Freight brokers organize the process of cargo transportation, agreeing on all issues arising between shippers and truckers. Road haulers can be either large trucking companies that provide their own employee drivers or independent haulers.
What is a freight broker?
Shippers are looking for carriers who will transport their loads safely, efficiently, and economically. And they are looking for brokers who conduct business honestly, reliably, and with an excellent service-oriented guide. Carriers are looking for good profitable contracts.
Therefore, the freight broker must use his negotiation skills to complete a competitive transaction that will satisfy everyone – the shipper, the carrier, and the broker.
What does a freight broker do?
Small companies sometimes benefit from using the services of freight brokers. While many transportation companies offer excellent discount programs for large companies with significant delivery needs, smaller companies that ship goods more individually often have to pay standard retail rates. Working with a broker, which usually has different discounted rates for different freight types, you can really reduce transportation costs, even for the most casual shippers.
Brokers can first find shippers who have cargo to ship and then contact road carriers to deliver their destination goods. Or brokers can “have on hand” the carrier to whom they find a load for transportation. In any case, the broker wants to make a deal and get his commission.
Freight brokers use efficient loading services. They can track all information about industrial freight and update information. They will know about any available loads or if any company needs a brokerage service. The truck broker, in turn, will contact the shipper and the trucker to perform this task. It is both economical and reliable for both parties. With the professional service of a broker, the shipper can track the location of the shipped goods in real-time. At the same time, trucking companies and the individual truck driver can receive quick payments for the goods they deliver.
How to be a freight broker?
Like real estate brokers and insurance brokers, a freight broker must be licensed to run their business. To obtain this license, they must meet certain requirements, including purchasing a surety and, among other things, purchasing insurance. It is much easier to become a freight broker and succeed in this direction if this person has experience in freight. Truckers not only have the experience, they also have the contacts needed to become successful freight brokers.
Beginners spend many hours negotiating and searching for both shippers and carriers. However, brokers learn to work actively with time and experience, where either shippers or truckers initiate most of the work.
A freight broker is always interested in finding transport to deliver goods. To do this, you need to negotiate with freight companies, which will undertake to work at the established rates. In this case, you need to understand what percentage the broker is willing to pay to the transport company and what he will receive after that.
How much can a freight broker earn?
The money you will earn as a freight broker varies depending on their situation. Brokers who work with the company make an average of $ 40,000 to $ 90,000 a year. Some companies prefer to pay commissions to their brokers depending on their performance, while others prefer to pay them a fixed salary. Freight brokers who run their own freight business have higher earning potential. A self-employed freight broker can earn an annual income in the range of more than $ 100,000.