Dalal dilemma — To engage or not
Fifty-six-year-old Subrahmanyam, steering a 14-wheel Leyland from somewhere in Tamilnadu with coconut for Kathmandu, Nepal, is pissed off.
Ethani sonallum, namm thirundha mattom,” (We don’t listen to reason) says the long haul trucker from Sankakiri, in Tamil, over the WhatsApp call.
I cottoned onto him when he ranted through a voice mail in transporters’ social media in Tamil three days after the Father of the Nation’s birthday was celebrated.
His point was simple. Don’t sidetrack dalals/brokers and engage with the party directly. The downside is deep.
Let there be no confusion. Still, here are the facts.
The coconut load on a 14-wheel truck from anywhere in Tamilnadu/Kerala to Kathmandu fetches a freight charge of Rs.240,000/- for the fleet owner. Brokers walk away with two per cent of the invoice value for the load proffered. That is, approximately Rs.4,800/-. Two drivers walk away with 15% of the freight charge. Well, there are many weighty expenses for the owner to bear.
Fleet owners try to wriggle out of brokers by quietly tying with the coconut mandi traders directly and save the two percent commission.
The catch is that when fleet owners engage mandi traders directly, bypassing dalals, they walk into a quagmire. The chances of default or non-payment by the consignor or consignee are huge. After unloading, the wait to collect payment is a herculean task.
The long distance between the parties and the cozying up to remove brokers in the deal makes life difficult for drivers. Delayed payment means detention in Kathmandu for 3–4 days at least. At times, fleet owners may persuade drivers to return and not worry about the payment from the party.
Instances wherein fleet owners were made to write off such payments are nothing unusual, say transporters in Sankakiri.
Subrahmaniyam bats for the broker route. His logic is simple. “When such non-fulfillment of payment transpires in a brokered deal, the Association chips into discipline such misdeeds of brokers and almost gets blacklisted. Invariably, settlements happen thus safeguarding fleet owners,” elaborates my man in Kathmandu.
Broker-routed deals provide a risk mitigation tool. Go on your own and face the music.
Nissim N Taleb of Black Swan fame touches upon this risk issue. Insuring against fire hazards may appear as an unnecessary expense when the going is good. In an unforeseen circumstance of a factory fire, the uninsured loss will be humungous. Taleb advice: “Don’t be foolish.”
Nepal-bound coconut load is not a one-off case. Gujarat-bound coconuts also face the same problem. “Beware of transacting directly,” fumes Rajkot-based Kishorbhai Parmar, President of Gujarat South Indian Lorry Suppliers Association, in a telephonic interview.
Why do fleet owners fall for such risky tricks? Pure demand-supply mismatch. “Maybe there are too many trucks, and low demand. So they park their trucks days in advance in front of mandis to clinch a direct deal,” avers Parmar.
“We only talk about detention before unloads. We ignore the pre-load voluntary detention,” points out Subrahmaniyam.
A tough ‘nut’ to crack!
