni-channel return rate is 17%. We're a little better than that. But seeing this inventory come into our facility and seeing that there's so much quality in those returns but we didn't have a reliable way to scalably sell it and so because at the time if you're a retailer you got these returns to one of your 3pls your your best option was to sell in bulk to some wholesaler for you know cents on the dollar and it would just make me sick and so when i tried to optimize it within the existing retailer so you know had our warehouse team set up stations try to take pictures and uh get this stuff moving through ebay or whatever the case was and we just couldn't build something that scaled.

38:20Veronica Va...: And so I took a step back and thought, okay, how would we solve this? And I thought three things would have to be true. Number one is we'd have to build a company that was solely focused on this. Number two is you have to cut out as much OPEX and freight as possible. So how can you source these things as close to the customer as you can? And number three is you need to own the end customer relationship. There's not enough meat on the bone to be paying rent to eBay, Amazon, et cetera. And so that was my half of the founding story and then found a business partner that was Jordan Allen, who was exceptionally strong where I was weak.

38:54Veronica Va...: And and so we were able to bring our experiences together to start this here about two and a half years ago.

39:01Brock Kowalchuk: Brog, that's fantastic stuff. It's like finding your Michael Vinson. I found mine. And where can we get more information about by wonder the things that you guys are doing? because i know we're we're pressed for time we got two other guests but i want to just know where can we get more information what's the future look like for you guys yeah so it's still

39:21Veronica Va...: like we say all the time like it's still day one for us like so you know we've we've got our website buywander.com we've got seven locations live across the us and so again like what we're doing is when a customer returns something to amazon or walmart or wherever less than 50 of the time that item's going back on the shelf the rest of the time that inventory is getting trucked around the country. It's just a tremendous waste of freight, operational expense, and really moving these items to areas of the country where there's not enough demand. So then they have to be trucked back to the end consumer.

39:51Veronica Va...: So we're buying these in bulk. We're sourcing them from multiple retailers. We're listing the items individually at auction and customers are picking up at one of our seven facilities. We've got an eighth facility opening up in Minneapolis in October. but yeah we're really excited about what we're building here and it's still day one for us there's a there's a lot of a lot of change on the horizon we're excited about it well I'm excited to

40:16Brock Kowalchuk: see it and excited to have you back on the show here soon Brock thanks again for being here sir this is great hey thank you so much yeah thanks for having me

40:24Veronica Va...: thanks Brock again co-founder so interesting Malcolm yeah so interesting I could dude we could do we need more we need like two shows to go through everything that he's talking about there there's so many seriously there's so many different angles that are there and how he's extracting the value out of this in order to make it work no right absolutely absolutely it's a lot going on

40:47Brock Kowalchuk: and uh it's a lot going on right now in the background because the quad box is officially set all right so joining us the quad box you know it's a good time whenever the quad box is here All right, so we're going to be joined by Veronica Van Loon, as well as Megan and Gabriel there with Changemakers. Ladies, welcome to the show. I know we had a lot to get to, but the best is for last. Welcome to What the Truck.

41:13Megan Gabriel: Thanks for having us. You got teed up nicely today, too, with one of the stories that came out on Friday.

41:20Brock Kowalchuk: Oh, come on. You saw what I did there. I'm a thinker. My mom raised me to be a thinking man, you know?

41:25Veronica Va...: He is a thinking man. You know, Malcolm. Yes, sir. We're not talking about one. We're not talking about two. We're not talking about three. We're talking about 36 NCAA tournament appearances, 21 Final Fours, 13 National Championship game appearances, and eight that they won. We're talking about University of Maryland field hockey. And check this out, bro. Megan, back-to-back national champion. Back-to-back, bro. How often does that happen?

42:01Brock Kowalchuk: Doesn't happen often. Doesn't happen often.

42:05Megan Gabriel: You know, you took it right out for me. People have to bring it up for me all the time. It's not something I talk about despite wearing the ring.

42:13Veronica Va...: She's wearing... Just one or two? How many you got?

42:18Megan Gabriel: Two rings. One I wear more frequently. The other one just comes out for special occasions because it's got that hefty weight to it.

42:27Veronica Va...: So, I mean, is it? So which one is better, the first or the second?

42:33Megan Gabriel: That's hard. You mean the heart there or the feeling?

42:38Veronica Va...: No, no, no, the feeling. What is, I mean, finally reaching that mountain or coming back and going, see, no fluke here?

42:47Megan Gabriel: Oh, that's hard. the first one because we had been in the final four the two years prior

42:52Veronica Va...: Malcolm Malcolm Malcolm's losing his mind okay quickly uh I can't forget I can't forget Veronica and this one this one is this one is quite cool this is this is very cool no no seriously no look so I mean she's she's got a hell of a hell of a pedigree right of schools and and so on and so forth but science is po is what what got me you did like a summer there or something i think is

43:18Megan Gabriel: that right i did i'm shocked you went back far uh yeah but yeah so check this out about this school

43:26Veronica Va...: right this school's in france right and and look she found it's got a fantastic background but this is really interesting stuff i thought this was really cool so charles de gaulle actually basically tore this thing down and redid it because he, in his mind, this school is responsible for producing some leaders that were pretty complicit with the Nazi takeover, right? In France. And that's how I'm going with this. What I'm going with this is he rebuilt this thing to be something that would be a value and benefit to France, right? Six of the next eight presidents of France came out of there after he rebuilt it.

44:09Brock Kowalchuk: Okay, I'm really impressed with your historical knowledge.

44:12Veronica Va...: Right, surely. So Pompadil, Mitterand, Chirac, Sarkozy, Holland, and Macron all came out of there. Six of the next eight. And not to mention Veronica. I mean, there you go. I think that's actually signed. That was like signed, dear Veronica, have a great career, love Charles, I think is what that was the caption.

44:38Megan Gabriel: How did you know? Yes, that was conversations we had. No.

44:47Brock Kowalchuk: Sorry, Malcolm. I had to go that way. You do not need to be sorry. I think Cody Dallard needs to be stripped of all Photoshop and AI capabilities. That's neither here nor there. Ladies, let's start. What does the company actually need to do when the worst day of its career suddenly arrives? What does that look like? That's a big statement I just made.

45:10Megan Gabriel: Yeah. So talking, you know, oh, go ahead, Megan. I was going to say, no, it is a huge statement. But, you know, as Veronica was going to jump in, that is something that if you're waiting until then, you've waited far too long. And so all the work actually starts beforehand. But Veronica, I'll let you dive in. No, I was going to say, just bringing it back to Montgomery, I think this is a place brokers today need to start thinking about yesterday or right now at this moment, which is companies that survive their worst day, which it's often not an if, but a when, are companies that have prepared and have some reputational equity that's built long before the media and the attention is turned towards them.

45:58Megan Gabriel: And by reputational equity, what I mean is people know what you stand for. They think of you favorably. You have a story and you tell it. And up until now, I think a lot of that was like our story for brokers is we're cost effective. We're on time, right? Now that story needs to sit alongside the story of safety and good decision making and why your clients are trusting you as a broker, as well as the mom on the road, on the highway with an 18 wheeler driving next to her. Why should she trust you to be putting that truck and that driver on the road? So while, you know, we hope when your worst day comes, you can pull out your crisis plan and put it into action with ease.

46:35Megan Gabriel: What I'm really hoping is that you have built some reputational equity. You have a story that is strong. That's more than just your typical business focused story. And the window to build that reputational equity is closing pretty fast in this post Montgomery world.

46:53Veronica Va...: so people need to be starting to grab onto this now and not wait till they get caught or sucked into a thing right i'm not trying to imply that jb hunt got caught but there are a ton of people who will see that and go they got caught and that's all they'll ever see and all they'll ever think right because it kind of verifies because we we read things to most people read things to

47:13Megan Gabriel: verify preconceived notion right correct 100 anything you say sorry anything you say after that is defensive, right?

47:22Veronica Va...: Right, right.

47:23Megan Gabriel: After that moment, it's defensive. So Megan, I'll let you go. Right. Yeah, the thing I would add is there's that two lanes of pre-planning, right? We're going to get into a little bit about like what we say, but the reality is what you say has to be rooted in actions and governance that's preceded that. So there is a new expectation on how people are vetting their drivers, how decisions are being made. We got to button that up now because that's going to be what is coming out in the media. That's going to be in a complex sector when people don't really know how freight works. There's going to be a lot more questions that you're not going to have time to answer.

48:00Megan Gabriel: And if you aren't doing the right things in plain language, layman speak, you're already behind the eight ball. You're going to be three steps back.

48:08Brock Kowalchuk: Veronica, talk to us about the first 48 hours, right? So whenever you get that call, It's leadership, right? Hey, we have a problem. What's the first thing that you want them to do?

48:20Megan Gabriel: Yeah, well, the first 48 hours, first thing you need to do is just take a breath, right? Tell your lawyer what you know. Tell your lawyer what you don't know. I hope you have a good lawyer on call. I hope ideally you have a lawyer who is also paired with someone who knows reputation because a lot of times those lawyers will give you a really great solid statement that checks all of your boxes as far as liability and legal decision-making. But we've all seen it, right? Something horrible happens. A statement is issued. It's inhuman. It's cold. There's a massive distance between the event and how it makes people feel.

49:03Megan Gabriel: And so I hope that your team is working together. And also that you've had some conversations within your team about who is the spokesperson? Have they ever practiced any spokesperson training? Do you have any idea kind of what you're going to say to begin with, right? And do you have that solid foundation to lean back on?

49:28Veronica Va...: It's so hard. The narratives are so hard because, well, let me ask you this. Do you think that this light being shown on this or the hiding places I like to say has been removed now, right? Kind of this veil, this iron curtain to keep them protected. The 3PL has been removed. Do you think that potentially if we navigate this correctly, it's actually a good thing for our industry because it starts to set some standards in this area? Is that a narrative that we should be speaking to?

50:02Megan Gabriel: I think that's absolutely an opportunity, especially for some of the leading brokers to be able to stand out and create that standard, evolve that standard, become the gold standard. And so there's an opportunity to be doing that and speaking about it in a way that is gonna build that reputational equity that Veronica started talking about. It's also going to be able to build the balance of what a legal strategy could use to be able to look at all the things that we do. And every once in a while, an accident's going to happen, a crash is going to happen, there's going to be a mistake. Those can be forgiven when you have the governance, the protocols, and the values that align with what organizations want from you.

50:45Brock Kowalchuk: So follow-up question, and Megan, I want to stay with you on this one. What are the outcomes when a company handles a crisis badly? We've seen some statements being made by certain companies, obviously, that haven't handled it the best. I mean, what are your thoughts there? Yeah.

51:03Megan Gabriel: I mean, look, if we go doomsday scenario, we're talking about loss of company. It's irrecoverable, especially for brokers where margins are really tight to begin with. There's not a lot of ways to balance and recover. And so that's something that we're really conscious of when we think about the worst case scenario. Now, that said, the relationships that are happening behind the scenes are always something that we need to be thinking about balancing as well. And that's where we need to really be thoughtful about the words and who we're speaking to and who's delivering that message. Backed by action, because that's where the statement needs to come from.

51:44Megan Gabriel: It needs to be backed by decision making action that we can point back on. and those are the moments that we can begin to re-earn trust that can keep us from that doomsday scenario.

51:56Brock Kowalchuk: We're on two minutes road right now in the fourth quarter, Mike.

51:59Veronica Va...: I got you. All right. So Veronica, how do you handle or how, what's your advice to handling the, uh, what you were trying to make money, you know, like even in a J.B. Hunt, right? Like you didn't go with the most expensive care, the most expensive carrier, cause you would have lost money instead of making money. Aren't you a, you know, a 501c? You know, how do you handle that narrative? I see.

52:24Megan Gabriel: So how do you handle a narrative where they're saying, well, you know, you chose the cheapest broker because you were trying to make a profit? Or the broker choosing a carrier, either one.

52:36Veronica Va...: Yeah.

52:36Megan Gabriel: Right. Well, I think that that's now an indefensible position, right? You know, I'm not a lawyer, but you're going to have to prove to your stakeholders and your audience, which your audience has expanded dramatically, right? Before Montgomery, you were really talking to your clients, right? The people trying to move. Now, your audience is public, right? So, and I think a lot of times there weren't those conversations before. So the answer is, no, that's not defensible. And that's why I said at the beginning, you need to tell your story about, you know, having good prices, being on time. And also, here's our good governance.

53:19Megan Gabriel: Here are our safety standards. And here are our values and what we believe in. And when you pair those two together and you actually believe it, right, you do it. You have the governance and the change management to show that you are actively trying to provide a good service and keep everybody safe on the road. that's where all of a sudden this good reputation is good PR turns from equity and a protection for your business, but also turns into a selling point for people to choose your business. Right. I bet JV Robinson made a different choice or excuse me. I bet JV Hunt made a different wishes.

53:55Megan Gabriel: They made a different choice when they were looking. Now we have an opportunity to do that.

54:00Brock Kowalchuk: That makes a lot of sense. Talk to me and Megan or Veronica or both of you guys, since we're on the quad box. I mean, whoever wants to go first is fine. Whenever it comes to this day, right? Because it's naturally going to happen to a lot of different organizations. All right. Obviously, we just talked about the first 48 and kind of the things and the statements and things of that nature. But what separates the organizations that survive this mess and the ones that actually really thrive under this mess and earn back the trust? What does that look like, ladies?

54:32Megan Gabriel: the organizations that really are able to use this as an opportunity and i know that sounds really weird but turn crisis into opportunity are the ones that are able to be agile and quick enough to respond in a way that balances stakeholders needs and what they need to hear at that moment now there's going to be uncertainty there's no perfect statement because you have a lot of different people who expect different things from you have different values from you but we need to be able to operate in a way that is consistent and transparent and proves the actions that are being taken. And at that point, we are able to kind of balance that narrative, listen, hear for one another.

55:10Megan Gabriel: And then from there, we can balance how we move forward and turn the page on things. Now, that doesn't mean that there's not going to be a lawsuit that's running in parallel on occasion that may be dismissed. It may not. It might go to trial. But we want to make sure that we know that the organizations that survive this mess are the ones that are maybe trying a case in the court of law, but they're also excelling in the court of public opinion by the way that they're engaging with the stakeholders that matter most to their business.

55:43Brock Kowalchuk: Fantastic stuff. Megan, as well as Veronica, thank you all so much for being here on What the Truck. Where do we get more information about what you guys are doing in the work from Changemakers? Because it's fantastic. Sure.

55:56Megan Gabriel: I mean, we can plug our website is where you can contact us all the time is www.thechangemakers.com. And we would be welcome to talk with anyone that has, you know, just a couple of questions because we know there's no easy answers here. And everything is changing and constantly will be as evidenced by what came at the beginning of this episode today and the fact that the world is going to continue to evolve in the courtroom and beyond. So thanks for having us today. We really appreciate it.

56:23Brock Kowalchuk: No, we really appreciate both of you all. And I hope to see you guys soon. All right.

56:28Megan Gabriel: All right.

56:28Brock Kowalchuk: Thank you. That was a fantastic show. We appreciate all of our guests, as well as my man, my partner in crime, Michael Vincent. Wednesday show, Mike, you're going to be in the midst of a doctor in the house. All right. I'm excited for this one. Yeah, we got a doctor on the way. Looking at the road ahead, going to have Dr. David Fletcher. All right. And I said this because we're talking about a lot of things and things that you really care about. Just giving you guys a precursor for this. All right. The biggest health threats facing truck drivers today. Of course, we have National Truck Driver Week coming up in a few weeks.

57:04Brock Kowalchuk: We're going to talk about how GLP medications are changing the game for driver health. And we're talking about the DOT physical aspect as well. And then this guy, his name is Greg Haber. He is coming to the show as well. he has a startup technology that to me and i'm just saying how i feel is going to be up there with like a highway a truck stop in a couple of years oh really greg yeah he's phenomenal dude it's crazy i went through a demo wow it's fantastic so we got greg we got dr fletcher that's it for us like subscribe do all the things there's peace there's love there's michael vincent there's malcolm harris we'll see you next time

57:58We'll be right back.